First Mining Gold Corp 6-K, filed Aug 16, 2021
First Mining Gold Corp. (FFMGF)
6-K
2021-08-16
For: 2021-08-16
View Original
Added on
April 07, 2026
About this 6-K
First Mining Gold Corp filed this 6-K on August 16, 2021.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN
PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
For the month of
August 2021
Commission File Number: 000-55607
First Mining Gold
Corp.
(Translation of registrant's name into English)
(Translation of registrant's name into English)
Suite
2070, 1188 West Georgia Street, Vancouver, B.C., V6E
4A2
(Address of principal executive office)
(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 [ ]
Form 40-F [ X ]
Indicate by check mark if the registrant is
submitting the Form 6-K in paper as permitted by Regulation S-T
Rule 101(b)(1): [ ]
DOCUMENTS INCORPORATED BY
REFERENCE
Exhibits
99.1 and 99.2 to this Report on Form 6-K are hereby incorporated by
reference as Exhibits to the Registration Statement on Form F-10 of
First Mining Gold Corp. (File No.
333-231801).
DOCUMENTS FILED AS PART OF THIS FORM
6-K
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Exhibits
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Description
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Condensed Interim Consolidated
Financial Statements for the three and six months ended June 30,
2021 and 2020
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Management’s Discussion &
Analysis For The Three And Six Months Ended June 30,
2021
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CEO Certification of Interim
Filings
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CFO Certification of Interim
Filings
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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.
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First Mining Gold
Corp.
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|
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(Registrant)
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|
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|
|
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Date: August 16, 2021
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/s/ Samir
Patel
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Samir Patel
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General Counsel and Corporate
Secretary
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EXHIBIT
INDEX
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Exhibits
|
Description
|
|
Condensed Interim Consolidated
Financial Statements for the three and six months ended June 30, 2021
and 2020
|
|
|
Management’s Discussion &
Analysis For The Three And Six Months Ended June 30,
2021
|
|
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CEO Certification of Interim
Filings
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CFO Certification of Interim
Filings
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Exhibit
99.1
First Mining Gold Corp.
Condensed Interim Consolidated Financial Statements
For the three and six months ended June 30, 2021 and
2020
(Expressed in thousands of Canadian dollars unless otherwise
noted)
(Unaudited)
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
AS AT
JUNE 30, 2021 AND DECEMBER 31, 2020
(Expressed
in thousands of Canadian dollars unless otherwise
noted)
(Unaudited)
|
|
June
30,
2021
|
December
31,
2020
|
|
|
|
|
|
ASSETS
|
|
|
|
Current
|
|
|
|
Cash and cash
equivalents
|
$33,762
|
$28,901
|
|
Assets held for
distribution (Note 5(c))
|
23,074
|
-
|
|
Investments (Note
3)
|
20,450
|
18,425
|
|
Prepaid expenses,
accounts and other receivables
|
695
|
2,700
|
|
Total
current assets
|
77,981
|
50,026
|
|
|
|
|
|
Non-current
|
|
|
|
Mineral properties
(Note 4)
|
160,322
|
179,429
|
|
Investment in
Treasury Metals Inc. (Note 5)
|
16,236
|
63,812
|
|
Investment in PC
Gold Inc. (Note 6)
|
35,999
|
-
|
|
Investment in Big
Ridge Gold Corp. (Note 7)
|
1,577
|
-
|
|
Mineral property
investments (Note 8)
|
6,283
|
6,726
|
|
Property and
equipment
|
888
|
570
|
|
Other
assets
|
464
|
650
|
|
Total
non-current assets
|
221,769
|
251,187
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|
TOTAL
ASSETS
|
$299,750
|
$301,213
|
|
|
|
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LIABILITIES
|
|
|
|
Current
|
|
|
|
Accounts payable
and accrued liabilities
|
$1,428
|
$2,013
|
|
Current portion of
lease liability
|
115
|
112
|
|
Provision for
Pickle Crow reclamation funding (Note 4)
|
1,160
|
-
|
|
Current portion of
environmental reclamation provision
|
-
|
250
|
|
Option – PC
Gold (Note 4(d))
|
17,306
|
4,410
|
|
Obligation to
distribute investments (Note 5(c))
|
23,074
|
34,040
|
|
Total
current liabilities
|
43,083
|
40,825
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|
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|
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|
Non-current
|
|
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|
Lease
liability
|
384
|
442
|
|
Environmental
reclamation provision
|
-
|
3,133
|
|
Silver Stream
derivative liability (Note 9)
|
31,471
|
13,260
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|
Total
non-current liabilities
|
31,855
|
16,835
|
|
TOTAL
LIABILITIES
|
74,938
|
57,660
|
|
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SHAREHOLDERS’
EQUITY
|
|
|
|
Share capital (Note
10)
|
317,648
|
317,167
|
|
Warrant and
share-based payment reserve (Note 10)
|
46,403
|
44,648
|
|
Accumulated other
comprehensive gain (loss)
|
948
|
(1,392)
|
|
Accumulated
deficit
|
(140,187)
|
(116,870)
|
|
Total
shareholders’ equity
|
224,812
|
243,553
|
|
TOTAL
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
$299,750
|
$301,213
|
|
The
consolidated financial statements were approved by the Board of
Directors:
Signed: “Keith
Neumeyer”, Director Signed: “Raymond
Polman”, Director
The accompanying
notes are an integral part of these condensed interim consolidated
financial statements.
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||
2
FIRST
MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed
in thousands of Canadian dollars unless otherwise
noted)
(Unaudited)
|
|
Six
months ended June 30,
|
|
|
|
2021
|
2020
|
|
|
|
|
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Cash
flows from operating activities
|
|
|
|
Net loss for the
period
|
$(34,286)
|
$(20,993)
|
|
Adjustments
for:
|
|
|
|
Gain on
deconsolidation of subsidiary (Note 4)
|
(8,830)
|
-
|
|
Impairment of
non-current assets (Note 5(b))
|
23,555
|
22,498
|
|
Share-based
payments (Note 10)
|
1,246
|
649
|
|
Depreciation
|
158
|
164
|
|
Fair value loss on
Silver Stream derivative liability (Note 9)
|
8,403
|
-
|
|
Investments fair
value loss (gain) (Note 3)
|
633
|
(3,013)
|
|
Other
expenses
|
23
|
40
|
|
Accrued interest
receivable
|
(89)
|
(1)
|
|
Unrealized foreign
exchange loss (gain)
|
138
|
(659)
|
|
Deferred income tax
recovery
|
-
|
(1,318)
|
|
Finance
cost
|
29
|
-
|
|
Equity and dilution
loss on equity accounted investments
|
5,688
|
-
|
|
Loss on disposal of
subsidiaries
|
-
|
303
|
|
Operating
cash flows before movements in working capital
|
(3,332)
|
(2,330)
|
|
Changes in non-cash
working capital items:
|
|
|
|
Decrease (increase)
in accounts and other receivables
|
9
|
(43)
|
|
Decrease in prepaid
expenditures
|
122
|
64
|
|
Decrease in
accounts payables and accrued liabilities
|
(613)
|
(132)
|
|
Total cash used in operating activities
|
(3,814)
|
(2,441)
|
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Cash
flows from investing activities
|
|
|
|
Mineral property
expenditures (Note 4)
|
(7,511)
|
(6,194)
|
|
Proceeds from sale
of investments (Note 3)
|
11,386
|
-
|
|
Property and
equipment purchases
|
(411)
|
(169)
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|
Option payments and
expenditures recovered (Note 4(c))
|
500
|
100
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|
Total
cash provided by (used in) investing activities
|
3,964
|
(6,263)
|
|
Cash
flows from financing activities
|
|
|
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Net proceeds from
private placements
|
-
|
9,282
|
|
Proceeds from
Silver Stream (Note 9)
|
4,757
|
-
|
|
Proceeds from ATM
program
|
-
|
125
|
|
Share issuance
costs
|
-
|
(128)
|
|
Proceeds from
exercise of warrants and stock options
|
199
|
116
|
|
Repayment of lease
liability
|
(55)
|
(42)
|
|
Finance costs
paid
|
(26)
|
(26)
|
|
Total
cash provided by financing activities
|
4,875
|
9,327
|
|
Foreign exchange
effect on cash
|
(164)
|
2
|
|
Change
in cash and cash equivalents
|
4,861
|
625
|
|
Cash
and cash equivalents, beginning
|
28,901
|
5,902
|
|
Cash
and cash equivalents, ending
|
$33,762
|
$6,527
|
The
accompanying notes are an integral part of these condensed interim
consolidated financial statements.
3
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF NET LOSS AND COMPREHENSIVE
LOSS
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed
in thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
|
|
Three
months ended
June
30,
|
Six
months ended
June
30,
|
||
|
|
2021
|
2020
|
2021
|
2020
|
|
|
|
|
|
|
|
OPERATING EXPENSES (Note
11)
|
|
|
|
|
|
General and
administration
|
$1,271
|
$1,251
|
$2,625
|
$2,008
|
|
Exploration and
evaluation
|
209
|
156
|
448
|
359
|
|
Investor relations
and marketing communications
|
959
|
246
|
1,432
|
545
|
|
Corporate
development and due diligence
|
90
|
94
|
247
|
226
|
|
Impairment of
non-current assets (Note 5)
|
-
|
22,498
|
23,555
|
22,498
|
|
Loss from
operational activities
|
(2,529)
|
(24,245)
|
(28,307)
|
(25,636)
|
|
|
|
|
|
|
|
OTHER
ITEMS
|
|
|
|
|
|
Gain on
deconsolidation of subsidiary (Note 4(d))
|
8,830
|
-
|
8,830
|
-
|
|
Fair value loss on
Silver Stream liability (Note 9)
|
(2,400)
|
-
|
(8,403)
|
-
|
|
Investments fair
value gain (loss) (Note 3)
|
154
|
3,013
|
(633)
|
3,013
|
|
Foreign exchange
gain (loss)
|
(97)
|
629
|
(165)
|
607
|
|
Other
expenses
|
(13)
|
(26)
|
(54)
|
(46)
|
|
Interest and other
income
|
71
|
16
|
134
|
54
|
|
Loss on disposal of
subsidiaries
|
-
|
(303)
|
-
|
(303)
|
|
Gain
(loss) before income taxes
|
$4,016
|
$(20,916)
|
$(28,598)
|
$(22,311)
|
|
Deferred income tax
recovery
|
-
|
1,385
|
-
|
1,318
|
|
Equity losses and
dilution impacts of equity accounted investments (Note 5,6 &
7)
|
(5,299)
|
-
|
(5,688)
|
-
|
|
Net
income (loss) for the period
|
$(1,283)
|
$(19,531)
|
$(34,286)
|
$(20,993)
|
|
|
|
|
|
|
|
OTHER
COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
Items that will not be reclassified to net income or
(loss):
|
|
|
|
|
|
Investments fair
value gain (Note 3)
|
2,445
|
450
|
2,794
|
73
|
|
Mineral property
investments fair value gain (loss) (Note 5)
|
257
|
567
|
(443)
|
903
|
|
|
|
|
|
|
|
Items that are or may be reclassified to net income or
(loss):
|
|
|
|
|
|
Currency
translation adjustment of foreign subsidiaries
|
(6)
|
(29)
|
(11)
|
35
|
|
Recycling of
currency translation adjustment on disposal of foreign
subsidiaries
|
-
|
(630)
|
-
|
(630)
|
|
Other comprehensive
income
|
2,696
|
358
|
2,340
|
381
|
|
|
|
|
|
|
|
Net
income (loss) and comprehensive income (loss)
for
the period
|
$1,413
|
$(19,173)
|
$(31,946)
|
$(20,612)
|
|
|
|
|
|
|
|
Basic and diluted
loss per share (in dollars)
|
$(0.00)
|
$(0.03)
|
$(0.05)
|
$(0.03)
|
|
Weighted average
number of shares outstanding–Basic and Diluted
|
697,682,299
|
633,042,052
|
697,493,176
|
621,006,471
|
The
accompanying notes are an integral part of these condensed interim
consolidated financial statements.
4
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
|
|
Number of common
shares
|
Share capital
|
Warrant reserve
|
Share-based payment reserve
|
Accumulated other comprehensive income (loss)
|
Accumulated deficit
|
Total
|
|
|
|
|
|
|
|
|
|
|
Balance
as at December 31, 2019
|
591,997,138
|
$282,666
|
$14,532
|
$18,798
|
$(3,649)
|
$(50,015)
|
$262,332
|
|
Proceeds
from private placements (Note 10(b))
|
40,198,095
|
8,160
|
1,122
|
-
|
-
|
-
|
9,282
|
|
Flow-through
share premium liability (Note 10(b))
|
-
|
(300)
|
-
|
-
|
-
|
-
|
(300)
|
|
Shares
issuance costs (Note 10(b))
|
-
|
(110)
|
(18)
|
-
|
-
|
-
|
(128)
|
|
At-the-market
distributions
|
532,000
|
125
|
-
|
-
|
-
|
-
|
125
|
|
Exercise
of options (Note 10(d))
|
625,000
|
255
|
-
|
(139)
|
-
|
-
|
116
|
|
Shares
issued for prior mineral property acquisition
|
24,220
|
4
|
-
|
-
|
-
|
-
|
4
|
|
Share-based
payments
|
-
|
-
|
-
|
999
|
-
|
-
|
999
|
|
Loss
for the period
|
-
|
-
|
-
|
-
|
-
|
(20,993)
|
(20,993)
|
|
Other
comprehensive income
|
-
|
-
|
-
|
-
|
381
|
-
|
381
|
|
Balance
as at June 30, 2020
|
633,376,453
|
$290,800
|
$15,636
|
$19,658
|
$(3,268)
|
$(71,008)
|
$251,818
|
|
Balance
as at December 31, 2020
|
697,216,453
|
$317,167
|
$25,056
|
$19,592
|
$(1,392)
|
$(116,870)
|
$243,553
|
|
Exercise of options
(Note 10(d))
|
650,000
|
230
|
-
|
(67)
|
-
|
-
|
163
|
|
Exercise of
warrants (Note 10(c))
|
110,000
|
43
|
(7)
|
-
|
-
|
-
|
36
|
|
Shares issued on
acquisition of Springpole mineral property tenure (Note
4)
|
565,705
|
208
|
-
|
-
|
-
|
-
|
208
|
|
Share-based
payments
|
-
|
-
|
-
|
1,829
|
-
|
-
|
1,829
|
|
Obligation to
distribute investments fair value adjustment
|
-
|
-
|
-
|
-
|
-
|
10,969
|
10,969
|
|
Loss for the
period
|
-
|
-
|
-
|
-
|
-
|
(34,286)
|
(34,286)
|
|
Other comprehensive
loss
|
-
|
-
|
-
|
-
|
2,340
|
-
|
2,340
|
|
Balance
as at June 30, 2021
|
698,542,158
|
$317,648
|
$25,049
|
$21,354
|
$948
|
$(140,187)
|
$224,812
|
|
|
|
|
|
|
|
|
|
The
accompanying notes are an integral part of these condensed interim
consolidated financial statements.
5
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
1. NATURE OF OPERATIONS
First
Mining Gold Corp. (the “Company” or “First
Mining”) is a public company which is listed on the Toronto
Stock Exchange (the “TSX”) under the symbol
“FF”, on the OTCQX under the symbol
“FFMGF”, and on the Frankfurt Stock Exchange under the
symbol “FMG”. The Company’s head office and
principal address is Suite 2070 – 1188 West Georgia Street,
Vancouver, British Columbia, Canada, V6E 4A2.
First
Mining was incorporated on April 4, 2005. The Company changed its
name to First Mining Gold Corp. in January 2018.
First
Mining is a Canadian gold exploration and development company
focused on the permitting and development of the Springpole Gold
Project in northwestern Ontario and advancing work at its other
gold projects in Canada. First Mining holds a significant equity
investment in Treasury Metals Inc. (“Treasury Metals”)
(TSX: TML) (Note 5) which is advancing the Goliath-Goldlund gold
complex in Ontario towards a construction decision. First
Mining’s portfolio of gold projects in eastern Canada also
includes Pickle Crow (being advanced by Auteco Minerals Ltd.
(“Auteco”) (ASX: AUT)), Hope Brook (being advanced with
Big Ridge Gold Corp. (“Big Ridge”) (TSXV: BRAU),
Cameron, Duparquet, Duquesne, and Pitt.
In
March 2020, the World Health Organization declared a global
pandemic related to COVID-19. As the Company does not have
production activities, the ability to fund ongoing exploration is
affected by the availability of financing. Due to market
uncertainty arising from the impacts of COVID-19 the Company may be
restricted in its ability to raise additional funding. To date the
impact on the Company has been limited to a slowing of on site
exploration activities during the 2020 year. The impact of COVID-19
on the Company over time is not readily determinable; however, its
effects may have a material impact on the Company’s financial
position, results of operations and cash flows in future
periods.
2. BASIS OF PRESENTATION
These
unaudited condensed interim consolidated financial statements have
been prepared in accordance with International Accounting Standard
34, Interim Financial
Reporting using policies consistent with International
Financial Reporting Standards as issued by the International
Accounting Standards Board (“IFRS”). These condensed
interim consolidated financial statements should be read in
conjunction with the Company’s audited annual consolidated
financial statements for the year ended December 31, 2020, as some
disclosures from the annual consolidated financial statements have
been condensed or omitted.
These
unaudited condensed interim consolidated financial statements have
been prepared on a historical cost basis, except for financial
instruments classified as fair value through profit and loss or
fair value through other comprehensive income (loss), which are
stated at their fair value. The condensed interim consolidated
financial statements are presented in thousands of Canadian
dollars, unless otherwise noted, and tabular amounts are expressed
in thousands of Canadian dollars.
These
condensed interim consolidated financial statements include the
accounts of the Company and its subsidiaries.
The
functional currency of the Company and its Canadian subsidiaries is
the Canadian dollar while the functional currency of the
Company’s non-Canadian subsidiary is the US
dollar.
These unaudited condensed interim consolidated financial statements
were approved by the Board of Directors on August 14, 2021.
6
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
2. BASIS OF PRESENTATION (continued)
In
preparing the Company’s unaudited condensed interim
consolidated financial statements for the three and six months
ended June 30, 2021, the Company used the same accounting policies,
methods of computation and accounting policy, judgments as in the
annual consolidated financial statements for the year ended
December 31, 2020. Additionally, the areas of
estimation uncertainty remain unchanged from those disclosed in the
annual consolidated financial statements. There are no IFRS or IFRS
Interpretations Committee interpretations that are not yet
effective that would be expected to have a material impact on the
Company’s consolidated financial statements.
The
movements in investments during the six months ended June 30, 2021
and the year ended December 31, 2020 are summarized as
follows:
|
|
Marketable Securities
(FVTPL)
|
Marketable
Securities
(FVTOCI)
|
Warrants
(FVTPL)
|
Total
Investments
|
|
Balance
as at December 31, 2020
|
$9,267
|
$3,386
|
$5,772
|
$18,425
|
|
Additions
|
13,691
|
-
|
-
|
13,691
|
|
Disposals
|
(9,043)
|
(651)
|
-
|
(9,694)
|
|
Gain recorded in
other comprehensive loss
|
-
|
2,794
|
-
|
2,794
|
|
Gain (loss)
recorded in net loss
|
1,006
|
-
|
(3,698)
|
(2,692)
|
|
Reclassification to
assets held for distribution
|
|
-
|
(2,074)
|
(2,074)
|
|
Balance
as at June 30, 2021
|
$14,921
|
$5,529
|
$-
|
$20,450
|
|
|
Marketable Securities
(FVTPL)
|
Marketable
Securities
(FVTOCI)
|
Warrants
(FVTPL)
|
Total
Investments
|
|
Balance
as at December 31, 2019
|
$-
|
$1,775
|
$-
|
$1,775
|
|
Additions
|
11,134
|
-
|
9,812
|
20,946
|
|
Disposals
|
(6,672)
|
-
|
-
|
(6,672)
|
|
Gain recorded in
other comprehensive loss
|
-
|
1,611
|
-
|
1,611
|
|
Gain (loss)
recorded in net loss
|
4,805
|
-
|
(4,040)
|
765
|
|
Balance
as at December 31, 2020
|
$9,267
|
$3,386
|
$5,772
|
$18,425
|
The
Company holds securities of publicly traded companies as strategic
interests. The investments where the Company does not have
significant influence are classified as marketable securities. The
Auteco and First Majestic common shares and Treasury Metals
Warrants are classified as FVTPL. Other marketable securities are
designated as FVTOCI in accordance with the Company’s
accounting policy.
During
the six months ended June 30, 2021, the Company:
●
Received 287,300
common shares of First Majestic (initial recognition - $5,051,000,
June 30, 2021 – $5,625,000) in connection with the Silver
Purchase Agreement (defined in Note 10);
●
Received
100,000,000 common shares of Auteco (initial recognition -
$8,640,000, June 30, 2021 – $7,436,000) in connection with
the Auteco Earn-In Agreement (defined in Note 4(d));
7
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
3. INVESTMENTS (continued)
●
Sold a total of
400,000 common shares of First Majestic for net proceeds of
$9,022,000 which resulted in a $3,863,000
realized gain on
sale based on the
original cost at the time of receipt; and
●
Sold a total of
419,200 common shares of other marketable securities for net
proceeds of $665,000 which resulted in a $385,000
realized gain on sale based on the acquisition
cost.
At June
30, 2021 the Treasury Metals Warrants (with a fair value of
$2,074,000) were reclassified to Assets Held for Distribution
following the shareholder vote approving the Treasury Metals Share
and Warrant distribution.
4. MINERAL PROPERTIES
As at
June 30, 2021 and December 31, 2020, the Company has capitalized
the following acquisition, exploration, and evaluation costs on its
mineral properties:
|
|
Springpole
|
Cameron
|
Duquesne
|
Pitt
|
Hope Brook
(Note 4 (c ))
|
Pickle Crow
(Note 4 (d))
|
Goldlund
(Note 5)
|
Others(1)
|
Total
|
|
Balance December 31, 2020
|
$87,907
|
$31,875
|
$5,144
|
$2,085
|
$20,612
|
$24,986
|
$-
|
$6,820
|
$179,429
|
|
Acquisition
|
$-
|
-
|
-
|
-
|
-
|
-
|
-
|
292
|
292
|
|
Concessions,
taxes, and royalties
|
$1,937
|
22
|
3
|
-
|
20
|
-
|
-
|
-
|
1,982
|
|
Salaries
and share-based payments
|
$1,341
|
93
|
-
|
-
|
44
|
22
|
-
|
19
|
1,519
|
|
Drilling,
exploration, and technical consulting
|
$2,043
|
35
|
4
|
-
|
16
|
3,251
|
-
|
117
|
5,466
|
|
Assaying,
field supplies, and environmental
|
$1,907
|
53
|
-
|
-
|
2
|
-
|
-
|
10
|
1,972
|
|
Travel
and other expenditures
|
$582
|
18
|
-
|
-
|
17
|
-
|
-
|
-
|
617
|
|
Total expenditures
|
$7,810
|
$221
|
$7
|
$-
|
$99
|
$3,273
|
$-
|
$438
|
$11,848
|
|
Option
payments received and expenditures recovered
|
$-
|
-
|
-
|
-
|
(2,685)
|
|
-
|
-
|
$(2,685)
|
|
Currency
translation adjustments
|
$-
|
-
|
-
|
-
|
-
|
-
|
-
|
(11)
|
$(11)
|
|
Disposal,
impairment or reclassification
|
$-
|
-
|
-
|
-
|
-
|
(28,259)
|
-
|
-
|
$(28,259)
|
|
Balance June 30, 2021
|
$95,717
|
$32,096
|
$5,151
|
$2,085
|
$18,026
|
$-
|
$-
|
$7,247
|
$160,322
|
|
|
Springpole
|
Cameron
|
Duquesne
|
Pitt
|
Hope Brook
|
Pickle Crow
|
Goldlund
(Note 5)
|
Others(1)
|
Total
|
|
Balance December 31, 2019
|
$76,775
|
27,374
|
5,133
|
2,084
|
20,071
|
19,263
|
98,894
|
3,221
|
$252,815
|
|
Acquisition
|
$-
|
4,219
|
-
|
-
|
-
|
-
|
-
|
-
|
$4,219
|
|
Concessions,
taxes, and royalties
|
$740
|
11
|
3
|
-
|
20
|
20
|
2
|
60
|
$856
|
|
Salaries
and share-based payments
|
$1,300
|
145
|
1
|
-
|
148
|
71
|
430
|
7
|
$2,102
|
|
Drilling,
exploration, and technical consulting
|
$4,828
|
52
|
7
|
1
|
140
|
4,409
|
796
|
37
|
$10,270
|
|
Assaying,
field supplies, and environmental
|
$3,555
|
50
|
-
|
-
|
123
|
1,217
|
255
|
8
|
$5,208
|
|
Travel
and other expenditures
|
$709
|
24
|
-
|
-
|
110
|
6
|
126
|
2
|
$977
|
|
Total expenditures
|
$11,132
|
$4,501
|
$11
|
$1
|
$541
|
$5,723
|
$1,609
|
$114
|
$23,632
|
|
Option
payments received and expenditures recovered
|
$-
|
-
|
-
|
-
|
-
|
-
|
-
|
(48)
|
$(48)
|
|
Currency
translation adjustments
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(2)
|
$(2)
|
|
Disposal,
impairment or reclassification
|
$-
|
-
|
-
|
-
|
-
|
-
|
(100,503)
|
3,535
|
$(96,968)
|
|
Balance
December 31, 2020
|
$87,907
|
$31,875
|
$5,144
|
$2,085
|
$20,612
|
$24,986
|
$-
|
$6,820
|
$179,429
|
(1)
Other
mineral properties as at June 30, 2021 and December 31, 2020
include: the mining claims and concessions located in the Township
of Duparquet, Quebéc, which are near the Company’s
Duquesne gold project;); the Swain Post property in northwestern
Ontario which is near the Company’s Springpole Gold Project
(property under option agreement from Exiro Minerals Corp.); the
Swain Lake property under the earn-in agreement with Whitefish
Explorations Inc.; a 1.5% NSR Royalty under the terms of the
Treasury Share Purchase Agreement (defined in Note 5), which was
reclassified from “Goldlund” to “Others”
during the year ended December 31, 2020; and, the Turquoise Canyon
property in Nevada (property under option to Momentum Minerals Ltd.
which was acquired by IM Exploration Inc. on July 6,
2021).
The
Company has various underlying agreements and commitments with
respect to its mineral properties, which define annual or future
payments in connection with royalty buy-backs or maintenance of
property interests.
a)
Swain Post property acquisition
On
March 1, 2021, the Company entered into a three year option
agreement with Exiro Minerals Corp. (“Exiro”) pursuant
to which First Mining may earn a 100% interest in Exiro’s
Swain Post property in northwestern Ontario
through
future cash and share payments of approximately $250,000 to Exiro
during the term of the option, and by completing all assessment
work requirements on the property during the three year option
term.
8
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
4. MINERAL PROPERTIES (continued)
b)
Swain
Lake property acquisition
On
April 29, 2021, the Company entered into an earn-in agreement with
Whitefish Exploration Inc. (“Whitefish”), which gives
First Mining the option to earn a 70% interest in Whitefish’s
Swain Lake project in northwestern Ontario by making cash payments
totaling $200,000 and share payments totaling $425,000, and by
incurring at least $500,000 worth of expenditures on the Swain Lake
Property during the first three years of the earn-in term. Upon
completing the first stage of the earn-in, First Mining will hold a
70% interest in the Swain Lake Property and will have an additional
period of two years within which to acquire the remaining 30% of
the project by paying $1,000,000 to Whitefish and issuing
$1,000,000 worth of First Mining shares.
c)
Hope
Brook Project
On June 8, 2021, the Company announced it had closed a definitive earn-in
agreement with Big Ridge Gold Corp. “Big Ridge” (the
“Big Ridge transaction”) whereby Big Ridge may earn up
to an 80% interest in First Mining’s Hope Brook Gold Project
located in Newfoundland, Canada. Pursuant to the definitive earn-in
agreement, Big Ridge can earn an 80% interest in the Hope Brook
Project through a two-stage earn-in over five years by incurring a
total of $20,000,000 in qualifying expenditures, issuing up to 36.5
million shares of Big Ridge to First Mining and making a future
cash payment to First Mining. First Mining will retain a 1.5% net
smelter returns royalty on the Project, of which 0.5% can be bought
back by Big Ridge for $2,000,000. In accordance with the agreement,
First Mining nominated one member to the Board of Directors of Big
Ridge upon closing. In the period ended June 30, 2021, the Company
received $500,000 and 11,500,000 shares of Big Ridge upon closing
which have been credited against the Hope Brook project mineral
property balance above. At the end of reporting period, the
Company assessed the Hope
Brooke Project for impairment indicators, no impairment indicators
were identified.
See Note 7 below for further details of the equity accounted
investment in Big Ridge.
d)
Pickle Crow Project
On
March 12, 2020, the Company and Auteco executed a definitive
Earn-In Agreement (the “Auteco Earn-In Agreement”)
whereby Auteco may earn up to an 80% interest in PC Gold, a then
wholly-owned subsidiary of First Mining which owns the Pickle Crow
Project. Pursuant to the Auteco
Earn-In Agreement, the Earn-In is comprised of two
stages:
●
Stage
1 Earn-In (51% earn-in) – Three year initial earn-in period
to acquire a 51% equity interest in PC Gold by:
o
Spending
$5,000,000 on exploration and environmental matters at the Pickle
Crow Gold Project (or cash payments in lieu), of which $750,000
must be incurred within the first 12 months; and
o
Issuing
100 million shares of Auteco to First Mining.
●
Stage
2 Earn-In (additional 19% to earn-in to 70%) – Upon
completion of the Stage 1 Earn-In, Auteco will have a two-year
follow-on period to acquire an additional 19% equity interest in PC
Gold by:
o
Spending
a further $5,000,000 on exploration on the Pickle Crow Gold
Project;
o
Making
a $1,000,000 cash payment to First Mining within 90 days of
completing the additional exploration spend; and
o
Issuing
First Mining a 2% NSR royalty on the Project (1% of which can be
bought back for USD$2,500,000) (issued upon completion of the Stage
2 Earn-In).
9
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
4. MINERAL PROPERTIES (continued)
In
addition, upon completion of the Stage 2 Earn-In, Auteco will have
an option to acquire an additional 10% equity interest in PC Gold,
exercisable any time following completion of the Stage 2 Earn-In,
by paying First Mining $3,000,000 in cash, after which First Mining’s residual 20%
interest in PC Gold is carried until a construction decision in
relation to the Pickle Crow
Project, which is to be made after a final feasibility study and
following Auteco having arranged sufficient financing to achieve
commercial production. If Auteco should fail to meet such
requirements within the applicable time periods outlined
above, the Auteco Earn-In Agreement will terminate and Auteco will
be entitled to retain any interest it has earned prior to the date
of termination. During the term of the Auteco Earn-In Agreement,
Auteco will incur all program costs and manage Pickle Crow
exploration activity.
On June
9, 2021, the Company announced completion of the Stage 1 earn-in
and accordingly Auteco obtained a 51% ownership of the PC Gold
legal entity. First Mining received the scheduled 100,000,000
Auteco shares and executed the joint venture shareholders
agreement. Auteco now has a two year follow-on period, commencing
June 4, 2021, within which to acquire the additional 19% interest
in PC Gold.
Following
the completion of the Stage 1 earn-in by AuTeco, First
Mining’s percentage ownership of the subsidiary PC Gold Inc.
was reduced from 100% to 49%, which led to a loss of control and
the resulting deconsolidation of PC Gold Inc. from First
Mining’s financial statements. The gain on deconsolidation
was calculated as a result of derecognizing the net assets of PC
Gold Inc. and recognizing the fair value of an equity accounted
associated, PC Gold, along with the fair value of the Stage 2 and
final earn in option liabilities.
At the
time of deconsolidation of PC Gold, management estimated a fair
value for the Stage 2 and final Auteco earn in options of
$17,306,000 based on the
portion of the fair value of the PC Gold investment that the
Company would be required divest net of any future proceeds from
Auteco.
Following
completion of the Auteco stage 1 Earn-In, the environmental
reclamation provision, which was recorded as a liability in the PC
Gold Inc. legal entity, has been deconsolidated from the June 30,
2021, condensed interim financial statements as described
above.
The
Company’s agreement with Auteco requires First Mining to
contribute its pro-rata share of the environmental reclamation
funding, which was 49% as at June 30, 2021. Accordingly, the
company has recorded a provision of $1,160,000 as at June 30, 2021
(December 30, 2020 - $nil).
10
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
4. MINERAL PROPERTIES (continued)
The
following information summarizes the deconsolidation of PC Gold as
at June 9, 2021:
|
|
June
9, 2021
|
|
Fair Value of retained interest in PC
Gold Inc.
|
|
|
112,146,017 shares
at $0.32 per share (deemed FV based on underlying property
interest)
|
$36,000
|
|
Provision for
Pickle Crow reclamation funding
|
(1,160)
|
|
|
|
|
Fair value of
Auteco shares received as additional consideration (Note
3)
|
8,640
|
|
|
|
|
Option – PC
Gold liability fair value of Stage 2 and final earn in
options
|
(17,306)
|
|
|
|
|
Net assets of PC
Gold
|
|
|
Prepaids
|
3
|
|
Reclamation
deposit
|
120
|
|
Mineral property,
net
|
20,358
|
|
Environmental
reclamation liability, net
|
(3,137)
|
|
Net assets of
subsidiary
|
17,344
|
|
|
|
|
Gain
on loss of control of subsidiary, Net
|
$8,830
|
5.
INVESTMENT IN TREASURY METALS
a)
Treasury Share Purchase Agreement Overview
On
August 7, 2020, First Mining completed a transaction with Treasury
Metals under a share purchase agreement (the “Treasury Share
Purchase Agreement”), pursuant to which Treasury Metals
agreed to acquire all of the issued and outstanding shares of
Tamaka Gold Corporation, a previously wholly-owned subsidiary of
the Company, and 100% owner of the Goldlund Project. Under the
terms of the Treasury Share Purchase Agreement, First Mining
received total consideration of $91,521,000 which was comprised of
(i) 43.33 million common shares (post-consolidation) of Treasury
Metals (“Treasury Metals Shares”) with a fair value of
$78,000,000; (ii) 11.67 million common share purchase warrants
(post-consolidation) of Treasury Metals (“Treasury Metals
Warrants”) with an exercise price of $1.50 for a three year
term with a fair value of $9,812,000; (iii) a retained 1.5% Net
Smelter Returns (“NSR”) royalty on Goldlund (0.5% of
which can be bought back by Treasury Metals for $5 million in cash)
with a fair value of $3,709,000; and (iv) the right to certain
contingent milestone payments totaling $5 million, payable in cash
on certain key advancements at Goldlund which have not been
recorded as at June 30, 2021.
b)
Equity Accounting Method for Investment in Treasury Metals and
Impairment
The
Company has concluded it has significant influence over Treasury
Metals. The Company is accounting for its investment using the equity
method. As at June 30, 2021 the fair market value of the
Company’s investment in common shares of Treasury Metals was
$39,000,000, based on the Treasury Metals quoted market
price.
11
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
5. INVESTMENT IN TREASURY METALS (continued)
Due to the significant decline in fair value of the Treasury Metals
Shares as at March 31, 2021, the Company recorded an impairment of
the investment in Treasury Metals amounting to
$23,555,000. This
impairment was recorded within the impairment of non-current assets
in the statement of net loss and comprehensive income
(loss). In
addition, the Company recorded dilution losses on its of the
investment in Treasury Metals predominantly as a result of the
exercise of special warrants by other investors (reducing the
Company’s interest from 38.4% to 33.3%). At June 30, 2021,
the Company reclassified a portion of its investment to Assets held
for distribution to reflect the portion of the equity accounted
investment being distributed to shareholders (note 5
(d)).
|
|
June 30,
|
December 31,
|
|
|
2021
|
2020
|
|
Balance, beginning of period
|
$63,812
|
$-
|
|
Acquisition
– Initial Recognition on August 7, 2020
|
-
|
78,000
|
|
Equity
(loss) income
|
(80)
|
1,446
|
|
Dilution
event in Q2, 2021
|
(5,000)
|
-
|
|
Impairment
of Investment in Treasury Metals Inc.
|
(23,555)
|
(15,634)
|
|
Reclassification
to assets held for distribution
|
(18,941)
|
-
|
|
Balance, end of period
|
$16,236
|
$63,812
|
The
equity accounting for Treasury Metals is based on published results
to March 31, 2021 and an estimate of results for the period of
April 1, 2021 to June 30, 2021. The Company’s estimated
equity share of Treasury’s net loss for the six-month period
ending June 30, 2021 was $80,000.
c)
Obligation to Distribute Investments
In
accordance with the terms of a Shareholders Agreement signed in
connection with the transaction, First Mining is required to
distribute approximately 23.3 million Treasury Metals Shares and
all 11.6 million of the Treasury Metals Warrants to its
shareholders (the “Distribution”) within 12 months of
closing of the transaction. Following the Distribution, First
Mining will retain approximately 20.0 million Treasury Metals
Shares, leaving the Company with an approximate
15.4% interest in Treasury Metals.
As at
June 30, 2021, the Company recognized a liability for the
Distribution of $23,074,000 (December 31, 2020 - $34,040,000).
Following shareholder approval of the Distribution on June 30,
2021, the Company reclassified the related Treasury Metals Warrants
and Treasury Metals Shares to Assets held for distribution. Assets
held for distribution are measured at fair value. Upon
reclassification, the Treasury Metals Shares were remeasured from
the equity accounting carrying value to fair value resulting in a
gain of $2,059 recorded in Investments fair value gain (loss) on
the statements of net loss and comprehensive loss.
Subsequent
to the end of the period, on July 15, 2021, the Company completed
the distribution of 23,333,333 Treasury Metals shares and
16,666,666 Treasury Metals warrants to the shareholders of First
Mining on a pro-rata basis.
12
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
6. INVESTMENT IN PC GOLD INC.
Following
the completion of the Stage 1 earn-in by Auteco, First Mining has
determined that its 49% investment in the common shares of PC Gold
gives it significant influence over PC Gold, requiring PC Gold to
be recorded in First Mining’s financial statements using the
equity method of accounting for an investment in
associate.
The
initial recognition of the investment in associate was accounted
for based on an estimated fair value using a market approach to
value Pickle Crow’s inferred resources on a per unit of metal
basis derived from comparable gold project
transactions.
|
|
June
30,
2021
|
December
31,
2020
|
|
Balance,
beginning of period
|
$-
|
$-
|
|
Acquisition –
Initial Recognition on June 9, 2021
|
36,000
|
-
|
|
Equity
loss
|
(1)
|
-
|
|
Balance,
end of period
|
$35,999
|
$-
|
The
subsequent equity accounting for PC Gold is based on results to
March 31, 2021 and an estimate of results for the period of June 9,
2021 to June 30, 2021. The Company’s estimated equity share
of PC Gold’s net loss for the interim period ending June 30,
2021 was $1,000.
7. INVESTMENT IN BIG RIDGE GOLD CORP.
Following
completion of the Big Ridge transaction on June 7, 2021, the
Company’s common share ownership interest in Big Ridge was
approximately 19.8% (Initial Recognition fair value - $2,185,000)
and was 14.0% on June 30, 2021 following a dilution event whereby
Big Ridge issued 23.4 million flow-through shares as part of a
private placement. In addition to its share ownership interest, the
Company considered various qualitative factors including representation rights on
Big Ridge’s board of directors in arriving at the
determination that significant influence exists, and therefore the
Company will be required to apply the equity method of
accounting.
|
|
June
30,
2021
|
December
31,
2020
|
|
Balance,
beginning of period
|
$-
|
$-
|
|
Acquisition –
Initial Recognition on June 7, 2021
|
2,185
|
-
|
|
Equity
loss
|
(20)
|
-
|
|
Dilution event in
Q2 2021
|
(588)
|
-
|
|
Balance,
end of period
|
$1,577
|
$-
|
The
equity accounting for Big Ridge is based on results to March 31,
2021 and an estimate of results for the period of June 7, 2021 to
June 30, 2021. The Company’s estimated equity share of Big
Ridge’s net loss for the interim period ending June 30, 2021
was $20,000.
13
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
8.
MINERAL PROPERTY INVESTMENTS
The
Company, through its subsidiary Clifton Star Resources Inc.
(“Clifton”), has a 10% equity interest in the shares of
Beattie Gold Mines Ltd., 2699681 Canada Ltd., and 2588111 Manitoba
Ltd. which directly or indirectly own various mining concessions
and surface rights, collectively known as the Duparquet gold
project.
Mineral
property investments (which comprise equity interests in the shares
of three private companies) are designated as FVTOCI, with changes
in fair value recorded in other comprehensive income
(loss).
As at
June 30, 2021, management determined, as a function of the falling
gold price environment, that there was a decline in the fair value
of mineral property investments and a fair value loss of $443,000
was recorded (six months ended June 30, 2020 – fair value
gain of $903,000) (Note 14). As at June 30, 2021, the fair value of
the Company’s mineral property investments is $6,283,000
(December 31, 2020 - $6,726,000).
9. SILVER STREAM DERIVATIVE LIABILITY
a)
Silver
Purchase Agreement Overview and Consideration Received
On June 10, 2020, the Company entered into a silver purchase
agreement (the “Silver Purchase Agreement”) with First
Majestic Silver Corp. (“First Majestic”), which closed
on July 2, 2020. Under the terms of the Silver Purchase Agreement,
First Majestic agreed to pay First Mining total consideration of
US$22.5 million (approx. $30.6 million as at the closing date), in
three tranches, for the right to purchase 50% of the payable silver
produced from the Springpole Gold Project over the life of the
project (the “Silver Stream”) and also received 30
million common share purchase warrants of First Mining. Each share
purchase warrant entitles First Majestic to purchase one common
share of First Mining at an exercise price of $0.40 for a period of
five years. The fair value of the warrants issued of
$6,278,000 was recorded in Equity (Warrant reserve) on the
Company’s consolidated statements of financial
position.
First Mining has the right to repurchase 50% of the Silver Stream
for US$22.5 million (approx. $27.9 million as at June 30, 2021) at
any time prior to the commencement of production at Springpole (the
“Buy-Back Right”). Per the Silver Purchase Agreement, First Majestic paid
US$10 million ($13.7 million) to First Mining on the July 2, 2020
closing date, with US$2.5 million ($3.3 million) paid in cash and
the remaining US$7.5 million ($10.4 million) paid in 805,698 common
shares of First Majestic (“Tranche 1”). Upon
announcement of the Pre-Feasibility Study
(“PFS”) on March 4, 2021,
First Mining received US$7.5 million ($9.8 million) from First
Majestic, with US$3.75 million ($4.8 million) paid in cash and the
remaining US$3.75 million ($5.0 million) paid in 287,300 common
shares of First Majestic (“Tranche
2”).
Consideration payable for the Silver Stream includes one further
tranche (split evenly between cash and First Majestic common
shares) of US$5 million (approx. $6.2 million as at June 30, 2021)
payable upon First Mining receiving approval of either a Federal or
Provincial Environmental Assessment. (The three tranches of
consideration totaling US$22.5 million ($23.5 million received for
Tranche 1 and Tranche 2) constitute the “Advance
Payment”). In the event of default, First Majestic may
terminate the Silver Purchase Agreement and the Advance Payment
received by First Mining at that time would become
repayable. The Advance Payment amount is used to track the
stream balance for commercial, but not accounting purposes. In the
event the Company exercises the Buy-Back Right by paying US$22.5
million (approx. $27.9 million) to First Majestic, the Advance
Payment amount shall be reduced to nil.
14
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
9.
SILVER STREAM DERIVATIVE LIABILITY (continued)
b)
Silver
Stream Derivative Liability Fair Value
The
Company has concluded that the Silver Stream is a standalone
derivative measured at FVTPL.
The
estimated fair value of the Silver Stream derivative liability was
determined using a discounted cash flow model which incorporated a
Monte Carlo simulation. The fair value of the Silver Stream
derivative liability is a Level 3 measurement.
The
fair value of the Silver Stream derivative liability is calculated
at each reporting date as the net of the future Advance Payment
tranches receivable (an asset for the Company) and the Silver
Stream obligation (a liability to the Company), with
gains or losses recorded in the statement of net loss and
comprehensive loss. The fair value of the Silver Stream derivative
liability as at June 30, 2021 is US$25,391,000 ($31,471,000), which
is comprised of the Silver Stream obligation fair value of
US$28,370,000 ($35,161,000) less the Advance Payment receivable
fair value of US$2,979,000 ($3,692,000). The fair value of the
Silver Stream derivative liability as at December 31, 2020 was
US$10,415,000 ($13,260,000), which is comprised of the Silver
Stream obligation fair value of US$21,761,000 ($27,706,000) less
the Advance Payment receivable fair value of US$11,346,000
($14,446,000).
|
|
Silver Stream derivative liability
|
|
Balance,
December 31, 2019
|
$-
|
|
Fair value of
Silver Stream derivative liability - Initial Recognition on July 2,
2020
|
(7,378)
|
|
Change in fair
value during the period
|
(5,882)
|
|
Balance,
December 31, 2020
|
$(13,260)
|
|
Advance payment
received (Tranche 2) (US$7.5 million)
|
(9,808)
|
|
Change in fair
value during the period
|
(8,403)
|
|
Balance,
June 30, 2021
|
$(31,471)
|
10. SHARE CAPITAL
a)
Authorized
Unlimited
number of common shares with no par value.
Unlimited
number of preferred shares with no par value.
b)
Issued
and Fully Paid
Common
shares: 698,542,158 (December 31, 2020 –
697,216,453).
Preferred
shares: nil (December 31, 2020 – nil).
c)
Warrants
The
movements in warrants during the six months ended June 30, 2021 and
year ended December 31, 2020 are
summarized
as follows:
15
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
10. SHARE CAPITAL (Continued)
|
|
Number
|
Weighted average exercise price
|
|
Balance
as at December 31, 2019
|
15,872,998
|
$0.41
|
|
Warrants
issued
|
77,460,159
|
0.49
|
|
Warrants
exercised
|
(247,500)
|
0.34
|
|
Balance
as at December 31, 2020
|
93,085,657
|
$0.48
|
|
Warrants
exercised
|
(110,000)
|
0.33
|
|
Warrants
expired
|
(3,027,615)
|
0.44
|
|
Balance
as at June 30, 2021
|
89,948,042
|
$0.48
|
The
following table summarizes information about warrants outstanding
as at June 30, 2021:
|
Exercise
price
|
Number
of warrants outstanding
|
Weighted
average exercise price
($
per share)
|
Weighted
average remaining life (years)
|
|
$0.33
|
18,402,659
|
$0.33
|
1.66
|
|
$0.40
|
42,795,383
|
$0.40
|
3.07
|
|
$0.70
|
28,750,000
|
$0.70
|
1.16
|
|
|
89,948,042
|
$0.48
|
2.17
|
There
were no warrants issued during the six months ended June 30,
2021.
Stock Options
The
Company has adopted a stock option plan that allows for the
granting of stock options to Directors, Officers, employees and
certain consultants of the Company for up to 10% of the
Company’s issued and outstanding common shares. Stock options
granted under the plan may be subject to vesting provisions as
determined by the Board of Directors.
16
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
The
movements in stock options during the six months ended June 30,
2021 and year ended December 31, 2020 are summarized as
follows:
|
|
Number
|
Weighted
average exercise price
|
|
Balance
as at December 31, 2019
|
46,927,500
|
$0.57
|
|
Granted –
January 31, 2020
|
8,750,000
|
0.25
|
|
Granted –
April 1, 2020
|
1,100,000
|
0.25
|
|
Granted –
October 30, 2020
|
900,000
|
0.43
|
|
Granted –
December 1, 2020
|
600,000
|
0.405
|
|
Options
exercised
|
(3,717,500)
|
0.33
|
|
Options
expired
|
(2,790,000)
|
0.40
|
|
Options
forfeited
|
(5,950,000)
|
0.52
|
|
Balance
as at December 31, 2020
|
45,820,000
|
$0.53
|
|
Granted –
February 2, 2021
|
8,615,000
|
0.435
|
|
Granted –
April 14, 2021
|
500,000
|
0.365
|
|
Granted –
June 8, 2021
|
400,000
|
0.37
|
|
Granted –
June 17, 2021
|
300,000
|
0.38
|
|
Options
exercised
|
(650,000)
|
0.25
|
|
Options
expired
|
(7,270,000)
|
0.75
|
|
Options
forfeited
|
(712,500)
|
0.386
|
|
Balance
as at June 30, 2021
|
47,002,500
|
$0.483
|
The
weighted average closing share price at the date of exercise for
the six months ended June 30, 2021 was $0.41 (June 30, 2020 –
$0.28). 650,000 stock options were exercised during the six months
ended June 30, 2021 (June 30, 2020 – 625,000).
The
following table summarizes information about the stock options
outstanding as at June 30, 2021:
|
|
Options Outstanding
|
Options Exercisable
|
||||
|
Exercise
price
|
Number
of options
|
Weighted
average exercise price ($ per share)
|
Weighted
average remaining life (years)
|
Number
of options
|
Weighted
average exercise price ($ per share)
|
Weighted
average remaining life (years)
|
|
$0.01 – 0.50
|
34,387,500
|
$0.38
|
3.37
|
24,863,750
|
$0.37
|
2.97
|
|
$0.51 – 1.00
|
12,615,000
|
0.75
|
0.98
|
12,615,000
|
0.75
|
0.98
|
|
|
47,002,500
|
$0.48
|
2.73
|
37,478,750
|
$0.50
|
2.30
|
During
the six months ended June 30, 2021, there were 9,815,000 (June 30,
2020 - 9,850,000) stock options granted with an aggregate fair
value at the date of grant of $445,000 (June 30, 2020 -
$1,170,000), or a weighted average fair value of $0.37 per option
(June 30, 2020 – $0.12). As at June 30, 2021, 9,524,000 (June
30, 2020 – 8,800,000) stock options remain unvested with an
aggregate grant date fair value of $1,933,000 (June 30, 2020 -
$520,000).
17
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
10. SHARE CAPITAL (Continued)
Certain
stock options granted were directly attributable to exploration and
evaluation expenditures on mineral properties and were therefore
capitalized to mineral properties. In addition, certain stock
options were subject to vesting provisions. These two factors
result in differences between the aggregate fair value of stock
options granted and total share-based payments expensed during the
periods. Total share-based payments expense during the three month
and six-month periods ended June 30, 2021 and June 30, 2020 was
classified within the financial statements as follows:
|
|
For the three months ended June 30,
|
For the six months ended June 30,
|
||
|
Statements
of Net Loss:
|
2021
|
2020
|
2021
|
2020
|
|
General and
administration
|
$270
|
$124
|
$768
|
$361
|
|
Exploration and
evaluation
|
75
|
29
|
190
|
73
|
|
Investor relations
and marketing communications
|
72
|
58
|
162
|
121
|
|
Corporate
development and due diligence
|
24
|
33
|
98
|
94
|
|
Subtotal
|
$441
|
$244
|
$1,218
|
$649
|
|
Statements
of Financial Position:
|
|
|
|
|
|
Mineral
Properties
|
204
|
126
|
612
|
350
|
|
Total
|
$645
|
$370
|
$1,830
|
$999
|
The
grant date fair value of the stock options recognized in the period
has been estimated using the Black-Scholes option pricing model
with the following weighted average assumptions:
|
|
Six
months ended
|
Year
ended
|
|
|
June
30, 2021
|
December
31, 2020
|
|
Risk-free interest
rate
|
0.40%
|
1.72%
|
|
Share price at
grant date (in dollars)
|
$0.43
|
$0.25
|
|
Exercise price (in
dollars)
|
$0.43
|
$0.27
|
|
Expected life
(years)
|
5.00
years
|
4.96
years
|
|
Expected volatility
(1)
|
68.67%
|
69.10%
|
|
Forfeiture
rate
|
7.50%
|
5.26%
|
|
Expected dividend
yield
|
Nil
|
Nil
|
(1)
The
computation of expected volatility was based on the Company’s
historical price volatility, over a period which approximates the
expected life of the option.
d)
Restricted
Share Units
The
Company granted Restricted Share Units ("RSUs") under its
share-based compensation plan to the Company’s executive
officers as part of the Company’s long-term incentive plan
(“LTIP”). Unless otherwise stated, the awards typically
have a graded vesting schedule over a three-year period and will be
settled in equity upon vesting.
The
associated compensation cost is recorded as share-based payments
expense against share-based payment reserve.
18
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
10. SHARE CAPITAL (Continued)
The
following table summarizes the changes in RSU's for the six months
ended June 30, 2021:
|
|
Number
|
Weighted average
fair value
|
|
Balance
as at December 31, 2020
|
-
|
$-
|
|
Granted –
February 2, 2021
|
1,550,000
|
0.40
|
|
Balance
as at June 30, 2021
|
1,550,000
|
$0.40
|
e)
Deferred
Share Units
The
Company granted 303,000 Deferred Share Units ("DSUs") under its
share-based compensation plan to a director as part of the
Company’s LTIP. DSUs have a graded vesting schedule over an
18-month period and will be settled in equity upon
vesting.
The
associated compensation cost is recorded as share-based payments
expense against share-based payment reserve. The grant date fair
value of the DSUs recognized in the six months ended June 30, 2021
is $0.36.
|
|
Number
|
Weighted average
fair value
|
|
Balance
as at December 31, 2020
|
-
|
$-
|
|
Granted –
February 2, 2021
|
40,000
|
0.40
|
|
Granted –
June 17, 2021
|
263,000
|
0.35
|
|
Balance
as at June 30, 2021
|
303,000
|
$0.36
|
19
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
11. OPERATING EXPENSES
Operating
expenditures by nature, which map to the Company’s functional
operating expense categories presented in the consolidated
statements of net loss and comprehensive loss, are as
follows:
|
|
For
the three months ended June 30, 2021
|
For
the three months ended June 30, 2020
|
||
|
|
General
and administration
|
Investor
relations and marketing communications
|
General
and administration
|
Investor
relations and marketing communications
|
|
Administrative and
office
|
$121
|
$54
|
$47
|
$8
|
|
Consultants
|
27
|
30
|
121
|
-
|
|
Depreciation
|
42
|
-
|
38
|
-
|
|
Directors
fees
|
12
|
-
|
126
|
-
|
|
Investor relations
and marketing communications
|
-
|
699
|
-
|
106
|
|
Professional
fees
|
486
|
-
|
525
|
-
|
|
Salaries
|
251
|
70
|
222
|
58
|
|
Share-based
payments (non-cash) (Note 10(d))
|
299
|
72
|
124
|
58
|
|
Transfer agent and
filing fees
|
32
|
34
|
45
|
16
|
|
Travel and
accommodation
|
1
|
-
|
3
|
-
|
|
Total
|
$1,271
|
$959
|
$1,251
|
$246
|
|
|
For
the six months ended June 30, 2021
|
For
the six months ended June 30, 2020
|
||
|
|
General
and administration
|
Investor
relations and marketing communications
|
General
and administration
|
Investor
relations and marketing communications
|
|
Administrative and
office
|
$184
|
$60
|
$105
|
$16
|
|
Consultants
|
89
|
45
|
142
|
10
|
|
Depreciation
|
85
|
-
|
64
|
-
|
|
Directors
fees
|
80
|
-
|
143
|
-
|
|
Investor relations
and marketing communications
|
-
|
917
|
3
|
268
|
|
Professional
fees
|
783
|
-
|
667
|
-
|
|
Salaries
|
469
|
215
|
385
|
103
|
|
Share-based
payments (non-cash) (Note 10(d))
|
797
|
161
|
361
|
121
|
|
Transfer agent and
filing fees
|
136
|
34
|
122
|
16
|
|
Travel and
accommodation
|
2
|
-
|
16
|
11
|
|
Total
|
$2,625
|
$1,432
|
$2,008
|
$545
|
20
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
12. SEGMENT INFORMATION
The
Company operates in a single reportable operating segment, being
the acquisition, exploration, development and strategic disposition
of its North American mineral properties. Geographic information
about the Company’s non-current assets, excluding financial
instruments, as at June 30, 2021 and December 31, 2020 is as
follows: Canada - $215,486,000 (December 31, 2020 - $244,018,000)
and USA - $432,000 (December 31, 2020 - $444,000).
13. RELATED PARTY TRANSACTIONS
The
Company’s related parties consist of the Company’s
Directors and Officers, and any companies associated with
them.
Key
management includes the Directors, Officers and Vice Presidents of
the Company. The compensation paid or payable to key management for
services during the three months and six months ended June 30, 2021
and 2020 is as follows:
|
Service
or Item
|
Three
months ended June 30,
|
Six
months ended June 30,
|
||
|
|
2021
|
2020
|
2021
|
2020
|
|
Directors’
fees
|
$80
|
$126
|
$160
|
$143
|
|
Salaries and
consultants’ fees
|
396
|
288
|
931
|
556
|
|
Share-based
payments (non-cash)
|
320
|
246
|
803
|
641
|
|
Total
|
$796
|
$660
|
$1,894
|
$1,340
|
14. FAIR VALUE
Fair
values have been determined for measurement and/or disclosure
requirements based on the methods below.
The
Company characterizes fair value measurements using a hierarchy
that prioritizes inputs depending on the degree to which they are
observable. The three levels of the fair value hierarchy are as
follows:
●
Level
1 fair value measurements are quoted prices (unadjusted) in active
markets for identical assets or liabilities;
●
Level
2 fair value measurements are those derived from inputs other than
quoted prices included within level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly
(i.e. derived from prices); and
●
Level
3 fair value measurements are those derived from valuation
techniques that include significant inputs for the asset or
liability that are not based on observable market data
(unobservable inputs).
The
carrying values of cash and cash equivalents, current accounts
receivables, and accounts payable and accrued liabilities
approximated their fair values because of the short-term nature of
these financial instruments. These financial instruments are
classified as financial assets and liabilities at amortized
cost.
The
carrying value of investments (except for Treasury Metals Warrants)
and the Treasury Metals Shares included within assets held for
distribution were based on the quoted market prices of the shares
as at June 30, 2021 and was therefore considered to be Level 1. The
fair value of Treasury Metals Warrants is determined using certain
Level 2 inputs, as the Black-Scholes valuation model incorporates
Treasury Metals’ expected share price volatility based on
actual historical share prices.
21
FIRST MINING GOLD CORP.
INTERIM
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
FOR THE
SIX MONTHS ENDED JUNE 30, 2021 AND 2020
(Expressed in
thousands of Canadian dollars, except share and per share
amounts)
(Unaudited)
14. FAIR VALUE (continued)
The
mineral property investments (First Mining’s 10% equity
interest in three privately held companies that own the Duparquet
Gold Project) are classified as financial assets at FVTOCI. The
fair value of the mineral property investments was not based on
observable market data and was therefore considered to be Level 3.
The initial fair value of the mineral property investments was
determined based on attributable pro-rata gold ounces for the
Company’s 10% indirect interest in the Duparquet project,
which formed part of the identifiable assets from the acquisition
of Clifton. Subsequently, the fair value has been reassessed at
each period end. Scenarios which may result in a significant change
in fair value include, among others, a change in the performance of
the investee, a change in the performance of comparable entities, a
change in gold price, a change in the economic environment, or
evidence from external transactions in the investee’s equity.
During the six months ended June 30, 2021, management concluded
that there was a decrease in the fair value of the mineral property
investments, and a fair value loss of $443,000 (June 30, 2020
– fair value gain of $903,000) was recorded (Note
6).
As the
Earn‐In Agreement provides Auteco the right to earn an
interest in PC Gold, rather than a direct interest in the Pickle
Crow project, Auteco’s option to acquire PC Gold shares is a
financial liability of First Mining. As a derivative, the Pickle
Crow project option liability is classified as financial liability
at FVTPL. The carrying value of the Option - Pickle Crow Gold
Project is not based on observable market data and therefore is
considered to be Level 3. The fair value of the Option –
Pickle Crow Gold Project as at June 30, 2021 was determined by
reference to the portion of the estimated fair value of PC Gold to
be given up by the Company with each option, net of any proceeds to
be received on exercise.
The
Silver Stream was determined to be a derivative liability, which is
classified as a financial liability at FVTPL. The carrying value of
the derivative liability was not based on observable market data
and involved complex valuation methods and was therefore considered
to be Level 3.
The
following table presents the Company’s fair value hierarchy
for financial assets and liabilities that are measured at fair
value:
|
|
June
30, 2021
|
December
31, 2020
|
||||||
|
|
|
Fair
value measurement
|
|
Fair
value measurement
|
||||
|
|
Carrying
value
|
Level
1
|
Level
2
|
Level
3
|
Carrying
value
|
Level
1
|
Level
2
|
Level
3
|
|
Financial
assets:
|
|
|
|
|
|
|
|
|
|
Investments (Notes
3, 5)
|
$20,432
|
$20,432
|
$-
|
$-
|
$18,425
|
$12,653
|
$5,772
|
$-
|
|
Assets held for
distribution (Note 5)
|
23,074
|
21,000
|
2,074
|
-
|
-
|
-
|
-
|
-
|
|
Mineral property
investments (Note 4)
|
6,283
|
-
|
-
|
6,283
|
6,726
|
-
|
-
|
6,726
|
|
Financial
liabilities:
|
|
|
|
|
|
|
|
|
|
Silver Stream
derivative liability (Note 9)
|
31,471
|
-
|
-
|
31,471
|
13,260
|
-
|
-
|
13,260
|
|
Option – PC
Gold (Note 4(d))
|
$17,306
|
$-
|
$-
|
$17,306
|
$4,410
|
$-
|
$-
|
$4,410
|
During
the six months ended June 30, 2021 there have been no transfers of
amounts between levels in the fair value hierarchy.
22
Exhibit
99.2
TSX:
FF | OTCQX: FFMGF | FRANKFURT: FMG
MANAGEMENT’S
DISCUSSION & ANALYSIS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2021
|
Suite 2070 – 1188 West Georgia Street, Vancouver, British
Columbia V6E 4A2www.firstmininggold.com | 1-844-306-8827
|
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
TABLE OF CONTENTS
|
COMPANY OVERVIEW
AND STRATEGY
|
2
|
|
2021
HIGHLIGHTS
|
2
|
|
SELECTED FINANCIAL
INFORMATION
|
4
|
|
ONTARIO MINERAL
PROPERTY PORTFOLIO LOCATIONS (1)
|
5
|
|
MINERAL PROPERTY
PORTFOLIO GOLD RESERVES (1)
|
6
|
|
MINERAL PROPERTY
PORTFOLIO GOLD RESOURCES (1)
|
7
|
|
MINERAL PROPERTY
PORTFOLIO REVIEW
|
8
|
|
SELECTED QUARTERLY
FINANCIAL INFORMATION
|
18
|
|
RESULTS OF
CONTINUING OPERATIONS
|
19
|
|
FINANCIAL
CONDITION, LIQUIDITY AND CAPITAL RESOURCES
|
21
|
|
FINANCIAL
INSTRUMENTS
|
22
|
|
RELATED PARTY
TRANSACTIONS
|
22
|
|
OFF-BALANCE SHEET
ARRANGEMENTS
|
22
|
|
NON-IFRS
MEASURES
|
23
|
|
ACCOUNTING
POLICIES
|
23
|
|
CRITICAL ACCOUNTING
ESTIMATES
|
23
|
|
CRITICAL ACCOUNTING
JUDGMENTS
|
23
|
|
ACCOUNTING
STANDARDS ISSUED BUT NOT YET APPLIED
|
24
|
|
RISKS AND
UNCERTAINTIES
|
24
|
|
QUALIFIED
PERSONS
|
27
|
|
SECURITIES
OUTSTANDING
|
27
|
|
MANAGEMENT’S
REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
|
27
|
|
FORWARD-LOOKING
INFORMATION
|
28
|
|
CAUTIONARY NOTE TO
U.S. INVESTORS REGARDING MINERAL RESOURCE AND MINERAL RESERVE
ESTIMATES
|
29
|
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
GENERAL
This
Management’s Discussion and Analysis (“MD&A”) should be read in
conjunction with the unaudited condensed interim consolidated
financial statements of First Mining Gold Corp. (the
“Company” or
“First Mining”)
for the three and six months ended June 30, 2021, which are
prepared in accordance with International Financial Reporting
Standards (“IFRS”) as applicable to the
preparation of interim financial statements, including
International Accounting Standard IAS 34 Interim Reporting. The
unaudited condensed interim consolidated financial statements
should also be read in conjunction with the Company’s audited
consolidated financial statements for the year ended December 31,
2020, which are prepared in accordance with IFRS as issued by the
International Accounting Standards Board. These documents along
with additional information on the Company, including the
Company’s Annual Information Form for the year ended December
31, 2020, are available under the Company’s SEDAR profile at
www.sedar.com,
on EDGAR at www.sec.gov.
In this
MD&A, unless the context otherwise requires, references to the
“Company”, “First Mining”,
“we”, “us”, and “our” refer to
First Mining Gold Corp. and its subsidiaries.
This
MD&A contains “forward-looking statements” and
“forward-looking information” within the meaning of
applicable Canadian securities laws. See the section of this
MD&A titled “Forward-Looking Information” for
further details. In addition, this MD&A has been prepared
in accordance with the requirements of Canadian securities laws,
which differ in certain material respects from the disclosure
requirements of United States securities laws, particularly with
respect to the disclosure of mineral reserves and mineral
resources. See the section of this MD&A titled
“Cautionary Note to U.S. Investors Regarding Mineral Resource
and Mineral Reserve Estimates” for further
details.
This
MD&A contains disclosure of certain non-IFRS financial
measures. Non-IFRS measures do not have any standardized meaning
prescribed under IFRS. See the section of this MD&A entitled
"Non-IFRS Measures" for further details.
All
dollar amounts included in this MD&A are expressed in Canadian
dollars unless otherwise noted. This MD&A is dated as of August
16, 2021 and all information contained in this MD&A is current
as of August 13, 2021.
COMPANY OVERVIEW AND STRATEGY
First
Mining is a Canadian gold developer focused on the development and
permitting of the Springpole gold project (the “Springpole Gold Project” or
“Springpole”) in northwestern
Ontario. Springpole is one of the largest undeveloped
gold projects in Canada. A Pre-Feasibility Study
(“PFS”) was
recently completed on the project and permitting is on-going with
submission of an Environmental Impact Statement
(“EIS”) for the
Project targeted for late 2021. In addition, the Company continues
the advancement of it portfolio of mining projects in Canada. The
Company also holds an approximate 15.4% equity position in
Treasury Metals Inc. (“Treasury Metals”) (TSX: TML) which
is advancing the Goliath Gold Complex gold project, in northwestern
Ontario, towards construction. First Mining’s portfolio of
gold projects in eastern Canada also includes the Pickle Crow
(being advanced in partnership with Auteco Minerals Ltd.
(“Auteco”) (ASX:
AUT), Hope Brook (being advanced in partnership with Big Ridge Gold
Corp. (“Big
Ridge”) (TSXV: BRAU), Cameron, Duparquet, Duquesne,
and Pitt gold projects.
The
following highlights the Company’s developments during fiscal
2021 (including subsequent events up to August 13,
2021).
Project Highlights
Springpole
●
Announced results of a positive PFS in January
2021. Post-tax net present value at a 5% discount rate
(“NPV5%”)
of US$995 million, post-tax internal rate of return
(“IRR”) of 29% and post-tax payback of 2.4 years
on initial capital of US$718 million.
●
Progressed
environmental fieldwork throughout 2020 and continued into 2021,
and submitted the amended proposed Terms Of Reference to
Ontario’s Ministry of the Environment, Conservation and Parks
(“MECP”) in
April 2021, with anticipated Ministry approval in August
2021.
●
Continued
engagement with local indigenous rightsholders and stakeholders of
the Springpole Gold Project.
●
Announced in March
2021 that the Company has entered into a 3-year option
agreement with Exiro Minerals Corp. (“Exiro”) pursuant to which First
Mining may earn a 100% interest in Exiro’s Swain Post
property through future cash and share payments to Exiro of
approximately $250,000 during the term of the option, and by
completing all assessment work requirements on the property during
the option term.
●
Signed a 3-year earn-in agreement with Whitefish
Exploration Inc. (“Whitefish”) comprising two stages. Stage 1 earn-in:
70% interest for $200,000 cash and $425,000 in First Mining share
payments together with $500,000 in exploration spend. Stage 2
earn-in: 70% to 100% ownership interest over an additional 2-year
term for $1,000,000 cash and $1,000,000 in First Mining share
payments.
●
On
July 5, 2021, the Company reported that a forest fire was active
within one kilometre of the camp at the Springpole Gold Project and
that operations were temporarily suspended. It was confirmed on
August 5, 2021 that the fire was under control and operations at
the camp recommenced on a limited basis until the Ministry of
Natural Resources and Forestry lift the Emergency Area
Order.
2
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Cameron
●
On July 28, 2021,
the Company announced that it had entered into an exploration
agreement with Animakee Wa Zhing #37 First Nation in respect of the
Cameron Gold Project.
●
Acquired the East
Cedartree claims from Metalore Resources Limited
(“Metalore”) in
December 2020, thereby consolidating First Mining’s land
holdings in the area into a single contiguous block and adding a
further 3,200 hectares to the 49,574 hectares that the Company
already held in the area. In connection with this acquisition,
First Mining paid $3.0 million in cash to Metalore, and issued 3
million common shares of First Mining (“First Mining Shares”) to Metalore
(with such shares subject to a statutory hold period of four months
plus one day from the closing date of the
transaction).
Pickle Crow
●
In March 2021, Auteco completed all expenditure
requirements set out in the earn-in agreement entered into between
First Mining and Auteco dated March 12, 2020 (the
“Auteco Earn-In
Agreement”) in respect of
Stage 1 of Auteco’s earn-in to the Pickle Crow Gold Project
(“Pickle Crow”). Following the issuance of 100,000,000
Auteco shares to First Mining on June 9, 2021, Auteco satisfied all
requirements under the Auteco Earn-In Agreement in respect of Stage
1 of the earn-in, and earned a 51% interest in PC Gold Inc.
(“PC
Gold”), First
Mining’s wholly-owned subsidiary that owns Pickle Crow.
Concurrently, the parties executed a joint venture
shareholders’ agreement (the “Auteco JV Agreement”) in respect
of PC Gold.
●
On
July 15, 2021, Auteco announced an increase in their Pickle Crow
resource, under JORC, to 1.7 million ounces of gold.
Hope Brook
●
In April 2021, the
Company announced that Big Ridge Gold Corp. (“Big Ridge”) (TSX-V:BRAU) had
entered into a definitive earn-in agreement with First Mining (the
“Big Ridge Earn-In
Agreement”) pursuant to which Big Ridge can earn up to
an 80% interest in First Mining’s Hope Brook Gold Project
(“Hope Brook”)
located in Newfoundland, Canada through a two-stage earn-in over
five years by incurring a total of $20 million in qualifying
expenditures, issuing up to 36,500,000 shares of Big Ridge to First
Mining and making a $500,000 cash payment to First Mining. First
Mining will retain a 1.5% NSR royalty on Hope Brook, of which 0.5%
can be bought back by Big Ridge for $2 million.
●
Upon
closing the transaction, Big Ridge issued 11,500,000 shares of Big
Ridge to the Company pursuant to the terms of the Big Ridge Earn-In
Agreement, and as a result, the Company owned approximately 19.8%
of the outstanding common shares of Big Ridge immediately after
such share issuance. The Company’s share ownership interest
in Big Ridge was subsequently diluted to 14% on June 30, 2021,
following a $5,000,000 flow-through financing by Big
Ridge.
Corporate Highlights
●
Investments
position of $20.5 million and an impressive portfolio of interests
in Treasury Metals, PC Gold and Big Ridge Gold with a combined
carrying value of $53.8 million as at June 30, 2021.
●
June 30, 2021 period-end cash balance of
$33.8 million.
●
Following the
Company’s annual general and special meeting of shareholders
on June 30, 2021 (the “2021
AGM”), it was announced that the Company’s
shareholders had voted in favour of all matters brought before the
2021 AGM.
●
On
July 15, 2021, the distribution by the Company of shares and
warrants of Treasury Metals to the Company’s shareholders of
record as of July 14, 2021, was completed based upon the final
allocation ratios that were announced by the Company on July 14,
2021. The combined value of the distribution was approximately
$20.8 million, and First Mining retains a 15.4% interest in
Treasury Metals post-distribution.
3
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
COVID-19 Response
In response to the onset of the COVID-19 novel
coronavirus (“COVID-19”) pandemic, the Company adopted a series of
robust COVID-19 risk mitigation policies incorporating
recommendations set by the provincial Governments of Ontario and
British Columbia, and by the Government of Canada. To date, First
Mining has not had any cases of COVID-19 at any of the camp
operations at its projects or its head office in Vancouver. The
health and safety of First Mining’s workforce, their families
and the communities in which the Company operates is First
Mining’s primary concern.
SELECTED FINANCIAL INFORMATION
|
|
For
the six months ended June 30,
|
||
|
Financial
Results (in $000s Except for per Share
Amounts):
|
2021
|
2020
|
2019
|
|
Mineral Property
Cash Expenditures(1)
|
$7,511
|
$6,194
|
$2,245
|
|
Net
Loss
|
(34,286)
|
(20,993)
|
(3,042)
|
|
Total Cash Used in
Operating Activities(3)
|
(3,814)
|
(2,441)
|
(1,993)
|
|
Basic and Diluted
Net Loss Per Share
(in
Dollars)(4)
|
$(0.05)
|
$(0.03)
|
$(0.01)
|
|
|
June 30,
|
December 31,
|
December 31,
|
|
Financial Position (in $000s):
|
2021
|
2020
|
2019
|
|
Cash and Cash
Equivalents
|
$33,762
|
$28,901
|
$5,902
|
|
Working Capital(2)
|
34,898
|
9,201
|
5,780
|
|
Investments
|
20,450
|
18,425
|
1,775
|
|
Mineral
Properties
|
160,322
|
179,429
|
252,815
|
|
Investment in
Treasury Metals Inc.
|
16,236
|
63,812
|
-
|
|
Investment in PC
Gold Inc.
|
35,999
|
-
|
-
|
|
Investment in Big
Ridge Gold Corp.
|
1,577
|
-
|
-
|
|
|
|
|
|
|
Total
Assets
|
299,750
|
301,213
|
268,020
|
|
Total Non-current
Liabilities
|
$31,855
|
$16,835
|
$3,139
|
(1)
This
represents mineral property expenditures per consolidated
statements of cash flows.
(2)
This
is a non-IFRS measurement with no standardized meaning under IFRS
and may not be comparable to similar financial measures presented
by other issuers. For further information please see the section in
this MD&A titled “Non-IFRS Measures”.
(3)
Per
the consolidated statement of cash flows in each corresponding
period.
(4)
The
basic and diluted loss per share calculations result in the same
amount due to the anti-dilutive effect of outstanding stock options
and warrants.
Net Loss - Fluctuations in net loss are typically caused by
non-cash items. Removing the impact of these non-cash items
illustrates that the income statement loss on operational
activities was relatively consistent over the prior periods
presented at an average of approx. $1.9 million however increased
in the six months ended June 30, 2021, mostly due to professional
fees associated with the Treasury Metals distribution and the US
marketing campaign.
Cash and Cash Equivalents - the
increase in 2021 was primarily attributable to proceeds from the
sales of shares of First Majestic Silver Corp.
(“First
Majestic”) that were
issued to the Company pursuant to the silver purchase agreement
that First Mining entered into with First Majestic on June 10, 2020
(the “Silver Purchase
Agreement”) and the
US$3,750,000 cash payment that the Company received from First
Majestic pursuant to the terms of the Silver Purchase Agreement,
partially offset by cash used in operational activities (Statement
of Net Loss) and investing activities at the projects (Statement of
Financial Position). See the section in this MD&A entitled
“Financial Condition, Liquidity and Capital
Resources”.
Total Assets – decreased relative to December 2020 mainly due to the
decline in non-current assets because of non-cash impairments
resulting from a decline in the fair value of the equity accounted
investment in Treasury Metals.
4
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
ONTARIO MINERAL PROPERTY PORTFOLIO
LOCATIONS (1)
(1)
Pickle
Crow is subject to the Auteco Earn-In Agreement pursuant to which
Auteco is the operator of the project and may acquire up to an 80%
interest in PC Gold, First Mining’s wholly-owned subsidiary
that owns the project.
5
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
MINERAL PROPERTY PORTFOLIO GOLD
RESERVES (1)
The
Springpole Gold Project is the only project owned by First Mining
that has Mineral Reserves attributed to it. The Mineral Reserves
for Springpole are based on the conversion of Indicated Mineral
Resources within the current pit design. The Mineral Reserves for
the Springpole Gold Project are shown below (for further details,
see the technical report entitled “NI 43-101 Technical Report
and Pre-Feasibility Study on the Springpole Gold Project, Ontario
Canada” dated February 26, 2021, which was prepared by AGP
Mining Consultants Inc. (“AGP”) in accordance with NI 43-101
and is available under First Mining’s SEDAR profile at
www.sedar.com):
Springpole Proven and Probable Reserves
|
Category
|
Tonnes (Mt)
|
Grade
Au (g/t)
|
Grade
Ag (g/t)
|
Contained Metal
Au (Moz)
|
Contained Metal
Ag (Moz)
|
|
Proven
|
0.0
|
0.0
|
0.0
|
0.0
|
0.0
|
|
Probable
|
121.6
|
0.97
|
5.23
|
3.8
|
20.5
|
|
Total
|
121.6
|
0.97
|
5.23
|
3.8
|
20.5
|
Notes:
(1)
The
Mineral Reserve estimate has an effective date of December 30, 2020
and is based on the Mineral Resource estimate that has an effective
date of July 30, 2020.
(2)
The Mineral Reserve estimate was completed under
the supervision of Gordon Zurowski, P.Eng., of AGP, a Qualified
Person as defined under National Instrument 43-101
Standards of Disclosure for
Mineral Projects (“NI
43-101”).
(3)
Mineral Reserves are stated within the final
design pit based on a US$878/oz gold (“Au”) pit shell with a US$1,350/oz Au price for
revenue.
(4)
The
equivalent cut-off grade was 0.34 g/t Au for all pit
phases.
(5)
The
mining cost averaged $2.75/t mined, processing cost averaged
$14.50/t milled, and the G&A cost averaged $1.06/t milled. The
process recovery for gold averaged 88% and the silver recovery was
93%.
(6)
The
exchange rate assumption applied was $1.30 equal to
US$1.00.
6
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
MINERAL PROPERTY PORTFOLIO GOLD
RESOURCES (1)
|
Project
|
Tonnes
|
Gold
Grade (g/t)
|
Silver
Grade (g/t)
|
Contained Gold Ounces (oz)
|
Contained Silver Ounces (oz)
|
|
Measured Resources
|
|||||
|
Cameron
Gold Project(2)
|
3,360,000
|
2.75
|
-
|
297,000
|
-
|
|
Duparquet
Gold Project(3)
|
18,470
|
1.52
|
-
|
901
|
-
|
|
Indicated Resources
|
|||||
|
Springpole
Gold Project(4)
|
151,000,000
|
0.94
|
5.00
|
4,600,000
|
24,300,000
|
|
Hope
Brook Gold Project
|
5,500,000
|
4.77
|
-
|
844,000
|
-
|
|
Cameron
Gold Project(5)
|
2,170,000
|
2.40
|
-
|
167,000
|
-
|
|
Duparquet
Gold Project(3)
|
7,122,070
|
1.73
|
-
|
396,134
|
-
|
|
Duquesne
Gold Project
|
1,859,200
|
3.33
|
-
|
199,161
|
-
|
|
Inferred Resources
|
|||||
|
Springpole
Gold Project(4)
|
16,000,000
|
0.54
|
2.80
|
300,000
|
1,400,000
|
|
Hope
Brook Gold Project
|
836,000
|
4.11
|
-
|
110,000
|
-
|
|
Cameron
Gold Project(6)
|
6,535,000
|
2.54
|
-
|
533,000
|
-
|
|
Pickle Crow Gold Project(7)
|
4,631,480
|
4.10
|
-
|
602,945
|
-
|
|
Duparquet
Gold Project(3)
|
4,066,284
|
1.85
|
-
|
242,312
|
-
|
|
Duquesne
Gold Project
|
1,563,100
|
5.58
|
-
|
280,643
|
-
|
|
Pitt
Gold Project
|
1,076,000
|
7.42
|
-
|
257,000
|
-
|
|
|
|||||
|
Total Measured Resources
|
3,378,470
|
2.74
|
-
|
297,901
|
-
|
|
Total Indicated Resources
|
167,651,270
|
1.14
|
5.00
|
6,206,295
|
24,300,000
|
|
Total Measured and Indicated Resources
|
171,029,740
|
1.18
|
5.00
|
6,504,196
|
24,300,000
|
|
Total Inferred Resources
|
34,707,864
|
2.07
|
2.80
|
2,325,900
|
1,400,000
|
(1)
The
Mineral Resources set out in this table are based on the technical
report for the applicable property, the title and date of which are
set out under the applicable property description within the
section “Mineral Property Portfolio Review” in this
MD&A or in the Company’s AIF for the year ended December
31, 2020, which is available under the Company’s SEDAR
profile at www.sedar.com.
(2)
Comprised
of 2,670,000 tonnes of pit-constrained (0.55 g/t Au cut-off)
Measured Mineral Resources at 2.66 g/t Au, and 690,000 tonnes of
underground (2.00 g/t Au cut-off) Measured Mineral Resources at
3.09 g/t Au.
(3)
The
Company owns 100% of the Central Duparquet Property, and a 10%
indirect interest in the Duparquet Gold Project. The Measured,
Indicated and Inferred Mineral Resources for Duparquet shown in the
above table reflect both of these ownership interests.
(4)
Springpole Mineral Resources are inclusive of
Mineral Reserves. Open pit mineral resources are reported at a
cut-off grade of 0.30 g/t Au. Cut-off grades are based on a price
of US$1,550/oz Au and $20/oz silver (“Ag”), and processing recovery of 88% Au and
93% Ag. The estimated Life of Mine (“LOM”) strip ratio for the resource estimate is
2.36. Silver Mineral Resources shown in separate column with grade
representing g/t Ag, and contained ounces representing
Ag.
(5)
Comprised
of 820,000 tonnes of pit-constrained (0.55 g/t Au cut-off)
Indicated Mineral Resources at 1.74 g/t Au, and 1,350,000 tonnes of
underground (2.00 g/t Au cut-off) Indicated Mineral Resources at
2.08 g/t Au.
(6)
Comprised
of 35,000 tonnes of pit-constrained (0.55 g/t Au cut-off) Inferred
Mineral Resources at 2.45 g/t Au, and 6,500,000 tonnes of
underground (2.00 g/t Au cut-off) Inferred Mineral Resources at
2.54 g/t Au.
(7)
Comprises 1,887,000 tonnes of pit-constrained
(0.50 g/t Au cut-off) Inferred Mineral Resources at 1.30 g/t Au,
and 7,565,000 tonnes of underground Inferred Mineral Resources that
consist of: (i) a bulk tonnage, long-hole stoping component (2.00
g/t Au cut-off); and (ii) a high-grade cut-and-fill component (2.60
g/t Au cut-off) over a minimum width of 1 metre. First
Mining owns 49% of the
Pickle Crow Gold Project, and 51% is owned by Auteco Minerals Ltd. The
Inferred mineral resources for Pickle Crow shown in the above table
reflects only the First Mining ownership
interest.
7
|
FIRST MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed in Canadian dollars, unless otherwise
indicated)
|
For the three and six months ended June 30,
2021
|
MINERAL PROPERTY PORTFOLIO REVIEW
First
Mining has properties located in Canada and the United States. The
following section discusses the Company’s priority and other
significant projects.
As
at June 30, 2021 and December 31, 2020, the Company had capitalized
the following acquisition, exploration and evaluation costs to its
mineral properties:
|
|
|
|
|
(in $000s)
|
|
|
|
|
|
|
Springpole
|
Cameron
|
Duquesne/
Pitt
|
Hope Brook
|
Pickle Crow
|
Goldlund
|
Others (1)
|
Total
|
|
Balance December 31, 2019
|
$76,775
|
$27,374
|
$7,217
|
$20,071
|
$19,263
|
$98,894
|
$3,221
|
$252,815
|
|
2020
acquisition and capitalized net expenditures
|
11,132
|
4,501
|
12
|
541
|
5,723
|
1,609
|
114
|
23,632
|
|
Disposal,
impairment or reclassification
|
-
|
-
|
-
|
-
|
-
|
(100,503)
|
3,485
|
(97,018)
|
|
Balance December 31, 2020
|
$87,907
|
$31,875
|
$7,229
|
$20,612
|
$24,986
|
$-
|
$6,820
|
$179,429
|
|
2021
acquisition and capitalized net expenditures
|
7,810
|
221
|
7
|
99
|
3,273
|
-
|
438
|
11,848
|
|
Disposal,
impairment or reclassification
|
-
|
-
|
-
|
(2,685)
|
(28,259)
|
-
|
(11)
|
(30,955)
|
|
Balance June 30, 2021
|
$95,717
|
$32,096
|
$7,236
|
$18,026
|
$-
|
$-
|
$7,247
|
$160,322
|
(1)
Other
mineral properties as at June 30, 2021 and December 31, 2020
include: the mining claims and concessions located in the Township
of Duparquet, Quebéc, which are near the Company’s
Duquesne gold project; Swain Post property in northwestern Ontario
which is near the Company’s Springpole Gold Project (property
under option agreement from Exiro Minerals Corp.); Swain Lake
property under the earn-in agreement with Whitefish Explorations
Inc.; a 1.5% NSR Royalty under the terms of an NSR Royalty
Agreement dated August 7, 2020 between the Company, Treasury Metals
and Goldlund Resources Inc., a wholly-owned subsidiary of Treasury
Metals, which was reclassified from “Goldlund” to
“Others” during the year ended December 31, 2020; and
the Turquoise Canyon property in Nevada (property under option to
Momentum Minerals Ltd. which was acquired by IM Exploration Inc. on
July 6, 2021).
CANADIAN GOLD PROJECTS
Springpole Gold Project, Ontario
The
Springpole Gold Project covers an area of 41,943 hectares in
northwestern Ontario, consisting of 30 patented mining claims, 282
contiguous mining claims and thirteen mining leases. The project is
located approximately 110 kilometres (“km”) northeast of the Municipality
of Red Lake in northwestern Ontario and is situated within the
Birch-Uchi Greenstone Belt. The large, open pittable resource is
supported by significant infrastructure, including a 72-person
onsite camp, winter road access, a logging road within 15 km of the
camp, and nearby power lines within 40 km. The Springpole Gold
Project is located within an area that is covered by Treaty Three
and Treaty Nine First Nations Agreements. With approximately 4.6
million ounces of gold and 24 million ounces of silver in the
Indicated Mineral Resource category, the Springpole Gold Project is
one of the largest undeveloped gold projects in Ontario1.
During
the six months ended June 30, 2021, the most significant
expenditures at the Springpole Gold Project were:
●
$1,821,000
in connection with land tenure and advanced royalty
acquisitions;
●
$1,740,000
in connection with ongoing environmental permitting and community
consultations;
●
$870,000
for site employees’, contractors’ salaries and
management salaries allocations;
●
$802,000
in connection with the Springpole PFS;
●
$676,000
in connection with drilling activities; and
●
$436,000
in connection with fuel charges.
1 Source: S&P Market
Intelligence database as of July 16, 2021. Ranking among
undeveloped primary gold resources per
jurisdiction.
8
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
During
the six-months ended June 30, 2021, and up to the date of this
MD&A, the most significant operational developments at the
Springpole Gold Project were:
1.
Completion of Pre-Feasibility Study
On
January 20, 2021, First Mining announced the results of a positive
PFS for the Springpole Gold Project. The PFS evaluates recovery of
gold and silver from a 30,000 tonne-per-day (“tpd”) open pit operation at
Springpole, with a process plant that will include crushing,
grinding, and flotation, with fine grinding of the flotation
concentrate and agitated leaching of both the flotation concentrate
and the flotation tails followed by a carbon-in-pulp recovery
process to produce doré bars. For full details regarding the
PFS for the Springpole Gold Project, see the technical report,
entitled “NI 43-101 Technical Report and Pre-Feasibility
Study on the Springpole Gold Project, Ontario Canada” dated
February 26, 2021, which was prepared by AGP in accordance with NI
43-101 and is available under First Mining’s SEDAR profile at
www.sedar.com.
PFS Highlights
●
US$1.5 billion pre-tax NPV5%
at US$1,600 per ounce
(“oz”) Au, increasing to US$1.9 billion at
US$1,800/oz Au
●
US$995 million post-tax NPV5%
at US$1,600/oz Au, increasing to
US$1.3 billion at US$1,800/oz Au
●
36.4%
pre-tax IRR; 29.4% after-tax IRR at US$1,600/oz Au
●
LOM
of 11.3 years, with primary mining and processing during the first
9 years and processing lower-grade stockpiles for the balance of
the mine life
●
After-tax
payback of 2.4 years
●
Declaration
of Mineral Reserves: Proven and Probable Reserves of 3.8 Moz Au,
20.5 Moz Ag (121.6 Mt at 0.97 g/t Au, 5.23 g/t Ag)
●
Initial
capital costs estimated at US$718 million, sustaining capital costs
estimated at US$55 million, plus US$29 million in closure
costs
●
Average
annual payable gold production of 335 koz (Years 1 to 9); 287 koz
(LOM)
●
Total cash costs of US$558/oz (Years 1 to 9); and
US$618/oz (LOM)(1)
●
All-in sustaining costs
(“AISC”)
of US$577/oz (Years 1 to 9), and AISC US$645
(LOM)(2)
Note: Base case parameters assume a gold price of US$1,600/oz and a
silver price of US$20/oz, and an exchange rate ($ to US$) of 0.75.
All currencies in the PFS are reported in U.S. dollars unless
otherwise specified. NPV calculated as of the commencement of
construction and excludes all pre-construction costs.
(1) Total cash costs consist of mining costs, processing costs,
mine-level general and administrative (“G&A”) costs, treatment and
refining charges and royalties.
(2) AISC consists of total cash costs plus sustaining and closure
costs.
Economic Sensitivities
The
economics and cash flows of the Springpole Gold Project are highly
sensitive to changes to the gold price.
Springpole Economic Sensitivity to Gold Price (base case in bold)
|
Gold Price (US$/oz)
|
$1,400
|
$1,600
|
$1,800
|
$2,000
|
|
Pre-Tax
NPV5%
|
US$1.04
billion
|
US$1.48 billion
|
US$1.92
billion
|
US$2.36
billion
|
|
Pre-Tax
IRR
|
28.9%
|
36.4%
|
43.2%
|
49.5%
|
|
After-Tax
NPV5%
|
US$690
million
|
US$995 million
|
$1.30
billion
|
$1.60
billion
|
|
After-Tax
IRR
|
23.3%
|
29.4%
|
35.0%
|
40.1%
|
9
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Springpole Economic Sensitivity to Initial Capital Costs
(base case in
bold)
|
Initial Capital Costs
|
+10%
|
US$718 million
|
-10%
|
|
Pre-Tax
NPV5%
|
US$1.34
billion
|
US$1.48 billion
|
US$1.61
billion
|
|
Pre-Tax
IRR
|
30.1%
|
36.4%
|
44.1%
|
|
After-Tax
NPV5%
|
US$875
million
|
US$995 million
|
US$1,102
million
|
|
After-Tax
IRR
|
23.8%
|
29.4%
|
36.3%
|
Springpole Economic Sensitivity to Operating Costs
(base case in
bold)
|
Operating Costs
|
+10%
|
US$2.21 billion
|
-10%
|
|
Pre-Tax
NPV5%
|
US$1.33
billion
|
US$1.48 billion
|
US$1.63
billion
|
|
Pre-Tax
IRR
|
34.1%
|
36.4%
|
38.6%
|
|
After-Tax
NPV5%
|
US$890
million
|
US$995 million
|
US$1,098
million
|
|
After-Tax
IRR
|
27.6%
|
29.4%
|
31.3%
|
The
Mineral Resources defined in the PFS do not reflect the significant
opportunities that are available for resource expansion or
discovery of additional ore bodies in the Springpole district, and
readers are cautioned that Mineral Resources that are not Mineral
Reserves do not have demonstrated economic viability. First Mining
believes that the Springpole Gold Project has several avenues for
resource expansion, both within the existing property footprint and
regionally in the under-explored Birch Uchi Greenstone belt. First
Mining plans to undertake approximately 10,000 m of diamond
drilling at the Springpole Gold Project in 2021 for metallurgy,
exploration, condemnation, and geotechnical purposes, and will
continue to review other exploration opportunities in the area. As
at June 30, 2021, 2,632 m of metallurgical drilling and 2,115 m of
geotechnical drilling had been completed, for a total of 4,747
m.
Project Enhancement Opportunities
The PFS
identified several opportunities to enhance the economics of the
Springpole Gold Project, and they will be investigated as First
Mining continues to advance the project. These opportunities
include:
●
Existing Resource
Upgrades. Inferred Mineral
Resources are contained within the existing pit design, and with
additional infill drilling, these resources may potentially support
conversion of some or all of this material into Indicated Mineral
Resources that could be converted to Probable Mineral Reserves and
evaluated in a Feasibility Study (“FS”).
●
Mine Plan
Optimization. Refined pit optimization parameters could result
in better optimized open pit limits which could reduce the overall
strip ratio.
●
Process Optimization.
Continued efforts to investigate
opportunities to improve the metal recoveries through further
metallurgical testing and refining milling processes, as well as
other process optimizations.
●
Further Geotechnical
Studies. A better
hydrogeological and geotechnical understanding may increase pit
slope angles, potentially reducing costs associated with mining
waste material.
●
Additional
Mineralization. There are geophysical and geological targets in
the area around the current resource, where additional drilling has
the potential to identify additional mineralization that could
support Mineral Resource estimation with upside potential for the
LOM.
2.
Silver Stream transaction with First Majestic Silver
Corp.
On June
10, 2020, First Mining entered into the Silver Purchase Agreement
with First Majestic pursuant to which First Majestic has agreed to
pay First Mining total consideration of US$22.5 million (the
“Advance
Payment”), in the following three tranches, for the
right to purchase 50% of the payable silver produced from the
Springpole Gold Project for the life of the project (the
“Silver
Stream”):
●
US$10 million payable on closing the transaction,
with US$2.5 million payable in cash and the remaining US$7.5
million to be satisfied by the issuance to First Mining of 805,698
common shares of First Majestic (the “First Majestic
Shares”);
●
US$7.5 million payable upon First Mining publicly
announcing the completion of a positive PFS for the Springpole Gold
Project, with US$3.75 million payable in cash and US$3.75 million
payable in First Majestic Shares based on the 20-day
volume-weighted average trading price (“VWAP”) of the First Majestic Shares on the TSX
at the time; and
●
US$5 million payable upon First Mining receiving
approval of a federal or provincial Environmental Assessment
(“EA”) for the Springpole Gold Project, with
US$2.5 million payable in cash and US$2.5 million payable in First
Majestic Shares (based on 20-day VWAP of the First Majestic Shares
on the TSX at the time).
10
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
The
transaction closed on July 2, 2020, and upon closing the
transaction, First Mining issued 30 million common share purchase
warrants (“First Mining
Warrants”) to First Majestic pursuant to the terms of
the Silver Purchase Agreement. Each First Mining Warrant entitles
First Majestic to purchase one First Mining Share at an exercise
price of $0.40 for a period of five years. As a result of the
Treasury Metals distribution in July 2021, pursuant to the
adjustment provisions of the First Mining Warrants, the exercise
price of these warrants was reduced, and the number of these
warrants was increased.
As of
the date of this MD&A, the first two cash and share payments
set out above, totalling US$17.5 million, have been paid to First
Mining by First Majestic.
In the
event of default, First Majestic may terminate the Silver Purchase
Agreement and the Advance Payment received by First Mining at that
time would become repayable. The Silver Stream has an initial term
of 40 years from July 2, 2020. The term is automatically extended
by successive 10-year periods as long as the life of mine continues
for the Springpole Gold Project.
Upon
receipt of its share of silver production, First Majestic will make
cash payments to First Mining for each ounce of silver paid to
First Majestic under the Silver Purchase Agreement equal to 33% of
the lesser of the average spot price of silver for the applicable
calendar quarter, and the spot price of silver at the time of
delivery, subject to a price cap of US$7.50 per ounce of silver
(the “Price
Cap”). The Price Cap is subject to annual inflation
escalation of 2%, commencing at the start of the third year of
production. First Mining has the right to repurchase 50% of the
Silver Stream for US$22.5 million at any time prior to the
commencement of production at Springpole.
The
proceeds received by First Mining will primarily be used to advance
the Springpole Gold Project through the PFS/FS process and will
also be used to advance the project through the federal and
provincial EA processes.
3.
Environmental Permitting and Baseline Data
First
Mining made key strategic additions to its Environment and
Community Relations team in 2020 to ensure that the Company has the
proper resources for the permitting and community relations work
for the Springpole Gold Project. Steve Lines joined First Mining as
Vice President, Environment and Community Relations on December 1,
2020, and has already built an expert team at the Company with
extensive experience in Ontario’s EA process. The team brings
across significant experience from Greenstone Gold Mines’
Hardrock project which was subject to the same federal and
provincial EA process that is currently underway for Springpole,
and they bring further permitting and regulatory experience from
similar in-lake open pit mines in Canada including the Meadowbank
Gold Mine and the Gahcho Kué Diamond Mine. First Mining
believes that the experience, expertise and relationships of Mr.
Lines and his team will contribute significantly to the ongoing
de-risking of the Springpole Gold Project.
First
Mining, and its predecessor Gold Canyon Resources, have been
actively collecting environmental baseline data necessary to
support an EA for the Springpole Gold Project since 2010. The
studies, both completed and ongoing, are focused on characterizing
all relevant biological and physical components of the aquatic and
terrestrial environments that may be impacted by, and may interact
with, the project.
First
Mining continues to advance the Springpole Gold Project through the
federal and provincial EA processes. The Company’s goal is to
prepare a coordinated EA document that meets the federal and
provincial requirements. Community consultation and engagement with
local Indigenous communities and other stakeholders is important to
First Mining and will remain on-going through the EA
process.
11
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
First
Mining plans to advance the development of the coordinated EA
document in 2021 in accordance with the federal EIS Guidelines and
the provincial EA Terms of Reference.
The Springpole permitting timeline is as follows:
The
final EIS guidelines outline federal information requirements for
the preparation of an EIS and were prepared after taking into
consideration comments received from federal departments, the
Ontario provincial ministry, Indigenous groups and the general
public. Currently, the Company is collecting environmental baseline
data and other information to prepare an EIS for Springpole. The
Company chose to continue to stay in the Canadian Environmental Assessment
Act, 2012 permitting
process and not move to the newly enacted Impact Assessment Act
process.
4.
Regional land acquisitions
On February 18, 2021, the Company entered into a three-year
option agreement pursuant to which First Mining may earn a 100%
interest in Exiro’s Swain Post property located in
northwestern Ontario through future cash and share payments of
approximately $250,000 to Exiro during the term of the option, and
by completing all assessment work requirements on the property
during the option term. The Swain Post property comprises 237
single cell mining claims covering nearly 5,000 hectares. It is
located approximately 5 km west of First Mining’s
western-most property boundary at Springpole.
On
April 29, 2021, the Company entered into an earn-in agreement with
Whitefish which gives First Mining the right to earn a 70% interest
in the Swain Lake project by making cash payments totaling $200,000
and share payments totaling $425,000, and by incurring at least
$500,000 worth of expenditures on the Swain Lake Property during
the first 3 years of the earn-in term. Upon completing the first
stage of the earn-in, First Mining will hold a 70% interest in the
Swain Lake Property and will have an additional period of 2 years
within which to acquire the remaining 30% of the project by paying
$1 million to Whitefish and issuing $1 million worth of First
Mining shares to Whitefish.
The
Swain Lake Property comprises of 82 single cell mining claims
covering 1,640 hectares. It is located approximately 2 km from
First Mining’s western-most property boundary at Springpole
and immediately to the east of the Swain Post
property.
12
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Cameron Gold Project, Ontario
The
Cameron Gold Project covers an area of 49,574 hectares in northern
Ontario and comprises 24 patented claims, 1,790 mining claims, 4
mining leases, and 7 Licenses of Occupation. The Cameron Gold
Project deposit is a greenstone‐hosted gold deposit and the
mineralization is mainly hosted in mafic volcanic rocks within a
northwest trending shear zone (Cameron Lake Shear Zone) which dips
steeply to the northeast. A technical report for the Cameron Gold
Project titled “Technical Report on the Cameron Gold Deposit,
Ontario, Canada” and dated January 17, 2017, was prepared by
Optiro Pty Limited in accordance with NI 43-101 and is available
under the Company’s SEDAR profile at www.sedar.com.
There is year-round road access to the property from the nearby
highway and power lines within 20 km.
During
the six months ended June 30, 2021, the most significant
expenditures at the Cameron Gold Project were:
●
$93,000
for site employees’ salaries and management salary
allocations;
●
$59,000
in connection with exploration and technical consulting;
and
●
$22,000
for provincial and municipal taxes.
13
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
On
December 3, 2020, the Company entered into an asset purchase
agreement with Metalore to acquire the East Cedartree claims. The
transaction closed on December 9, 2020. Under the terms of the
transaction, First Mining paid Metalore $3 million in cash and
issued 3 million First Mining Shares to Metalore. The East
Cedartree claims contain an existing Mineral Resource estimate that
was prepared in accordance with NI 43-101 and they encompass a
highly favourable geological setting for new gold discoveries in
close proximity to the existing deposits at the Company’s
Cameron and West Cedartree properties. The acquisition of the East
Cedartree claims consolidates First Mining’s land holdings at
Cameron into a single contiguous block and adds a further 3,200
hectares to the 49,574 hectares that First Mining already holds in
the district. As a result of the acquisition of the East Cedartree
claims, the Cameron Gold Project now covers an area of 52,774
hectares and comprises 24 patented claims, 2,002 mining claims, 4
mining leases, and 7 Licenses of Occupation.
Plans
at Cameron for 2021 include approximately 4,000 metres of drilling
to extend local understanding and identify new drill targets on the
project and in particular at the recently acquired East Cedartree
claims, plus continued local community consultations and ongoing
environmental permitting activities.
Pickle Crow Gold Project, Ontario
The
Pickle Crow Gold Project covers an area of 19,033 hectares and
comprises 104 patented claims and 932 mining claims. The area is
located in northwestern Ontario and is covered by the Treaty Nine
First Nations Agreement. A technical report for the Pickle Crow
Gold Project titled “An Updated Mineral Resource Estimate for
the Pickle Crow Property, Patricia Mining Division, Northwestern
Ontario, Canada” and dated June 15, 2018, was prepared by
Micon International Limited in accordance with NI 43-101 and is
available under the Company’s SEDAR profile at www.sedar.com.
Extensive infrastructure in place or proximal to the Pickle Crow
Gold Project includes a 200 tpd gravity mill on site, generators
and fuel storage and gravel road access to the property, and the
property is within 10 km of a regional airport at Pickle Lake. The
Pickle Crow Gold Project was a former high-grade operating mine
until the late 1960s.
Earn-In Agreement with Auteco Minerals
On March 12, 2020, the Company and Auteco executed the Auteco
Earn-In Agreement, pursuant to which Auteco can earn an 80%
interest in PC Gold, First
Mining’s then wholly-owned subsidiary that owns Pickle
Crow, through a two-stage earn-in over five years by
incurring a total of $10.0 million in qualifying expenditures,
issuing up to 125 million shares of Auteco to First Mining and
making a $4.1 million cash payment to First Mining. First Mining
will retain a 2.0% NSR royalty on Pickle Crow, of which 1.0% can be
bought back by Auteco for US$2.5 million. A more detailed summary
of the earn-in arrangement is set out in the news release dated
March 12, 2020.
During the year ended December 31, 2020, the Company received the
scheduled cash consideration of $100,000 and 25,000,000 shares of
Auteco with a fair value on receipt of $740,000 under the terms of
the Auteco Earn-in Agreement. In the three-months ended March 31,
2021, Auteco confirmed to the Company that it had completed the
Stage 1 earn-in exploration expenditure requirement of $5,000,000.
Auteco held a meeting of its shareholders in May 2021 to approve
the issuance of 100,000,000 Auteco shares to First Mining, and
having obtained shareholder approval and listing approval from the
Australian Securities Exchange (the “ASX”), Auteco issued the 100,000,000 Auteco
shares to First Mining on June 9, 2021. As a result, Auteco has
earned a 51% interest in PC Gold, First Mining’s previously
wholly-owned subsidiary and the parties executed the Auteco
JV Agreement in respect of PC Gold. Auteco now has a two-year
follow-on period, commencing as of the date of execution of the
Auteco JV Agreement, within which to acquire an additional 19%
interest in PC Gold per the Stage 2 Earn-In, in accordance with the
terms of the Auteco Earn-In Agreement.
Upon completion of the Stage 2 Earn-In, Auteco will have an option
to acquire an additional 10% equity interest in PC Gold,
exercisable any time following completion of the Stage 2 Earn-In,
by paying First Mining $3,000,000 in cash. First
Mining’s residual 20% interest in PC Gold (and thereby,
Pickle Crow) will be carried until a construction decision in
respect of Pickle Crow, which is to be made after a final
feasibility study and following Auteco having arranged sufficient
financing to achieve commercial production. If Auteco should fail to meet such requirements
within the applicable time periods, the Auteco Earn-In
Agreement will terminate and Auteco will be entitled to retain any
interest which it has earned-in to prior to the date of termination.
14
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Following
the completion of the Stage 1 earn-in by Auteco, First
Mining’s percentage ownership of the subsidiary PC Gold Inc.
was diluted from 100% to 49%, which led to a loss of control and a
deconsolidation of PC Gold from First Mining’s financial
statements. First Mining has determined that its investment in the
common shares of PC Gold gives it significant influence over PC
Gold, resulting in PC Gold being recorded on First Mining’s
financial statements using the equity method of accounting as an
investment in associate. PC Gold is now a subsidiary of Auteco.
Auteco is publicly traded on the ASX. The initial recognition of
the investment in associate was accounted for at a fair value using
a peer group analysis of comparable $/oz prices of the Pickle Crow
gold project. The gain/loss on deconsolidation was calculated as a
result of derecognizing the net assets of PC Gold and recognizing
the fair value of the investment in associate. The investment in
associate was assessed for impairment indicators relating to the
underlying assets of PC Gold in accordance with IAS 36 and IFRS
6.
On February 28, 2019, PC Gold received a letter from the Acting
Director, Mine Rehabilitation, at the Ontario Ministry of Energy,
Northern Development and Mines (“MENDM”), which required the Company to submit a
schedule for the development of a closure plan amendment for the
Pickle Crow Gold Project. The Company complied with the requirement
and submitted the schedule for the development of a closure plan
amendment on March 29, 2019. The submission of a closure plan
amendment complete with cost estimates was initially due on
November 1, 2019. PC Gold has been granted an extension and is
working with the Ministry towards the filing of the closure plan in
2021. PC Gold has engaged consultants to assist with developing
this plan. Pursuant to the Earn-In Agreement, the Company is
required to reimburse Auteco for a pro rata amount of its expenses
with respect to any related bond requirements for the mine closure
plan.
Hope Brook Gold Project, Newfoundland
The
Hope Brook Gold Project covers an area of 26,650 hectares in
Newfoundland, including six mineral licenses, with a deposit hosted
by pyritic silicified zones occurring within a deformed,
strike-extensive advanced argillic alteration zone. A technical
report for the Hope Brook Gold Project titled “2015 Mineral
Resource Estimate Technical Report for the Hope Brook Gold Project,
Newfoundland and Labrador, Canada” and dated November 20,
2015, was prepared by Mercator Geological Services Limited in
accordance with NI 43-101 and is available under the
Company’s SEDAR profile at www.sedar.com.
The
resource covers 1.5 km of an 8 km mineralized structure.
Substantial infrastructure at the property includes a ramp to 350
metres (“m”)
below surface with vent raise, line-power to site, commercial barge
and landing craft ramp, air strip, and a strong local labour force.
The Hope Brook Gold Project was a former operating gold mine that
produced 752,163 oz Au from 1987 to 1997.
Earn-In Agreement with Big Ridge Gold
On
April 6, 2021, First Mining announced that it had entered into the
Big Ridge Earn-In Agreement pursuant to which Big Ridge may earn up
to an 80% interest in Hope Brook.
Pursuant
to the agreement, Big Ridge can earn an 80% interest in Hope Brook
through a two-stage earn-in over five years by incurring a total of
$20 million in qualifying expenditures, issuing up to 36,500,000
shares of Big Ridge to First Mining and making a $500,000 cash
payment to First Mining. First Mining will retain a 1.5% NSR
royalty on Hope Brook, of which 0.5% can be bought back by Big
Ridge for $2 million. First Mining will also have the right to
nominate one member to the Board of Directors of Big Ridge (the
“Big Ridge
Board”) on closing, and thereafter, First Mining will
be entitled to have one of its nominees on the Big Ridge Board for
so long as First Mining owns at least 10% of the issued and
outstanding shares of Big Ridge. A more detailed summary of the Big
Ridge Earn-In Agreement is set out in our April 6, 2021 news
release, and in the June 8, 2021 news release which announced the
closing of the transaction.
In the
period ended June 30, 2021, the Company received $500,000 and
11,500,000 shares of Big Ridge upon closing the transaction, which
were credited against the Hope Brook project mineral property on
the Company’s Statement of Financial Position as at June 30,
2021. In addition, Ken Enquist, the Company’s COO, was
appointed to the Big Ridge Board as the Company’s nominee
under the terms of the Big Ridge Earn-In Agreement.
15
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Other Mineral Properties and Mineral Property
Interests
The
following table sets out the Company’s remaining projects by
region. These projects are 100%-owned by the Company with the
exception of the Duparquet Gold Project in which the Company has a
10% indirect ownership interest in the Duparquet Gold Project and a
100% interest in the Central Duparquet Property.
|
Canada
|
USA
|
|
Duquesne,
Québec (1)
|
Turquoise
Canyon, Nevada (2)
|
|
Pitt,
Québec
|
|
|
Duparquet,
Québec
|
|
|
Horseshoe
Island, Ontario
|
|
(1)
In connection with
an agreement entered into by Clifton Star Resources Inc.
("Clifton Star") on July 31,
2012, prior to its acquisition by First Mining, Clifton Star
purchased 0.5% of a 3% NSR royalty on the Duquesne Gold Project for
$1,000,000 in cash. Per the terms of this agreement, beginning June
2019, the remaining 2.5% NSR must be purchased over the ensuing
five years in tranches of 0.5% for $1,000,000 for each tranche.
Management is currently in discussions with the royalty owners
regarding potential amendments to the timing and amount of any
future payments related to this royalty repurchase.
(2)
Property under option to a private company, Momentum Minerals Ltd., in
which the Company has approximately 10% ownership and right to earn
in to 100% ownership position. On July 6, 2021 IM Exploration Inc.
announced it had closed the acquisition of all issued and
outstanding shares of Momentum Minerals Ltd.
Mineral Property Interest – Duparquet Gold Project,
Québec
The
Company, through its wholly-owned subsidiary Clifton Star, has a
10% equity interest in the shares of Beattie Gold Mines Ltd.,
2699681 Canada Ltd., and 2588111 Manitoba Ltd. which directly or
indirectly own various mining concessions and surface rights,
collectively known as the Duparquet Gold Project.
The
Duparquet Gold Project has a large open-pittable resource, as well
as underground and tailings resource. The Company’s interest
in the Duparquet Gold Project was acquired through our acquisition
of Clifton Star in 2016. The Duparquet Gold Project covers an area
of 1,147 hectares and is located in the Abitibi Region of
Québec, one of the world's most prolific gold producing
regions. A technical report for the Duparquet Gold Project entitled
“Technical Report and Prefeasibility Study for the Duparquet
Project” and with an effective date of March 26, 2014, was
completed by InnovExplo in accordance with NI 43-101 and was filed
on SEDAR by Clifton Star on May 23, 2014. The 2014 PFS for the
Duparquet Gold Project includes pre-production capital costs of
$394 million, a pay-back period of 4.3 years and pre-tax
NPV5%
of $222 million at US$1,300 per ounce of gold.
In
addition to the 10% indirect interest in the Duparquet Gold
Project, the Company also holds a 100% interest in the adjoining
Central Duparquet Property, which was purchased on January 20,
2017. This additional ground comprises 16 claims covering 339 ha.
Infrastructure includes site roads, access to electrical power 15
km away, tailings storage facility and water management solutions
and ancillary site buildings.
16
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Québec Mineral Property Portfolio Locations
NSRs owned by or available to First Mining
Through
recent transactions, First Mining has created the following
portfolio of twenty existing and potential NSR royalties on certain
of our mineral properties and property interests. The Company is
currently evaluating potential strategic opportunities available to
enhance and optimize the value of the royalty
portfolio.
|
Royalty
|
NSR Rate
|
Key Terms
|
|
Pickle
Crow (Ontario, Canada)
|
2.00%
|
1.00%
buy-back for US$2.5 million
|
|
Hope
Brook (Newfoundland, Canada)
|
1.50%
|
0.5%
buy-back for $2.0 million
|
|
Goldlund
(Ontario, Canada)
|
1.50%
|
0.5%
buy-back for $5.0 million
|
|
Mexican
Projects (1)
(11
including Las Margaritas)
|
1.00%
|
1.00%
buy-back for US$1.0 million on each project
|
|
Turquoise
Canyon (Nevada, USA)
|
2.00%
|
1.00%
buy-back for US$1.0 million
|
|
Joutel,
Québec
|
1.00%
|
No
buy-back option
|
|
Morris,
Québec
|
1.00%
|
No
buy-back option
|
|
Ronguen
(Burkina Faso)
|
1.00%
|
1.00%
buy-back for US$1.0 million
|
|
Pompoi
(Burkina Faso)
|
1.50%
|
1.50%
buy-back for $1.5 million
|
|
Lac
Virot Iron Ore (Labrador, Canada)
|
2.00%
|
1.00%
buy-back for $1.0 million
|
(1)
The
Mexican projects NSRs include: Sonora - Miranda, Apache, Socorro,
San Ricardo, Los Tamales, Puertecitos, Batacosa; Durango –
Las Margaritas; Oaxaca – Geranio, Lachatao, El
Roble.
Note that the Pickle Crow NSR in the above table will only be
granted to us upon Auteco successfully completing its Stage 2
Earn-in. Similarly, the Hope Brook NSR in the above table will only
be granted to us upon Big Ridge successfully completing its Stage 1
Earn-in. Neither of these two NSRs are in existence as of the date
of this MD&A.
For further information on all of the Company’s mineral
properties, see the Company’s AIF for the year ended December
31, 2020 which is available under the Company’s SEDAR profile
at www.sedar.com,
as an exhibit to the Company’s Form 40-F on EDGAR at
www.sec.gov.
17
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
SELECTED QUARTERLY FINANCIAL INFORMATION
|
Financial
Results (in $000s Except for per Share Amounts):
|
|
|
|
|
|
|
|
|
|
|
2021-Q2
|
2021-Q1
|
2020-Q4
|
2020-Q3
|
2020-Q2
|
2020-Q1
|
2019-Q4
|
2019-Q3
|
|
Net
Income (Loss) $
|
$(1,285)
|
$(33,001)
|
$530
|
$(12,352)
|
$(19,531)
|
$(1,462)
|
$(2,274)
|
(1,643)
|
|
Impairment of
non-current assets
|
-
|
23,555
|
-
|
2,372
|
22,498
|
-
|
-
|
341
|
|
Total cash used in
operating activities (2)
|
(1,940)
|
(1,874)
|
(725)
|
(1,056)
|
(1,128)
|
(1,313)
|
(1,037)
|
(1,349)
|
|
Basic and Diluted
Net Income (Loss) Per Share (in dollars) (3)
|
(0.00)
|
(0.05)
|
0.00
|
(0.02)
|
(0.03)
|
(0.00)
|
(0.00)
|
(0.01)
|
|
Financial Position (in $000s):
|
|||||||||||||||||
|
Cash
and Cash Equivalents
|
|
33,762
|
|
39,174
|
|
28,901
|
|
32,477
|
|
6,475
|
|
10,497
|
|
5,902
|
|
5,687
|
|
|
Working
Capital (1)
|
|
34,898
|
|
19,893
|
|
9,201
|
|
14,324
|
|
8,596
|
|
9,946
|
|
5,780
|
|
8,360
|
|
|
Investments
|
|
20,450
|
|
13,907
|
|
18,425
|
|
24,016
|
|
5,601
|
|
1,398
|
|
1,775
|
|
3,503
|
|
|
Mineral
Properties
|
|
160,322
|
|
186,761
|
|
179,429
|
|
168,188
|
|
159,630
|
|
256,532
|
|
252,815
|
|
248,509
|
|
|
Investment
in Treasury Metals Inc.
|
|
16,236
|
|
39,867
|
|
63,812
|
|
62,833
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Investments
in PC Gold Inc.
|
|
35,999
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
Investment
in Big Ridge Gold Corp.
|
|
1,577
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Assets
|
|
299,750
|
|
287,856
|
|
301,213
|
|
296,343
|
|
258,044
|
|
276,776
|
|
268,020
|
|
263,470
|
|
|
Total
Non-Current Liabilities
|
$
|
31,855
|
|
32,522
|
$
|
16,835
|
$
|
15,332
|
$
|
1,959
|
$
|
3,306
|
$
|
3,139
|
$
|
-
|
|
(1)
These
are non-IFRS measures with no standardized meaning under IFRS. For
further information and a detailed reconciliation, please refer to
the section in this MD&A titled “Non-IFRS
Measures”.
(2)
Per
the consolidated statements of cash flows in each of the
corresponding periods presented.
(3)
The
basic and diluted loss per share calculations result in the same
amount due to the anti‐dilutive effect of outstanding stock
options and warrants in all periods.
Key trends in the quarterly results are as follows:
Net loss - quarter
to quarter fluctuations are typically due to the timing of non-cash
items. Share-based payments expense, which fluctuates due to the
timing and number of stock option grants together with the
associated fair value dollar amount calculated at the time of the
grant, is one of the more common examples. In addition to
non-recurring impairment charges which are required as and when
facts dictate, the other key non-cash items are fair value
movements on the Silver Stream derivative liability and certain
investments based on underlying market prices at period end. As can
be seen in the table above, the fluctuation in cash used in
operating activities does not tend to vary nearly as much as net
loss.
Cash and cash equivalent – fluctuations are
principally due to the amount and timing of cash used to fund
investing activities at the Company’s mineral property
portfolio, offset by the success of financings provided by private
placements, public offerings, and the exercise of options and
warrants to support such activities.
Total assets – quarterly changes are the direct
result of fluctuations described above in cash and cash equivalents
and investments in the current asset category, and due to mineral
property expenditure additions and more recently the equity loss
and impairments of investment in Treasury Metals, PC Gold and Big
Ridge Gold, all of which are in the non-current asset
category.
18
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Non-current liabilities – changes occur predominantly due to
the Silver Stream derivative liability which is measured at fair
value at each period end date.
RESULTS OF CONTINUING
OPERATIONS
Unless
otherwise stated, the following financial data was prepared on a
basis consistent with IFRS and extracted from the Company’s
unaudited condensed interim consolidated financial
statements:
Second Quarter 2021 Compared to Second Quarter 2020
For the
three months ended June 30, 2021, net loss for the period has
decreased by $18,248,000 compared to the three months ended June
30, 2020. The most significant components of this overall change
are explained by the following:
|
Income Statement Category
|
Variance between
Periods - (Increase) decrease
|
Explanation
|
|
Loss
from operational activities
|
|
|
|
Investor relations
and marketing communications
|
$(713,000)
|
Increase due to
increases in marketing expenditures and higher share-based payment
expense allocation.
|
|
Impairment of
non-current assets (non-cash)
|
$22,498,000
|
Relates to the
impairment of the Goldlund mineral property in the prior period
which was based on the recoverable amount per terms of the Share
Purchase Agreement with Treasury Metals.
|
|
Other
items
|
|
|
|
Gain on
deconsolidation of subsidiary (non-cash)
|
$8,830,000
|
Following
completion of the Stage 1 earn-in by Auteco, First Mining’s
percentage ownership of PC Gold was reduced from 100% to 49% which
led to a loss of control and deconsolidation of PC Gold. The
resultant gain was calculated as the recognized fair
value/consideration received less PC Gold’s net assets
derecognized from First Mining’s balance sheet.
|
|
Change in fair
value on Silver Stream derivative liability (non-cash)
|
$(2,400,000)
|
Fair value loss on
the silver stream derivative primarily the result of changes to the
silver price futures curve which was marginally offset by changes
to the estimated credit spread since the prior period.
|
|
Investments fair
value loss (non-cash)
|
$3,167,000
|
Reduced fair value
gain between periods primarily due to the significant increase in
the Auteco share price in the prior period which was not consistent
in the current period end.
|
|
Deferred income tax
recovery (non-cash)
|
$1,385,000
|
Prior period
deferred income tax recovery resulting from the reversal of tax
expenses connected with the Goldlund mineral property impairment
following the Share Purchase Agreement with Treasury
Metals.
|
|
|
|
|
|
Net
loss for the period
|
$18,248,000
|
Predominantly
relates to the reduced impairment of non-current assets and the
recorded gain on deconsolidation of PC Gold.
|
|
|
|
|
|
Other
comprehensive income (loss)
|
|
|
|
Investments fair
value gain (non-cash)
|
$1,995,000
|
The fair value
gains on marketable securities recorded through OCI were higher
than the prior period.
|
|
|
|
|
|
Net
loss and comprehensive income
|
$20,586,000
|
Predominantly
relates to the reduced impairment of non-current assets and the
recorded gain on deconsolidation of PC Gold.
|
19
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Two Quarters ended 2021 Compared to Two Quarters ended
2020
For the
six months ended June 30, 2021, net loss for the period has
increased by $13,293,000 compared to the six months ended June 30,
2020. The most significant components of this overall change are
explained by the following:
|
Income Statement Category
|
Variance between
Periods - (Increase) decrease
|
Explanation
|
|
Loss
from operational activities
|
|
|
|
General and
administration
|
$(617,000)
|
Increase is
primarily due to higher share-based payment expense as a result of
the number of grants and fair value of grants being higher when
compared to the prior year. In addition, professional fees were
higher due to the increased legal expenditures associated with
corporate transactional activities.
|
|
Investor relations
and marketing communications
|
$(887,000)
|
Increase due to
increases in marketing expenditures and higher share-based payment
expense allocation.
|
|
Impairment of
non-current assets (non-cash)
|
$(1,057,000)
|
Relates to the
comparative increase in the impairment recorded for the reduction
in the equity accounted interest of Treasury metals ($23,555,000)
when compared with the prior period write-down of the Goldlund
mineral property which was based on the recoverable amount per
terms of the Share Purchase Agreement with Treasury Metals
($22,498,000).
|
|
Other
items
|
|
|
|
Gain on
deconsolidation of subsidiary (non-cash)
|
$8,830,000
|
Following
completion of the Stage 1 earn-in by Auteco, First Mining’s
percentage ownership of PC Gold was reduced from 100% to 49% which
led to a loss of control and deconsolidation of PC Gold. The
resultant gain was calculated as the recognized fair
value/consideration received less PC Gold’s net assets
derecognized from First Mining’s balance sheet.
|
|
Change in fair
value on Silver Stream derivative liability (non-cash)
|
$(8,403,000)
|
Fair value loss on
the silver stream derivative primarily the result of decreases in
the estimated credit spread since the prior period and the result
of changes to the silver price futures curve at period
end.
|
|
Deferred income tax
recovery (non-cash)
|
$1,318,000
|
Prior period
deferred income tax recovery resulting from the reversal of tax
expenses connected with the Goldlund mineral property impairment
following the Share Purchase Agreement with Treasury
Metals.
|
|
Equity loss from
investment in Treasury Metals, PC Gold, Big Ridge
(non-cash)
|
$(5,688,000)
|
Reflects the
current year estimated equity loss pick-up for accounting purposes
on the Company’s equity investments Treasury Metals, PC Gold
and Big Ridge Gold, and any amounts recorded for associated losses
on dilution in the period.
|
|
|
|
|
|
Net
loss for the period
|
$(13,293,000)
|
Predominantly
relates to the recorded gain on deconsolidation of PC Gold which
was partially offset by fair value losses on the Silver Stream
derivative liability.
|
|
|
|
|
|
Other
comprehensive income (loss)
|
|
|
|
Investments fair
value gain (non-cash)
|
$2,721,000
|
The fair value
gains on marketable securities recorded through OCI were higher
than the prior period.
|
|
Mineral property
investments fair value loss (non-cash)
|
$(1,346,000)
|
The fair value loss
on mineral property investments recorded through OCI was higher
than the prior period.
|
|
|
|
|
|
Net
loss and comprehensive loss
|
$(11,334,000)
|
Predominantly
relates to the recorded gain on deconsolidation of PC Gold which
was partially offset by fair value losses on the Silver Stream
derivative liability.
|
20
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES
|
(in $000s)
|
Six months ended June 30,
|
|
|
|
2021
|
2020
|
|
CASH
PROVIDED BY (USED IN)
|
|
|
|
Operating
activities
|
$(3,814)
|
$(2,441)
|
|
Investing
activities
|
3,964
|
(6,263)
|
|
Financing
activities
|
4,875
|
9,327
|
|
Foreign exchange
effect on cash
|
(165)
|
2
|
|
CHANGE
IN CASH AND CASH EQUIVALENTS
|
4,861
|
625
|
|
Working
capital(1)
|
34,898
|
9,946
|
|
Cash and cash
equivalents, beginning
|
28,901
|
5,902
|
|
Cash
and cash equivalents, ending
|
$33,762
|
$6,527
|
(1)
Working capital is a non-IFRS measurement with no
standardized meaning under IFRS and may not be comparable to
similar financial measures presented by other issuers. For further
information and a detailed reconciliation, please see the section
“Non-IFRS Measures –
Working Capital”.
Key
reasons for variances from June 30, 2020 to June 30,
2021:
●
The
increase of $4,861,000 in cash and cash equivalents was primarily
due to cash proceeds from the sale of First Majestic shares and
cash received from First Majestic under the terms of the Silver
Purchase Agreement, offset by cash used in operating and other
investing activities;
●
Cash
used in operating activities is comparable between the second
quarter 2021 and second quarter 2020;
●
Cash
provided by investing activities increased due to the proceeds from
the sale of the First Majestic shares which were received in July
2020;
●
Cash
provided by financing activities decreased due to the prior period
private placement;
●
Working
capital increased due to the increase in cash and cash equivalents
as discussed above and a decrease in the obligation to distribute
investments as a result of the reduced fair value of Treasury
Metals shares and warrants.
Trends in Liquidity, Working Capital, and Capital
Resources
As at
June 30, 2021, the Company had working capital of $26,303,000
(December 31, 2020 – $9,201,000). The Company has no history
of revenues from its operating activities. The Company is not in
commercial production on any of its mineral properties and
accordingly does not generate cash from operations. During the six
months ended June 30, 2021, the Company had negative cash flow from
operating activities. The Company anticipates it will have negative
cash flow from operating activities in future periods for the
foreseeable future.
The
Company has, in the past and during the year ended December 31,
2020, financed its activities by raising capital through issuances
of new shares, other means such as the Silver Stream upfront
proceeds and/or sales of its investments in other companies. In
addition to adjusting spending, disposing of assets and seeking
other non-equity sources of financing, the Company remains reliant
on equity markets for raising capital until it can generate
positive cash flow from operations to finance its exploration and
development programs.
The
Company believes it has sufficient cash resources to maintain its
mineral properties in good standing for the next twelve
months.
21
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
OUTLOOK
We remain focused on advancing the Company’s strategic
objectives and near-term milestones, which include the
following:
●
Advancing
the Springpole EA processes which includes a focus on community,
indigenous rightsholder and stakeholder consultations.
●
Springpole
technical studies, including metallurgical work, geotechnical
optimization and further process optimization following the release
and publication of the PFS.
●
Springpole
exploration drilling to identify and follow-up on regional
targets.
●
Cameron drill
program (36 holes, 4,100 m) – to extend local understanding
and identify new targets.
●
Evaluating our
mineral properties in Québec and potential for partnership
opportunities.
●
Maintaining a
strong balance sheet and cash position
to fund investing activities consistent with First Mining’s
business strategy.
●
Providing support as needed to partnership
projects (Pickle Crow, Goldlund-Goliath, Hope Brook) which
will continue to enable the Company to
surface value from these direct and indirect
interests.
●
Establishing and initiating an environmental,
social and governance (“ESG”) reporting framework in
2021.
FINANCIAL INSTRUMENTS
All
financial instruments are required to be measured at fair value on
initial recognition. Fair value is based on quoted market prices
unless the financial instruments are not traded in an active
market. In this case, the fair value is determined by using
valuation techniques like the Black-Scholes option pricing model or
other valuation techniques. Measurement in subsequent periods
depends on the classification of the financial instrument. A
description of the Company’s financial instruments and their
fair value is included in the audited consolidated financial
statements for the year ended December 31, 2020, filed on SEDAR
at www.sedar.com
..
In the
normal course of business, the Company is inherently exposed to
certain financial risks, including market risk, credit risk and
liquidity risk, through the use of financial instruments. The
timeframe and the manner in which we manage these risks varies
based upon our assessment of these risks and available alternatives
for mitigation. We do not acquire or issue derivative financial
instruments for trading or speculative purposes. All transactions
undertaken are to support our operations.
RELATED PARTY TRANSACTIONS
Amounts
paid to related parties were incurred in the normal course of
business and measured at the amount agreed upon by the transacting
parties and on terms and conditions similar to non-related parties.
There were no transactions with related parties outside of the
ordinary course of business during the period ended June 30,
2021.
OFF-BALANCE SHEET ARRANGEMENTS
The Company has no off-balance sheet arrangements that have, or are
reasonably likely to have, a current or future effect on the
results of operations or financial condition of the Company
including, without limitation, such considerations as liquidity and
capital resources.
FINANCIAL LIABILITIES AND COMMITMENTS
The
Company’s financial liabilities as at June 30, 2021 are
summarized as follows:
|
(in $000s)
|
Carrying Amount
|
Contractual Amount
|
Less than 1 year
|
1 – 3 years
|
4 – 5 years
|
After 5 years
|
|
Accounts payable
and accrued liabilities
|
$1,428
|
$1,428
|
$1,428
|
$-
|
$-
|
$-
|
|
Obligation to
distribute investments
|
23,074
|
23,074
|
23,074
|
-
|
-
|
-
|
|
Lease
liability
|
499
|
596
|
164
|
334
|
98
|
-
|
|
Total
|
$25,001
|
$25,098
|
$24,666
|
$334
|
$98
|
$-
|
22
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
NON-IFRS MEASURES
Alternative
performance measures in this document such as “cash
cost”, “AISC” and “AIC” are furnished
to provide additional information. These non-IFRS performance
measures are included in this MD&A because these statistics are
used as key performance measures that management uses to monitor
and assess future performance of the Springpole Gold Project, and
to plan and assess the overall effectiveness and efficiency of
mining operations.
Certain Non-IFRS financial measures used in this MD&A and
common to the gold mining industry are defined below.
Total Cash Costs and Total Cash Costs per Gold Ounce –
Total Cash Costs are reflective of the
cost of production. Total Cash Costs reported in the PFS include
mining costs, processing, water & waste management costs,
on-site general & administrative costs, treatment &
refining costs, royalties and silver stream credits. Total Cash
Costs per Ounce is calculated as Total Cash Costs divided by total
LOM payable gold ounces.
All-in Sustaining Costs (“AISC”) and AISC per Gold
Ounce – AISC is
reflective of all of the expenditures that are required to produce
an ounce of gold from operations. AISC reported in the PFS includes
Total Cash Costs, sustaining capital and closure costs. AISC per
Ounce is calculated as AISC divided by total LOM payable gold
ounces.
In
addition, the Company has included non-IFRS measures in the annual
and quarterly info tables above. Working capital is calculated as
Current Assets less Current Liabilities. The Company believes that
these measures provide investors with an improved ability to
evaluate the performance of the Company.
Non-IFRS
measures do not have any standardized meaning prescribed under
IFRS. Therefore, such measures may not be comparable to similar
measures employed by other companies. The data is intended to
provide additional information and should not be considered in
isolation or as a substitute for measures of performance prepared
in accordance with IFRS.
ACCOUNTING POLICIES
The
Company’s significant accounting policies are in accordance
with IFRS and are contained in the audited consolidated financial
statements for the year ended December 31, 2020. There were no
changes in the Company’s accounting policies during the 2021
financial year to date.
CRITICAL ACCOUNTING ESTIMATES
The
preparation of the consolidated financial statements in conformity
with IFRS requires management to make judgments, estimates and
assumptions which affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities at
the date of the consolidated financial statements and the reported
amounts of revenues and expenses during the reporting period.
Estimates are based on historical experience and other factors
considered to be reasonable and are reviewed on an ongoing basis.
Revisions to estimates and the resulting effects on the carrying
amounts of the Company’s assets and liabilities are accounted
for prospectively.
Estimation
uncertainties are described in the Company’s audited
consolidated annual financial statements for the financial year
ended December 31, 2020.
CRITICAL ACCOUNTING JUDGMENTS
The
preparation of financial statements requires management to exercise
judgment in the process of applying its accounting policies.
Judgments are regularly evaluated and are based on
management’s experience and other factors, including
expectations about future events that are believed to be reasonable
under the circumstances. In preparing the Company’s unaudited
condensed interim consolidated financial statements for the three
and six months ended June 30, 2021, the Company used the same
accounting policies and methods of computation as in the
Company’s audited consolidated annual financial statements
for the financial year ended December 31, 2020. The following
section discusses significant accounting policy judgments which
have been made in connection with the condensed interim
consolidated financial statements for the three and six months
period ended June 30, 2021:
23
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Mineral Property Impairment Indicators
In
accordance with the Company’s accounting policy for mineral
properties, exploration and evaluation expenditures on mineral
properties are capitalized. There is no certainty that the
expenditures made by the Company in the exploration of its property
interests will result in discoveries of commercial quantities of
minerals. The Company applies judgment to determine whether
indicators of impairment exist for these capitalized
costs.
Management
uses several criteria in making this assessment, including the
period for which the Company has the right to explore, expected
renewals of exploration rights, whether substantive expenditures on
further exploration and evaluation of mineral properties are
budgeted, and evaluation of the results of exploration and
evaluation activities up to the reporting date.
Impairment of Investment in Associates
With
respect to its investments in Treasury Metals, PC Gold and Big
Ridge Gold, which are accounted for using the equity method, the
Company is required to make estimates and judgments about future
events and circumstances and whether the carrying amount of the
asset exceeds its recoverable amount. Recoverability of each
investment depends on various factors, including the identification
of economic recoverability of reserves at the respective
exploration properties, the ability for each company to obtain the
necessary financing to complete the development, and future
profitable production or proceeds from the disposition of the
underlying company shares themselves. The publicly quoted share
price of each company, where applicable, is also a source of
objective evidence about the recoverable amount of the equity
investment.
ACCOUNTING STANDARDS ISSUED BUT NOT YET APPLIED
There
are no IFRS or International Financial Reporting Interpretations
Committee interpretations that are not yet effective that would be
expected to have a material impact on the Company’s
consolidated financial statements.
RISKS AND UNCERTAINTIES
The
Company is subject to a number of risks and uncertainties, each of
which could have an adverse effect on its business operations or
financial results. Some of these risks and uncertainties are
detailed below. For a comprehensive list of the Company’s
risks and uncertainties, see the Company’s AIF for the year
ended December 31, 2020 under the heading “Risks that can
affect our business”, which is available under our SEDAR
profile at www.sedar.com,
and on EDGAR as an exhibit to Form 40-F.
Risks related to Financial Instruments
The
Company thoroughly examines the various financial instruments and
risks to which it is exposed and assesses the impact and likelihood
of those risks. These risks include market risk (including equity
price risk, foreign currency risk, interest rate risk and commodity
price risk), credit risk, liquidity risk, and capital risk. Where
material, these risks are reviewed and monitored by the
Board.
The
Board has overall responsibility for the determination of the
Company’s risk management objectives and policies. The
overall objective of the Board is to set policies that seek to
reduce risk as much as possible without unduly affecting the
Company’s competitiveness and flexibility.
a)
Market
Risk
Market risk is the risk that the fair value of future cash flows of
a financial instrument will fluctuate due to changes in market
prices. Market risk includes equity price risk, foreign currency
risk, interest rate risk and commodity price risk.
Equity Price Risk
The Company is exposed to equity price risk as a result of holding
investments in equity securities of several other mineral property
related companies.
If the fair value of our investments in equity instruments
designated as FVTPL had been 10% higher or lower as at June 30,
2021, net loss for the three months ended June 30, 2021 would have
decreased or increased, respectively, by approximately $1,700,000
(2020 – $80,000. If the fair value of our investments in
equity instruments designated as FVTOCI had been 10% higher or
lower as at June 30, 2021, other comprehensive income (loss) for
the six months ended June 30, 2021 would have decreased or
increased, respectively, by approximately $550,000 (2020 –
$713,000).
24
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Foreign Currency Risk
The Company is exposed to financial risk related to the fluctuation
of foreign exchange rates. As at June 30, 2021, the Company was
exposed to currency risk on the following financial instruments
denominated in US$: Cash and cash equivalents ($2,700,000) and the
Silver Stream derivative liability ($25,391,000), for a net
liability exposure of $22,691,000. The sensitivity of the
Company’s net loss due to changes in the exchange rate
between the US$ against the Canadian dollar is therefore $2,269,000
Canadian dollar equivalents based on a 10% change in currency
exchange rates.
Interest Rate Risk
Interest rate risk is the risk that future cash flows will
fluctuate as a result of changes in market interest rates. The
Company does not have any borrowings that are subject to
fluctuations in market interest rates. Interest rate risk is
limited to potential decreases on the interest rate offered on cash
and cash equivalents held with chartered Canadian financial
institutions. The Company manages its interest rate risk by
maximizing the interest income earned on excess funds while
maintaining the necessary liquidity to conduct its day-to-day
operations. The Company considers this risk to be
immaterial.
Commodity price risk
The Company is subject to commodity price risk from fluctuations in
the market prices for gold and silver. Commodity price risks are
affected by many factors that are outside the Company’s
control including global or regional consumption patterns, the
supply of and demand for metals, speculative activities, the
availability and costs of metal substitutes, inflation, and
political and economic conditions. The financial instrument
impacted by commodity prices is the Silver Stream derivative
liability.
b)
Credit
Risk
Credit risk is the risk of financial loss to the Company if a
counterparty to a financial instrument fails to meet its
contractual obligations. Financial instruments which are
potentially subject to credit risk for the Company consist
primarily of cash and cash equivalents, accounts and other
receivables, and the reclamation deposit. The Company considers
credit risk with respect to its cash and cash equivalents to be
immaterial as cash and cash equivalents are mainly held through
high credit quality major Canadian financial institutions as
determined by ratings agencies. As a result, the Company does not
anticipate any credit losses.
c)
Liquidity
Risk
Liquidity
risk is the risk that the Company will not be able to meet its
financial obligations as they become due. The Company’s
policy is to ensure that it will have sufficient cash to allow it
to meet its liabilities when they become due, under both normal and
stressed conditions, without incurring unacceptable losses or
risking damage to the Company’s reputation. The Company
manages its liquidity risk by preparing annual estimates of
exploration and administrative expenditures and monitoring actual
expenditures compared to the estimates to ensure that there is
sufficient capital on hand to meet ongoing
obligations.
See the
section of this MD&A entitled “Financial Liabilities and
Commitments” for a summary of the maturities of the
Company’s financial liabilities as at June 30, 2021 based on
the undiscounted contractual cash flows.
25
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
As at
June 30, 2021, the Company had cash and cash equivalents of
$33,762,000 (December 31, 2020 – $28,901,000).
d)
Capital
Risk Management
The
Company’s objectives when managing capital are to safeguard
the Company’s ability to continue as a going concern in order
to pursue the exploration and retention of its mineral properties.
The Company has historically demonstrated the ability to raise new
capital through equity issuances and/or through surplus cash as
part of its acquisitions. In the management of capital, the Company
includes the components of shareholders’ equity as well as
cash. The Company prepares annual estimates of exploration and
administrative expenditures and monitors actual expenditures
compared to the estimates to ensure that there is sufficient
capital on hand to meet ongoing obligations.
Other Risk Factors
Financing Risks
The
Company has finite financial resources, has no current source of
operating cash flow and has no assurance that additional funding
will be available to it for its future activities, including
exploration or development of mineral projects. Such further
activities may be dependent upon the Company’s ability to
obtain financing through equity or debt financing or other
means. Failure to obtain additional financing could result in
delay or indefinite postponement of exploration and development of
the Company’s existing mineral projects and could result in
the loss of one or more of its properties.
Exploration and Development Risks
The
exploration for and development of minerals involves significant
risks, which even a combination of careful evaluation, experience
and knowledge may not eliminate. These risks include:
●
few
properties that are explored are ultimately developed into
producing mines;
●
there
can be no guarantee that the estimates of quantities and qualities
of minerals disclosed will be economically
recoverable;
●
with
all mining operations there is uncertainty and, therefore, risk
associated with operating parameters and costs resulting from the
scaling up of extraction methods tested in pilot conditions;
and
●
mineral
exploration is speculative in nature and there can be no assurance
that any minerals discovered will result in an increase in our
resource base.
Exploration
and development of mineral properties is capital intensive and
unsuccessful exploration or development programs could have a
material adverse impact on the Company’s operations and
financial condition.
Global Financial Conditions
Global
financial conditions have, at various times in the past and may, in
the future, experience extreme volatility. Many industries,
including the mining industry, are impacted by volatile market
conditions. Global financial conditions may be subject to sudden
and rapid destabilizations in response to economic shocks or other
events, such as developments concerning COVID-19. A slowdown in the
financial markets or other economic conditions, including but not
limited to consumer spending, employment rates, business
conditions, inflation, fluctuations in fuel and energy costs,
consumer debt levels, lack of available credit, the state of the
financial markets, interest rates and tax rates, may adversely
affect the Company’s growth and financial condition. Future
economic shocks may be precipitated by a number of causes,
including government debt levels, fluctuations in the price of oil
and other commodities, volatility of metal prices, geopolitical
instability, changes in laws or governments, war, terrorism, the
volatility of currency exchanges, inflation or deflation, the
devaluation and volatility of global stock markets, pandemics and
natural disasters. Any sudden or rapid destabilization of global
economic conditions could impact the Company’s ability to
obtain equity or debt financing in the future on terms favourable
to the Company or at all. In such an event, the Company’s
operations and financial condition could be adversely
impacted.
26
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
Public Health Crises
The
Company's business, operations and financial condition could be
materially adversely affected by the outbreak of epidemics,
pandemics or other health crises, such as COVID-19, and by
reactions by government and private actors to such outbreaks. As at
the date of this MD&A, the global reactions to the spread of
COVID-19 have led to, among other things, significant restrictions
on travel, quarantines, temporary business closures and a general
reduction in consumer activity. While these effects are expected to
be temporary, the duration of the disruptions to business
internationally and the related financial impact cannot be
estimated with any degree of certainty at this time. Such public
health crises can result in disruptions and extreme volatility in
financial markets and global supply chains as well as declining
trade and market sentiment and reduced mobility of people, all of
which could impact commodity prices, interest rates, credit
ratings, credit risk, availability of financing and inflation. The
risks to the Company of such public health crises also include
risks to employee health and safety and may result in a slowdown or
temporary suspension of operations at some or all of the Company's
mineral properties as well as its head office. Although the Company
has the capacity to continue certain administrative functions
remotely, many other functions, including the conduct of
exploration and development programs, cannot be conducted remotely
and may be impacted or delayed if the Company experiences
limitations on employee mobility. At this point, the extent to
which COVID-19 may impact the Company remains uncertain; however,
it is possible that COVID-19 could have a material adverse effect
on the Company's business, results of operations and financial
condition. There can be no assurances that the Company will not be
required to further demobilize its personnel and contractors at any
of its mineral projects due to the ongoing COVID-19 pandemic. Any
such demobilization may have an adverse impact on the
Company’s ability to conduct exploration and further advance
its work programs on the affected properties.
Risks Generally
For a
comprehensive discussion of the risks and uncertainties that may
have an adverse effect on the Company's business, operations and
financial results, refer to the Company’s latest AIF for the
year ended December 31, 2020 filed with Canadian securities
regulatory authorities at www.sedar.com,
and filed under Form 40-F with the United States Securities
Exchange Commission at www.sec.gov/edgar.html.
The AIF, which is filed and viewable on www.sedar.com
and www.sec.gov/edgar.html,
is available upon request from the Company.
QUALIFIED PERSONS
Hazel
Mullin, P.Geo., Director of Data Management and Technical Services
at First Mining, is a Qualified Person as defined by NI 43-101, and
is responsible for the review and verification of the scientific
and technical information in this MD&A.
SECURITIES OUTSTANDING
As at
the date on which this MD&A was approved and authorized for
issue by the Board, the Company has 700,060,308 common shares
issued and outstanding; 89,792,392 warrants outstanding; 45,390,000
options outstanding; 1,550,000 restricted stock units outstanding;
and 303,000 deferred stock units outstanding.
DISCLOSURE CONTROLS AND PROCEDURES
The
Company’s Management, with the participation of its Chief
Executive Officer (“CEO”) and its Chief Financial
Officer (“CFO”),
have evaluated the effectiveness of the Company’s disclosure
controls and procedures. Based upon the results of that evaluation,
the Company’s CEO and CFO have concluded that, as of June 30,
2021, the Company’s disclosure controls and procedures were
effective to provide reasonable assurance that the information
required to be disclosed by the Company in reports it files is
recorded, processed, summarized and reported, within the
appropriate time periods and is accumulated and communicated to
Management, including the CEO and CFO, as appropriate to allow
timely decisions regarding required disclosure.
MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING
The
Company’s Management, with the participation of its CEO and
CFO, is responsible for establishing and maintaining adequate
internal control over financial reporting as such term is defined
in the SEC’s rules and the rules of the Canadian Securities
Administrators. The Company’s internal control over financial
reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the
preparation of annual financial statements for external purposes in
accordance with IFRS as issued by the International Accounting
Standards Board. The Company’s internal control over
financial reporting includes policies and procedures
that:
●
address
maintaining records that accurately and fairly reflect, in
reasonable detail, the transactions and dispositions of assets of
the Company;
●
provide
reasonable assurance that transactions are recorded as necessary
for preparation of financial statements in accordance with
IFRS;
●
provide
reasonable assurance that the Company’s receipts and
expenditures are made only in accordance with authorizations of
Management and the Company’s Directors; and
●
provide
reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use, or disposition of the
Company’s assets that could have a material effect on the
Company’s consolidated financial statements.
27
|
FIRST
MINING GOLD CORP.
|
Management’s
Discussion & Analysis
|
|
(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
|
The
Company’s internal control over financial reporting may not
prevent or detect all misstatements because of inherent
limitations. Additionally, projections of any evaluation of
effectiveness for future periods are subject to the risk that
controls may become inadequate because of changes in conditions or
deterioration in the degree of compliance with the Company’s
policies and procedures.
In the
first quarter of 2020, the Company’s employees began to work
remotely. Since then, the Company has reopened its offices and its
employees have performed their duties through a combination of
working remotely and in the office. This change has required
certain processes and controls that were previously done or
documented manually to be completed and retained in electronic
form. Despite the changes required by the current environment,
there have been no significant changes in our internal controls
during the quarter ended June 30, 2021 that have materially
affected, or are likely to materially affect, the Company’s
internal control over financial reporting.
LIMITATIONS OF CONTROLS AND PROCEDURES
The
Company’s Management, including the CEO and CFO, believes
that any disclosure controls and procedures or internal control
over financial reporting, no matter how well conceived and
operated, may not prevent or detect all misstatements because of
inherent limitations. Further, the design of a control system must
reflect the fact that there are resource constraints, and the
benefits of controls must be considered relative to their costs.
Because of the inherent limitations in all control systems, they
cannot provide absolute assurance that all control issues and
instances of fraud, if any, within the Company have been prevented
or detected. These inherent limitations include the realities that
judgments in decision-making can be faulty, and that breakdowns can
occur because of a simple error or mistake. Additionally, controls
can be circumvented by the individual acts of some persons, by
collusion of two or more people, or by unauthorized override of the
control. The design of any control system is also based in part
upon certain assumptions about the likelihood of future events, and
there can be no assurance that any design will succeed in achieving
its stated goals under all potential future conditions.
Accordingly, because of the inherent limitations in a
cost-effective control system, misstatements due to error or fraud
may occur and may not be detected.
FORWARD-LOOKING INFORMATION
This
MD&A is based on a review of the Company’s operations,
financial position and plans for the future based on facts and
circumstances as of June 30, 2021. This MD&A contains
“forward-looking statements” within the meaning of
applicable Canadian securities regulations (collectively,
“forward-looking
statements”). Any statements that express or involve
discussions with respect to predictions, expectations, beliefs,
plans, projections, objectives, assumptions or future events or
performance (often, but not always, using words or phrases such as
“seek”, “anticipate”, “plan”,
“continue”, “estimate”,
“expect”, “may”, “will”,
“project”, “predict”,
“forecast”, “potential”,
“targeting”, “intend”, “could”,
“might”, “should”, “believe”
and similar expressions) are not statements of historical fact and
may be “forward-looking statements”. These statements
relate to future events or the Company’s future performance,
business prospects or opportunities. Forward-looking statements
include, but are not limited to: statements regarding the
advancement of the Company’s mineral assets towards
production; statements regarding the potential for the Company to
acquire additional mineral assets in the future; statements
regarding the next stages and anticipated timing of the
metallurgical study or the environmental, permitting at the
Springpole Gold Project; statements regarding opportunities to
enhance project economics identified under the PFS for the
Springpole Gold Project; statements regarding the targeted
submission date for the EIS in relation to the Springpole Gold
Project; statements regarding the potential increase in gold and
silver recoveries at the Springpole Gold Project; statements
regarding the anticipated receipt, timing and use of proceeds
received by First Mining pursuant to the Silver Purchase Agreement;
statements regarding the Company’s intentions and
expectations regarding exploration, infrastructure and production
potential of any of its mineral properties; statements relating to
the Company's working capital, capital expenditures and ability and
intentions to raise capital; statements regarding the potential
effects of financing on the Company's capitalization, financial
condition and operations; forecasts relating to mining, development
and other activities at the Company’s operations; forecasts
relating to market developments and trends in global supply and
demand for gold; statements relating to future global financial
conditions and the potential effects on the Company; statements
relating to future work on the Company’s non-material
properties; statements relating to the Company’s mineral
reserve and mineral resource estimates; statements regarding
regulatory approval and permitting including, but not limited to,
EA approval for the Springpole Gold Project and the expected timing
of such EA approval; statements regarding the Company’s
anticipated timing to receive final approval from the MECP of the
Terms of Reference for the Springpole Gold Project, and
consultations in respect thereof; statements regarding the
Company's compliance with laws and regulations including, but not
limited to environmental laws and regulations; statements regarding
the Pickle Crow Gold Project Earn-In Agreement and payouts, share
issuances and exploration expenditure commitments thereunder;
statements regarding the Company’s engagement with local
stakeholders; statements regarding the Company's ability to enter
into agreements with local stakeholders including, but not limited
to, local Indigenous groups; statements regarding the potential
impact of the COVID-19 pandemic; statements regarding key
personnel; statements regarding non-IFRS measures and changes in
accounting standards; statements relating to the limitation of the
Company's internal controls over financial reporting; and
statements regarding the preparation or conduct of studies and
reports and the expected timing of the commencement and completion
of such studies and reports.
28
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FIRST
MINING GOLD CORP.
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Management’s
Discussion & Analysis
|
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(Expressed
in Canadian dollars, unless otherwise indicated)
|
For the three and six months ended June 30,
2021
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There
can be no assurance that such statements will prove to be accurate,
and future events and actual results could differ materially from
those anticipated in such statements. Important factors that could
cause actual results to differ materially from the Company’s
expectations are disclosed under the heading “Risks that can affect our
business” in the Company’s AIF for the year
ended December 31, 2020 and other continuous disclosure documents
filed from time to time via SEDAR with the applicable Canadian
securities regulators. Forward-looking statements are based on the
estimates and opinions of management on the date the statements are
made, and the Company does not undertake any obligation to update
forward-looking statements should conditions or our estimates or
opinions change, except as required by applicable laws. Actual
results may differ materially from those expressed or implied by
such forward-looking statements. These statements involve known and
unknown risks, uncertainties, and other factors that may cause the
Company’s actual results, levels of activity, performance or
achievements to be materially different from any future results,
levels of activity, performance or achievement expressed or implied
by these forward-looking statements.
The
Company believes that the expectations reflected in any such
forward-looking statements are reasonable, but no assurance can be
given that these expectations will prove to be correct and such
forward-looking statements included herein this MD&A should not
be unduly relied upon.
CAUTIONARY NOTE TO U.S. INVESTORS REGARDING MINERAL RESOURCE AND
MINERAL RESERVE ESTIMATES
This
MD&A has been prepared in accordance with the requirements of
Canadian securities laws, which differ in certain material respects
from the disclosure requirements of United States securities laws.
The terms “mineral
reserve”, “proven mineral reserve” and
“probable mineral
reserve” are Canadian mining terms as defined in
accordance with NI 43-101 and the Canadian Institute of Mining,
Metallurgy and Petroleum (“CIM”) 2014 Definition Standards on
Mineral Resources and Mineral Reserves, adopted by the CIM Council,
as may be amended from time to time. These definitions differ from
the definitions in the United States Securities and Exchange
Commission (the “SEC”) rules applicable to domestic
United States companies. In addition, the terms “mineral resource”,
“measured mineral
resource”, “indicated mineral resource” and
“inferred mineral
resource” are defined under the 2014 CIM definition
standards, and are required to be disclosed by NI 43-101. However,
these terms are not defined under the SEC rules applicable to
domestic United States companies. Accordingly, information
concerning mineral deposits set forth or incorporated by reference
in this MD&A may not be comparable with information made public
by companies that report in accordance with U.S.
standards.
29
Exhibit 99.3
FORM
52-109F2
CERTIFICATION
OF INTERIM FILINGS
FULL
CERTIFICATE
I,
Daniel W. Wilton, Chief Executive Officer of First Mining Gold
Corp., certify the following:
1.
Review: I have
reviewed the interim financial report and interim MD&A
(together, the “interim
filings”) of First Mining Gold Corp. (the
“issuer”) for
the interim period ended June 30, 2021.
2.
No
misrepresentations: Based on my knowledge, having exercised
reasonable diligence, the 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,
for the period covered by the interim filings.
3.
Fair presentation:
Based on my knowledge, having exercised reasonable diligence, the
interim financial report together with the other financial
information included in the 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 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 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 interim filings are
being prepared; and
(ii)
information
required to be disclosed by the issuer in its annual filings,
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 the 2013
Internal Control –
Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO).
5.2
N/A.
5.3
N/A.
6.
Reporting changes in
ICFR: The issuer has disclosed in its interim MD&A any
change in the issuer’s ICFR that occurred during the period
beginning on April 1, 2021 and ended on June 30, 2021 that has
materially affected, or is reasonably likely to materially affect,
the issuer’s ICFR.
|
|
|
|
|
|
|
|
|
|
|
Date: August 16,
2021.
|
By:
|
/s/
Daniel
W. Wilton
|
|
|
|
|
Daniel W.
Wilton
|
|
|
|
|
Chief Executive
Officer
|
|
Exhibit 99.4
FORM
52-109F2
CERTIFICATION
OF INTERIM FILINGS
FULL
CERTIFICATE
I,
Andrew Marshall, the Chief Financial Officer of First Mining Gold
Corp., certify the following:
1.
Review: I have
reviewed the interim financial report and interim MD&A
(together, the “interim
filings”) of First Mining Gold Corp. (the
“issuer”) for
the interim period ended June 30, 2021.
2.
No
misrepresentations: Based on my knowledge, having exercised
reasonable diligence, the 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,
for the period covered by the interim filings.
3.
Fair presentation:
Based on my knowledge, having exercised reasonable diligence, the
interim financial report together with the other financial
information included in the 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 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 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 interim filings are
being prepared; and
(ii)
information
required to be disclosed by the issuer in its annual filings,
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 the 2013
Internal Control –
Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO).
5.2
N/A.
5.3
N/A.
6.
Reporting changes in
ICFR: The issuer has disclosed in its interim MD&A any
change in the issuer’s ICFR that occurred during the period
beginning on April 1, 2021 and ended on June 30, 2021 that has
materially affected, or is reasonably likely to materially affect,
the issuer’s ICFR.
|
|
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|
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Date: August 16,
2021.
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By:
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/s/ Andrew
Marshall
|
|
|
|
|
Andrew
Marshall
|
|
|
|
|
Chief Financial
Officer
|
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