Fury Gold Mines Ltd 6-K, filed Apr 1, 2025
Fury Gold Mines Ltd (FURY)
About this 6-K
Fury Gold Mines Ltd filed this 6-K on April 1, 2025.
UNITED STATES
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 April 2025
Commission File No. 001-38145
Fury Gold Mines Limited
(Translation of registrant's name into English)
401 Bay Street, 16th
Floor, Toronto, Ontario, Canada, M5H 2Y4
(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 ☐
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Exhibits 99.1 to 99.3 included with this report are hereby incorporated by reference into the Registrant’s registration statement on Form F-10 (File no. 333-272658) (the “Registration Statement”), and to be a part thereof from the date on which this report is submitted, to the extent not superseded by documents or reports subsequently filed or furnished.
SUBMITTED HEREWITH
SIGNATURE
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.
Dated: March 31, 2025
Fury Gold Mines Limited
Phil van Staden
Chief Financial Officer
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Exhibit 99.1
FURY GOLD MINES LIMITED |
| ANNUAL INFORMATION FORM |
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FOR THE FINANCIAL YEAR ENDED DECEMBER 31, 2024 DATED MARCH 31, 2025 |
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TABLE OF CONTENTS
| INTRODUCTORY NOTES | 4 |
| Cautionary Note Regarding Forward-Looking Statements | 4 |
| Cautionary Note to United States Investors Regarding Presentation of Mineral Resource Estimates | 6 |
| Resource Category (Classification) Definitions | 7 |
| CORPORATE STRUCTURE | 8 |
| Name, Address and Incorporation | 8 |
| 2022 to 2024 Unification of the Éléonore South Gold Project | 9 |
| Inter-corporate Relationships | 10 |
| General Development of the Business | 11 |
| Business of Fury Gold | 11 |
| Three-Year History Fury Gold’s Business | 11 |
| Eau Claire Exploration Program | 11 |
| Completion of Sale of Homestake Ridge Project to Dolly Varden and Investor Rights Agreement | 11 |
| 2022 Partial Sale of Dolly Varden Shareholdings | 12 |
| Eau Claire Exploration Program | 12 |
| Corporate developments | 13 |
| Eau Claire Exploration Program | 14 |
| Éléonore South Exploration Program | 14 |
| Committee Bay Exploration 2024 Program | 15 |
| 2024 Partial Sale of Dolly Varden Shareholdings | 16 |
| Business Description | 17 |
| General | 17 |
| Specialized Skill and Knowledge | 17 |
| Competitive Conditions | 18 |
| Cyclical and Seasonal | 18 |
| Intangible Properties | 18 |
| Environmental Protection | 18 |
| Employees | 18 |
| Social and Environmental Policies | 18 |
| Indigenous and Local Community Engagement | 19 |
| THE COMPANY’S MINERAL PROJECTS | 20 |
| Summary of Three Material Mineral Properties | 20 |
| Eau Claire Project | 21 |
| Property Description and Location | 21 |
| Accessibility, Climate, Local Resources, Infrastructure and Physiography | 22 |
| Geology and Mineralization | 23 |
| Mineral Resources | 24 |
| Sample Preparation, Analyses and Security | 25 |
| Sampling, Analysis and Data Verification | 25 |
| Mineral Processing and Metallurgical Testing | 26 |
| 2024 Mineral Resource Estimate | 27 |
| Combined Mineral Resource Estimate for the Eau Claire Project, May 10, 2024 | 28 |
| Conclusions | 30 |
| Recommendations | 30 |
| Regional Exploration: | 32 |
| Committee Bay Project | 33 |
| Description and Location | 33 |
| Access, Climate, Local Resources, Infrastructure and Physiography | 33 |
| Geology, Mineralization and Deposit Types | 34 |
| History | 34 |
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| Sampling, Analyses and Data Verification | 35 |
| Committee Bay RAB Drilling QA/QC Disclosure | 35 |
| Committee Bay Diamond Drilling QA/QC Disclosure | 35 |
| Committee Bay Grabs QA/QC Disclosure: | 35 |
| Mineral Processing and Metallurgical Testing | 36 |
| 2023 Committee Bay Mineral Resource Estimates | 37 |
| Exploration Program Recommendations | 39 |
| 2015 through 2021 Committee Bay Exploration by Fury | 40 |
| 2018 Committee Bay Exploration Program | 40 |
| 2019 Committee Bay Exploration Program | 41 |
| 2021 Committee Bay Project Drill and Exploration Program | 41 |
| 2022 and 2023 Committee Bay Project Exploration Program | 42 |
| 2024 Committee Bay Project Exploration Program | 42 |
| 2023 Committee Bay Mineral Resource Estimate and Technical Report | 43 |
| Éléonore South Property, Québec, Canada | 43 |
| Access, Climate, Local Resources, Infrastructure and Physiography | 45 |
| Geology, Mineralization and Deposit Types | 45 |
| History | 46 |
| Sampling, Analyses and Data Verification | 50 |
| Mineral Processing and Metallurgical Testing | 51 |
| Mineral Resource Estimates | 51 |
| 2024 Éléonore South Exploration Program | 51 |
| Biochemical Sampling | 52 |
| Drilling | 52 |
| Conclusion | 52 |
| Recommendations | 52 |
| 2024 Éléonore South project Exploration | 53 |
| RISK FACTORS | 54 |
| Exploration Activities May Not Be Successful | 54 |
| Commodity Price Fluctuations and Cycles | 55 |
| Additional Funding Requirements and Shareholder Equity Dilution | 56 |
| Negative Cash Flow | 56 |
| Indirect Economic Interest in the Homestake Ridge Project | 56 |
| Price Volatility of Publicly Traded Securities | 56 |
| Mineral Resource Estimates | 57 |
| Inflation | 57 |
| Property Commitments | 57 |
| Environmental Regulatory, Health & Safety Risks | 57 |
| Relationships with Local Communities and Indigenous Organizations | 58 |
| Environmental Protection | 58 |
| Climate Change | 59 |
| Changes in Government Mining, Permitting, Environmental Regulation | 59 |
| Competitive Conditions | 60 |
| Local Community Uncertainties | 60 |
| Acquisitions May Not Be Successfully Integrated | 60 |
| Changes in the Market Price of Common Shares | 60 |
| Properties May Be Subject to Defects in Title | 61 |
| Reliance on Contractors and Experts | 61 |
| Qualified and Experienced Employees, Management, and Board Members | 61 |
| Legal and Litigation Risks | 61 |
| Risks Relating to Statutory and Regulatory Compliance | 61 |
| Under-insured or Uninsurable Insurance Risks | 62 |
| Limited Business History and No History of Earnings | 62 |
| Claims by Investors Outside of Canada | 62 |
| No-Dividends Policy | 63 |
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| Disclosure and Internal Controls | 63 |
| Cybersecurity Risks | 64 |
| Social Media Risks | 64 |
| Liabilities relating to Past Issuances of Flow-Through Shares | 64 |
| DESCRIPTION OF CAPITAL STRUCTURE | 65 |
| Attributes of Common Shares | 65 |
| MARKET FOR SECURITIES | 65 |
| Trading Price and Volume | 65 |
| Prior Sales | 66 |
| DIRECTORS AND EXECUTIVE OFFICERS | 66 |
| Name, Principal Occupation and Province or State of Residence | 66 |
| Management Security Holdings | 68 |
| Management History of Cease Trade Orders, Bankruptcies, Penalties or Sanctions | 68 |
| Potential Conflicts of Interest | 69 |
| Audit Committee | 69 |
| Audit Committee Charter | 69 |
| Composition of the Audit Committee | 69 |
| Relevant Education and Experience of Audit Committee Members | 69 |
| Pre-Approval Policies and Procedures | 70 |
| External Auditor Service Fees | 70 |
| Other Board Committees | 70 |
| No Legal Proceedings | 71 |
| INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS | 71 |
| SHARED SERVICES PROVIDER | 71 |
| UNIVERSAL MINERAL SERVICES LTD. (“UMS”) | 71 |
| TRANSFER AGENT AND REGISTRAR | 71 |
| AUDITOR | 72 |
| MATERIAL CONTRACTS | 72 |
| INTERESTS OF EXPERTS | 72 |
| ADDITIONAL INFORMATION | 73 |
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introductory notes
In this Annual Information Form (the “AIF”) the “Company”, “Fury Gold”, “we”, “us” or “our” refers to Fury Gold Mines Limited, together with, as the context requires, its subsidiaries or its predecessors.
This AIF is dated March 31, 2025. Except as otherwise indicated, all information contained herein is as at December 31, 2024. In this AIF, unless otherwise indicated, all dollar amounts and references to “C$” or “$” are to Canadian dollars and references to “US$” are to U.S. dollars. All dollar amounts are expressed in thousands of Canadian dollars unless otherwise indicated.
All financial figures are in 000s except for exploration program recommendations.
Cautionary Note Regarding Forward-Looking Statements
Certain statements made in this AIF contain forward-looking information within the meaning of applicable Canadian and United States securities laws (“forward-looking statements”). These forward-looking statements are presented for the purpose of assisting the Company’s securityholders and prospective investors in understanding management’s intentions and views regarding future outcomes and are inherently uncertain and should not be heavily relied upon. When used in this AIF, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “seek”, “propose”, “estimate”, “expect”, and similar expressions, as they relate to the Company, identify such forward-looking statements. Specific forward-looking statements in this AIF include:
| · | the Company’s exploration and financing plans, |
| · | the ability of the Company to realize the objectives of the Company’s planned exploration programs; |
| · | the results of the Company’s exploration programs and the likelihood of discovering or expanding resources; |
| · | the Company’s estimated mineral resources; |
| · | the future price of minerals, especially gold and other precious metals; |
| · | the Company’s future capital expenditures and requirements, and sources and timing of additional financing; |
| · | the Company’s plans to complete the acquisition of Quebec Precious Metals Corporation; |
| · | the potential for resource expansion and ultimately mine development of the Company’s Eau Claire Project, |
| · | permitting timelines and possible delays; |
| · | local indigenous and other affected communities engagement; |
| · | government regulation of mining operations; |
| · | environmental and climate-related risks; |
| · | the possible impairment of mining interests; |
| · | any objectives, expectations, intentions, plans, results, levels of activity, goals or achievements; |
| · | the liquidity of the common shares in the capital of the Company; and |
| · | other events or conditions that may occur in the future. |
The forward-looking statements contained in this AIF represent the Company’s views as of the date hereof. The assumptions related to these plans, estimates, projections, beliefs and opinions may change without notice and in unanticipated ways. Many assumptions may prove to be incorrect, including:
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| · | the Company’s budgeting plans, expected costs, assumptions regarding capital and commodity market conditions and other factors upon which the Company has based its expenditure and funding expectations; |
| · | the Company will be able to raise additional capital to proceed with its exploration, development and operations plans and attracting finance for precious metal exploration will be possible; |
| · | the Company’s ability to obtain or renew the licenses, permits and regulatory approvals necessary for its planned exploration and securing support of locally affected communities; |
| · | the Company’s exploration plans will not be adversely impacted by declines in prices of precious metals and consequent impairment of the Company’s ability to finance its operations |
| · | that operations and financial markets will not in the long term be adversely impacted by wars, pandemics or other natural or man-made disasters; |
| · | the Company’s ability to complete and successfully integrate acquisitions, including its acquisition of Quebec Precious Metals Corporation; |
| · | the Company’s plan of operations will not be adversely impacted by climate change, extreme weather events, water scarcity, and seismic events, and the Company’s strategies to deal with these issues will be effective; |
| · | the Company’s expectations regarding the future demand for, and supply and price of, precious metals; |
| · | the Company’s ability to recruit and retain qualified personnel to pursue its business operations; |
| · | the Company’s mineral resource estimates, and the assumptions upon which they are based, are reasonably accurate; |
| · | the Company will be able to comply with current and future environmental, safety and other regulatory requirements and to obtain and maintain local community support. |
Inherent in the forward-looking statements are known and unknown risks, uncertainties and other factors beyond the Company’s ability to control or predict, that may cause the actual results, performance or achievements of the Company, or developments in the Company’s business or in its industry, to adversely differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. Some of the risks and other factors (some of which are beyond the Company’s control) which could cause results to differ materially from those expressed in the forward-looking statements and information contained in this AIF include, but are not limited to:
| · | fluctuations in the current and projected prices for gold, other precious and base metals and other commodities (such as natural gas, fuel oil and electricity) which are needed to explore for and ultimately produce these metals; |
| · | the Company does not earn any revenues from its business and has history of losses and negative cash flows from operations, each of which is expected to continue in the future; |
| · | the Company may not be able to secure additional financings, including equity financings, to continue the planned exploration of its mineral properties; |
| · | the Company’s exploration programs are inherently risky as they involve uncertain geology and risk exploration failure and may overrun on costs and not be successful in achieving the targeted objectives or result in the discovery of new resources or the expansion of existing resources |
| · | the Company’s plan of operations involves risks and hazards associated with the business of mineral exploration, development and mining (including environmental hazards, potential unintended releases of contaminants, industrial accidents, unusual or unexpected geological or structural formations, pressures, cave-ins and flooding); |
| · | the speculative nature of mineral exploration and development; the estimation of mineral resources, the Company’s ability to obtain funding, including the Company’s ability to complete future equity financings; |
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| · | the shareholders of Quebec Precious Metals Corporation may not approve the acquisition by the Company; |
| · | environmental risks and remediation measures, including evolving environmental regulations and legislation; |
| · | changes in laws and regulations impacting exploration and mining activities; |
| · | the Company’s mineral properties being subject to prior unregistered agreements, transfers or claims and other defects in title; |
| · | legal and litigation risks; |
| · | statutory and regulatory compliance; |
| · | insurance and uninsurable risks; |
| · | the continuation of our management team and our ability to secure the specialized skill and knowledge necessary to operate in the mining industry |
| · | the Company’s limited business history and history of losses and negative cash, which will continue into the foreseeable future; |
| · | our inability to pay dividends, volatility in the Company’s share price, the continuation of our management team and our ability to secure the specialized skill and knowledge necessary to operate in the mining industry; relations with and claims by local communities and non-governmental organizations, including relations with and claims by indigenous populations; |
| · | the effectiveness of the Company’s internal control over financial reporting; |
| · | cybersecurity risks and other reputational risks; |
| · | general business, economic, competitive, political and social uncertainties; |
| · | the effects of climate change, extreme weather events, water scarcity, and seismic events, and the effectiveness of strategies to deal with these issues; |
| · | and public health crises such as the COVID-19 pandemic and other uninsurable risks. |
While intended to list the primary risks we see, no list can be exhaustive of the risk and other adverse factors that may affect any of the Company’s forward-looking statements. Some of these risks and other factors are discussed in more detail in the section entitled “Risk Factors” in this AIF. Investors and others should carefully consider these risks and other factors and not place heavy reliance on the forward-looking statements.
The Company only updates its forward-looking statements, to the extent required by applicable securities laws.
Cautionary Note to United States Investors Regarding Presentation of Mineral Resource Estimates
This AIF uses the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource”, which are Canadian mining terms as defined in, and required to be disclosed in accordance with, National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”), which references the guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) – CIM Definition Standards on mineral resources and mineral reserves (“CIM Definition Standards”), adopted by the CIM Council, as amended. Mining disclosure under U.S. securities law was previously required to comply with SEC Industry Guide 7 (“SEC Industry Guide 7”) under the United States Securities Exchange Act of 1934, as amended. The SEC has adopted rules to replace SEC Industry Guide 7 with new mining disclosure rules under sub-part 1300 of Regulation S-K of the U.S. Securities Act (“Regulation S-K 1300”) which became mandatory for U.S. reporting companies beginning with the first fiscal year commencing on or after January 1, 2021. Under Regulation S-K 1300, the SEC now recognizes estimates of “Measured Mineral Resources”, “Indicated Mineral Resources” and “Inferred Mineral Resources”. In addition, the SEC has amended its definitions of “Proven Mineral Reserves” and “Probable Mineral Reserves” to be substantially similar to international standards. Readers are cautioned that despite efforts to harmonize U.S. mining disclosure rules with NI 43-101 and other international requirements, there are differences between the terms and definitions used in Regulation S-K 1300 and mining terms defined by CIM and used in NI 43 101, and there is no assurance that any mineral reserves or mineral resources that an owner or operator may report as “proven mineral reserves”, “probable mineral reserves”, “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources” under NI 43-101 would be the same had the owner or operator prepared the reserve or resource estimates under the standards of Regulation S-K 1300.
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As a “foreign private issuer” under United States securities laws, the Company was previously eligible to file its annual report on Form 40-F with the SEC pursuant to the multi-jurisdictional disclosure system. Consequently, the Company was not required to provide disclosure on its mineral properties under US Regulation S-K 1300 but rather provided disclosure under Canadian NI 43-101 and the Canadian Institute of Mining and Metallurgy (CIM) Standards. The Company is presently not able to file its SEC annual report on Form 40-F for the year ended December 31, 2024 using Canadian standards due to the non-affiliate market capitalization of its public share float having a market value less than US$75 million. Consequently, the Company will file its annual report with the SEC on Form 20-F for the year ended December 31, 2024 (the “2024 Form 20-F”) will include disclosure on the Company’s material properties in accordance with the requirements of Regulation S-K 1300 which as noted above may materially differ from the requirements of NI 43-101 and the CIM Definition Standards.
There is no assurance any mineral resources that the Company may report as “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources” under NI 43- 101 would be the same had the Company prepared the resource estimates under the standards adopted under the Regulation S-K 1300. However, the Company’s mineral resources presented in this AIF are consistent with the Company’s estimates of mineral resources prepared under Regulation S-K 1300 that will be include in the Company’s 2024 Form 20-F. United States investors are also cautioned that while the SEC will now recognize “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources”, investors should not assume that any part or all of the mineralization in these categories will ever be converted into a higher category of mineral resources or into mineral reserves. Mineralization described using these terms has a greater amount of uncertainty as to their existence and feasibility than mineralization that has been characterized as reserves.
The Company has no mineral reserves which require that the estimated resources be demonstrated to be economic in at least a pre-feasibility study. Accordingly, investors are cautioned not to assume that any “measured mineral resources”, “indicated mineral resources” or “inferred mineral resources” that the Company reports are or will be economically or legally mineable. Although in Canada, “inferred mineral resources” are subject to an expectation that there must be a reasonable probability of upgrading a majority of an inferred resource into a measured or indicated category, inferred resources have a greater amount of uncertainty as to their existence and as to whether they can be mined legally or economically. Therefore, United States investors are also cautioned not to assume that all or any part of the “inferred mineral resources” exist. In accordance with Canadian securities laws, estimates of “inferred mineral resources” cannot form the basis of feasibility or other economic studies, except in limited circumstances where permitted under NI 43-101.
Accordingly, information contained in this AIF describing the Company’s mineral deposits may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations thereunder.
See the heading “Resource Category (Classification) Definitions” below for a description of certain of the mining terms used in this AIF.
Resource Category (Classification) Definitions
The discussion of mineral deposit classifications in this AIF adheres to the CIM Definition Standards developed by the CIM. Estimated mineral resources fall into two broad categories dependent on whether the economic viability of them has been established and these are “mineral resources” (potential for economic viability) and “mineral reserves” (viable economic production is feasible). Resources are sub-divided into categories depending on the confidence level of the estimate based on level of detail of sampling and geological understanding of the deposit. The categories, from lowest confidence to highest confidence, are inferred mineral resource, indicated mineral resource and measured mineral resource. Reserves are similarly sub-divided by order of confidence into probable (lowest) and proven (highest). The Company at this time has not classified any of its mineral deposits as mineral reserves. These classifications can be more particularly described as follows:
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A “mineral resource” is a concentration or occurrence of solid material of economic interest in or on the Earth’s crust in such form, grade or quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade or quality, continuity and other geological characteristics of a mineral resource are known, estimated or interpreted from specific geological evidence and knowledge, including sampling. The Company has no projects for which mineral reserves are claimed.
An “inferred mineral resource” is that part of a mineral resource for which quantity and grade or quality are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient to imply but not verify geological and grade or quality continuity. It has a lower level of confidence than that applying to an indicated mineral resource and must not be converted to a mineral reserve. It is reasonably expected that the majority of inferred mineral resources could be upgraded to indicated mineral resources with continued exploration.
An “indicated mineral resource” is that part of a mineral resource for which quantity, grade or quality, densities, shape and physical characteristics are estimated with sufficient confidence to allow the application of modifying factors in sufficient detail to support mine planning and evaluation of the economic viability of the deposit. Geological evidence is derived from adequately detailed and reliable exploration, sampling and testing and is sufficient to assume geological and grade or quality continuity between points of observation. It has a lower level of confidence than that applying to a measured mineral resource and may only be converted to a probable mineral reserve.
A “measured mineral resource” is that part of a mineral resource for which quantity, grade or quality, densities, shape, and physical characteristics are estimated with confidence sufficient to allow the application of modifying factors to support detailed mine planning and final evaluation of the economic viability of the deposit. Geological evidence is derived from detailed and reliable exploration, sampling and testing and is sufficient to confirm geological and grade or quality continuity between points of observation. It has a higher level of confidence than that applying to either an indicated mineral resource or an inferred mineral resource. It may be converted to a proven mineral reserve or to a probable mineral reserve.
A “mineral reserve” is the economically mineable part of a measured and/or indicated mineral resource. It includes diluting materials and allowances for losses, which may occur when the material is mined or extracted and is defined by studies at Pre-Feasibility or Feasibility level as appropriate that include application of modifying factors, which are considerations used to convert mineral resources to mineral reserves and include, but are not restricted to, mining, processing, metallurgical, infrastructure, economic, marketing, legal, environmental, social and governmental factors. Such studies demonstrate that, at the time of reporting, extraction could reasonably be justified. The reference point at which mineral reserves are defined, usually the point where the ore is delivered to the processing plant, must be stated. It is important that, in all situations where the reference point is different, such as for a saleable product, a clarifying statement is included to ensure that the reader is fully informed as to what is being reported. The public disclosure of a mineral reserve must be demonstrated by a pre-feasibility study or feasibility study.
A “probable mineral reserve” is the economically mineable part of an indicated, and in some circumstances, a measured mineral resource. The confidence in the modifying factors applying to a probable mineral reserve is lower than that applying to a proven mineral reserve. The Company has not determined that any of its properties contain any probable mineral reserves.
A “proven mineral reserve” is the economically mineable part of a measured mineral resource. A proven mineral reserve implies a high degree of confidence in the modifying factors. The Company has not determined that any of its properties contain any proven mineral reserves.
Corporate Structure
Name, Address and Incorporation
The Company was incorporated under the Business Corporations Act (British Columbia) (the “BCBCA”) on June 9, 2008, under the name Georgetown Capital Corp. The Company was a Capital Pool Company under the policies of the TSX Venture Exchange (the “TSXV”) and, accordingly, on February 23, 2011, the Company completed a qualifying transaction (the “Qualifying Transaction”) with Full Metal Minerals USA Inc., a wholly owned subsidiary of Full Metals Minerals Ltd. Pursuant to the Qualifying Transaction, the Common Shares began trading on the TSXV. On October 15, 2013, the Company changed its name to Auryn Resources Inc. On November 1, 2016, the Company completed its graduation to the TSX and the Common Shares began trading on the TSX. In connection with the Company’s graduation to the TSX, the Common Shares were voluntarily delisted from the TSXV. On July 17, 2017, the Common Shares also commenced trading on the NYSE American.
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Fury Gold is a reporting issuer in all of the provinces and territories of Canada. In addition, the Common Shares are registered under Section 12(b) of the U.S. Exchange Act by virtue of being listed on the NYSE American. The Company’s legal registered and records office is in care of its attorneys at 1500-1055 West Georgia Street, Vancouver, BC, V6E 4N7, and its head office is located at 401 Bay Street, 16th Floor, Toronto, ON M5H 2Y4.
2020 Merger and Reorganization
On October 9, 2020, the Company acquired all of the then-issued and outstanding shares of Eastmain Resources Inc. (“Eastmain”) while distributing (or “spinning out”) shares of two subsidiaries to its shareholders (“Spinco Transactions”) in accordance with the terms and conditions of the arrangement agreement dated August 10, 2020 (the “2020 Arrangement Agreement”). The Spinco Transactions resulted in the divestment of the Company’s South American exploration assets to focus on Canadian mineral projects. On October 5, 2020, the Eastmain Transaction and the Spinco Transactions (as defined herein) received the approval of both the Company’s and Eastmain’s shareholders, and on October 7, 2020, the British Columbia Supreme Court and the Ontario Superior Court of Justice approved the Reorganization Arrangement and the Eastmain Arrangement, respectively, and both courts issued final orders approving the Eastmain Transaction and the Spinco Transactions. In accordance with the terms of the 2020 Arrangement Agreement, the Company changed its name to “Fury Gold Mines Limited” pursuant to a certificate of change of name dated October 8, 2020.
Immediately following the closing of the Transaction, the Company’s ticker symbol for the Common Shares was changed to “FURY” effective October 12, 2020 on the NYSE American and October 13, 2020 on the TSX. Eastmain’s shares were delisted from the TSX and removed from the OTCQB after the end of trading on October 9, 2020. Immediately following the closing of the Eastmain Arrangement, Eastmain became and remains a wholly-owned subsidiary of Fury Gold.
2022 Sale of Homestake Mineral Project to Dolly Varden Silver Corporation for Dolly Varden Shares
On February 25, 2022, the Company announced the completion of the sale of the Homestake Ridge project to Dolly Varden Silver Corporation (“Dolly Varden”), a publicly traded corporation listed on the TSX Venture Exchange. Pursuant to the Homestake Purchase Agreement entered into on December 6, 2021, Dolly Varden acquired 100% of Homestake Resource Corporation from Fury in exchange for a $5 million cash payment and the issuance of 76,504,590 common shares of Dolly Varden. On October 13, 2022, the Company reduced its holdings to 59,504,590 by selling 17 million common shares, representing 22.2% of the Company’s interest in Dolly Varden, for gross proceeds of $6.8 million, and resulting in the Company’s interest in Dolly Varden being reduced to 25.8%. Following further dilutive equity financings completed by Dolly Varden on December 22, 2022 and November 2, 2023, Fury Gold held 59,504,590 common shares, representing a 22.03% interest in Dolly Varden as at December 31, 2023. The Company's interest in Dolly Varden was further reduced by 5,450,000 shares in a March 2024 private sale, and by 3,000,000 shares in an October 2024 private sale, resulting in in the Company’s interest being 16.11% in Dolly Varden as at December 31, 2024.
2022 to 2024 Unification of the Éléonore South Gold Project
On September 12, 2022, the Company and its joint venture partner Newmont Corporation (“Newmont”), through their respective subsidiaries, completed the acquisition of the remaining approximately 23.77% participating interest of Azimut Exploration Inc. in the Éléonore South Joint Venture (“ESJV”), on a pro-rata basis. Following the completion of the transaction, the 100% ESJV participating interests were then held 50.022% by the Company and 49.978% by Newmont with Fury remaining the operator under an amended and restated joint operating agreement.
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On February 29, 2024, the Company completed the purchase of Newmont’s 49.978% interest in the Éléonore South Gold Project in Quebec (“Éléonore South”) for $3,000,000. As a result of the consolidation, Fury Gold is the 100% owner of Éléonore South. The Company also acquired Newmont’s 30,392,372 common shares or 10.98% of Sirios Resources Inc. (“Sirios”) as part of the transaction for an additional $1,300,000. Sirios shares have been acquired for investment purposes, and Fury will evaluate its investment in Sirios on an ongoing basis with respect to any possible additional purchases or dispositions. In March 2024, the Company sold 1,514,000 common shares of Sirios, resulting in the Company’s interest in Sirios being reduced to 10.4%. Following further dilutive equity financings completed by Sirios in 2024, the Company’s holding interest in Sirios as at December 31, 2024 was less than 9.9%.
Inter-corporate Relationships
Fury Gold conducts its business through a number of wholly-owned subsidiaries The following diagram depicts the Company’s corporate structure as of December 31, 2024, and its material subsidiaries, including the name, jurisdiction of incorporation and proportion of ownership in each:
Not reflected in the above organization chart is the Company’s non-material interest in a shared service provider entity, Universal Mineral Services Ltd (“UMS”). Fury owns 25% of UMS with three other junior resource explores each owning 25%. Also not shown is a pending acquisition of 100% of Quebec Precious Metals Corporation for $5.1 million which is expected to complete in late April 2025.
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General Development of the Business
Business of Fury Gold
Fury Gold Mines is a Canadian-focused high-grade gold exploration company strategically positioned in two prolific mining regions: the Eeyou Istchee James Bay Region of Quebec and the Kitikmeot Region in Nunavut. Fury Gold has a portfolio of mineral properties, including the Eau Claire property located in the Eeyou Istchee James Bay Region of Northern Quebec (the “Eau Claire Project”), the Committee Bay gold project located in the Kitikmeot Region of Nunavut (the “Committee Bay Project”) and the Éléonore South property also located in the Eeyou Istchee James Bay Region of Northern Quebec (“Éléonore South Project”) which was determined to have become material as of March, 31, 2025.
Three-Year History Fury Gold’s Business
2022
Eau Claire Exploration Program
In October 2022, the Company completed the initial drilling program at Eau Claire and the Percival prospect, completing a total of approximately 52,700m from 2020-2022, with the final 17,700m completed in 2022. Additionally, the company completed a B-horizon soil sampling program at Lac Clarkie, a property adjacent to the Eau Claire project.
Changes to Management and the Board
On March 9, 2022, the Company announced the appointment of Bryan Atkinson, P.Geo, to Senior Vice President (SVP), Exploration and Michael Henrichsen, P.Geo, to Chief Geological Officer, effective immediately. The Company also announced that Salisha Ilyas, Vice President of Investor Relations, has resigned to pursue other opportunities.
On May 24, 2022, the Company announced that the Company’s Board Chair, Ivan Bebek was retiring from the Board, effective June 29, 2022 and would be an advisor.
Financing
On April 14, 2022, the Company completed a non-brokered private placement with two placees, who include a Canadian corporate investor and a US institutional investor, for a private placement sale of 13.75 million common shares of the Company at a price of $0.80 per share for gross proceeds of $11,000.
Completion of Sale of Homestake Ridge Project to Dolly Varden and Investor Rights Agreement
On February 25, 2022, the Company completed the sale of the Homestake Ridge Project to Dolly Varden. Pursuant to the agreement entered into on December 6, 2021 (“Homestake Purchase Agreement”), Dolly Varden purchased 100% of the shares of the Company’s subsidiary, Homestake Resource Corporation for a $5 million cash payment and the issuance of 76,504,590 common shares of Dolly Varden (the “Homestake Transaction. As a result of the sale, the Company has an indirect economic interest in the Homestake Ridge Project through its ownership of shares of Dolly Varden but does not have legal control over either Dolly Varden or the Homestake Ridge Project.
In connection with the Homestake Transaction, Dolly Varden and Fury Gold entered into an investor rights agreement (the "Homestake Investor Rights Agreement") pursuant to which Fury Gold has the following rights, and is subject to the following obligations:
| (i) | Fury Gold will have the right to appoint two nominees to the Dolly Varden board so long as Fury Gold owns greater than 20% of the Dolly Varden common shares outstanding. Should Fury Gold own less than 20% but greater than 10% of the Dolly Varden shares outstanding, Fury Gold shall have the right to appoint one nominee to the Dolly Varden board. Tim Clark, the Chief Executive Officer of Fury Gold, and Michael Henrichsen, the Chief Geological Officer of Fury Gold, joined the Dolly Varden Board upon closing of the Homestake Transaction. As Fury Gold now owns less than 20% but greater than 10% of the Dolly Varden shares outstanding, only Mr. Clark remains a director. |
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| (ii) | Fury Gold will have the right to appoint one member to Dolly Varden’s technical committee for the purpose of providing non-binding advice and recommendations to the Dolly Varden board for so long as Fury Gold is entitled to appoint one nominee to the Dolly Varden board. |
| (iii) | Fury will have pre-emptive rights to maintain its ownership percentage in Dolly Varden for so long as Fury Gold owns more than 10% of the outstanding Dolly Varden common shares, subject to certain carve-outs and top-up rights. |
| (iv) | Fury Gold will not sell the Dolly Varden Shares during the one-year hold period following closing and will provide to Dolly Varden the right to direct the sale of any DV Shares proposed to be sold by Fury Gold after the expiry of the initial one-year hold period. |
| (v) | Fury Gold will for the initial two year period following closing, and subject to Fury Gold continuing to hold at least 10% of Dolly Varden’s outstanding shares, vote its shares in accordance with Dolly Varden management’s recommendations at each meeting of the shareholders of Dolly Varden, subject to exceptions for certain excluded matters, including special resolutions, minority shareholder votes required pursuant to Multilateral Instrument 61-101 and matters that would materially and adversely impact Fury Gold disproportionately. |
| (vi) | Fury Gold will not for the initial three-year period following Closing, and subject to Fury Gold continuing to hold at least 10% of Dolly Varden’s outstanding shares, acquire additional securities of Dolly Varden, solicit proxies separately from any Dolly Varden board approved proxy circular or otherwise seek to control management, the board or the policies of Dolly Varden. |
2022 Partial Sale of Dolly Varden Shareholdings
On October 3, 2022, the Company announced that it had entered into a non-brokered sale agreement to sell 17 million common shares of Dolly Varden at $0.40 per share, representing approximately 7.4% of the outstanding common shares of Dolly Varden. The gross proceeds received by the Company upon the close of the transaction on October 13, 2022, was $6.8 million. At December 31, 2022, and 2023, the Company held a 23.5% and 22.03% interest, respectively, in Dolly Varden.
2023
Eau Claire Exploration Program
On February 13, 2023, Fury Gold provided an update on targeting the wholly owned Lac Clarkie project immediately to the east of its 100% owned Eau Claire project in the Eeyou Istchee Territory in the James Bay region of Quebec. The Company has defined a total of eight gold targets through the completion of a B-horizon soil sampling program (Figure 1). Six of the targets lie along the Cannard Deformation Zone, which hosts numerous gold occurrences along its >100 kilometre (km) mapped extent, including Fury’s Eau Claire Deposit and Percival Property. Fury is working to prioritize these newly defined targets for follow-up in 2023 with the aim of advancing a number of these targets.
In April 2023, Fury Gold commenced a drilling program at the Eau Claire Deposit, comprising of 10,000 to 15,000 metres (m), with the goals of i) continuing expansion of the high-grade Eau Claire resource; ii) following up on the 2022 success at the Percival Prospect 14 km to the east of Eau Claire; and iii) advancing several early-stage exploration targets along the Cannard Deformation Zone to the drill ready stage.
On July 10, 2023, the Company announced its 2023 summer exploration program and the restart of all exploration activities, which had been interrupted since June 5, 2023, due to a governmental emergency fire evacuation order.
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On August 3, 2023, Fury announced results for the first three 2023 core drill holes at the high-grade Eau Claire gold project. The 2023 drill program focused on the continued expansion of the Hinge Target located immediately west of the Eau Claire Deposit. Drilling at the Hinge Target continues to return multiple stacked zones of gold mineralization from each drill hole, including 5.0m of 3.6 g/t Au within a broader interval of 14.0m of 2.37 g/t Au. Additional drill intercepts include 6.5m of 2.66 g/t Au, 6.0m of 2.77 g/t Au and 1.0m of 10.35 g/t Au.
On October 3, 2023, the Company reported the results for an additional two infill core drill holes from the Hinge Target at the Eau Claire Project. The 2023 drill program continues to focus on infill drilling at the Hinge Target located immediately west of the Eau Claire Deposit. Every hole completed at the Hinge Target to date has intercepted two corridors of stacked gold-bearing quartz tourmaline veins and alteration, including 3.5m of 5.73 g/t gold and 11.27 g/t Tellurium and 7.43g/t gold over 2.5m within a broader interval of 4.65g/t gold and 8.72 g/t Tellurium over 4.5m. Drill holes 23EC-065 and 23EC-068 represent the continuation of a series of infill drill holes designed to tighten up the spacing of the 2022 Hinge Target drilling to a nominal spacing of 60-80m. The stacked intercepts through these new holes continue to exhibit the overall strength of the mineralized system within the Hinge Target.
On November 28, 2023, the Company reported additional results from the 2023 infill drilling program at the Hinge Target at the Eau Claire Project. Drilling continues to intercept multiple zones of gold mineralization, including 5.5m of 4.52 g/t gold and 3.0m of 3.34 g/t gold from 23-EC-069; 1.0m of 20.20 g/t gold and 3.5m of 3.51 g/t gold from 23EC-070; 1.0m of 19.55 g/t gold from 23EC-066; and 3.5m of 3.82 g/t gold from 23EC-067.
Changes to Management and the Board
On February 22, 2023, the Company announced that its Board of Directors has appointed Brian Christie as an Independent Director, effective immediately. Mr. Christie most recently served as Vice President, Investor Relations at Agnico Eagle Mines Limited, prior to which Mr. Christie worked for over 17 years as a precious and base metals mining analyst and brings with him extensive experience in the capital markets and the mining industry. On May 15, 2023, the Company announced the appointment of Mr. Christie as Board Chair, replacing Mr. Jeffrey Mason, who was appointed Board Chair on January 11, 2023 and continues to serve as independent Director of Fury Gold. The Company also announced that Michael Henrichsen, Chief Geological Officer, resigned from his role to pursue other interests.
On June 23, 2023, Phil van Staden, having previously served as the Company’s Corporate Controller since 2020, was appointed Interim Chief Financial Officer of the Company and brings over 15 years of diverse international experience in various accounting roles and industries throughout South Africa and Canada. He holds B. Commerce and B. Commerce Honours degrees, respectively, from the University of Pretoria and the University of South Africa. Mr. van Staden, took over from Dr. Lynsey Sherry, who had been the Chief Financial Officer since November 2020. Mr. van Staden was appointed (permanent) Chief Financial Officer effective January 1, 2024.
On September 5, 2023 Fury announced that it had appointed Ms. Isabelle Cadieux as an Independent Director, and she served until her resignation from the Board on March 24, 2025.
Financings
In March 2023, the Company closed a bought-deal private placement of 6,076,500 Common Shares of the Company that qualify as “flow-through shares” (the “FT Shares”) at a price of C$1.44 per FT Share for aggregate gross proceeds of approximately $8.750 million. The proceeds from the March 2023 Offering are being used to incur “flow-through mining expenditures” in connection with the exploration of the Company’s Eau Claire and ESJV projects. As at December 31, 2023, the Company had approximately $544,000 available to incur flow-through mining expenditures before December 31, 2024.
Corporate developments
On October 12, 2023, the Company filed a short form base shelf prospectus (the "Shelf Prospectus") with the securities commissions or similar regulatory authorities in all of the provinces and territories of Canada and has filed a corresponding registration statement on Form F-10 with the United States Securities and Exchange Commission. As a result of the completion of these filings, the Company is permitted to publicly offer up to $75 million of common shares, subscription receipts, warrants, and units or any combination thereof to investors in Canada and the United States during the 25-month period from October 12, 2023, that the Shelf Prospectus is effective.
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2024
Eau Claire Exploration Program
On January 17, 2024, the Company reported results from the 2023 drilling program at the Hinge Target at the Eau Claire Project. Highlights from the seven drill holes include 31.77 g/t gold over 3.50m from 23EC-077; 65.0 g/t gold over 0.50m and 14.25 g/t gold over 1.0m from 23EC-074; 2.56 g/t gold over 7.50m from 23EC-068; and 3.41 g/t gold over 6.50m and 5.0 g/t gold over 3.50m from 23EC-075.
On February 6, 2024, the Company announced the final set of results from the 12,000m 2023 drilling program at the Hinge Target, part of the high-grade Eau Claire Project. Highlights from these last five drill holes include 17.62 g/t gold over 3.50m, including 29.80 g/t gold over 2m, and 22.20 g/t gold over 0.50m from 23EC-079; and 5.49 g/t gold over 3.50m from 23-EC-078. The reported intercepts from drill hole 23EC-082 of 17.62 g/t gold over 3.50m is within 135m of surface and is completely open to surface and to the west, above the rest of the Hinge Target.
On March 13, 2024, Fury Gold announced the results for the five remaining 2023 core drill holes from the Percival
Prospect located 14 kilometers east of the Eau Claire Project. Highlights from the drill holes include 15.0 m of 0.88 g/t Au including 3.0 m of 2.81 g/t Au from 23KP-016; 18.0m of 0.50 g/t Au from 23KP-014; and 14.50m of 1.05 g/t Au including 1.0m of 10.70 g/t Au from 23KP-013.
On May 14, 2024, the Company announced an updated Mineral Resource Estimate for the high-grade Eau Claire deposit as well as a Maiden Mineral Resource Estimate for the Percival deposit. The Eau Claire project now contains a combined mineral resource of 1.16Moz gold (Au) at a grade of 5.64 g/t Au in the Measured and Indicated category as well as an additional 723koz gold at a grade of 4.13 g/t Au in the Inferred Category. The 2024 updated Mineral Resource Estimate indicates an increase in the Measured and Indicated category by 307koz (a 36.0% increase) and adds 223koz Au (a 44.6% increase) to the Inferred category.
On June 19, 2024, the Company commenced a 3,500m drill program at the Serendipity Project at Eau Claire, focusing on three target areas.
On June 28, 2024, the Company announced the filing of a Technical Report for the Increased Mineral Resource Estimate for the high-grade Eau Claire deposit as well as a Maiden Mineral Resource Estimate for the Percival deposit located in the Eeyou Istchee Territory of the James Bay region of Quebec. The Eau Claire project now contains a combined mineral resource of 1.16Moz gold (Au) at a grade of 5.64 g/t Au in the Measured and Indicated category as well as an additional 723koz gold at a grade of 4.13 g/t Au in the Inferred Category. Gold mineralization remains open for expansion in all directions at both the Eau Claire and Percival deposits through additional drilling. The authors of this report are further described below.
On September 9, 2024, the Company announced results from the diamond drilling program at the greenfield Serendipity Prospect on its wholly owned Eau Claire project in the Eeyou Istchee Territory in the James Bay region of Quebec. The Serendipity Prospect lies within the same prospective geological setting as the Company’s Percival Deposit. In total 3,871 metres (m) were drilled in 10 holes across five distinct targets at Serendipity. Drill hole 24SD-009 targeted a biogeochemical anomaly overlying the easterly extension of the structure controlling the mineralization at Serendipity and intercepted 12.16 g/t gold over 3.0 m (Figures 1 and 2, Table 1). Drill hole 24SD-002 targeted a biogeochemical anomaly at the hinge of an interpreted fold within volcanic stratigraphy and intercepted 5.27 g/t gold over 1.0 m. The two noted intercepts above are separated by over 2 kilometres (km) indicating the potential for a large mineralizing system at Serendipity. The Company is in the process of planning follow-up drilling at Serendipity for 2025.
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Éléonore South Exploration Program
On March 5, 2024, Fury Gold announced that is has identified a robust geochemical gold anomaly within the same sedimentary rock package that hosts Newmont’s Éléonore Mine at the Éléonore South gold project located in the Eeyou Istchee Territory in the James Bay region of Quebec. The orientation level biogeochemical sampling survey was designed to target an interpreted fold nose within the Low Formation sediments in an area where conventional soil or till sampling was not possible due to the ground conditions. The targeted area exhibited similar geological, geophysical, and structural characteristics to those present at the nearby Éléonore Mine. The identified anomaly is up to 200x the background value in gold and outlines the folded sedimentary package
On March 20, 2024, the Company announced a drilling program at its owned Éléonore South gold project located in the Eeyou Istchee Territory in the James Bay region of Quebec, in early April 2024, comprising of 2,000 metres (m) focusing on the Moni showing trend. Previous drilling intercepted up to; 53.25 m of 4.22 g/t gold (Au); 6.0 m of 49.50 g/t Au including 1.0 m of 294 g/t Au and 23.8 m of 3.08 g/t Au including 1.5 m of 27.80 g/t Au, several of which remain open.
On June 4, 2024, Fury announced the results of its spring 2024 diamond drilling program and the summer 2024 exploration plans for the project. The 2,331.4 metres (m) drilling program was completed with seven diamond drill holes testing 2.3 kilometres (km) of strike along the JT – Moni Trend. The drilling targeted 100 to 125 m downdip extensions from historical drilling. All seven drill holes intercepted anomalous gold mineralization including 137.5 m of 0.44 g/t gold and 18.7 m of 0.97 g/t from drill hole 24ES-161, 115.5 m of 0.50 g/t gold from drill hole 24ES-162 and, 28.0 m of 0.47 g/t gold from drill hole 24ES-160. During the summer of 2024, Fury plans to complete the biogeochemical sampling grid where a robust geochemical gold anomaly within the same sedimentary rock package that hosts Newmont’s Éléonore Mine has been identified. The completion of the biogeochemical grid will allow Fury to finalize drill targeting.
On October 7, 2024, the Company announced the discovery of high-grade lithium outcrop on the western claim block of its 100% owned Éléonore South project in the Eeyou Istchee Territory in the James Bay region of Quebec. The outcrop sampling program targeted the historical Fliszar showing lepidolite bearing pegmatite as well as new rock exposures over an area of approximately 1000 x 500 metres (m) resulting in the collection of 34 samples. Seven samples returned high-grade values above 1.75% lithium oxide (Li2O) with a peak value of 4.67% Li2O. The Company’s focus remains on the gold prospectivity of the Éléonore South project. However, the announced lithium results provide additional exploration targets as the overall project is advanced.
On November 12, 2024, the Company announced the finalization of drill targeting at the Éléonore South gold project in the Eeyou Istchee Territory in the James Bay Region of Quebec. Drilling will target robust geochemical gold anomalies within the same sedimentary rock package that hosts Newmont’s Éléonore Mine. The completed biogeochemical sampling survey covered an interpreted fold nose within the Low Formation sediments where an orientation level study identified a large-scale gold anomaly in a similar geological, geophysical, and structural setting to that of the nearby Éléonore Mine. Six priority drill targets across over 3 kilometres (km) of prospective folded sedimentary stratigraphy have been identified. These six targets encompass multi point gold anomalies above the 90th percentile of the data and correlate with moderate pathfinder elemental anomalies, most notably arsenic which is associated with gold mineralization at the Éléonore Mine. The Company intends to mobilize crews in Q1 2025 for an initial fully funded 3,000 – 5,000 metre (m) diamond drilling program.
On November 20, 2024, the Company announced that it has finalized drill targeting after completing a surficial geochemical survey at the Éléonore South gold project located in the Eeyou Istchee Territory in the James Bay region of Quebec. Six priority drill targets across over 3 kilometres (km) of prospective folded sedimentary stratigraphy have been identified. These six targets encompass multi point gold anomalies above the 90th percentile of the data and correlate with moderate pathfinder elemental anomalies, most notably arsenic, which is associated with gold mineralization at the Éléonore Mine.
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Committee Bay Exploration 2024 Program
On October 24, 2024, the Company announced the results from the summer exploration program at its 100% Committee Bay project in the Kitikmeot Region of Nunavut. The 2024 exploration program defined three drill ready shear zone hosted targets advanced through a combination of till sampling, rock sampling and geological mapping:
| § | Three Bluffs Shear, where drilling in 2021 intercepted 13.93 g/t Au over 10 metres (m) (see news release dated December 1, 2021); |
| § | Raven Shear where 7 rock samples have averaged 16.12 g/t gold; and |
| § | Burro West where a 300 by 300 m discrete >90th percentile gold in till anomaly has been defined with a peak value of 50 ppb gold. |
Changes to Management and the Board
On January 10, 2024, the Company announced the appointment of Phil van Staden, the current Interim CFO of the Company, to the position of Chief Financial Officer effective as of January 1, 2024.
On June 27, 2024, as a result of the voting at its Annual General Meeting (“AGM”) of Shareholders held on June 26, 2024, the Company confirmed that each director nominee listed in the Company’s management information circular dated May 14, 2024, in connection with the AGM were re-elected as directors of the Company and that Deloitte LLP was re-appointed as the Company’s auditor. Mr. Mason did not stand for re-election as a director in 2024.
Financing
On June 13, 2024, the Company closed the $5 million financing announced on May 23, 2024. The Company issued 5,320,000 common shares of the Company that qualify as “flow-through shares” as defined under subsection 66(15) of the Income Tax Act (Canada) and section 359.1 of the Taxation Act (Québec) (the “FT Shares”) at a price of C$0.94 per FT Share for total gross proceeds to the Company of C$5,001.
2024 Partial Sale of Dolly Varden Shareholdings
On March 14, 2024, the Company announced that it had sold 5.45 million common shares of Dolly Varden at $0.735 per share, for gross proceeds of $4,006, lowering its holdings to 19.99% and decreasing its right to one director on Dolly Varden under its Investors Rights Agreement, to which notice have been given. On October 4, 2024 the Company sold another 3 million common shares of Dolly Varden for gross proceeds of $3,356, lowering its interest to 16.11% as at December 31, 2024.
Corporate Developments
On February 29, 2024, the Company, and its joint operation partner Newmont Corporation (“Newmont”), through their respective subsidiaries, closed a transaction whereby the Company acquired 100% control of the joint operation interests, the Éléonore South project, consolidating these properties into the Company’s portfolio at which time the joint venture operation was dissolved. The 49.978% that Newmont held was acquired by the Company for $3,000 while incurring $22, in transaction costs. As part of the transaction, the Company acquired 30,392,372 shares of Sirios Resources Inc. from Newmont which represented a 10.98% share at the time. The Company has sold a portion of the Sirios shares to retain under 9.9% which is the insider reporting threshold in Canada.
2025
The Company entered into an arrangement agreement with Quebec Precious Metals Corporation (“QPM”) on February 25, 2025 (the “Original Arrangement Agreement”). Under the terms of the Arrangement Agreement, Fury Gold has agreed to acquire QPM pursuant to a statutory plan of arrangement (the “Arrangement”) under Section 192 of the Canada Business Corporations Act (the “CBCA”) whereby Fury Gold will acquire all of the issued and outstanding shares of QPM on the basis of 0.0741 of one common share of Fury Gold for each share of QPM (the “Exchange Ratio”) as consideration for the acquisition. On March 6, 2025, Fury and QPM amended and restated the Original Arrangement Agreement in order to address certain technical matters related to QPM’s share capital (the “Amended and Restated Arrangement Agreement”). The Amended and Restated Arrangement Agreement was further amended by an amendment agreement dated March 19, 2025 (the “Amendment Agreement” and together with the Amended and Restated Arrangement Agreement, the “Arrangement Agreement”). In addition, each outstanding option and warrant of QPM will become exercisable to purchase shares of Fury following closing in accordance with the Exchange Ratio. Fury anticipates that approximately 8,385,030 common shares of Fury will be issued on closing of the Arrangement and that an additional 879,277 common shares will be issuable upon exercise of QPM options and warrants after closing. Fury Gold has obtained the approval of the Toronto Stock Exchange and NYSE American for the completion of the acquisition and related share issuances. Closing remains subject to the approval of the shareholders of QPM, the receipt of a final court order approving the Arrangement under the CBCA and satisfaction of other customary conditions to closing. Closing is anticipated to occur by April 30, 2025 if the required shareholder and court approvals are obtained.
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QPM’s main asset is the Sakami gold project located in Eeyou Istchee James Bay territory in Québec, Canada (the “Sakami Project”). QPM’s other assets include the Cheechoo-Eleonore Trend gold project which is adjacent to the northwest to the Sakami Project, and the Elmer East gold and lithium project located in Eeyou Istchee James Bay territory in Québec, Canada. QPM also holds a 68% interest in the Kippawa rare earths project and a 100% interest in the Zeus heavy rare earths project, both of which are located in the Témiscamingue region of Québec, Canada.
Business Description
General
Fury Gold Mines is a Canadian-focused high-grade gold exploration company strategically positioned in two prolific mining regions: the Eeyou Istchee James Bay Region of Quebec and the Kitikmeot Region in Nunavut.
Fury Gold has a portfolio of mineral properties of which three are considered material at this time: the Eau Claire property located in the Eeyou Istchee James Bay Region of Northern Quebec (the “Eau Claire Project”), the Committee Bay gold project located in the Kitikmeot Region of Nunavut (the “Committee Bay Project”) and the Éléonore South property also located in the Eeyou Istchee James Bay Region of Northern Quebec (“Éléonore South Project”) which was determined to have become material as of March, 31, 2025.
Since 2016, the Company has been actively exploring its mineral projects with the goal of identifying new areas of significant mineralization. As discussed in relevant project sections below, the majority of this work has taken place away from the known deposit areas in the form of regional exploration and prospect drilling at satellite targets. Though this work has yet to lead to the discovery of any new material mineral deposits, it has strengthened the Company’s understanding of the geological systems and provided new evidence with respect to the projects’ continued perspectivity. The Company expects to continue its exploration on the Eau Claire Project and Éléonore South project through 2025 as discussed under the heading “General Development of the Business – Recent Developments”.
The Company has not yet determined whether any of its mineral property interests contain economically recoverable mineral reserves. The Company’s continuing operations and the underlying value of the Company’s mineral property interests are entirely dependent upon the existence of economically recoverable mineral reserves, the ability of the Company to obtain the necessary financing to complete the exploration of its mineral property interests, obtaining the necessary mining permits, and on future profitable production or the proceeds from the disposition of the exploration and evaluation assets. See “Risk Factors” for further information.
Specialized Skill and Knowledge
Most aspects of the Company’s business require specialized skills and knowledge. Such skills and knowledge include the areas of geology, mining, metallurgy, engineering, environment issues, permitting, social issues, capital markets, financing and accounting. While competition in the resource mining industry can make it difficult to locate and retain competent employees in such fields, the Company has been successful in finding and retaining personnel for the majority of its key processes. See “Risk Factors – Specialized Skill and Knowledge”.
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In addition, Fury Gold’s technical and management teams have a track record of successfully monetizing assets for all stakeholders and local communities in which it operates. Fury Gold conducts itself to the highest standards of corporate governance and sustainability.
Competitive Conditions
The mineral exploration industry is competitive and Fury Gold will be required to compete for the acquisition of project opportunities. As a result of this competition Fury Gold may not be able to acquire or retain prospective mineral projects, technical experts that can find, develop and mine such mineral properties and interests, workers to operate its mineral properties, and capital to finance exploration, development and future operations. The Company competes with other mining companies, some of which have greater financial resources and technical facilities, for the acquisition of mineral property interests, the recruitment and retention of qualified employees and for necessary investment capital with which to fund its operations and projects. See “Risk Factors – Competitive Conditions”.
Cyclical and Seasonal
The Company’s mineral exploration activities may be subject to seasonality due to adverse weather conditions affecting exploration including, without limitation, incremental weather, frozen ground and restricted access due to snow, ice or other weather-related factors. Further, the mining business, and particularly the precious metals industry, including the gold industry, is subject to metal price cycles. Moreover, the mining and mineral exploration business is subject to global economic cycles effecting, among other things, the marketability and price of gold products in the global marketplace. See “Risk Factors – Commodity Price Fluctuations and Cycles”.
Intangible Properties
The Company’s intangible property, including its mineral and surface rights, is described elsewhere in this AIF. The Company’s business is not materially affected by intangibles such as business or commercial licenses, patents and trademarks or other intellectual property.
Environmental Protection
Exploration activities are subject to numerous and often stringent environmental laws and regulations. Compliance with such laws and regulations increases the costs of and delays planning, designing, drilling and developing the Company’s properties. To the best of management’s knowledge, the Company is in compliance in all material respects with all environmental laws and regulations applicable to its exploration and drilling activities. Fury Gold is committed to meeting or surpassing all applicable environmental legislation, regulations, permit and license requirements, and to continuously improving its environmental performance and practices. The Company embraces safe, socially and environmentally responsible and sustainable work practices during all activities. Fury Gold seeks to utilize innovative technologies and techniques to reduce its environmental footprint across all of the Company’s projects. This includes awarding drill contracts to an EcoLogo certified contractor at Eau Claire, the use of Rotary Air Blast (RAB) drilling at the Committee Bay Project, which reduces water usage, footprint and time on the ground, and the use of drone imagery to allow targeted ground-based follow up of outcrop. Current costs associated with compliance are considered to be normal. See “Risk Factors – Environmental Regulatory, Health & Safety Risks and “Risk Factors – Environmental Protection”.
Employees
As at December 31, 2024, the Company had approximately 9 equivalent full-time employees located primarily in Canada. The Company shares certain technical and administrative functions provided by Vancouver-based Universal Mineral Services Ltd on a full-cost recovery basis (See “Agreement with Universal Mineral Services Ltd.). The Company also relies on consultants and contractors to carry on many of its business activities and, in particular, to supervise and carry out mineral exploration and drilling on its mineral properties. No management functions of Fury Gold are performed to any substantial degree by a person other than the directors or executive officers of Fury Gold.
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Social and Environmental Policies
Building and maintaining good corporate citizenship is an important component of Fury Gold’s business practices. The Company has adopted several social and environmental policies and codes of conduct that are essential to its operations. The Company’s operating practices are governed by the principles set out in its Code of Business Conduct and Ethics, Diversity Policy, Insider Trading Policy, Indigenous Relations Policy, Disclosure Policy and Whistle-Blower Policy.
Fury Gold endeavours to contribute to the communities in which it operates by focusing on activities that can make a meaningful, positive and lasting difference to the lives of those affected by its presence. Fury Gold prioritizes creating mutually beneficial and long-term partnerships with the communities where it operates, respecting their interests as our own. Fury Gold establishes constructive local partnerships to contribute to local priorities and interests and to have communities benefit both socially and economically from its activities. The Company seeks opportunities to maximize employment and procurement for local communities through the provision of suitable training opportunities and resources.
Fury Gold endeavours to engage in open and transparent dialogue with governments, local communities, Indigenous peoples, organizations and individuals on the basis of respect, fairness and meaningful consultation and participation.
Further information regarding Fury Gold’s corporate governance policies and charters can be found on its website at www.furygoldmines.com/about -us/governance.
Indigenous and Local Community Engagement
Fury Gold respects and engages meaningfully with Indigenous and local communities at all of its operations. The Company is committed to working constructively with local communities, government agencies and Indigenous groups to ensure that exploration work is conducted in a culturally and environmentally sensitive manner. The Company’s engagement with Indigenous and local communities is governed by the principles set out in its Indigenous and Community Relations Committee Charter. Moreover, Fury Gold is committed to:
| · | sharing information about its projects and operations, providing meaningful opportunities for input and dialogue and involving local and Indigenous communities in archaeological work, environmental assessments and related studies; |
| · | making meaningful efforts to reach agreements with local and Indigenous groups on the preferred method of participation and engagement processes; |
| · | exploring opportunities for local and Indigenous communities to benefit from its projects and activities, which may include employment, contracting, training, community benefits and agreements, as appropriate to the type and stage of activity being undertaken; and |
| · | engaging in candid and respectful dialogue with a view to resolving or minimizing any disagreements and ensuring full communication in respect of any unresolved issues. |
Fury Gold is committed to responsible mineral exploration. The Company is dedicated to collaborating with Indigenous peoples and communities to establish and maintain effective, lasting, and mutually beneficial relationships. To achieve this commitment, we strive for relationships based on transparency, mutual respect, and trust. Accordingly, Fury implemented an Indigenous Relations Policy in 2024, which can be found on the Company’s website at www.furygoldmines.com/about-us/governance.
Cultural Awareness
In 2021, employees and the board of directors participated in a multi-module accredited in-house learning program aimed at developing Indigenous cultural competency. This program is provided to any new board members as part of the director onboarding process. In 2024, employees and the board of directors completed additional cultural awareness training which focused on the Indigenous communities in the regions of its projects in Quebec.
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Fury, in partnership with the Cree Hunters Economic Security Board and 15 other mining and exploration companies, contributed to a voluntary fund totalling C$750,000 for the Reconstruction Initiative Forest Fires Fund 2023. This initiative aimed to support the rebuilding of cabins destroyed by the 2023 wildfires in the Eeyou Istchee James Bay territory of Quebec.
Ecologo Certificate
During the year ended December 31, 2024, the Company received its Ecologo certification for mineral exploration. Ecologo is the first comprehensive certification for mineral exploration companies and their service providers that features third-party certification of environmental, social and economic practices in Quebec.
Additionally, during the first quarter of 2022, the Company undertook a qualitative environmental, social and governance (“ESG”) assessment with Digbee, a technology company which provides qualitative assessment tools to mining companies to track their ESG achievements. Fury Gold received an overall score of BB with a range of CC to A broken down into a corporate score of BB with a range of B to A and a project score of BB with a range of CC to A for both the Eau Claire and Committee Bay projects. These results are considered strong for an exploration company and the Company is continually evaluating and implementing initiatives to improve future scores. Fury Gold conducted a second annual Digbee ESG Certification in 2024, and achieved an overarching score of BBB with a range of CC to AA as of June 2024. A corporate score of A with a range of BB to A was obtained, which is considered to be strong for an Exploration company. The Eau Claire project achieved a score of BB with a range of CC to AA. The Company continues to evaluate and implement initiatives to improve future scores.
During 2023 and 2024, the Company’s subsidiary Eastmain entered into a Services Agreement with Stajune Ventures Inc., a business entity of the Cree Nation of Eastmain, which provided for the local First Nation personnel to provide services for the summer exploration activities at the Eau Claire project during those years.
Fury Gold’s Indigenous and Community Relations Committee Charter can be viewed on its website at www.furygoldmines.com/about -us/governance.
THE COMPANY’S MINERAL PROJECTS
Summary of Three Material Mineral Properties
At December 31, 2024, the Company’s three material mineral properties were the Eau Claire Project and the Éléonore South Project located in the Eeyou Istchee James Bay Region of Northern Quebec, and the Committee Bay Project located in the Kitikmeot Region of Nunavut, Canada. The Éléonore South Project has been determined to have become material effective March 31, 2025 as a result of the Company increasing its ownership interest to 100% and increasing exploration expenditures. As a consequence of being determined to be material, a Technical Report on Committee Bay described below authored by the Company’s Senior Project Geologist is being filed concurrently with this AIF.
The Eau Claire Project is a resource stage project, 100% held and operated by Fury, comprised of 446 claims, totaling 23,284 hectares(ha). Located in 1:50,000 scale NTS map sheets 33B04 and 33B05, approximately 320 km northwest of the town of Chibougamau and 800 km north of Montreal in the Eeyou Istchee James Bay Region of Quebec. The centre of the property is located at approximately 75.78 degrees longitude west and 52.22 degrees latitude north.
The early exploration stage Éléonore South Project, 100% held and operated by Fury, comprises 282 claims, totaling 14,760 hectares (ha). Located in 1:50,000 scale NTS map sheets 33B12 and 33C09, approximately 200 km east of the Cree community of Wemindji, 330 km northwest of the town of Chibougamau and 800 km north of Montreal in the Eeyou Istchee James Bay Region of Quebec. The centre of the property is located at approximately 75.98 degrees longitude west and 52.58 degrees latitude north.
The Committee Bay Project, 100% held by Fury, is a resource stage project comprising 156 claims and 57 crown leases, totaling 254,623.05 hectares (ha). located in 1:250,000 scale NTS map sheets 56J, 56K, 59O and 56P, approximately 430 km northwest of the town of Rankin Inlet. The approximate centre of the Project is located at Universal Transverse Mercator (UTM) co-ordinates 7,400,000m N and 570,000m E (NAD 83, Zone 15N).
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Eau Claire Project
The following disclosure relating to the Eau Claire Project (other than the disclosure regarding the 2023 Eau Claire exploration programs) is based on information derived from the NI 43-101 compliant technical report on the Eau Claire Project entitled “Technical Report on the Eau Claire Project, Quebec, Canada” prepared by Maxime Dupéré, B.Sc., P.Geo,, Ben Eggers, B.Sc. MAIG, P.Geo and Sarah Dean, B.Sc., MBA, P.Geo of SGS Geological Services with an effective date of May 10, 2024 (the “Eau Claire Technical Report”). Reference should be made to the full text of the Eau Claire Report, which is available electronically on the SEDAR+ website at www.sedarplus.ca under our SEDAR profile, filed on June 28, 2024, as the Eau Claire Report contains additional assumptions, qualifications, references, reliance and procedures which are not fully described herein. The Eau Claire Technical Report, dated May 10, 2024, and supersedes all previous technical reports, including a now-superseded preliminary economic assessment of the project. All information of a scientific or technical nature contained below and provided after the date of the Eau Claire Report has been reviewed and approved by the Company’s Senior Project Geologist, Valerie Doyon, a Qualified Person as defined by NI 43-101.
Property Description and Location
Fury Gold owns a 100%-interest in the Eau Claire Project, host to the Eau Claire gold deposit, one of five known gold deposits in the Eeyou Istchee James Bay region of Québec. The largest of these, Newmont’s Éléonore mine, is located 57 km NNW of the Eau Claire Project.
The Eau Claire Project is located in the Eeyou Istchee James Bay Territory of Northern Quebec, approximately 320 km northwest of the town of Chibougamau and 800 km north of Montreal. The property is accessible, year-round, by the Route du Nord and is located 100 km north of Nemaska, serviced by commercial flights twice per week.
The approximate centre of the Project is located at Universal Transverse Mercator (UTM) co-ordinates 5,786,800 m N and 453,000 m E (NAD 83, Zone 18N). The approximate UTM co-ordinates for the centre of the currently defined Eau Claire deposit are 5,785,100 m N and 444,600 m E. The Project is located within National Topographic System (NTS) 1:50,000 scale map-areas; 33B04 and 33B05.
Land Tenure
As of December 31, 2024 the Eau Claire Project consisted of 446 map designated claims covering 23,284.5 ha, 100% owned by Eastmain Resources Inc., a wholly owned subsidiary of Fury. The claims are in good standing as of December 31, 2024.
The Eau Claire Project is located north of the 52nd parallel (52ºN) and as such is subject to the provisions of the James Bay and Northern Quebec Agreement (1975), and the Paix des Braves Agreement (2002). The Eau Claire Project falls within the Eeyou Istchee Territory of the Eastmain Cree First Nation, including trap line VC36 held by Dr. Ted Moses as the Cree Tallyman. The Eau Claire project is located on Category III lands, as established under the James Bay and Northern Quebec Agreement.
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The figure below presents property location and claims comprising the Eau Claire Deposit:
Existing Infrastructure
There is no permanent infrastructure on the Project. Fury, through its Eastmain subsidiary, maintains a forty-person camp to support exploration activities at the Eau Claire project. The closest infrastructure to the Eau Claire deposit includes a number of hydroelectric complexes and associated infrastructure, including the EM-1 hydroelectric complex. The EM-1 complex is located within 15 km of the Eau Claire gold deposit. Hydro Québec has established a 600-person camp at EM-1 that includes fuel and medical services
Accessibility, Climate, Local Resources, Infrastructure and Physiography
As of the effective date of the Eau Claire Technical Report, the Eau Claire Project consisted of 446 map designated claims covering 23,284.5 ha, 100% owned by Eastmain Resources Inc., a wholly owned subsidiary of Fury. The claims are in good standing as of December 31, 2024.
The Eau Claire Project is located north of the 52nd parallel (52ºN) and as such is subject to the provisions of the James Bay and Northern Quebec Agreement (1975), and the Paix des Braves Agreement (2002). The Eau Claire Project falls within the Eeyou Istchee Territory of the Eastmain Cree First Nation, including trap line VC36 held by Dr. Ted Moses as the Cree Tallyman. The Eau Claire project is located on Category III lands, as established under the James Bay and Northern Quebec Agreement.
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History
Key historical events are:
| · | 1897: First reconnaissance survey in the area by the Geological Survey of Canada (GSC) (A. P. Low). |
| · | 1942: Mapping of the Eastmain Greenstone Belt by the Geological Survey of Canada (GSC) (Shaw). |
| · | 1966: Eade from the Geological Survey of Canada mapped the area of interest at a 1:1 000 000 scale. |
| · | 1971 and 1972: Canico carried out a “winkie” drilling program (19 holes). |
| · | 1973 to 1977: SEREM and Société de développement de la Baie-James (SDBJ) carried out geochemical surveys, prospecting, rock sampling, airborne and ground geophysics, geological mapping, and diamond drilling. |
| · | 1978: Mapping at the 1:100 000 scale by the Ministère des Richesse Naturelle (MRN) (Franconi) |
| · | 1985 to 1990: Westmin conducted airborne geophysics, soil geochemistry, prospecting, mapping, trenching and drilling (79 DDH, totalling 8,937 metres) |
| · | 1995 to 2001: SOQUEM conducted soil geochemistry, geological mapping, trenching and drilling (54 DDH totalling 19,639 metres) |
| · | 2002 to 2020: Eastmain Resources carried out geochemical and airborne geophysical surveys, geological mapping, prospecting, trenching and drilling. A total 816 diamond drilled holes, totalling 277,410.6 metres, were drilled. In 2018 discovered the Percival prospect where they drilled 13,182.6 metres in 2018 and 2019. |
| · | 2020 to 2023: Fury completed a total of 110 diamond drill holes for approximately 71,774.3 metres on the Project. |
| · | In 2023 Fury and SGS restated the Mineral Resource Estimate, for the portion of the deposit considered in the previous 2018 MRE and PEA, reporting approximately 0.9 Mt of Measured Mineral Resources grading 6.63 g/t Au containing 193,000 ounces gold, Indicated Mineral Resources of 3.39 Mt grading 6.06 g/t Au containing 660,000 ounces gold and 2.38 Mt of inferred Mineral Resources at an average grade of 6.53 g/t Au containing 500,000 ounces gold. |
| · | In 2024, Fury released its Mineral Resource Estimate update for the Eau Claire Project. |
Geology and Mineralization
The Eau Claire project is contained within the La Grande volcano-plutonic Subprovince (2,752 to 2,696 Ma) of the Superior Province approximately 30 km south of the contact with the metasedimentary Opinaca Subprovince (2700 to 2648 Ma). Portions of the La Grande Subprovince were formerly referred to as the Eastmain Greenstone Belt.
The La Grande Subprovince consists of four volcanic cycles erupted between 2,752 and 2,705 Ma (Kauputauch, Natel, Anatacau-Pivert, and Komo-Kasak formations). The supracrustal rocks of the region are intruded by syn-volcanic (2747 to 2710 Ma) and post or late-tectonic (2,697 to 2,618 Ma) tonalite- trondhjemite-granodiorite (TTG) suites. The Eastmain Greenstone Belt consists of a 5 to 10 km wide by 150 km long succession of Archean bimodal volcanic rocks (Figure 7-1 and Figure 7-2). The volcanic sequence includes lowermost mafic volcanic rocks overlain by felsic pyroclastic to volcaniclastic rocks, intercalated facies of iron formation, shaly and graphitic sedimentary units.
Gold mineralization at the Eau Claire gold deposit is generally located within approximately EW trending structurally controlled, high-grade en-echelon quartz-tourmaline veins and adjacent altered wall rocks, as well as variable width ESE trending sheared and foliated alteration zones. The alteration zones are parallel to the overall foliation and are thus believed to represent an altered stratigraphic unit. The vein systems are predominantly hosted within a thick sequence of massive and locally pillowed mafic volcanic flows, interbedded with narrow intervals of volcaniclastic meta-sedimentary rocks. Both gold bearing vein sets may occur with as narrow intervals with tourmaline and develop into thick quartz-tourmaline veins with zoned tourmaline+/-actinolite+/-biotite+/-carbonate alteration halos which can measure up to several metres in thickness.
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The Eau Claire deposit is a structurally controlled gold deposit. Mineralization occurs primarily in a series of sheeted en-echelon quartz-tourmaline veins and associated metre scale alteration zones. Carbonate within the veins is associated with gold mineralization. The overall trend of the mineralized veins is controlled by a structural corridor sub-parallel to the D2 Cannard Deformation Zone. Individual veins are up to 1 metre thick and extent for at least 100 metres along strike.
Gold occurs as isolated grains or as clusters of fine-grained particles. Irregular to sub-angular shaped gold grains range in size from less than 10 micrometres to 1 millimetre. In rare instances, grains up to 1 centimetre in size have been observed. Locally, veins contain micrometre-size clusters of visible gold particles. Tellurobismuthite (Bi2Te3) occurs throughout the deposit. Gold and tellurides occur within micro fractures in quartz, interstitial to granular tourmaline grains, at the contact between massive aphanitic tourmaline and quartz bands, and along tourmaline laminations.
Gold mineralization also occurs within altered host rock without veining occurring as centimetre to several metre wide tourmaline-actinolite ± biotite ± calcite replacement zones around vein selvages.
The two major vein areas discovered to date in the resource area (the 450 West and 850 West zones) form a crescent-shaped mineralized, surface projected footprint 1.8 km long by more than 100 metres wide, which has been traced to date to a vertical depth of 900 metres. Veins within the 450 West zone typically strike 85 degrees and dip 50 to 65 degrees to the south. Veins within the 850 West zone typically strike 60 degrees and dip subvertically.
Mineral Resources
The Eau Claire deposit contains mineral resources of 1,160,000 oz of gold (6.39 million tonnes at an average grade of 5.65 g/t Au) in the Measured and Indicated category, and 512,000 ounces of gold (2.64 million tonnes at an average grade 6.04 g/t Au) in the Inferred category.
The open pit mineral resource includes, at a base case cut-off grade of 0.5 g/t Au, 367,000 ounces of gold (2.45 million tonnes at an average grade of 4.66 g/t Au) in the Measured and Indicated category, and 10,000 ounces of gold (69 thousand tonnes at an average grade of 4.39 g/t Au) in the Inferred category.
The underground mineral resource includes, at a base case cut-off grade of 2.5 g/t Au, 793,000 ounces of gold (3.95 million tonnes at an average grade of 6.25 g/t Au) in the Measured and Indicated category, and 502,000 ounces of gold (2.57 million tonnes at an average grade of 6.08 g/t Au) in the Inferred category.
The Percival deposit contains an inferred mineral resource of 211,000 oz of gold (2.81 million tonnes at an average grade of 2.34 g/t Au)
The open pit inferred mineral resource includes, at a base case cut-off grade of 0.5 g/t Au, 131,000 ounces of gold (2.25 million tonnes at an average grade of 1.81 g/t Au).
The underground inferred mineral resource includes, at a base case cut-off grade of 2.5 g/t Au, 80,000 ounces of gold (557,000 tonnes at an average grade of 4.47 g/t Au).
The following section describes the MREs for Eau Claire and Percival. Completion of the MREs involved the assessment of a validated drill hole and channel sample database, which included all data for surface drilling and surface and channel sampling completed through the end of 2023. Completion of the MREs also included the assessment of updated three-dimensional (3D) mineral resource models (mineral resource domains), 3D topographic surface models and 3D overburden surface models.
The Inverse Distance Cubed (“ID3”) and Inverse Distance Squared (“ID2”) calculation methods restricted to the mineral resource domains were used to interpolate grades for Au (g/t) into block models for all deposit areas. Measured, Indicated, and Inferred mineral resources are reported in the summary tables in Section 14.11. The MREs presented below takes into consideration that the deposits may be mined by either open pit or underground mining methods.
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The reporting of the MREs complies with all disclosure requirements for Mineral Resources set out in the NI 43-101 Standards of Disclosure for Mineral Projects (2016). The classification of the MREs is consistent with the 2014 Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards (2014 CIM Definitions) and adheres to the 2019 CIM Estimation of Mineral Resources & Mineral Reserves Best Practice Guidelines (2019 CIM Guidelines).
Sample Preparation, Analyses and Security
Fury Gold manages its exploration samples from their collection points. For drilling, the foreman or driller transports drill core in closed and secured core boxes from the drill to the onsite core-logging facility, where they are received by a geologist or a geological technician. The core boxes are arranged in numerical order, opened, measured and inspected for any drill site numbering or measurement discrepancies. Prior to storage, boxes are tagged with aluminum labels.
Samples are systematically hand oriented in the core box by reference to rock foliation and end matched where possible before being marked for cutting.
While core is logged, mineralized sections are described, measured and marked for sampling with assay tags placed at the end of each sample. A technician selects the interval and saws it in half lengthwise along the core axis perpendicular to core foliation. Core is replaced in position in the core box with the ‘top’ half of the sawn sample interval placed in a plastic sample bag along with a copy of the assay tag. The sample bag is sealed with a plastic tie. The remaining half-core interval is left in the core box and stored as a permanent record or for further sampling and review.
Since the beginning of drilling by Fury in 2020 samples have dominantly been shipped to ALS in either Val d’Or or Montreal, Quebec for preparation and sample pulps analyzed at ALS Val d’Or, Quebec or North Vancouver, British Columbia. The ALS Val d’Or, Montreal, and North Vancouver facilities are ISO 9001 and ISO/IEC 17025 certified.
Approximately 25% of the samples collected during this period have been sent to either Activation Laboratories (“ACT”) in Val d’Or, Quebec and Thunder Bay, Ontario or to Bureau Veritas (“BV”) in Timmons, Ontario and Vancouver, British Columbia where the preparation and analysis methods used have been replicated as closely as possible. The ACT Val d’Or and Thunder Bay, and BV Timmons and Vancouver facilities are ISO/IEC 17025 certified.
Each sample batch is logged into a master manifest listing the sample shipment and a sample shipping list is attached to the first bag of the shipment. At every staging point from camp to the final destination, all parties handling the samples are required to confirm that the number of physical samples received in sample transport sign-off.
Sampling, Analysis and Data Verification
Fury Gold has adapted the historical Analytical Quality Assurance Program at Eau Claire to control and assure the analytical quality of assays. This protocol includes the systematic addition of blank samples and certified standards to each batch of samples sent for analysis at commercial laboratories. Blank samples are used to check for possible contamination in laboratories, while certified standards determine the analytical accuracy and precision of the laboratory procedure. Generally, check sample inserts approximate 10% of sample flow from project sites.
Pulp (inline split of 100-150 g) and coarse reject (inline split of 250-500 g) lab duplicates are also acquired by the primary lab at a rate of 2 each per hundred samples submitted and shipped to a second independent lab for further sample QA/QC.
Sample shipments from the exploration program in 2021 were sent to Actlabs in Val d’Or, QC for preparation and then to Actlabs in Thunder Bay, ON for analysis. All samples are assayed using 50 g nominal weight fire assay with atomic absorption finish (1A2B-50) and multi-element four acid digest ICP-AES/ICP-MS method (1F2). Where 1A2B-50 results were greater than 5 ppm Au the assay were repeated with 50 g nominal weight fire assay with gravimetric finish (1A3-50). QA/QC programs using internal standard samples, field and lab duplicates and blanks indicate good.
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Analytical samples for the Extension Program from March 2021 through to October 2021 were sent to Bureau Veritas (BV) lab in Timmins, ON (ISO/IEC 17025 accredited facility) for preparation and analysis. Preparation included crashing core sample to 90% < 2mm and pulverizing 1000g of crushed material to better than 85% < 75 microns. All samples are assayed using 50 g nominal weight fire assay with atomic absorption finish (BV code FA450) and multi-element four acid digest ICP-AES/ICP-MS method (BV code MA200). Where FA450 results are greater than 5 ppm Au the assay is repeated with 50 g nominal weight fire assay with gravimetric finish (FA550-Au). QA/QC programs using internal and lab standard and blank samples, field and lab duplicates and re-assay indicate good overall accuracy and precision.
The Company’s main assay contractor for the Eau Claire Project is ALS Chemex. Once received by ALS, samples were weighed, dried and finely crushed to better than 90% passing 2 mm (Tyler 10 mesh). A split of 1,000 grams was taken using a riffle splitter and pulverized to better than 85% passing a 75 micron (Tyler 200 mesh) screen (package PREP-31B).
All samples were initially assayed for gold using a conventional fire assay procedure with and inductively coupled plasma – atomic absorption spectroscopy (ICP-AAS) finish on 50-gram sub-samples (package code Au-AA24). The detection limits of this method are 0.005 to 10 parts per million gold (ppm Au). Samples containing more than 5 ppm Au are re-assayed using a second 50-gram aliquot by fire assay with a gravimetric finish (package code Au-GRA22). The detection limits of this method are 0.05 to 10,000 ppm Au.
All samples are also analyzed for a suite of 47 trace elements using inductively coupled plasma (ICP) methods. The element suite includes, among others; silver, bismuth, copper, cadmium, cobalt, lead, nickel, zinc, arsenic, antimony, manganese, molybdenum, tellurium, vanadium and barium. Base metal concentrations that exceed detection limits (usually > 1%) and silver are re-analyzed via dilution and re-analyzed by inductively coupled plasma-mass spectrometry (ICP-MS). Results were corrected for spectral inter-element interference.
Mineral Processing and Metallurgical Testing
Metallurgical testing was previously completed on Eau Claire mineralization by COREM in 2001 and by SGS in 2010 and 2017.
In 2010, Eastmain contracted the services of SGS Mineral Services (Lakefield Research) (“SGS”) to evaluate ore characteristics through mineralogy, chemical analyses and comminution testing. A secondary goal of the test work was to explore several processing avenues for the purpose of establishing a preliminary gold recovery flowsheet. The deportment and recovery of tellurium was also monitored in the program.
Four vein composites representing the P, JQ, R, and S veins and one master composite (an equally weighted blend of the four vein composites) were subjected to ore characterization, metallurgical and environmental testing. These composites were prepared from assay reject material in freezer storage at SGS (Lakefield) from analytical work completed in 2008.
The SGS test work completed on the Master Composite and Vein Composites samples indicated the following:
Mineralization Characterization:
| · | Calculated and direct gold grades showed significant variation in the master and vein composites ranging from approximately 11 g/t Au in Vein JQ and R to approximately 38 g/t Au in Vein S. |
| · | In terms of acid generating potential, the samples indicated very low risk. |
| · | The Bond ball mill work indices ranged from 10.2 (Vein S) to 11.1 (Vein P). These samples are considered to be soft in ball mill grindability terms. |
| · | A brief mineralogical examination of the four vein composites revealed that pyrrhotite is the principal sulphide mineral with minor amounts of pyrite and chalcopyrite. |
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Metallurgical Testing:
| · | Gravity separation will generate significant gold recovery in an industrial setting. Gold recoveries ranged from 30 to 45% in the master composite and up to 74% from the S vein composite. |
| · | Tellurium did concentrate to some extent along with the gold in the gravity separation. Approximately 7% recovery in the JQ vein composite up to a maximum of 25% in the S vein composite. |
| · | Flotation of the master composite gravity separation tailings, at grind sizes ranging from 121 to 65 μm, resulted in excellent gold recovery for all of the tests conducted. Approximately 94% gold recovery was achieved at a P80 of 121 μm while ~96% was achieved at P80 = 65 μm. |
| · | Gold recovery by gravity separation plus flotation ranged from 92% to 97% in the variability tests completed for the vein composites. |
| · | Further development of the flotation option, including optimizing primary grind size, improving conditions to achieve higher tellurium recovery, further investigating rougher concentrate cleaning and the impact of regrinding on cleaner circuit performance is strongly recommended. |
| · | Tellurium recovery was significant in rougher flotation, ranging from a low of 77% from the JQ vein composite to a maximum of 87% from the S vein composite. |
| · | Cyanide leaching of gravity separation tailing yielded an excellent gold response in all tests completed with approximately 95.7% of the gold being recovered in the gravity plus cyanidation flowsheet at 121 μm for the master composite. Gold recoveries ranged from 95.6% from the R vein composite to 98.2% from the S vein composite. |
| · | Flotation concentrate cyanidation yielded a unit gold extraction of 98.3% at a grind size of 121 μm. Overall circuit gravity separation + flotation concentrate cyanidation yielded a gold extraction of 92.8%. |
Environmental:
| · | The acid-base accounting and net acid generation tests completed on the various feed and tailing streams generated in the program clearly indicate that the samples will not generate acid mine drainage. |
Supplemental test work completed in 2017 by SGS returned gold grades of 6.56 g/t, 0.08 g/t, and 4.98 g/t, were reported for the Ore, HW- FW, and Master Composite, respectively, in the 2017 program. Silver reported as <2 g/t in all samples.
Sulphide sulphur grades were 0.99%, 0.28%, and 0.84% in the Ore, HW-FW, and Master Composite, respectively.
Gold grades in the 2010 test work were 18.6 g/t in the Master Composite and 11.1 g/t, 14.0 g/t, 10.9 g/t, and 37.7 g/t in the JQ, P, R, and S Vein Composites, respectively. Silver grades averaged approximately 5 g/t in the Vein and Master Composites. Sulphide sulphur grade ranged from approximately 0.5% in Vein S to approximately 0.9% in Vein R.
Overall gold recovery by gravity separation + gravity tailing cyanidation yielded results in the 2017 program that compared very well to parallel test work completed in 2010. Gold recovery from the 2010 Master Composite (at a 14.8 g/t Au head grade) was 95.7% with a final tailing grade of 0.66 g/t Au. In 2017 overall gold recovery from a head grade of 4.85 g/t Au was approximately 96%, with a final tailing grade of approximately 0.20 g/t Au.
2024 Mineral Resource Estimate
The MREs for the Project include MREs for the Eau Claire and Percival deposits. The Eau Claire project contains a combined Mineral Resource of 1,160,000 oz of Au at a grade of 5.65 g/t in the Measured and Indicated category, and an additional 723,000 oz of Au at a grade of 4.13 g/t Au in the Inferred Category (Table 14-10).
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Combined Mineral Resource Estimate for the Eau Claire Project, May 10, 2024
| Category | Tonnes | (g/t Au) | Contained Au (oz) |
| Measured | 1,612,000 | 5.67 | 294,000 |
| Indicated | 4,781,000 | 5.64 | 866,000 |
| Total Measured & Indicated | 6,393,000 | 5.65 | 1,160,000 |
| Inferred | 5,445,000 | 4.13 | 723,000 |
Eau Claire Deposit Mineral Resource Estimate, May 10, 2024
| Category | Tonnes | Au g/t | Contained Au (oz) | |
| Open Pit (base case cut-off grade of 0.5 g/t Au) | Measured | 1,157,000 | 5.19 | 193,000 |
| Indicated | 1,291,000 | 4.19 | 174,000 | |
| Measured & Indicated | 2,448,000 | 4.66 | 367,000 | |
| Inferred | 69,000 | 4.39 | 10,000 | |
| Underground (base case cut-off grade of 2.5 g/t Au) | Measured | 455,000 | 6.90 | 101,000 |
| Indicated | 3,490,000 | 6.17 | 692,000 | |
| Measured & Indicated | 3,945,000 | 6.25 | 793,000 | |
| Inferred | 2,566,000 | 6.08 | 502,000 | |
| Combined open pit and Underground | Measured | 1,612,000 | 5.67 | 294,000 |
| Indicated | 4,781,000 | 5.64 | 866,000 | |
| Measured & Indicated | 6,393,000 | 5.65 | 1,160,000 | |
| Inferred | 2,635,000 | 6.04 | 512,000 |
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Percival Deposit Mineral Resource Estimate, May 10, 2024
| Category | Tonnes | Au g/t | Contained Au (oz) | |
| Open Pit (base case cut-off grade of 0.5 g/t Au) | Inferred | 2,253,000 | 1.81 | 131,000 |
| Underground (base case cut-off grade of 2.5 g/t Au) | Inferred | 557,000 | 4.47 | 80,000 |
| Combined open pit and Underground | Inferred | 2,810,000 | 2.34 | 211,000 |
Eau Claire and Percival Deposits Mineral Resource Estimate Notes:
(1) The effective date of the Eau Claire project Mineral Resource Estimates (“MREs”), including the Eau Claire and Percival deposit estimates, is May 10, 2024.
(2) The Mineral Resource Estimates were estimated by Maxime Dupéré, B.Sc., géo. of SGS Geological Services and is an independent Qualified Person as defined by NI 43-101.
(3) The classification of the current Mineral Resource Estimates into Measured, Indicated and Inferred mineral resources is consistent with current 2014 CIM Definition Standards - For Mineral Resources and Mineral Reserves.
(4) All figures are rounded to reflect the relative accuracy of the estimate and numbers may not add due to rounding.
(5) The mineral resources are presented undiluted and in situ, constrained by continuous 3D wireframe models, and are considered to have reasonable prospects for eventual economic extraction.
(6) Mineral resources which are not mineral reserves do not have demonstrated economic viability. An Inferred Mineral Resource has a lower level of confidence than that applying to an Indicated Mineral Resource and must not be converted to a Mineral Reserve. It is reasonably expected that most Inferred Mineral Resources could be upgraded to Indicated Mineral Resources with continued exploration.
(7) The Project mineral resource estimates are based on a validated database which includes data from 1202 surface diamond drill holes totalling 406,431 m, and 426 surface channels (Eau Claire deposit) for 1,345 m. The resource database totals 273,402 drill hole assay intervals representing 267,721 m of data and 2,254 channel assays for 1,316 m.
(8) The MRE for the Eau Claire deposit is based on 280 three-dimensional (“3D”) resource models representing the 450, 850 and hinge zones. The MRE for the Percival deposit is based on 29 3D resource models representing high grade and lower grade halo zones.
(9) Grades for Au were estimated for each mineralization domain using 1.0 metre capped composites assigned to that domain. To generate grade within the blocks, the inverse distance cubed (ID3) interpolation method was used for all domains. An average density value was assigned to each domain.
(10) Based on the location, surface exposure, size, shape, general true thickness, and orientation, it is envisioned that parts of the Eau Claire and Percival deposits may be mined using open-pit mining methods. In-pit mineral resources are reported at a base case cut-off grade of 0.5 g/t Au. The in-pit resource grade blocks are quantified above the base case cut-off grade, above the constraining pit shell, below topography and within the constraining mineralized domains (the constraining volumes).
(11) The pit optimization and base-case cut-off grade consider a gold price of $1,900/oz and considers a gold recovery of 95%. The pit optimization and base case cut-off grade also considers a mining cost of US$2.80/t mined, pit slope of 55⁰ degrees, and processing, treatment, refining, G&A and transportation cost of USD$19.00/t of mineralized material.
(12) The results from the pit optimization, using the pseudoflow optimization method in Whittle 4.7.4, are used solely for the purpose of testing the “reasonable prospects for economic extraction” by an open pit and do not represent an attempt to estimate mineral reserves. There are no mineral reserves on the Property. The results are used as a guide to assist in the preparation of a Mineral Resource statement and to select an appropriate resource reporting cut-off grade. A Whittle pit shell at a revenue factor of 0.52 was selected as the ultimate pit shell for the purposes of this mineral resource estimate.
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(13) Based on the size, shape, general true thickness, and orientation, it is envisioned that parts of the Eau Claire and Percival deposits may be mined using underground mining methods. Underground mineral resources are reported at a base case cut-off grade of 2.5 g/t Au. The mineral resource grade blocks were quantified above the base case cut-off grade, below surface/pit surface and within the constraining mineralized wireframes (considered mineable shapes). Based on the size, shape, general thickness, and orientation of the mineralized structures, it is envisioned that the deposits may be mined using a combination of underground mining methods including sub-level stoping (SLS) and/or cut and fill (CAF) mining.
(14) The underground base case cut-off grade of 2.5 g/t Au considers a mining cost of US$65.00/t mined, and processing, treatment, refining, G&A and transportation cost of USD$19.00/t of mineralized material.
(15) The estimate of Mineral Resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues.
Conclusions
Drilling to 2018 at the Eau Claire deposit has outlined mineralization with three-dimensional continuity, and size and grades that can potentially be extracted economically. Project geologists have a good understanding of the regional, local, and deposit geology and controls on mineralization. The geological models are reasonable and plausible
Mineral Resources for the Eau Claire deposit were estimated assuming combined open pit and underground mining methods. At cut-off grades of 0.5 g/t Au for open pit and 2.5 g/t Au for underground, Measured Mineral Resources are estimated to total 0.9 Mt at an average grade of 6.63 g/t Au containing 193,000 ounces gold. At the same cut-off grades, Indicated Mineral Resources are estimated to total 3.39 Mt at an average grade of 6.06 g/t Au containing 660,000 ounces gold. At the same cut-off grades, Inferred Mineral Resources are estimated to total 2.38 Mt at an average grade of 6.53 g/t Au containing 500,000 ounces gold. The open pit resources were constrained by a preliminary pit shell generated in Whittle software from surface to 150m below surface. Underground resources are reported at the high cut-off grade outside of the pit shell from 150 to 860m below surface.
The limited metallurgical testwork conducted so far suggests that the gold can be recovered by conventional means, such as a combination of gravity followed by cyanide leaching of the concentrate. Additional metallurgical testwork will be warranted if further exploration increases the size of the resource.
In 2018, significant gold mineralization was identified at the Percival prospect located 14 kilometres (km) to the east of the Eau Claire deposit. The Eau Claire deposit, the Percival prospect and various other mineral occurrences, displayed on Figure 3, are all located within the Eau Claire Property, also referred to as the Eau Claire Project. Gold mineralization at Percival has been defined within a 500x100x300m footprint within folded sulphidized and silicified breccias and quartz veining in an interbedded volcanic and sedimentary sequence. Fury recognized that the high-grade core of the Percival mineralization, represented by historical drill intercepts of 9.0m of 6.26 g/t gold, 8.5m of 7.13 g/t gold, and 2.0m of 8.47 g/t gold was parallel and slightly offset to magnetic stratigraphic units that define a steep westerly plunging fold hinge. Targeting of the fold hinge geometry has significantly expanded the Percival mineralized footprint with intercepts of up to 13.5m of 8.05 g/t Au, including 3m of 25.8 g/t Au. Exploration historically has focussed on Quartz-tourmaline veins (VQTL) within mafic volcanic sequences at Eau Claire, the recent identification of the Percival mineralization indicates there is good potential to discover additional mineralization and to add to the resource base within the Eau Claire Project.
Recommendations
The following summarizes the work programs recommended by the authors of the 2024 Technical Report for the Eau Claire Project.
Fury’s intentions are to continue exploration on the Property in 2025 and onwards. The proposed work program consists of a regional portion focused on refining known gold occurrences within the Percival – Serendipity trend, 14km to the east of Eau Claire, and attempting to define new prospects in areas with favourable geological and structural settings. In addition to the regional program, a drill program focused on the Eau Claire deposit is planned to tie-in the mineralization identified 450m west of the current resource with the aim of updating the current mineral resource. Additional drilling would focus on the Percival prospect and other nearby geochemical anomalies to determine the continuity and scale of gold mineralization.
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Fury has gained a better understanding of the combination of pathfinder elements and structural controls on the gold mineralization at Percival. The broad low-grade gold mineralization occurs along a well-defined east–west trending structural splay of the Cannard Deformation Zone. Certain elemental associations, most notably Arsenic, Bismuth, and Tungsten, are proving to be important pathfinders for the gold mineralization. Higher-grade gold within the broader corridor is controlled by secondary shearing and is identified by the high degree of silicification. With this knowledge, the Company has refined their targeting along the Percival to Serendipity Trend identifying ten priority targets for 2024. These identified targets lie within the same stratigraphic package as Percival Main and have undergone varying degrees of deformation. The proximity of the main Cannard and Hashimoto Deformation Zones varies from one target to the other and may have a significant impact on the gold mineralization. Fury believes the varying degrees of deformation are an important control on both gold mineralization and the potential preservation of a sizeable, mineralized body.
The recommended work program is anticipated to include the collection of 15,000 infill till and biogeochemical samples and 30,000 m of diamond drilling. Drilling would be allocated with 2,000 m to 7,500 m focused on testing biogeochemical anomalies within the Percival – Serendipity trend, approximately 20,000 m at the Eau Claire deposit for resource expansion, and 2,500 m to 8,000 m at Percival for resource expansion. Subsequent to the completion of additional drilling on the Property, updated MREs are planned which will form the basis of an updated engineering study in the form of an updated Preliminary Economic Assessment.
The total cost of the planned work program by Fury is estimated at $14.2 M shown in the table below. The Company has not yet made any decision to implement these recommendations as they are financing and success dependent.
Recommended Work Programs
| Item | Details | Cost (C$) | ||||
| Labour | Staff Wages, Technical and Support Contractors | 1,750,000 | ||||
| Assaying | Sampling and Analytical | 750,000 | ||||
| Drilling | Diamond Drilling (30,000m at $175/m) | 5,250,000 | ||||
| Till Sampling | Detailed sampling program | 1,500,000 | ||||
| Land Management | Consultants. Assessment Filing, Claim maintenance | 750,000 | ||||
| Community Relations | Community Tours, Outreach | 75,000 | ||||
| Information Technology | Remote site communications and IT | 35,000 | ||||
| Safety | Equipment, Training and Supplies | 75,000 | ||||
| Expediting | Expediting | 150,000 | ||||
| Camp Costs | Equipment, Maintenance, Food, Supplies | 250,000 | ||||
| Freight and Transportation | Freight, Travel, Helicopter | 450,000 | ||||
| Fuel | 1,200,000 | |||||
| General and Administration | 100,000 | |||||
| Update MRE and PEA | 600,000 | |||||
| Sub-total | 12,935,000 | |||||
| Contingency (10%) | 1,293,500 | |||||
| Total | 14,228,500 | |||||
2020 - 2024 Eau Claire Exploration Program
From 2020 through to 2024, Fury completed a total of 120 diamond drill holes for approximately 75,654.3 m on the Project. The drill program consisted of i) an extension phase focused on extensions to the known vein corridors along strike from the current resource (“Extension Program”); ii) an exploration phase designed to test targets along the 4.5km long deposit trend (“Exploration Program”) and iii) an exploration phase of drilling designed to test targets at the Percival and Serendipity prospects 14km east and 20 km northeast of the Eau Claire Deposit respectively. Large stepout drilling in 2022 increased the mineralized footprint of the Eau Claire deposit by over 450m to the west. At Percival Fury intercepted 13.5 m of 8.05 g/t gold (Au) outlining a 500x100x300m zone of gold mineralization.
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The 2023 drilling campaign focused on the Hinge Target, which is located west of the deposit, adjacent to the 850 W zone, and the at Percival prospect area. Results from the 2023 Hinge drilling expanded the Hinge Target gold mineralization 50m up-dip and 75m to the west respectively, over 450m from the defined Eau Claire Resource as well as intercepting high grade shallow mineralization on the eastern edge of the Hinge target.
The Extension Program at the Eau Claire deposit was designed to target strike extensions of the known vein corridors to the west and southeast of the current mineral resource. To date, Fury Gold has drilled twenty one holes targeting the southeast extension of the Eau Claire Resource with intercepts including: 23.27 g/t Au over 7.09m, 11.56 g/t Au over 6.04m, 59.3 g/t Au over 0.96m and 4.89 g/t Au over 2.94m. Results from the four holes completed in the second quarter of 2022 were released on August 3, 2022 including 4.43 g/t Au over 1.43m and 4.60 g/t Au over 1.25m. Two additional holes were completed in October 2022 with results released on January 23, 2023 including 3.91 g/t Au over 2.50m.
The exploration drilling program along the Eau Claire deposit trend continues to demonstrate the potential to significantly expand the Eau Claire deposit to the west. The focus has been on the Western Hinge, and Gap Zone as well as along the north limb of the anticline. All exploration targets within the Deposit Trend have the potential to significantly expand the Eau Claire mineralized footprint. To date the footprint of gold mineralization has been increased by over 455m or 25% at the Hinge Target alone and remains open to further expansion to the West.
Regional Exploration:
Percival Prospect
The Company completed 11,497.8 m in 18 diamond drill holes in 2022 and 2023 at Percival. Five holes targeted the parallel hinge 500 m to the east of Percival proper. All holes intercepted silicified sulphide rich breccias, however only narrow low grade gold values were returned. The remainder of the drilling tested extensions of the historical gold mineralization at Percival proper. The results from the Percival proper drilling program confirm that the high-grade core of the Percival mineralization plunges steeply to the west and remains open in all directions. Highlights included an 85 m step out from historical high-grade mineralization which intercepted 13.5 m of 8.05 g/t Au, (including 3.00 m of 25.8 g/t Au) in drill hole 22KP-008 and a 150 m step out which intercepted 7.5 m of 4.38 g/t Au, (including 3 m of 8.7 g/t Au, and 3 m of 5.5 g/t Au) in drill hole 22KP-005 (Table 10-6). As well as 279 g/t Au over 1.5 m along the eastern edge of the defined mineralization. With the recent drilling the gold mineralization at Percival Main is represented by a 500 m by 100 m footprint with high-grade gold being defined to 300 m below surface hosted within folded sulphidized, silicified, and brecciated sediments.
Serendipity Prospect
The Serendipity Prospect is situated 16 kilometres (km) northeast of the Eau Claire Deposit and 6.5 km north northeast of the Percival Deposit along the Hashimoto Deformation Zone which is related to the Cannard Deformation Zone, one of the primary controls on gold mineralization within the region. Drilling during 2024 tested geochemical anomalies associated with prospective folded stratigraphy across approximately 2 km of strike length. In total 3,871 metres (m) were drilled in 10 holes across five distinct targets at Serendipity. Drill hole 24SD-009 targeted a biogeochemical anomaly overlying the easterly extension of the structure controlling the mineralization at Serendipity and intercepted 12.16 g/t gold over 3.0 m. Drill hole 24SD-002 targeted a biogeochemical anomaly at the hinge of an interpreted fold within volcanic stratigraphy and intercepted 5.27 g/t gold over 1.0 m. The two noted intercepts above are separated by over 2 kilometres indicating the potential for a large mineralizing system at Serendipity.
Broad low-grade gold mineralization occurs along well-defined structural splays sub-parallel to the regional Cannard and Hashimoto Deformation Zones. Certain elemental associations, most notably Arsenic, Bismuth, and Tungsten, are proving to be important pathfinders for the gold mineralization. Higher-grade gold within the broader corridor is controlled by secondary shearing and is identified by the high degree of silicification.
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Committee Bay Project
The following disclosure relating to the Committee Bay Project is based on information derived from the NI 43-101 compliant technical report entitled “Technical Report on the Committee Bay Project, Nunavut Territory, Canada” dated September 11, 2023, prepared by Bryan Atkinson, P.Geo. as Senior Vice President Exploration of Fury Gold Mines and Andrew Turner, P.Geol., principal at APEX Geoscience Ltd., (the “Committee Bay Report”). Reference should be made to the full text of the Committee Bay Report, which is available electronically under the Company’s profile page on SEDAR+ at www.sedarplus.ca, as the Committee Bay Report contains additional assumptions, qualifications, references, reliances and procedures which are not fully described herein. The Committee Bay Report is the only current NI 43-101 compliant technical report with respect to the Committee Bay Project and supersedes all previous technical reports.
Description and Location
The Committee Bay Project is located in the eastern part of the Kitikmeot Region of Nunavut, approximately 430 km northwest of the town of Rankin Inlet, Nunavut. The Project is accessible by air, either from Rankin Inlet or Baker Lake, Nunavut. Rankin Inlet and Baker Lake are serviced seasonally by barge and ship. The hamlets of Rankin Inlet, Baker Lake, Naujaat, Gjoa Haven, Taloyoak, and Kugaaruk are accessible by scheduled commercial flights.
The Committee Bay Project consists of 57 Crown Leases and 154 mineral claims in six non-contiguous blocks totaling approximately 254,933.10 ha. all of which are in good standing as of December 31, 2024
The figure below presents property location and claims comprising the Committee Bay project:
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Access, Climate, Local Resources, Infrastructure and Physiography
The Committee Bay Project is accessed via fixed wing charter primarily through a 914 m, graded, esker airstrip at Hayes Camp, a permitted, seasonally prepared 1,580 m winter ice airstrip, which is constructed on the adjacent Sandspit Lake, or a 320m tundra airstrip at the Bullion Camp.
The Committee Bay Project is located in the Wager Bay Plateau Ecoregion of the Northern Arctic Ecozone (Marshall and Schutt, 1999). This ecoregion is classified as having a low arctic ecoclimate. Summers are short and cold, with mean daily temperatures above freezing only in July and August. Snow cover usually lasts from September to June, but it can fall during any month. Most of the lakes are icebound until approximately mid-July. Precipitation is moderate throughout the year, but drifting of snow in the winter can result in considerable localized accumulations, particularly on the sides of hills. Fog is often a problem near the coast and at higher elevations particularly during the late spring to early summer and the fall months.
There is no permanent infrastructure at the Committee Bay Project. The Company maintains four camps to support seasonal exploration campaigns in various portions of the Committee Bay Project, namely the Hayes Camp (100 person capacity), the Bullion Camp (20 to 40 person capacity), Crater Camp (40 person capacity) and the Ingot Camp (10 person capacity). A drill water system is maintained at the Three Bluffs site.
Geology, Mineralization and Deposit Types
The Committee Bay Project area, situated in the Churchill Structural Province, is underlain by Archean and Proterozoic rocks and extensively covered by Quaternary glacial drift. It comprises three distinct Archean sub-domains (Prince Albert Group, Northern Migmatite, and Walker Lake Intrusive Complex).
The Committee Bay Greenstone Belt (the “CBGB”), which hosts the gold occurrences discussed in the Committee Bay Report, is composed of Prince Albert Group rocks. These are bounded by the wide, northeast-striking Slave-Chantrey mylonite belt to the northwest and by the Amer and Wager Bay shear zones to the south. Two major fault systems, the northeast-striking Kellet fault and the northwest-striking Hayes River fault, intersect the central portion of the CBGB and cut the Prince Albert Group rocks. Gold occurrences in the CBGB appear to be spatially related to the major shear systems and their sub-structures indicating the potential for the re-mobilization of mineral-bearing fluids along these structures.
The regional strike of rock units in the West Laughland Lake area is generally north but shows a degree of variability. Units, generally vertically dipping in much of the CBGB, have a more moderate to shallow dip at Four Hills. Rocks generally strike northeast from Four Hills east to the Committee Bay Project. In the Hayes River area, the east-striking Walker Lake shear zone is the dominant structure. Dips in the Hayes River area are generally sub-vertical and there is evidence of flexural shear and silicification along lithological contacts between iron formation and talc-actinolite schist (meta-komatiite). Rocks of the Curtis River area, approximately 120 km northeast of the Hayes River area, strike northeast and dip sub-vertically.
The iron formations that host the Three Bluffs, Antler, Hayes, and Ledge gold occurrences have unique lithological associations with their contact rocks and do not appear to be stratigraphically equivalent.
Three low, rounded, rusty outcrops, called West, Central, and East, comprise the Three Bluffs gold occurrence. Gold mineralization is hosted in gossanous, predominantly oxide, silicate, and sulphide facies iron formations. Iron formation thicknesses range from 25 m to 30 m at the West Bluff to 55 m at the Central Bluff. The Three Bluffs iron formation maintains a thickness of 10 m for a minimum strike length of 1.8 km and is at least 55 m thick for 700 m. The iron formations are poorly banded to massive with locally shared, quartz-veined intervals of up to 3 m near lithological contacts. Chlorite and epidote alteration indicates either lower amphibolite grade metamorphism (epidote-amphibolite facies) or the result of retrograde greenschist facies metamorphism associated with gold deposition. Local mineralization, composed of disseminated pyrite and pyrrhotite, can occupy up to 50% of the rock volume.
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History
Key historical events for the project are include: (i) in 1961 and 1967, mapping was done in the area by the Geological Survey of Canada (“GSC”); (ii) in 1970, King Resources Company conducted reconnaissance geological mapping and sampling in the Laughland Lake and Ellice Hills areas, with follow-up work including geophysics and detailed mapping, trenching, and sampling; (iii) in 1970, 1974, and 1976 Cominco Ltd. Carried out reconnaissance and detailed geological mapping, ground geophysics, and sampling in the Hayes River area; (iv) in 1971, the Aquitaine Company conducted airborne electromagnetic (‘EM”) and magnetometer surveys; (v) from 1972 to 1977, detailed re-mapping of the area was done by the GSC; (vi) in 1979, Urangesellschaft Canada Ltd. Carried out reconnaissance airborne radiometric surveys and prospecting for uranium in the Laughland Lake area; (vii) in 1986, Wollex carried out geological mapping and rock sampling in the West Laughland Lake area; (viii) in 1992, GSC conducted geological re-assessment of the mineral potential of the Prince Albert Group; (ix) in 1994, channel sampling carried out over the Three Bluffs area but the results were lost; (x) in 1996, Terraquest Ltd. Conducted a high-resolution airborne magnetometer survey; (xi) from 1997 to 1998, P.H. Thompson Geological Consulting Ltd. Conducted regional geological mapping in the Three Bluffs area; (xii) from 1999 to 2002: GSC conducted a multi-disciplinary study of the Committee Bay Greenstone Belt (“CBGB”); (xiii) from 1992 to 2012, North Country Gold and its predecessors Carried out prospecting, rock sampling, gridding, airborne and ground geophysics, geophysics, geological mapping, and reverse circulation and diamond drilling on several of the gold targets including Three Bluffs, Three Bluffs West, West Plains, Anuri, Inuk, Antler, and Hayes.
Historical drilling (pre-2015) on the Project amounts to 68,269.98 metres drilled in 426 drill holes. Of the historical drilling, 351 drill holes comprising 58,575.56 m were completed at Three Bluffs and are the basis for the Three Bluffs Mineral Resource described below.
Sampling, Analyses and Data Verification
Committee Bay RAB Drilling QA/QC Disclosure
Intercepts were calculated using a minimum of a 0.25 g/t Au cut off at beginning and end of the intercept and allowing for no more than four consecutive samples (six metres) of less than 0.25 g/t Au.
Analytical samples were taken using 1/8 of each 5ft (1.52m) interval material (chips) and sent to ALS Global (“ALS”) Lab in Yellowknife, NWT and Vancouver, BC for preparation and then to ALS Lab in Vancouver, BC for analysis. All samples are assayed using 30g nominal weight fire assay with atomic absorption finish (Au-AA25) and multi-element four acid digest ICP-AES/ICP-MS method (ME-MS61). Quality Assurance/Quality Control (“QA/QC”) programs using internal standard samples, field and lab duplicates and blanks indicate good accuracy and precision in a large majority of standards assayed.
Committee Bay Diamond Drilling QA/QC Disclosure
Intercepts were calculated using a minimum of a 0.25 g/t Au cut off at beginning and end of the intercept and allowing for no more than six consecutive metres of less than 0.25 g/t Au.
Analytical samples were taken by sawing NQ diameter core into equal halves on site and sent one of the halves to ALS Lab in Yellowknife, NWT for preparation and then to ALS Lab in Vancouver, BC for analysis. All samples are assayed using 50g nominal weight fire assay with atomic absorption finish (Au-AA26) and multi-element four acid digest ICP-AES/ICP-MS method (ME-MS61). QA/QC programs using internal standard samples, field and lab duplicates and blanks indicate good accuracy. Due to the nuggety nature of mineralization encountered, the Company will be running additional analysis on duplicate samples to better understand the analytical precision.
True widths of mineralization are unknown based on current geometric understanding of the mineralized intervals.
Committee Bay Grabs QA/QC Disclosure:
Approximately 1 to 2kg of material was collected for analysis and sent to ALS Lab in Vancouver, BC for preparation and analysis. All samples are assayed using 50g nominal weight fire assay with atomic absorption finish (Au-AA26) and multi-element four acid digest ICP-AES/ICP-MS method (ME-MS61). QA/QC programs for 2018 rock grab samples using internal standard samples, lab duplicates, standards and blanks indicate good accuracy and precision in a large majority of standards assayed. Grab samples are selective in nature and cannot be consider as representative of the underlying mineralization.
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Core arrives in camp at the end of each drill shift where geological technicians check and correct and downhole distance discrepancies. Technicians record core recovery, fracture density and orientation, magnetic susceptibility, and overall rock quality designation. Geological logging follows, comprising measurement and descriptions of geological units and the collection of semi- quantitative data such as the number of visible gold occurrences, volume percent sulphide minerals, volume percent of alteration minerals, volume percent vein quartz, etc. Sample intervals are then designated by the logging geologist focusing on sulphide bearing and/or silicified Intervals that are well bracketed by apparently unmineralized rock. Protocols limit sampling intervals between 0.75 m and 1 m in length with a minimum length of 0.3 m and a maximum length of 1.5 m so long as geological boundaries were honoured.
Drill core is digitally photographed and core samples are marked for sawing. Sampling intervals, geological boundaries, and a “saw line” are marked by the logging geologist and the core is sawed in half longitudinally by technicians. One half of the core is placed in a sample bag with a uniquely numbered tag and secured with plastic cable ties. Each batch of 20 field samples contain a blank and one of four commercial certified reference materials. The remaining half core is returned to the core box for reference. The majority of the reference core remains on-site except for chosen intervals which are taken to Edmonton, Alberta for display purposes. Individual sample bags are placed inside a larger bag which is closed with a security seal for shipment to the laboratory.
Assaying procedures are generally similar to those used in 2003, with some minor modifications. The standard aliquot size was increased to 2AT (58.32 g) and the samples were all analyzed using FA with a gravimetric finish. Selected samples, containing visible gold or which assayed greater than 20 g/t Au, are re-analyzed using metallic screen fire assay that include twin 2AT gravimetric assays of the fine fraction. A pulp from each sample is sent for standard 30 element ICP analysis using a three-acid digestion.
All the RAB and diamond drill core samples are analyzed at the ALS laboratory in Vancouver, BC, by fire assay of a 50 g sample followed by a gravimetric finish according to ALS lab code Au-GRA22 and by a multi-element inductively couple plasma atomic emission spectrometry or mass spectrometry (“ICP-AES/ICP-MS”) package following a four acid digestion of a one gram sample according to ALS lab code ME-MS61. Sample intervals with visible gold in core were assayed using a Screen Fire Assay method on a one kg sample according to ALS lab code Au-SCR24 where the entire sample is screened to 100 μm and firs assays are performed on a 50 g sample of <100 μm material and on the entire >100 μm material. The fire assay is calculated as a weighted average of the two fire assays.
In the opinion of Roscoe Postle Associates Inc. (“RPA”, formerly Scott Wilson Roscoe Postle Associates Inc.), the sample collection, preparation, analysis, transport, and security procedures at the Committee Bay Project are adequate for use in the estimation of mineral resources.
Mineral Processing and Metallurgical Testing
2003 Metallurgical Testing
Dawson Metallurgical Laboratories, Inc. of Salt Lake City, Utah, was commission in 2003 to conduct metallurgical tests on Three Bluffs mineralized material. Twelve drill core samples, eight high-grade and four low-grade, totaling approximately 20 kg were used. The mineralogical study reported the principal sulphide minerals as pyrrhotite with minor pyrite. No reference was made to any deleterious elements in the samples.
The test indicated that 92% gold recovery could be achieved with cyanidation but the presence of pyrrhotite would result in high cyanide consumption. RPA notes that these preliminary tests suggest gold at Three Bluffs can be recovered using conventional methods.
2008 Metallurgical Testing
Mineral processing testwork comprising exploratory gravity concentration, cyanide leaching, and froth flotation studies were undertaken by Process Research Associates Ltd. (“PRA”) under the guidance of RPA. The sample used was a 110 kg composite of drill core samples from the 2007 exploration program with an average estimated grade of 4.3 g/t Au and 7.5% S.
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Additional gravity recovery test work on Three Bluffs mineralization was performed by Knelson Research Technology Centre. An 18 kg sample, taken from a composite of coarse rejects sample material from 2007 drill core samples, was subjected to multi-pass testing utilizing a bench-scale enhanced gravity concentrator. The tests were designed to examine recovery trends for gold and gold-bearing sulphides.
Based on the composite sample tested it was expected that Three Bluffs mineralization could be processed by various standard beneficiation steps to recover approximately 93% of the gold. The limited metallurgical testwork conducted to date suggests that the gold can be recovered by conventional means, a combination of gravity and flotation followed by cyanide leaching of the concentrate. The metallurgical test results indicated that a combination of gravity and flotation followed by cyanide leaching of the concentrate is likely the most suitable processing option.
2009 Metallurgical Testing
Follow-up work at PRA was then undertaken in April 2009 to look specifically at a flowsheet consisting of gravity recovery followed by cyanidation. These results were reported by PRA on May 6, 2009. At a primary grind size P80 of 74 μm, gold was effectively extracted by gravity and flotation, with 96% of the gold recovered. In a single Locked-Cycle test, a gravity circuit recovery of 60.5% gold in 0.22% of mass, followed by a cleaner flotation recovery of 35.3% gold in 17.7% of the mass, was obtained. Thus, an overall gold recovery of 95.8% in 17.9% of the mass was shown to be possible. Flotation recovery without gravity scalping was also reasonably successful.
Flotation concentrate was subjected to cyanide leach testwork. A total of eight concentrate leach tests were performed. A single whole ore cyanide leach test obtained 79.2% gold extraction after 48 hours and 94.6% after 72 hours. Several issues were identified during metallurgical testing of samples, the largest issue lies with cyanide consumption. Cyanide consumption has been found to be extremely high at up to 0.2 kg/h, while leaching kinetics remain low. Another issue that has been identified is that gold bearing sulphides are not amenable to enhanced gravity separation, therefore batch concentration and not continuous gravity concentration should be utilized. Based on the samples tested to date, Three Bluffs ore is generally considered to be relatively free-milling. Gravity concentration has been effective in recovering up to 60% of the gold. Much of the remaining gold can be effectively recovered by either flotation or cyanide leaching to produce an overall metallurgical recovery above 90%. RPA recommends further optimization and variability work on a greater variety of samples from the Three Bluffs property if further economic studies are conducted.
There has been no mineralogical processing and metallurgical testing since 2009.
2023 Committee Bay Mineral Resource Estimates
The mineral resources at the Committee Bay Project are estimated to be approximately 2.07 million tonnes of indicated mineral resources grading 7.85 g/t Au, containing 524,000 ounces of gold, and 2.93 million tonnes of inferred mineral resources grading 7.64 g/t Au, containing 720,000 ounces of gold as of September 11, 2023. No additional drilling within the resource has been completed and the 2017 Mineral Resource Estimate and the 2017 block model remains appropriate for the 2023 mineral resource calculation in the opinion of Mr. Turner. Mr. Turner acknowledges that some other parties may be using somewhat higher long-term gold price assumptions than were used for this estimate. A bulk density of 3.15 t/m3 was applied for estimation of tonnage. This value was derived from a total of 6,426 density determinations carried out on drill core from a variety of locations in the deposit.
The estimate was carried out using a block model method constrained by wireframe grade shell models, with Inverse Distance Cubed (“ID3”) weighting. Two sets of wireframes and block models were employed: one contemplated open pit mining and the other, underground mining. The block model grade interpolations were checked by (i) an inspection of the interpolated block grades in plan and section views and comparison to the composite grades, and (ii) through a statistical comparison of global block and composite mean grades. Inspection of the block grades in plan and section indicates that the grade estimation honours the drill hole grades reasonably well.
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The reported mineral resources at calculated cut-off grades of 3.0 g/t Au for open pit mining and 4.0 g/t Au for underground mining based on the following assumptions:
| · | Gold Sale Price: US$1,200/oz; |
| · | Process Recovery 93%; |
| · | Open Pit Mining Cost C$10.00/t; |
| · | Underground Mining Cost C$70.00/t; |
| · | Process + G&A Costs C$75.00/t; and |
| · | Exchange Rate 1.25 US$/C$. |
To fulfill the resource status criteria requirements of “reasonable prospects for eventual economic extraction”, a pit shell analysis was run on the 0.5 g/t Au model to determine how much of the deposit could potentially be extracted using open pit methods. The analysis was done using Whittle software with very preliminary assumptions for pit slopes, metallurgical recovery, prices, and costs.
For this mineral resource the preliminary pit shell that was optimized in 2013 using a different gold price and cost assumptions (listed below) than those used to calculate the updated cut-off grade. Mr. Turner considers this approach reasonable given that the pit shell used to report open pit resources is conceptual and the relative difference between the underground and open-pit resource cut-off grades is negligible.
The following cost assumptions were used:
| · | Gold Sale Price: US$1,500/oz; |
| · | Overall Pit Slope Angles: 50°; |
| · | Process Recovery 93%; |
| · | Mining Cost US$10.00/t; and |
| · | Process + G&A Costs US$60.00/t |
Blocks from the open pit model captured within this shell were considered eligible for reporting as open pit resources. The same pit shell was applied to the underground model, except that blocks from this model were included in the resource only if they were outside of the shell.
Mineral Resources as of September 11, 2023
| Class | Type |
Cut-off
(g/t AU)
|
Tonnes
(000 t)
|
Gold Grade
(g/t Au)
|
Contained Gold
(oz Au)
|
| Indicated | Open Pit | 3.0 | 1,760 | 7.72 | 437,000 |
| Indicated | Underground | 4.0 | 310 | 8.57 | 86,000 |
| Total | 2,070 | 7.85 | 524,000 | ||
| Inferred | Open Pit | 3.0 | 590 | 7.57 | 144,000 |
| Inferred | Underground | 4.0 | 2,340 | 7.65 | 576,000 |
| Total | 2,930 | 7.64 | 720,000 |
Notes:
| 1. | Mineral Resources are not Mineral Reserves as they do not have demonstrated economic viability, although, as per CIM requirements, the Mineral Resources reported above have been determined to have demonstrated reasonable prospects for eventual economic extraction. |
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| 2. | The Mineral Resources were estimated in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum (CIM), CIM Standards on Mineral Resources and Reserves, Definitions (2014) and Best Practices Guidelines (2019) prepared by the CIM Standing Committee on Reserve Definitions and adopted by the CIM Council. |
| 3. | The Mineral Resources Committee Bay Gold Project was initially reported in Ross (2017) – QP David A. Ross, M.Sc., P.Geo, effective date of May 31, 2017. |
| 4. | The resources reported above are reviewed in detail within this Report and are accepted as current by the Qualified Person, Mr. Andrew J. Turner, B.Sc., P.Geol., of APEX Geoscience Ltd |
| 5. | The Cutoff grades were determined using average block grade values within the estimation domains and an Au price of US$1,200/oz, and Process Recovery of 93%, Open Pit mining costs of C$10.00/t, Underground mining costs of C$70.00/t, Process and G&A costs of approximately C$75/t and an exchange rate of 1.25 US$/C$. |
| 6. | A bulk density values value of 3.15 t/m3 was assigned based on available SG measurements. |
| 7. | Differences may occur in totals due to rounding. |
Exploration Program Recommendations
The following summarizes the work programs recommended by the authors of the 2023 Technical Report for the Committee Bay Project. The Phase 1 program is anticipated to include collection of 15,000 infill detailed till samples and 7,500 m of Diamond drilling along the shear zone sub-parallel to the Three Bluffs deposit. The Phase 1 program is estimated to cost approximately $5 million Details of the recommended Phase I program can be found below.
A Phase 2 exploration program will be drill intensive. An additional 10,000 – 15,000m of diamond drilling should be completed at the Three Bluffs deposit to explore the down dip potential of the limb mineralization as well as tying in the newly identified shear zone hosted mineralization with the ultimate goal of updating the Mineral Resource Estimate. An additional 10,000m of drilling should be allocated to regional targets defined from the Phase 1 program. The Phase 2 program is estimated to cost between $15 and $20 million. Details of the recommended Phase 2 program can be found below.
Recommended Work Programs for 2024 and beyond
| Phase 1 | ||||||
| Type | Details | Cost Estimate (C$) | ||||
| Labour | Staff Wages, Technical and Support Contractors | 350,000 | ||||
| Assaying | Sampling and Analytical | 150,000 | ||||
| Drilling | Three Bluffs Diamond Drilling (7,500 meters at $220/m) | 1,650,000 | ||||
| Till Sampling | Detailed sampling program | 120,000 | ||||
| Land Management | Consultants. Assessment Filing, Lease Payments | 250,000 | ||||
| Community Relations | Community Tours, Outreach | 30,000 | ||||
| Information Technology | Remote site communications and IT | 35,000 | ||||
| Safety | Equipment, Training and Supplies | 15,000 | ||||
| Expediting | Expediting (Rankin Inlet, Baker Lake, Churchill) | 150,000 | ||||
| Camp Costs | Equipment, Maintenance, Food, Supplies | 250,000 | ||||
| Freight and Transportation | Freight, Travel, Helicopter, Fixed Wing | 450,000 | ||||
| Fuel | 1,000,000 | |||||
| General and Administration | 100,000 | |||||
| Sub-total | 4,550,000 | |||||
| Contingency (10%) | 455,000 | |||||
| Total | 5,005,000 | |||||
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| Phase 2 | ||||||
| Type | Details | Cost Estimate (C$) | ||||
| Labour | Staff Wages, Technical and Support Contractors | 1,750,000 | ||||
| Drilling | 20,000 – 25,000 m Diamond Drilling at Three Bluffs and regional | 6,500,000 | ||||
| Assaying | Sampling and Analytical | 750,000 | ||||
| Community Relations | Community Tours, Outreach | 50,000 | ||||
| Information Technology | Remote site communications and IT | 150,000 | ||||
| Safety | Equipment, Training and Supplies | 75,000 | ||||
| Expediting | Expediting (Rankin Inlet, Baker Lake, Churchill) | 550,000 | ||||
| Camp Costs | Equipment, Maintenance, Food, Supplies | 1,250,000 | ||||
| Freight and Transportation | Freight, Travel, Helicopter, Fixed Wing | 1,950,000 | ||||
| Fuel | 2,750,000 | |||||
| General and Administration | 400,000 | |||||
| Sub-total | 16,175,000 | |||||
| Contingency (10%) | 1,617,500 | |||||
| Total | 17,792,500 | |||||
2015 through 2021 Committee Bay Exploration by Fury
Since acquiring the Project, Fury Gold has completed a total of 47,194.47 m of RAB drilling in 271 drill holes as well as 14,006.28 m of diamond drilling as part of the Phase 1 recommendations detailed above. In addition to the drilling extensive regional and infill till geochemical campaigns, ground and airborne geophysical surveying as well as aerial drone surveying have been undertaken. The Company has incurred approximately $60M in expenditures exploring the Project. The Company views that the results from this exploration further support conclusions drawn in the Committee Bay Report and do not represent a material change to the Committee Bay Project. The Company intends to continue its exploration in accordance with the Phase 2 recommendations with the continued testing of regional drill targets and expansion drilling at the Three Bluffs deposit.
The Company did not undertake an exploration program at Committee Bay in 2022 in order to focus available resources on the exploration program in Quebec.
2018 Committee Bay Exploration Program
During 2018, the Company drilled approximately 10,000 m across several targets in the vicinity of the Three Bluffs deposit but away from known mineralization. Summarized results from this program are highlighted as follows:
Aiviq - 16 core and 7 RAB holes - The majority of the core drill holes intersected 20 - 40 meter widths of intense quartz veining and sulphidized banded iron formations. Results from the Aiviq core drill program include highlights of 13.5 m of 1.54 g/t gold (including 6 m of 3.3 g/t gold) 4.5 m of 2.93/t Au, and 1.5 m of 8.95/t Au;
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Kalulik - 8 RAB holes - The 2018 drill program at Kalulik identified two separate gold-bearing hydrothermal systems, 4 km apart, that intersected broad zones of low-grade mineralization over 10 - 20 meter widths within sulphidized banded iron formations and associated quartz veining. These results include 21.34 m at 0.4 g/t gold and 16.76 m at 0.45 g/t gold; and,
Aarluk - 7 RAB holes - At the Aarluk prospect the best intercept was 3.05 m of 3.39 g/t gold, which was encountered in a weakly sulphidized banded iron formation.
2019 Committee Bay Exploration Program
During 2019, the Company followed up on the results from its 2018 program by completing the following:
Machine Learning - A total of twelve new targets were generated through unbiased processing of existing exploration data. Two of the targets overlapped with the Company’s geologist derived targets adjacent to the Aiviq and Kalulik discoveries;
Drill Program - A 2,700m diamond drill program at the Committee Bay Project targeted a combination of both machine learning and traditional geologist generated targets and drilled a new gold-bearing system along the regional fault zone that hosts the Aiviq and Kalulik systems. These results include 30 m of 0.67 g/t gold, including 1.5m of 5.03 g/t gold; and
IP Survey - A 27 line - kilometer induced polarization survey was conducted to identify both chargeability and conductivity targets along the Aiviq-Shamrock corridor.
2021 Committee Bay Project Drill and Exploration Program
The Company completed 2,587m of diamond drilling during a six-week field program in the third quarter of 2021. The drilling was focused on expanding the defined high-grade mineralization at the Raven prospect and testing the potential mineralization below the current resource at the Three Bluffs deposit.
Raven Prospect
The Raven prospect is located in the southwest third of the Committee Bay Gold Belt, approximately 50 km west of the Three Bluffs deposit. The prospect is situated along an 8km long shear zone where defined gold mineralization is strongly associated with arsenopyrite within sheared and altered gabbros as well as within quartz veins marking the contact between the gabbro and metasediments over a known strike length of approximately 1.2km. There have been 207 rock samples historically taken over the defined area of mineralization, with 30 samples returning values greater than 5 g/t gold with a peak value of 143 g/t gold. Importantly, only 1.2km of the 8km shear zone has been systematically explored to date.
The prospect has a total of nine historical drill holes totaling 1,670m with intercepts including 5.49m of 12.6 g/t gold, 2.84m of 31.1 g/t gold, and 5.38m of 2.99 g/t gold over a drilled strike length of 400m. Historical drilling at the prospect has defined a high-grade body of mineralization approximately 250m in length, with a 30-degree plunge to the east that is open along strike and down dip. Highlights include drill intercepts of 9.18 g/t gold (Au) over 1.5 metres (m) and 7.30 g/t Au over 1.0m in drill hole 21RV-012 and 0.88 g/t Au over 8.00m in drill hole 21RV-011 as well as rock grab results of up to 32.90 g/t Au from a newly identified gold mineralized outcrop 150m to the south of the Raven structure that was drilled in this program.
The reported intercepts have extended mineralization 160m down dip and 70m along strike from historical drilling at Raven. These results paired with the identification of a previously untested gold mineralized structure clearly indicate the significance of the Raven structure and shear zones in general, as exploration targets along the belt. Additional till sampling was completed at the Raven prospect to explore the entire length of the 8km shear zone to define new targets. The sampling has identified high-grade gold mineralization 150m south of the main Raven showing along an undrilled structure at the edge of an 8km long regional shear zone. Seven rock grab samples from outcrop returned results above 10 g/t Au with a peak of 32.9 g/t Au. Gold and arsenic in till now define a coherent 1,400m by 500m anomaly at Raven.
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Three Bluffs Deposit
The Three Bluffs deposit contains a high-grade resource defined by 525,000oz at 7.85 g/t gold in the indicated category and 720,000oz at 7.64 g/t gold in the inferred category. The deposit is characterized by gold mineralization hosted within a folded, silicified, and sulphidized banded iron formation. The anticline that defines the deposit has a strike length of approximately 4km and has been drilled from 150m to 650m vertical depth and is open down dip. High-grade mineralization at the deposit is associated with high conductivity responses due to the intense sulphidation of the banded iron formation as evidenced in the hinge zone of the anticline.
Fury Gold's primary target for 2021 at the Three Bluffs deposit was a conductive body that measures 600m by 200m at a vertical depth of between 300m and 500m. The target is down dip from high grade mineralization within the limbs of the anticline and is offsetting the following intersections: 5m of 40.6 g/t gold, 5.3m of 29.03 g/t gold, 11m of 16.23 g/t gold, 5m of 15.2 g/t gold, 2m of 21.81 g/t gold, and 2m of 19.38 g/t gold. The Company completed a single drill hole that intersected 10.0m of 13.93 g/t Au, 3.0m of 18.67 g/t Au and 1.0m of 23.2 g/t Au (Figure 5). These intercepts are associated with a deformation zone within a meta-sediment unit that is underexplored at Three Bluffs.
Three Bluffs Gold Deposit Long Section Looking North depicting the 2021 drilling results.
2022 and 2023 Committee Bay Project Exploration Program
The Company did not undertake an exploration program in 2022 and 2023 in order to focus all resources on the Quebec programs. However all claims were and are maintained in good standing.
2024 Committee Bay Project Exploration Program
The 2024 exploration program prioritized follow-up and infill sampling of highly anomalous regional gold-in-till samples with unidentified sources. The exploration model focused on regional shear zones proximal to favourable lithologies such as iron formation and ultramafic lithologies.
Three drill targets have now been determined:
| 1. | Three Bluffs Shear, where drilling in 2021 intercepted 13.93 g/t Au over 10 metres (m) (see news release dated December 1, 2021); |
| 2. | Raven Shear where 7 rock samples have averaged 16.12 g/t gold; and |
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| 3. | Burro West where a 300 by 300 m discrete >90th percentile gold in till anomaly has been defined with a peak value of 50 ppb gold. |
The program resulted in the collection of 546 infill till samples from two detailed grids, Burro West and Aarluk East, and 69 rock samples from 5 targets.
The 2024 mapping and rock sampling focused on shear zones proximal to and sub-parallel to favourable lithologies for gold mineralization within the Committee Bay Greenstone Belt with samples being collected at Three Bluffs, Raven, Burro, Aarluk East and Aarluk West.
The mapping and rock sampling at Three Bluffs was able to confirm the continuity of the interpreted shear zone that is sub-parallel to the Three Bluffs iron formation to the east of the reported 2021 intercept of 13.93 g/t gold over 10 m from drill hole 21TB152 (see news release dated December 1st, 2021). The reported 2021 intercept was a 120 m step out from the defined high-grade Three Bluffs gold deposit which on its own demonstrates the potential to meaningfully expand the known resource. The mapped continuation of this sub-parallel shear zone to the east trends into an area where there is no historic drilling providing an excellent near deposit drill target.
At Raven rock sampling and mapping has identified a mineralized sub parallel shear zone to the south of the main Raven showing where the average grade from seven rock samples collected is 16.12 g/t gold. The extensions along strike of the Raven south shear zone are obscured by glacial till deposits however, the average grade from outcrop sampling and prevalence of visible gold observed in the limited outcrop are encouraging and warrant drilling.
Infill till sampling at the Burro West target has identified a robust multi point +90th percentile approximately 300 x 300 m gold in till anomaly. The Burro West anomaly is spatially associated with a break in the regional magnetics data which is interpreted as a sheared contact between mafic volcanics and ultramafic lithologies. Additionally, the highest gold value returned from all the 2024 infill till samples is located at the SW corner of the Burro West grid and remains open.
The Aarluk East grid returned several intriguing moderate isolated gold in till anomalies associated with interpreted regional structures that require additional mapping work to potentially advance to the drill ready stage.
2023 Committee Bay Mineral Resource Estimate and Technical Report
Three Bluffs resource estimations were completed by APEX Geoscience Ltd. (“APEX”) (see the Technical Report on the Committee Bay Project, Nunavut Territory, Canada, dated September 11, 2023, and filed under Fury’s SEDAR+ profile). It supersedes all previous Committee Bay technical reports.
The Company expects to incur approximately $160,000 in annual mineral claims expenditures in 2025, in order to keep the property in good standing. Payments totalling $157,000 were made during the year ended December 31, 2024, in respect of these mineral claims.
Éléonore South Property, Québec, Canada
The following disclosure relating to the Éléonore South project is based on information derived from the technical report on the Éléonore South Project entitled “Technical Report on the Éléonore South Project, Quebec, Canada” prepared by Mrs. Valerie Doyon, the Company’s Senior Project Geologist with an effective date of March 31, 2024 (the “Éléonore South Technical Report”) Reference should be made to the full text of the Éléonore South Technical Report, which is available electronically on the SEDAR+ website at www.sedarplus.ca under our SEDAR profile, filed on March 31, 2025, as the Éléonore South Project contains additional assumptions, qualifications, references, reliance and procedures which are not fully described herein. Mrs. Doyon is a technically “qualified person” as defined by NI 43-101. All information of a scientific or technical nature contained below and provided after the date of the Éléonore South Report has been reviewed and approved by Mrs. Valerie Doyon.
The Éléonore South Project has been determined to be a material property effective March 31, 2025.
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The Éléonore South Project, 100% held and operated by by Fury, is an exploration stage project comprised of 282 claims, totaling 14,760 hectares (ha). Located in 1:50,000 scale NTS map sheets 33B12 and 33C09, approximately 200 km east of the Cree community of Wemindji, 330 km northwest of the town of Chibougamau and 800 km north of Montreal. The property is accessible, year-round, by either the James Bay Highway or Route du Nord and is located 100 km north of Nemaska, serviced by commercial flights twice per week. The centre of the property is located at approximately 75.98 degrees longitude west and 52.58 degrees latitude north.
116 of the claims are subject to an escalating Net Smelter Royalty (NSR) held by Osisko Royalties (Osisko Royalty). The Osisko Royalty is tied to overall production from these claims as well as from the Éléonore Mine property claims held by Newmont Corporation. The royalty amounts to 2% on the first 3 Moz of gold production and tops out at 3.5% after 8 Moz Au production. The royalty increases by 10% for gold prices above US$550/oz Au – again topping out at 3.5%. The remaining 166 claims are free of any royalty.
The Project is located north of the 52nd parallel (52ºN) and as such is subject to the provisions of the James Bay and Northern Quebec Agreement (1975), and the Paix des Braves Agreement (2002). The Project falls within the Eeyou Istchee Territory and straddles the boundary between the Cree Nations of Wemindji and Eastmain, including trap lines held by Angus Mayappo and Roderick Mayappo (tallyman).
The Éléonore South project is located on Category III lands, as established under the James Bay and Northern Quebec Agreement. Category III lands are administered by the province of Quebec, and they do not have any substantial restrictions on mineral exploration. A notice of work must be forwarded to the Wemindji and Eastmain Communities and the tallyman prior to initiating exploration activities. The Project straddles the traditional territories of the Cree Nations of Wemindji and Eastmain (Figure 1) and lies on traplines VC-29, VC-35 and VC-36.
The figure below presents property location and claims comprising the Éléonore South Project:
The Éléonore South property is strategically located in an area of prolific gold mineralization within the Eeyou Istchee James Bay gold camp and is locally defined by Newmont’s Éléonore mine and Sirios Resources’ Cheechoo deposit. The property has been explored over the last 12 years by the joint venture focused on the extension of the Cheechoo deposit mineralization within the portion of the Cheechoo Tonalite on the joint venture ground. Approximately 27,000 m of drilling in 172 drill holes, covering only a small proportion of the property at the Moni and JT prospects has been completed. Notable drill intercepts include 53.25 m of 4.22 g/t gold (Au); 6.0 m of 49.50 g/t Au including 1.0 m of 294 g/t Au and 23.8 m of 3.08 g/t Au including 1.5 m of 27.80 g/t Au.
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In December 2020, Fury Gold announced the recognition of a large-scale gold in till anomaly on the Éléonore South property through a review of historical datasets. This target has not been drill tested. In September 2021 the ESJV initiated a field program designed to refine the broad geochemical anomaly into discrete targets for further follow up and eventual drill testing. Additionally, a regional survey was completed on the southern third of the property where no historical systematic sampling had been completed.
During the third quarter of 2022 an orientation biogeochemical sampling survey was completed over a buried fold hinge target interpreted to be hosted within the same sedimentary rock package as Newmont's Éléonore mine. A total of 641 biogeochemical samples were collected. In addition to the biogeochemical orientation survey the Company completed a rock sampling program within the nine discrete gold in soil anomalies identified from the 2021 field work. The nine discrete gold in till anomalies are centered on an east-west structural corridor that separates intrusives to the south and sediments to the north. The importance of this new structural framework is that the newly defined gold in till anomalies are located along deep-rooted structures clearly visible in the geophysical data. Based on the elemental associations observed of gold with arsenic, bismuth and tungsten, in both the historical and infill sampling the most likely style of mineralization to be encountered in the nine targets will be the Cheechoo style observed at the JT and Moni showings.
Access, Climate, Local Resources, Infrastructure and Physiography
The Project is located in the Eeyou Istchee James Bay Territory of Northern Quebec, approximately 200 km east of the Cree community of Wemindji, 330 km northwest of the town of Chibougamau and 800 km north of Montreal (NTS Map sheet 33B12 and 33C09). The Project is 15 km southeast of Newmont Corporation’s Éléonore Mine (Figure 1). The property is accessible, year-round, by either the James Bay Highway or Route du Nord and is located 100 km north of Nemaska, serviced by commercial flights twice per week.
The property is accessible, year-round through a combination of the Billy Diamond (James Bay) Highway, the Route du Nord and Hydro-Quebec’s Sarcelle road. Sirios Resources has constructed a resource access road which leads to the Cheechoo Deposit within the Cheechoo Tonalite along the central east portion of the Property. Éléonore South is located 100 km north of Nemaska, serviced by commercial flights twice per week.
Fury, through its Eastmain subsidiary, maintains a 20-person camp to support exploration activities at the Éléonore South project. The hydroelectric power line that feeds Newmont’s Éléonore Mine transects the Éléonore South property (Figure 1). Newmont’s Éléonore mine complex, including a private airport are located 15 km to the northwest. Necessities such as skilled labour and specialized equipment are sourced from Val-d’Or or Chibougamau. Many services are now available through numerous Cree owned businesses and partnerships in Wemindji, Eastmain and Nemaska.
The property is located within the Canadian Shield and is characterized by many lakes, swamps, rivers, and low-lying terrain. The Property is bordered to the west by the Opinaca Reservoir. The Gipouloux River flows westward through the northern portion of the Property. The Éléonore South project is located in the boreal forest where forest fires are common. Vegetation is typical of taiga, including areas dominated by sparse black spruce, birch, and poplar forests, in addition to large areas of peat bog devoid of trees.
Overburden is typically 3 to 4 m thick, with the exception of isolated areas where overburden thickness can reach 20 m. Numerous glacial eskers often reaching tens of km in length can be seen of satellite images. Rock outcrops are sparse due to the abundance of quaternary deposits and swamps. The topography of the area is subdued and characterized dominantly by lowlands, with few hills that attain elevations up to 300 m above sea level.
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Geology, Mineralization and Deposit Types
The Éléonore South property is in the northeastern part of the Archean Superior Province (4.3-2.6 Ga; Percival et al., 2012), in a region comprising both the La Grande and Opinaca Subprovinces. Both subprovinces were largely constructed and metamorphosed during a series of micro-continent collisions formerly known as the “Kenoran Orogeny” (ca. 2,720-2,660 Ma; Card, 1990; Percival et al., 2012). The property is entirely enclosed in the southwestern part of the La Grande Subprovince known as the Eastmain River domain at proximity of the boundary with the Opinaca Subprovince. This proximity with the Opinaca boundary is considered highly prospective for various types of gold mineralization along both north and south portions of the contact exemplified by the Éléonore and Eastmain mines, and several exploration projects such as Corvet Est, Poste Lemoyne and La Grande Sud.
The Éléonore South property is characterized by the widespread presence of metasedimentary rocks and felsic intrusions. The northern part of the main block consists almost exclusively of the LGSP Low Formation (which has in the past been attributed to the OPSP). The Low Formation comprises essentially variably recrystallized tubiditic biotite meta-wacke along with minor aluminous porphyroblasts bearing meta-pelite bands, conglomerates and iron formations. Its deposition is poorly constrained due to a complex history resulting in apparently conflicting dates. The Ell Lake diorite (2,706±2 Ma, Fontaine et al., 2017) intrudes the sediments, setting a local minimum age for consolidation, while sedimentation is locally thought to have kept going well after 2,700 Ma (Bandyayera et al., 2010; Ravenelle, 2013). However, some parts were deposited as early as shortly after 2,714 Ma. (Bandyayera et al., 2010) The sediments were therefore likely deposited in a tectonically active basin with magma intruding barely consolidated sedimentary rocks, while some parts were still sedimenting. Proximity and similarity in composition and chronology suggest that the Low Formation could represent a more proximal lower grade extension of the Laguiche basin (OPSP).
Two distinct styles of mineralization have been identified to date; structurally controlled quartz veins hosted within sedimentary rocks similar to the high-grade mineralization observed at the Éléonore Mine; and intrusion-related disseminated gold mineralization similar to that seen at the low-grade bulk tonnage Cheechoo deposit with higher grade potential as seen at the JT and Moni Prospects on the project.
History
Regional exploration work was undertaken in the 1970s to evaluate the mineral economic potential of the area in anticipation of the flooding· resulting from the construction of the James Bay hydroelectric projects. Lake bottom sediment and geophysical surveys were conducted as well as regional geological mapping. Systematic and focused exploration work on the property started in 2005.
1970
In 1970’s, Société de Développement de la Baie James (SDBJ) did an evaluation of the mineral endowment of the area in anticipation of the flooding that was planned with the building of the James Bay hydroelectric projects (GM 34000, 34001, 34002 and 38167).
1976
In 1976 Quebec Government (MRNF) carried out a geological compilation of the James Bay area (DP 358 - Dube & al.,1976).
1977
In 1977 Quebec Government (MRNF) carried out a geological mapping covering the western part of the NTS 32/C09 (DPV 446 - Remick, 1976).
1999
In 1999 Quebec Government (MRNF) carried out a geological reconnaissance which covered the eastern part of the NTS 33/B12 (Simard & Gosselin, 1999).
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2002
In 2002 Quebec Government (MRNF) worked on a geological synthesis report by Moukshil et al., 2002 - ET2002-06.
2003
In 2003, Azimut Exploration Inc. acquires by map designation the Opinaca C Property. The property counts 99 claims, (news release from 2003, November 24th).
2004
In 2004, Viriginia Gold mines discovered the Roberto gold deposit located 15 km north and adjacent to the Eastmain's Éléonore South Property (Robinson & Tolhurst, 2011).
Following the discovery of Roberto deposits, Azimut Exploration Inc. increases its holding near the area of Éléonore discovery and add 67 map designated claims to Opinaca C property. The property totalized at this time 166 conjugate claims owns at 100% by Azimut (news release from 2004 November 22nd).
2005
In March 2005, Azimut Exploration Inc. and Eastmain Resources Inc. signed an agreement for the Opinaca C property (news release from 2005, March 30th). Eastmain could acquire a 50% interest from Azimut Exploration during a 5-year period for certain payments of cash and shares.
In the summer of 2005, Eastmain Resources contracted Geotech Limited to carried out a helicopter-borne geophysical survey. It included a time domain electromagnetic and magnetic survey. A total of 1021-line km were flown on a 100 m spacing. Several EM anomaly groupings were identified (GM 62241).
Groundwork was conducted by Eastmain Resources for 2005 summer. A geochemical soil survey was completed over the entire property on a 100 m by 500 m grid alongside a prospecting and reconnaissance mapping survey. A total of 2118 soil samples (B-horizon) were collected and confirmed a large gold arsenic anomaly. A total of 202 rocks samples were collected and selected grab samples assayed up to 3390 ppb gold and 4170 ppm arsenic. The prospecting/mapping work confirmed underlying rock and alteration (aluminosilicate) are comparable to Roberto Gold Deposit (GM 62732).
2006
In March 2006, an interpretation of the airborne geophysical surveys flown by Geotech in 2005 was done by Eastmain. A total of 6 areas of interest were identified from the electromagnetic data (GM 62242).
In April 2006, Azimut, Goldcorp and Eastmain sign a Three-Way Joint Venture agreement to merge the 166 claims from Opinaca C block (azimuth and Eastmain) to 116 additional claims (Goldcorp) located north and west of the property. This new merged will become the Éléonore South property and count 282 claims in total split in two blocs (the main block with 248 claims and the west block with 34 claims). Eastmain was appointed the Project operator. Eastmain had the option to earn 33% of the property by funding certain exploration work.
In summer/fall 2006, Eastmain continue to work on the Éléonore South property, and 318.8-line km of grid was cut over 40% of the property. The grid line was completed with a north-south orientation at 200 m spacing and 50 m station. A regional geochemistry soil sampling (O, A and B-horizon) was executed and a total of 8639 samples were harvested and 688 samples from 2005 survey were re-assayed to obtain more precise multi-element values. Several km-size multi-element (Au-As-Sb) Roberto-type geochemical anomalies were detected. A geological mapping and prospecting survey were completed at 200 m line intervals. A total of 675 rock samples were collected from outcrops and boulders. From this number, 11 outcrops assayed between 100 to 1,915 ppb and 9 boulders assayed between 100 to 4,750 ppb. Details mapping and trenching were carried out to follow-up on 7 anomaly areas from 2005 campaign and geophysical survey. A total of 19 trenches were excavated totalizing 3,580 linear m and 380 rock samples were collected (331 grabs and 49 of 1 m intervals channel samples). Several trenches (9) assayed at least one value between 100 to 12,950 ppb. The best value was found in trench 1A (2,090 ppb gold with and > 10,000 ppm arsenic) and in trench 1E (one grab of 12,950 ppb gold and 527 ppm arsenic and a channel composite of 1.4 g/t Au across 16 m). Trench 1A is associated with the WB showing and trench 1E is associated with the JT Prospect (GM 63371).
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Eastmain contracted Geotech Limited to carried out a helicopter-borne geophysical survey on the new claims added to the property. It included a time domain electromagnetic and magnetic survey. A total of 814.6-line km were flown on a 100 m spacing. Several EM anomaly groupings were identified (GM 63373).
2007
In 2007, Eastmain Resources contracted Abitibi Geophysics to complete a resistivity/induced polarization survey. A total of 267-line km was surveyed over the central area of the main grid and over JT Prospect. A gradient IP survey and a dipole-dipole configuration was carried out. The resistivity signature showed two distinctive resistivity unit split by a very conductive lineament interpreted as a major shear zone corridor (GM 64031).
A 9.2-line km grid was cut over JT to facilitate the IP survey. A mapping and prospecting survey was carried out on the property. The goal was to complete the regional mapping, to visit the previous gold and arsenic soil anomalies and the preliminary IP conductors. A total of 387 grabs were assayed and 10 samples return values between 30 and 1,130 ppb gold. Trenches was excavated to investigate firstly the JT Prospect and then to investigate geochemical, geophysical and geological target across the property. Several trenches were excavated for a total of 5,074-line-m split in 28 trenches and 3,391 channel samples. Visible gold was identified first the first time at JT (trench 1E) and some of the best channel composite graded 10.98 g/t over 3.0 m and 15.73 g/t over 2.0 m, 20.0 g/t over 2.0 m. Trench 1A (WB showing) return 7,950 ppb Au over 1.0 m (GM 64030).
Eastmain contracted L.E. Reed Geophysical Consultant Inc to interpret the VTEM and mag survey done on the property in the year 2005 and 2006. The interpretation confirms the existence of several conductor with some associated to mag anomalies (GM 64032).
Eastmain contracted Mehmet F. Taner to conduct a petrographic and mineralogical study. A total of 18 grab samples were analyzed under the microscope. The study confirmed the presence of alumino silicate as alteration in the metasediment. A brief look at the metamorphism mineralogy indicates an upper greenschist to amphibolite metamorphic grade on the property. No gold was found in the thin section and the assays return all below detection limit for those grab samples (GM 64033).
2008
In 2008, Eastmain began a drilling campaign on the Éléonore South property. A total of 3,129 m of drilling were done in 16 drill holes. From this number, 1,275 m were completed on the JT Prospect and 1,854 m were complete on other anomalies. A total of 2,750 core samples were collected and assayed for gold. Holes ES08-09 to ES08-13 drilled the JT Prospect and all intercepted gold value. Several assays return between 500 to 18,400 ppb gold. Holes ES08-15 and ES08-16 were drilled 4 km southeast of JT and tested anomalous rocks trenched and return few values between 550 to 4,980 pbb (GM 64367).
In 2008, Goldcorp mandated Inlandsis Consultant s.e.n.c. to carried a till survey to cover the whole Éléonore Property and part of the Éléonore South Property. Samples were collected at 100 m to 200 m spacing along lines distributed at every 1 km to 1.5 km. A total of 32 samples were collected on the north-west side of the property. Several anomalies of more than 0.1 ppm gold were identified (GM 65193).
2009
In 2009, Eastmain drilled a total of 3,697 m on the Éléonore South property split in 14 drill holes. Drilling was divided in 3 parts focusing on JT and WB showing and on regional geological, geophysical and geochemical anomalies. Multiple broad zones of anomalous gold and arsenic were intersected, and one composite calculated 0.54 g/t over 14 m gold. Total of 28 assayed intervals return more than 1 g/t gold with 2 samples over 9 g/t gold. Drilling on the WB showing confirm the continuation of the mineralization and one composite return 0.37 g/t over 24 m of gold. Two drill holes tested regional anomalies. One of the holes drilled at 2.5 km southeast of JT return a composite value of 0.93 g/t over 4 m with a peak value of 1.64 g/t over 1 m gold. During fall, Eastmain also completed a mapping and prospecting survey. A total of 64 grabs were collected and 2 samples return assays over 500 ppb (GM 65239).
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2010
In 2010, Eastmain drilled a total of 3,622 m on the Éléonore South property split in 17 drill holes. Drilling was divided in 3 parts focusing on JT and WB showing and on regional geological, geophysical and geochemical anomalies. Drilling on JT intersected 15 intervals which contain greater than 1.0 g/t, with a maximum of 3.81 g/t gold. The JT Prospect remain open to the west, south and north. One hole was testing the south extension of the WB showing. Hole return one value of 0.79 g/t over 1.0 m. Three holes from the regional targeting located approximatively at 2.5 km and 4.5 km southeast of JT return value up to 2.41 g/t gold. A total of 90 grabs were collected during a mapping and prospecting campaign. Best value from the prospection survey returns 61 ppb gold (GM 65891).
2012
In the summer of 2012, Eastmain contracted Eagle Mapping from Coquitlam, British Columbia to conduct an aerial Light Detection and Ranging (LiDAR) survey over the Éléonore South property. The survey permits to delineate some structure to be tested in the future (GM 68093).
2016
In 2016, Azimut Exploration Inc. performed a prospection program to test several previously uncovered geochemical soil anomalies. Prospecting focused on the soil anomalies localized in the northern sector of the property and on the southeast side of JT just south of the Cheechoo discovery. A total of 448 samples were collected including 432 grabs samples from outcrops and boulders and 16 channel samples. Results return 48 samples with values over 1.0 g/t (grabs and channel). A total of 12 grab samples returned values between 11.65 to 247.0 g/t. The best channel composite return results of 19.22 g/t Au over 3.8 m, 7.85 g/t Au over 3.4 m, 49.18 g/t Au over 4.0 m and 50.37 g/t Au over 3.50m Gold is found in pegmatite and tonalite rocks and all the gold value but one were found east of the JT Prospect identified as the Moni Prospect (GM 71311).
In fall 2016, Azimut conducted a first phase drilling campaign and 2,509.6 m was drilled split in 12 holes. Drill holes were mostly targeting the Moni Prospect and the Cheechoo extension all return value values over 0.5 g/t with 10 assays over 2.5 g/t gold. Some of the calculated composites give value of 8.88 g/t gold over 2.5m, 0.83 g/t gold over 12.0 m, 5.0 g/t gold over 4.0 m and 0.76 g/t gold over 21.58 m. Two drill holes were targeting a linear high mag anomaly, and one assay return 0.1 g/t gold (GM 71346).
2017
In 2017, Azimut carried out a drilling program (second phase) contemporary to a prospecting and mapping survey. Phase 2 drilling program consists of 32 drill holes totalizing 7,176.2 m. Drill targets were selected from coincident geochemical and geophysical anomalies in the vicinity of the Cheechoo extension and Moni Prospect. All drill holes but 2 return gold values over 0.5 g/t and the best assay up to 68.8 g/t gold. Some of the best calculated composites give value of 4.74 g/t gold over 6.0 m and 3.75 g/t gold over 23.25 m (GM 71346).
In 2017, Azimut carried out a prospection survey and a total of 458 surface samples were collected and comprises 313 grabs samples, 82 channels on 17 trenches and 63 soil samples. The exploration program focused on the soil anomalies localized in the northern sector of the property and on the southeast side of JT just south of the Cheechoo discovery (on Moni Prospect and Cheechoo extension). The exploration program confirmed the presence of gold in many areas of the property. The best gold results returned 96.6 g/t Au over 1.0m from the Moni Prospect in a quartz-feldspar vein / Tonalite (channel R16) and 1,500 g/t Au from the Trench prospect from an angular boulder of quartz-feldspar±biotite and pegmatitic vein with native gold. The Trench prospect is situated just southwest of the Moni Prospect (GM 71972).
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2018
In winter 2018, Azimut drilled 30 holes (28 new holes and 2 extension holes) for a total drilled of 5,448.6 m. Drill targets were collared on coincident geochemical and geophysical anomalies and based on the results from the 2017 prospection campaign. A total of 3,940 core samples were assayed for gold. Drilling campaign focused on the southwestern extension of the Cheechoo discovery, the Moni Prospect discovered in the Summer 2016 campaign, the Trench Prospect located southwest of the Moni Prospect and an elongated E-W trending magnetic high to the south. Drilling from the southwestern Cheechoo extension return 32 values over 1.0 g/t. The best calculated composite in the tonalite assayed value of 2.02 g/t over 4.4 m, 2.50 g/t over 3.05 m and 2.44 g/t over 7.10 m. Drilling on the Moni Prospect return 100 values over 1.0 g/t. Some of the best intersect were obtained in the tonalite with calculated composite of 13.58 g/t over 2.5 m, 8.46 g/t over 8.4 m and 2.58 g/t over 7.8 m (GM 71647).
In the summer of 2018, Eastmain Resources Inc. carried out a stripping program to extend the exposure of the Moni Prospect and to expose the under explored west-south-west extension of Moni. A total of 9 trenches were dug and 2,352 m2 of rock were exposed and 225 samples were collected. Only 5 trenches on 9 were sampled due to lack of pegmatite dykes in some trenches. A total of 23 samples graded over 0.1 g/t gold and 2 graded over 1.0 g/t gold. Those 2 samples are found in trench TRES18-01 at the Moni Extension and return value of 2.18 g/t gold over 0.9 m and 2.5 g/t gold over 1.0 m (GM 73120).
In fall 2018, Eastmain conducted a first phase of drilling. A total of 7,216.4 m was drilled split in 27 holes. All drill holes return values over 0.1 g/t gold and 26 of them return value over 0.5 g/t gold. The campaign tested the JT Prospect with 4 holes and the others tested the Cheechoo southeast extension. In JT, the hole ES18-140 return one value of 28.3 g/t gold over 0.5 m in wacke and the hole ES18-141 return the best composite calculated of 0.64 g/t over 6.9 m. The Cheechoo Southeast Extension return value up to 84.0 g/t gold over 1.0 m and some of the best calculated composite return 3.8 g/t gold over 3.9 m, 3.5 g/t gold over 3.5 m and 22.4 g/t gold over 4.0 m (GM 73121).
In 2018, Les Mines Opinacas mandated Ios Services Géoscientifiques to carried a till survey to cover between the 2008 lines to evaluate the mineral potential in the Roberto deposit neighbourhood. Samples were collected at 200 m to 250 m spacing along lines distributed at every 1 km to 1.5 km. A total of 27 samples were collected on the north-west side of the property and 6 in the north-north-west side of the property. Gold grains count varied from 4 to 16 in the north-north-west side of the property and varied from 17 to 66 in the north-west side of the property both on normalized on 10 kg samples (GM 71452).
2019
In winter 2019, Eastmain conducted a second phase of drilling. A total of 4,708.5 m was drilled split in 14 holes and hole extension. The drilling campaign was achieved on the Cheechoo southeastern extension. All drill hole return value over 0.1 g/t gold and best assay graded 63.2 g/t gold on 1.0 m. Some of the best calculated composite return 8.7 g/t gold over 8.2 m and 12.7 g/t gold over 3.5 m (GM 73121).
In summer 2019, Eastmain carried out a field work survey with mapping, rock sampling, soil sampling and channel sampling. No excavator was available on-site in 2019. Chennel sampling was executed on 2018 trenches and on outcrops. The objective of the campaign was to identify new prospective areas for further work. In total, 1,299 rock samples, 130 channel samples and 1,744 A-B-C-horizon soil samples were collected. The soil samples were collected every 50 m with an interline spacing of 400 m and were then analyzed by XRF at the Eastmain Éléonore South coreshack. The XRF study permit to identified 5 geochemical signature and a new geological map was interpreted. A total of 9 rocks sample return values between 0.114 and 0.828 ppm gold. Sample are found in the extreme north, West, and south-west of the property and south of the Cheechoo tonalite. Mapping on the property permit to recognize several geological units as felsic intrusion, sediments and mafic volcanic. The channel sampling was done in the Moni trend to follow-up on 2018 anomalies. In total 57 samples return values over 0.1 g/t and 6 return value over a 1 g/t. The best values are associated with the Bill zone and the 101 zone and vary between 1.285 and 5.426 g/t (GM 73381).
At total of 37,816 m of drilling in 164 drill holes has been completed on the Property. Drilling has largely focussed on the Moni - JT trend and successfully defined two zones, 2,000 m x 750 m at Moni and 1,200 m x 500 m at JT, of lower-grade intrusion related gold mineralization similar to that of the Cheechoo gold deposit. The Moni trend comprises the Cheechoo Southwest Extension and JT Prospect comprises the WB Prospect. Within the lower-grade gold mineralization halo, there are a series of structurally controlled quartz vein stockworks which host significantly higher grades of gold.
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Sampling, Analyses and Data Verification
Method of analysis varied since the beginning of the project. QC protocols were established in 2008 and carried through with minor refinements through the current drilling program.
Quality Control (QC) samples were introduced into the sample stream at a rate of 4% for both blank samples and CRM samples. Fury increases this rate to 5% and add field duplicates in the form of quarter sawn core samples introduced into the sample stream at a rate of 1 in 50 samples.
Core recovery is generally very good to excellent, allowing for representative samples to be taken and accurate analyses to be performed. Half-core samples, 0.5 m to 1.5 m long, were taken. The core was sampled along the entire length of each hole. Samples intervals were recorded with red grease pencil on the drill core during logging. Each sample was assigned a laboratory sample number for analytical purposes.
The sample is split along the cutting line and starting and stopping at the marked red arrows on the core. Place one half of the core in the bag and place the other half back in the core box with the cut face upwards. He/she is to place the sample end pieces (the core marked with red arrows) cut face side up, with the arrows pointing in the appropriate direction.
Samples with native gold were identified. This was to make sure the core cutting blade was cleaned before and after each of these mineralized samples by cutting through a concrete block.
Split core samples were placed in fiber rice bags in batches and labelled for shipment to ALS laboratories (ISO/IEC 17025:2017 and ISO 9001:2015 accredited facility) for preparation and analysis. These sacks were sealed with cable ties and fiber tape and shipped by commercial transport companies directly to the lab. A control file, the laboratory sample dispatch form, includes the sample-bag numbers in each shipment. The laboratory sample dispatch form accompanies the sample shipment and is used to control and monitor the shipment. The lab sends a confirmation email with detail of samples received upon delivery.
In the opinion of The Author, the logging, sampling, assaying, and chain of custody protocols practiced through the history of the Project meet or exceed industry standards. The drill programs have been configured and carried out in a manner that is appropriate for the geometry of the known mineralization. Drill holes are oriented perpendicular to strike and aimed to intersect the zones at an angle generally greater than 45°. As such, the samples should be representative of the mineralization as it is presently known.
The Author has reviewed the QC reports and files, as well as the laboratory procedures undertaken and conclude that the QC program for the Project is sufficient to support the current level of exploration. QC sample failures were dealt with on a case-by-case basis and were documented with commentary in the Dispatch Returns table within the database. The Author has been involved in all exploration programs on the Project since 2020 and was last on-site August 2024. Comprehensive data verification was performed by Fury Gold Mines. These included checks against original data sources, standard database checks such as from/to errors and basic visual checks for discrepancies with respect to topography and drillhole deviations.
The Author has been personally involved in the integration and merging of the historical drill data into the current database. This work included relogging of historical holes to provide consistency of logging codes across all generations of drilling, as well as spot checks of drill core versus drill logs to verify the geologic model. During this process sample intervals were verified. Lastly, the assay database was compared to original assay certificates. No errors were found within the geologic or assay databases.
Mineral Processing and Metallurgical Testing
There has been no metallurgical testing completed on the Éléonore South project.
Mineral Resource Estimates
There are no Mineral Resource Estimates for the Éléonore South Project.
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2024 Éléonore South Exploration Program
Biochemical Sampling
A biogeochemical sampling survey designed to target an interpreted fold nose within the Low Formation sediments in an area where conventional soil or till sampling was not possible due to the ground conditions was completed in the summer of 2024. The targeted area exhibited similar geological, geophysical, and structural characteristics to those present at the nearby Éléonore Mine. Six priority drill targets across over 3 km of prospective folded sedimentary stratigraphy have been identified. These six targets encompass multi point gold anomalies above the 90th percentile of the data and correlate with moderate pathfinder elemental anomalies, most notably arsenic which is associated with gold mineralization at the Éléonore Mine.
Drilling
In winter 2024, Fury carried out a drilling campaign to focus on Moni Trend structural corridors and following up on previous drill intercepts of 53.25 m of 4.22 g/t Au; 6.2 m of 14.7 g/t Au and 23.8 m of 3.08 g/t Au (figure 6). In total, 2,331 m of were drilled in 7 holes. A total of 1,704 core samples were sent to the lab to be tested for gold. The drilling campaign work area was 2,500 m east-west by 800 m north-south. Most holes were drilled at 320 degrees azimuth and one at 140 degrees and one through north. All holes dip at -50 degrees.
The holes intersected broad gold zone with local gold peak value. The hole 24ES-161 intersected 0.44 g/t gold over 137.5 m (Table 13) including 9.7 g/t over 1.5 and 8.33 g/t gold over 8.33 g/t (Table 14). The hole 24ES-162 intersected 0.5 g/t gold over 115.5 m.
The 2024 Fury drilling campaign show the continuity at depth of the mineralized zone in the Cheechoo Tonalite.
Conclusion
The Éléonore South project is an early-stage exploration project with limited previous drilling and sampling completed. The drilling completed to date has confirmed the presence of a Reduced Intrusion Related Gold System (RIRGS) within the southern portion of the Cheechoo Tonalite. Additionally, surface work completed by Fury has identified several gold in soil anomalies and biogeochemical anomalies which all require additional follow up work.
Recommendations
Future exploration efforts should focus on the high-grade gold potential of the Cheechoo tonalite while also continuing to advance the identified gold in soil and biogeochemical anomalies to the drill ready stage. The recommended Phase 1 work program consists of a 5,000 – 6,000 m drilling program targeting the robust Eleonore style gold targets identified through the biogeochemical sampling program. The Phase 1 program is estimated to cost approximately $3.1 million, shown in below table.
The Phase 2 exploration program will be drill intensive. An additional 10,000 – 20,000 m of diamond and reverse circulation drilling should be completed to follow up on the results from the phase 1 program as well as within the Cheechoo Tonalite to determine if sufficient continuity of gold mineralization is present to prepare a maiden mineral resource estimate. The Phase 2 program is estimated to cost between $7.5 and $10 million, as shown below.
| Phase 1 | ||||||
| Type | Details | Cost Estimate (C$) | ||||
| Labour | Staff Wages, Technical and Support Contractors | 500,000 | ||||
| Assaying | Sampling and Analytical | 400,000 | ||||
| Drilling | Diamond Drilling (5,000m at $150/m) | 750,000 | ||||
| Land Management | Consultants. Assessment Filing, Claim maintenance | 5,000 | ||||
| Community Relations | Community Tours, Outreach | 10,000 | ||||
| Information Technology | Remote site communications and IT | 5,000 | ||||
| Safety | Equipment, Training and Supplies | 5,000 | ||||
| Expediting | Expediting | 7,500 | ||||
| Camp Costs | Equipment, Maintenance, Food, Supplies | 200,000 | ||||
| Freight and Transportation | Freight, Travel, Helicopter | 600,000 | ||||
| Fuel | 250,000 | |||||
| General and Administration | 100,000 | |||||
| Sub-total | 2,873,500 | |||||
| Contingency (10%) | 287,350 | |||||
| Total | 3,121,250 | |||||
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| Phase 2 | ||||||
| Type | Details | Cost Estimate (C$) | ||||
| Labour | Staff Wages, Technical and Support Contractors | 1,250,000 | ||||
| Drilling | Diamond Drilling (10,000 - 20,000m) | 2,000,000 | ||||
| Assaying | Sampling and Analytical | 1,000,000 | ||||
| Community Relations | Community Tours, Outreach | 25,000 | ||||
| Information Technology | Remote site communications and IT | 10,000 | ||||
| Safety | Equipment, Training and Supplies | 125,000 | ||||
| Expediting | Expediting | 150,000 | ||||
| Camp Costs | Equipment, Maintenance, Food, Supplies | 550,000 | ||||
| Freight and Transportation | Fright, Travel, Helicopter | 1,500,000 | ||||
| Fuel | 600,000 | |||||
| General and Administration | 250,000 | |||||
| Sub-total | 7,460,000 | |||||
| Contingency (10%) | 746,500 | |||||
| Total | 8,206,000 | |||||
The Company expects to incur approximately $35,000 annually in project maintenance costs, including certain mineral claims payments, in order to keep the properties in good standing in 2025.
2024 Éléonore South project Exploration
The Spring 2024 drilling program resulted in 2,331.4 metres (m) completed in seven diamond drill holes testing 2.3 kilometres (km) of strike along the JT – Moni Trend. The drilling targeted 100 to 125 m downdip extensions from historical drilling. All seven drill holes intercepted anomalous gold mineralization, including 137.5 m of 0.44 g/t gold and 18.7 m of 0.97 g/t from drill hole 24ES-161, 115.5 m of 0.50 g/t gold from drill hole 24ES-162 and, 28.0 m of 0.47 g/t gold from drill hole 24ES-160.
During the summer of 2024 the Company carried out a limited prospecting program targeting multiple lepidolite and spodumene bearing pegmatite outcrops within the western claim block at the Éléonore South project. The outcrop sampling program targeted the historical Fliszar showing lepidolite bearing pegmatite as well as new rock exposures over an area of approximately 1000 x 500 metres (m) resulting in the collection of 34 samples. Seven samples returned high-grade values above 1.75% lithium oxide (Li2O) with a peak value of 4.67% Li2O.
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The Company finalized drill targeting after completing a surficial geochemical survey at the Éléonore South project. Six priority drill targets across over 3 kilometres (km) of prospective folded sedimentary stratigraphy have been identified. These six targets encompass multi point gold anomalies above the 90th percentile of the data and correlate with moderate pathfinder elemental anomalies, most notably arsenic, which is associated with gold mineralization at the Éléonore Mine.
On February 3, 2025, Fury Gold commenced a first phase drilling campaign, at the Éléonore South project. Drilling will target robust multi-faceted geological, geophysical, and geochemical gold anomalies within the same sedimentary rock package that hosts the Éléonore Mine. The fully funded first phase drilling campaign will comprise approximately 4,000 – 6,000 metres (m) targeting an interpreted fold nose within the Low Formation sediments. Within the prospective folded stratigraphy are six undrilled priority targets spanning over 3 kilometres (km) of strike length that have been identified through a combination of biogeochemical sampling and interpretation of magnetics and electromagnetics survey data. The first phase of drilling will be focussed within a northwest-southeast structural corridor where a strong correlation between anomalous gold, stratigraphy, and structure has been identified. The drill targets occur in a structurally complex setting with little to no outcrop exposure and the targeting model will evolve with each hole drilled. The Company plans to complete approximately 15 of the 77 permitted drill holes as part of the first phase.
Risk Factors
An investment in securities of Fury Gold involves significant risks, which should be carefully considered by prospective investors before purchasing such securities. Management of Fury Gold considers the following risks to be most significant for potential investors in Fury Gold, but such risks do not necessarily comprise all those associated with an investment in Fury Gold. Additional risks and uncertainties not currently known to management of Fury Gold may also have an adverse effect on Fury Gold’s business. If any of these risks actually occur, Fury Gold’s business, financial condition, capital resources, results of operations and/or future operations could be materially adversely affected.
In addition to the other information set forth elsewhere in this AIF, the following risk factors should be carefully considered when assessing risks related to Fury Gold’s business.
Exploration Activities May Not Be Successful
Exploration for, and development of, mineral properties is speculative and involves significant financial risks, which even a combination of careful evaluation, experience and knowledge may not eliminate. While the discovery of an ore body may result in substantial rewards, few properties that are explored are ultimately developed into producing mines. Major expenditures may be required to establish reserves by drilling, to complete a feasibility study and to construct mining and processing facilities at a site for extracting gold or other metals from ore. Fury Gold cannot ensure that its future exploration programs will result in profitable commercial mining operations.
Few properties that are explored are ultimately developed into producing mines. Unusual or unexpected formations, formation pressures, fires, power outages, labour disruptions, flooding, explosions, cave-ins, landslides and the inability to obtain adequate machinery, equipment and/or labour are some of the risks involved in mineral exploration activities. The Company has relied on and may continue to rely on consultants and others for mineral exploration expertise.
The Company has implemented safety and environmental measures designed to comply with or exceed government regulations and ensure safe, reliable and efficient operations in all phases of its operations. The Company maintains liability and property insurance, where reasonably available, in such amounts as it considers prudent. The Company may become subject to liability for hazards against which it cannot insure or which it may elect not to insure against because of high premium costs or other reasons.
Also, substantial expenses may be incurred on exploration projects that are subsequently abandoned due to poor exploration results or the inability to define reserves that can be mined economically. Development projects have no operating history upon which to base estimates of future cash flow. Estimates of proven and probable mineral reserves and cash operating costs are, to a large extent, based upon detailed geological and engineering analysis. There have been no feasibility studies conducted in order to derive estimates of capital and operating costs including, among others, anticipated tonnage and grades of ore to be mined and processed, the configuration of the ore body, ground and mining conditions, expected recovery rates of the gold or copper from the ore, and anticipated environmental and regulatory compliance costs.
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Substantial expenditures are required to establish mineral resources and mineral reserves through drilling and development and for mining and processing facilities and infrastructure. No assurances can be given that mineral will be discovered in sufficient quantities to justify commercial operations or that funds required for development can be obtained on a timely basis. There is also no assurance that even if commercial quantities of ore are discovered that the properties will be brought into commercial production or that the funds required to exploit any mineral reserves and resources discovered by the Company will be obtained on a timely basis or at all. Economic feasibility of a project is based on several other factors including anticipated metallurgical recoveries, environmental considerations and permitting, future metal prices and timely completion of any development plan. Most of the above factors are beyond the control of the Company. There can be no assurance that the Company’s mineral exploration activities will be successful. In the event that such commercial viability is never attained, the Company may seek to transfer its property interests or otherwise realize value or may even be required to abandon its business and fail as a “going concern”.
Moreover, advancing any of the Company’s exploration properties into a revenue generating property, will require the construction and operation of mines, processing plants and related infrastructure, the development of which includes various risks associated with establishing new mining operations, including:
| · | the ability to obtain acceptance and support from the local communities affected given many communities are opposed to mining operations of any kind; |
| · | the timing and costs, which can be considerable, of the construction of mining and processing facilities; |
| · | the availability and cost of skilled labour, mining equipment and principal supplies needed for operations; |
| · | the availability and cost of appropriate smelting and refining arrangements; |
| · | the need to maintain necessary environmental and other governmental approvals and permits; |
| · | the availability of funds to finance construction and development activities; |
| · | potential opposition from non-governmental organizations, environmental groups, local groups or other stakeholders which may delay or prevent development activities; and |
| · | potential increases in construction and operating costs due to changes in the cost of labour, fuel, power, materials and supplies. |
It is possible that actual costs and economic returns of future mining operations may differ materially from Fury Gold’s best estimates. It is not unusual for new mining operations to experience unexpected problems during the start-up phase and to require more capital than anticipated. These additional costs could have an adverse impact on Fury Gold’s future cash flows, earnings, results of operations and financial condition.
Commodity Price Fluctuations and Cycles
Resource exploration is significantly linked to the outlook for commodities. When the price of commodities being explored for declines, investor interest subsides, and capital markets become more difficult. The price of commodities varies on a daily basis and there is no reliable way to predict future prices.
Gold prices specifically are historically subject to wide fluctuation and are influenced by a number of factors including not only supply and demand for industrial its uses, but for speculation purposes, all of which factors are beyond the control or influence of the Company. Some factors that affect the price of gold include industrial and jewelry demand; central bank lending or purchase or sales of gold bullion; forward or short sales of gold by producers and speculators; future level of gold productions; and rapid short-term changes in supply and demand due to speculative or hedging activities by producers, individuals or funds. Gold prices are also affected by macroeconomic factors including: confidence in the global monetary system; expectations of the future rate of inflation; the availability and attractiveness of alternative investment vehicles; the general level of interest rates; the strength of, and confidence in the U.S. dollar, the currency in which the price of gold is generally quoted, and other major currencies; global and regional political or economic events; and costs of production of other gold producing companies.
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Additional Funding Requirements and Shareholder Equity Dilution
Fury Gold’s business is in the exploration stage and the Company does not carry-on mining activities. As such, it will require additional financing to continue its operations. Fury Gold’s ability to secure additional financing and fund ongoing exploration will be affected by many factors, including the strength of the economy and other general economic factors. Global financial conditions continue to be subject to volatility arising from international geopolitical developments and global economic phenomenon, as well as general financial market turbulence. Access to public financing and credit can be negatively impacted by the effect of these events on Canadian and global credit markets. These instances of volatility and market turmoil could adversely impact Fury Gold’s operations and the trading price of the Common Shares. There can be no assurance that Fury Gold will be able to obtain adequate financing in the future, or that the terms of such financing will be favourable for further exploration and development of its projects. Failure to obtain such additional financing could result in delay or indefinite postponement of further exploration, drilling and/or development. Further, revenues, financings and profits, if any, will depend upon various factors, including the success, if any, of exploration programs and general market conditions for natural resources.
In order to finance future operations, Fury Gold may raise funds through the issuance of additional Common Shares or the issuance of debt instruments or other securities convertible into Common Shares. Fury Gold cannot predict the size of future issuances of Common Shares or the issuance of debt instruments or other securities convertible into Common Shares or the dilutive effect, if any, that future issuances and sales of Fury Gold’s securities will have on the market price of the Common Shares.
Negative Cash Flow
Fury Gold experiences negative cash flow from operations and anticipates incurring negative cash flow from operations for 2025 and beyond as a result of the fact that it does not have revenues from mining or any other activities. In addition, as a result of Fury Gold’s business plans for the development of its mineral projects, Fury Gold expects cash flow from operations to continue to be negative until Fury Gold is able to establish the economic viability and the development of one of its mineral projects, of which there is no assurance. Accordingly, Fury Gold’s cash flow from operations will be negative for the foreseeable future as a result of expenses to be incurred s in connection with advancement of exploration on its mineral projects.
Indirect Economic Interest in the Homestake Ridge Project
As a result of the completion of the sale of the Homestake Ridge Project to Dolly Varden in February 2022, the Company continues to own an indirect minority economic interest in the Homestake Ridge Project through its ownership of a significant interest in Dolly Varden’s common shares (currently 16.11 %). Additionally, the Company has the right to nominate one director to the Dolly Varden Board, based on the Company’s current ownership position of Dolly Varden, and the right to nominate a representative to the technical committee. The value of the Company’s ownership in Dolly Varden will vary as the price of the common shares of Dolly Varden fluctuate on the TSX Venture Exchange and this value may be more or less than the accounting value ascribed to these shares (which may create non-cash charges and credits when Dolly Varden finances). While the Company has pre-emptive rights under the Investor Rights Agreement to retain is ownership position in Dolly Varden (on a percentage ownership basis) there is no assurance that the Company will exercise these pre-emptive rights to continue to maintain its position if Dolly Varden determines to complete future equity offerings, either as a result of a determination of the Company not to invest or the inability of the Company to allocate available funds to complete a required investment. Accordingly, the Company’s interest in Dolly Varden may ultimately be diluted.
Price Volatility of Publicly Traded Securities
In recent years, the securities markets in the United States and Canada have experienced a high level of price and volume volatility, and the market prices of securities of many mining companies have experienced wide fluctuations in price which have not necessarily been related to the operating performance, underlying asset values or prospects of such companies. There can be no assurance that continuing fluctuations in price will not occur. These factors are ultimately beyond the control of Fury Gold and could have a material adverse effect on the Company’s financial condition and results of operations. Securities class action litigation often has been brought against companies following periods of volatility in the market price of their securities. The Company may in the future be the target of similar litigation. Securities litigation could result in substantial costs and damages and divert management's attention and resources.
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Mineral Resource Estimates
There is no certainty that any of the mineral resources on the Eau Claire Project, the Committee Bay Project, or any other project with mineral resources will be advanced into mineral reserves. Until a deposit is actually mined and processed, the quantity of mineral resources and grades must be considered as estimates only, and are expressions of judgment based on knowledge, mining experience, analysis of drilling results and industry best practices. Valid estimates made at any given time may vary significantly when new information becomes available. While Fury Gold believes that the Company’s estimates of mineral resources are well established and reflect management’s best estimates, by their nature mineral resource estimates are imprecise and depend, to a certain extent, upon statistical inferences and geological interpretations, which may ultimately prove inaccurate.
The mineral resource estimates included herein have been determined and valued based on assumed future prices, cut-off grades and operating costs. Furthermore, fluctuations in gold and base or other precious metals prices, results of drilling, metallurgical testing and production and the evaluation of studies, reports and plans subsequent to the date of any estimate may require revisions to such estimates. Any material reductions in estimates of mineral resources could have a material adverse effect on the Company’s results of operations and financial condition.
To date, the Company has not established mineral reserves on any of its mineral properties.
Inflation
Consumer price inflation, although lower than 2023, has stayed above 2% in 2024 and if it continues will mean much higher costs for Fury Gold’s expenditure programs. Fury Gold’s program cost estimates could rapidly become out-of-date. If this happens, the Company will need to either raise additional funds causing equity dilution or reduce its expenditures and reducing progress. Increases in inflation usually result in central bank interest rate hikes which can trigger negative capital market conditions making financing difficult. While inflation increases have often led to higher precious metals prices, there can be no assurance of that and the Company’s operations and its share price could well be adversely affected by increased inflation.
Property Commitments
Fury Gold’s mineral properties and/or interests may be subject to various land payments, royalties and/or work commitments. Failure by Fury Gold to meet its payment obligations or otherwise fulfill its commitments under these agreements could result in the loss of related property interests.
Environmental Regulatory, Health & Safety Risks
Fury Gold’s operations are subject to environmental regulations promulgated by government agencies from time to time. Environmental legislation and regulation provide for restrictions and prohibitions on spills, releases or emissions of various substances produced in association with certain exploration industry operations, such as from tailings disposal areas, which would result in environmental pollution. A breach of such legislation may result in the imposition of fines and penalties. In addition, certain types of operations require the submission and approval of environmental impact assessments. Environmental legislation is evolving in a manner which means stricter standards, and enforcement, fines and penalties for non-compliance are more stringent. Future legislation and regulations could cause additional expenses, capital expenditures, restrictions, liabilities and delays in exploration of any of Fury Gold’s properties, the extent of which cannot be predicted. Environmental assessments of proposed projects carry a heightened degree of responsibility for companies and directors, officers and employees. The cost of compliance with changes in governmental regulations has a potential to reduce the profitability of operations.
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Although Fury Gold believes its operations are in compliance in all material respects with all relevant permits, licenses and regulations involving worker health and safety as well as the environment, there can be no assurance regarding continued compliance or ability of the Company to meet stricter environmental regulation, which may also require the expenditure of significant additional financial and managerial resources.
Moreover, mining companies are often targets of actions by non-governmental organizations and environmental groups in the jurisdictions in which they operate. Such organizations and groups may take actions in the future to disrupt Fury Gold’s operations. They may also apply pressure to local, regional and national government officials to take action which may be adverse to Fury Gold’s operations. Such actions could have an adverse effect on Fury Gold’s ability to advance is projects and, as a result on its operations and financial performance.
Relationships with Local Communities and Indigenous Organizations
Negative relationships with Indigenous and local communities could result in opposition to the Company’s projects. Such opposition could result in material delays in attaining key operating permits or make certain projects inaccessible to the Company’s personnel. Fury Gold respects and engages meaningfully with Indigenous and local communities at all of its operations. Fury Gold is committed to working constructively with local communities, government agencies and Indigenous groups to ensure that exploration work is conducted in a culturally and environmentally sensitive manner.
Fury Gold believes its operations can provide valuable benefits to surrounding communities, in terms of direct employment, training and skills development and other benefits associated with ongoing community support. In addition, Fury Gold seeks to maintain its partnerships and relationships with local communities, including Indigenous peoples, and stakeholders in a variety of ways, including in-kind contributions, volunteer time, sponsorships and donations. Notwithstanding the Company’s ongoing efforts, local communities and stakeholders could become dissatisfied with its activities or the level of benefits provided, which could result in civil unrest, protests, direct action or campaigns against it. Any such occurrence could materially and adversely affect the Company’s business, financial condition or results of operations.
Environmental Protection
All phases of the Company’s operations are subject to treaty provision and federal, provincial and local environmental laws and regulations. These provisions, laws and regulations address, among other things, the maintenance of air and water quality standards, land reclamation, the generation, transportation, storage and disposal of solid and hazardous waste, and the protection of natural resources and endangered species. Fury Gold has expanded significant financial and managerial resources to comply with environmental protection laws, regulations and permitting requirements in each jurisdiction where it operates. Fury Gold’s exploration and drilling projects operate under various operating and environmental permits, licenses and approvals that contain conditions that must be met. Failure to obtain such permits, licenses and approvals and/or meet any conditions set forth therein could have a material adverse effect on Fury Gold’s financial conditions or results of operations. Environmental hazards may exist on the Company’s properties which are unknown to the Company at present and were caused by previous or existing owners or operators of the properties, for which the Company could be held liable.
Although Fury Gold believes its operations are in compliance, in all material respects, with all relevant permits, licenses and regulations involving worker health and safety as well as the environment, there can be no assurance regarding continued compliance or ability of Fury Gold to meet potentially stricter environmental regulation, which may also require the expenditure of significant additional financial and managerial resources.
Fury Gold cannot be certain that all environmental permits, licenses and approvals which it may require for its future operations will be obtainable on reasonable terms or that such laws and regulations would not have an adverse effect on any mining project that it might undertake. To the extent such permits, licenses and approvals are required and are not obtained, Fury Gold may be delayed or prohibited from proceeding with planned exploration or development of its projects, which would adversely affect Fury Gold’s business, prospects and operations.
Failure to comply with applicable laws, regulations and permitting requirements may result in enforcement actions including orders issued by governmental, regulatory or judicial authorities causing operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment or remedial actions. Parties engaged in mining operations may be required to compensate those suffering loss or damage by reason of the mining activities and may have civil or criminal fines or penalties imposed upon them for violation of applicable laws or regulations. Amendments to current provisions, laws and regulations and permits governing operations and activities of mining companies, or more stringent implementation thereof, could have a material adverse impact on Fury Gold and cause increases in capital expenditures or exploration costs, reduction in levels of exploration or abandonment or delays in the development of mining properties.
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Moreover, mining companies are often targets of actions by non-governmental organizations and environmental groups in the jurisdictions in which they operate. Such organizations and groups may take actions in the future to disrupt Fury Gold’s operations. They may also apply pressure to local, regional and national government officials to take actions which may be adverse to Fury Gold’s operations. Such actions could have an adverse effect on Fury Gold’ ability to advance its projects and, as a result, on its financial position and results.
Climate Change
Fury Gold recognizes climate change as an international and community concern. The effects of climate change or extreme weather events may cause prolonged disruption to the delivery of essential commodities which could negatively affect production efficiency. Furthermore, increased regulation of greenhouse gas emissions (including in the form of carbon taxes or other charges) may adversely affect the Company’s operations and that related legislation is becoming more stringent.
As a junior explorer Fury does not have operations which contribute significant green house gases relative the operations of a producing mining company .Fury Gold is focused on operating in a manner that minimizes environmental impacts of its activities; however, environmental impacts from exploration and drilling activities are inevitable. The physical risks of climate change that may impact the Company’s operations are highly uncertain and may be particular to the unique geographic circumstances associated with each of its operations. Such physical risks include, but are not limited to, extreme weather events, wildfires, resource shortages, changes in rainfall and storm patterns and intensities, water shortages, changing sea levels and changing temperatures. There may also be supply chain implications in getting supplies to the Company’s operations, including transportation issues. Fury Gold makes efforts to mitigate climate risks by ensuring that extreme weather conditions are included in its emergency response plans. However, there is no assurance that the response will be effective, and the physical risks of climate change will not have an adverse effect on the Company’s operations and profitability.
Fury Gold is focused on operating in a manner that minimizes environmental impacts of its activities; however, environmental impacts from exploration and drilling activities are inevitable. The physical risks of climate change
Changes in Government Mining, Permitting, Environmental Regulation
In addition to climate change, other changes in government regulations or the application thereof and the presence of unknown environmental hazards on any of Fury Gold’s mineral properties may result in significant unanticipated compliance and reclamation costs. Government regulations and treaty provisions relating to mineral rights tenure, permission to disturb areas and the right to operate can adversely affect Fury Gold.
Fury Gold may not be able to obtain all necessary licenses and permits that may be required to carry out exploration on any of its projects. Obtaining the necessary governmental permits is a complex, time consuming and costly process. The duration and success of efforts to obtain permits are contingent upon many variables not within our control. Obtaining environmental permits may increase costs and cause delays depending on the nature of the activity to be permitted and the interpretation of applicable requirements implemented by the permitting authority. There can be no assurance that all necessary approvals and permits will be obtained and, if obtained, that the costs involved will not exceed those that we previously estimated. It is possible that the costs and delays associated with the compliance with such standards and regulations could become such that we would not proceed with the development or operation.
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Competitive Conditions
Fury Gold’s activities are directed towards exploration, evaluation and development of mineral deposits. The mineral exploration industry is competitive and Fury Gold will be required to compete for the acquisition of mineral permits, claims, leases and other mineral interests for operations, exploration and development projects. As a result of this competition, Fury Gold may not be able to acquire or retain prospective development projects, technical experts that can find, develop and mine such mineral properties and interests, workers to operate its mineral properties, and capital to finance exploration, development and future operations. The Company competes with other mining companies, some of which have greater financial resources and technical facilities, for the acquisition of mineral property interests, the recruitment and retention of qualified employees; and for investment capital with which to fund its projects. If Fury Gold is unable to successfully compete in its industry it could have a material adverse effect on the Company’s results of operations and financial condition.
Local Community Uncertainties
Fury Gold’s operations at the Committee Bay Project are located in Nunavut, and, as such, its operations are exposed to various levels of political, economic and other risks and uncertainties inherent in operating in such jurisdictions. Risks and uncertainties of operating in Nunavut may vary from time to time, but are not limited to a limited local workforce, poor infrastructure, a complex regulatory regime and harsh weather. Moreover, Fury Gold’s operations at the Eau Claire Project are located within the Eeyou Istchee James Bay region, which is subject to a modern treaty with the Cree Nation. The treaty identifies land use categories across the region and communities of interest within the Cree Nations which will be consulted with during development of mineral projects in the Eau Claire Project area.
Acquisitions May Not Be Successfully Integrated
Fury Gold undertakes evaluations from time to time of opportunities to acquire additional mining assets and businesses. Any such acquisitions may be significant in size, may change the scale of the Company’s business, may require additional capital, and/or may expose the Company to new geographic, political, operating, financial and geological risks.
Fury Gold recently entered into the Arrangement Agreement to acquire a 100% interest in QPM for approximately $5.1 million payable in common shares of Fury Gold. Completion of the acquisition of QPM under the Arrangement Agreement remains subject to the approval of QPM’s shareholders, final court approval under the Canada Business Corporations act and satisfaction of other customary conditions to closing. Accordingly, there is no assurance that this acquisition will be completed as planned.
Fury Gold’s success in its acquisition activities depends on its ability to identify suitable acquisition candidates, acquire them on acceptable terms, and integrate their operations successfully. Any acquisitions would be accompanied by risks such as: (i) a significant decline in the relevant metal price after Fury Gold commits to complete an acquisition on certain terms; (ii) the quality of the mineral deposit acquired proving to be lower than expected; the difficulty of assimilating the operations and personnel of any acquired companies; (iii) the potential disruption of Fury Gold’s ongoing business; (iv) the inability of management to realize anticipated synergies and maximize the financial and strategic position of Fury Gold; (v) the failure to maintain uniform standards, controls, procedures and policies; (vi) the impairment of relationships with employees, customers and contractors as a result of any integration of new management personnel; and (vii) the potential unknown liabilities associated with acquired assets and businesses.
Changes in the Market Price of Common Shares
The Common Shares are listed on the TSX and the NYSE American. The price of Common Shares is likely to be significantly affected by short-term changes in the gold price or in its financial condition or results of operations as reflected in its quarterly earnings reports. Other factors unrelated to Fury Gold’s performance that may have an effect on the price of Common Shares and may adversely affect an investor’s ability to liquidate an investment and consequently an investor’s interest in acquiring a significant stake in Fury Gold include: a reduction in analyst coverage by investment banks with research capabilities, a drop in trading volume and general market interest in Fury Gold’s securities, a failure to meet the reporting and other obligations under relevant securities laws or imposed by applicable stock exchanges could result in a delisting of the Common Shares and a substantial decline in the price of the Common Shares that persists for a significant period of time.
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Properties May Be Subject to Defects in Title
Fury Gold has investigated its rights to explore and exploit its projects and, to the best of its knowledge, its rights are in good standing. However, no assurance can be given that such rights will not be revoked, or significantly altered, to Fury Gold’s detriment. There can also be no assurance that Fury Gold’s rights will not be challenged or impugned by third parties.
Some of Fury Gold’s mineral claims may overlap with other mineral claims owned by third parties which may be considered senior in title to the Fury Gold mineral claims. The junior claim is only invalid in the areas where it overlaps a senior claim. Fury Gold has not determined which, if any, of the Fury Gold mineral claims is junior to a mineral claim held by a third party. Although Fury Gold is not aware of any existing title uncertainties with respect to any of its projects, there is no assurance that such uncertainties will not result in future losses or additional expenditures, which could have an adverse impact on Fury Gold’s future cash flows, earnings, results of operations and financial condition.
Reliance on Contractors and Experts
In various aspects of its operations, Fury Gold relies on the services, expertise and recommendations of its service providers and their employees and contractors, whom often are engaged at significant expense to the Company. For example, the decision as to whether a property contains a commercial mineral deposit and should be brought into production depends in large part upon the results of exploration programs and/or feasibility studies, and the recommendations of duly qualified third-party engineers and/or geologists. In addition, while Fury Gold emphasizes the importance of conducting operations in a safe and sustainable manner, it cannot exert absolute control over the actions of these third parties when providing services to Fury Gold or otherwise operating on Fury Gold’s properties. Any material error, omission, act of negligence or act resulting in environmental pollution, accidents or spills, industrial and transportation accidents, work stoppages or other actions could adversely affect the Company’s operations and financial condition.
Qualified and Experienced Employees, Management, and Board Members
Fury Gold’s future success is based on successfully attracting, training
and developing employees at all levels of the company from Site Staff to Executive Management. This is especially true for professional
geologists with the required skillset being available in the geographic areas that we operate in. The markets for highly skilled workers,
as well as talented professionals and leaders in the mining and exploration industry are extremely competitive. The inability to meet
our needs for skilled workers and talented professionals and leaders, whether through recruitment or internal training and development
activities, could impact our ability to effectively implement our strategy. In addition to this, retaining qualified board members with
diversified experience also brings valuable oversight and knowledge to the business.
Legal and Litigation Risks
All industries, including the exploration industry, are subject to legal claims, with and without merit. Defense and settlement costs of legal claims can be substantial, even with respect to claims that have no merit. Due to the inherent uncertainty of the litigation process, the resolution of any particular legal proceeding to which Fury Gold may become subject could have a material adverse effect on Fury Gold’s business, prospects, financial condition, and operating results. Defense and settlement of costs of legal claims can be substantial.
Risks Relating to Statutory and Regulatory Compliance
Fury Gold’s current and future operations, from exploration through development activities and commercial production, if any, are and will be governed by applicable laws, regulations and treaty obligations governing mineral claims acquisition, prospecting, development, mining, production, exports, taxes, labour standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters. Companies engaged in exploration activities and in the development and operation of mines and related facilities, generally experience increased costs and delays in production and other schedules as a result of the need to comply with applicable laws, regulations, treaty obligations and permits. Fury Gold has received all necessary permits for the exploration work it is presently conducting; however, there can be no assurance that all permits which Fury Gold may require for future exploration, construction of mining facilities and conduct of mining operations, if any, will be obtainable on reasonable terms or on a timely basis or at all, or that such laws and regulations would not have an adverse effect on any project which Fury Gold may undertake.
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Failure to comply with applicable laws, regulations, treaty obligations and permits may result in enforcement actions thereunder, including the forfeiture of claims, orders issued by regulatory or judicial authorities requiring operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment or costly remedial actions. Fury Gold may be required to compensate those suffering loss or damage by reason of its mineral exploration activities and may have civil or criminal fines or penalties imposed for violations of such laws, regulations, treaty obligations and permits. Fury Gold is not currently covered by any form of environmental liability insurance. See “– Under-insured or Uninsurable Insurance Risk”, below.
Existing and possible future laws, regulations and permits governing operations and activities of exploration companies, or more stringent implementation thereof, could have a material adverse impact on Fury Gold and cause increases in capital expenditures or require abandonment or delays in exploration.
Under-insured or Uninsurable Insurance Risks
Fury Gold is subject to a number of operational risks and may not be adequately insured for certain risks, including: accidents or spills, industrial and transportation accidents, which may involve hazardous materials, labour disputes, catastrophic accidents, fires, blockades or other acts of social activism, changes in the regulatory environment, impact of non-compliance with laws and regulations, natural phenomena such as inclement weather conditions, floods, earthquakes, ground movements, cave-ins, and encountering unusual or unexpected geological conditions and technological failure of exploration methods.
Limited Business History and No History of Earnings
Fury Gold has no history of operating earnings. The likelihood of success of Fury Gold must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with the establishment of its business. Fury Gold has limited financial resources and there is no assurance that additional funding will be available to it for further operations or to fulfill its obligations under applicable agreements. There is no assurance that Fury Gold will ultimately generate revenues, operate profitably, or provide a return on investment, or that it will successfully implement its plans.
Claims by Investors Outside of Canada
Fury Gold is incorporated under the laws of British Columbia. All of Fury Gold’s directors and officers, with the exception of Mr. Tim Clark, CEO of the Company who is a US resident, and all of the experts named herein, are residents of Canada or otherwise reside outside of the United States, and all or a substantial portion of their assets, and a substantial portion of Fury Gold’s assets, are located outside of the United States. As a result, it may be difficult for investors in the United States or outside of Canada to bring an action against directors, officers or experts who are not resident in the United States. It may also be difficult for an investor to enforce a judgment obtained in a United States court or a court of another jurisdiction of residence predicated upon the civil liability provisions of United States federal securities laws or other laws of the United States or any state thereof or the equivalent laws of other jurisdictions outside of Canada against those persons or Fury Gold.
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No-Dividends Policy
No dividends on the Common Shares have been paid by Fury Gold to date. Payment of any future dividends, if any, will be at the discretion of the Board after taking into account many factors, including Fury Gold’s operating results, financial conditions, development and growth, and current and anticipated cash needs.
Disclosure and Internal Controls
Internal controls over financial reporting are procedures designed to provide reasonable assurance that transactions are properly authorized, assets are safeguarded against unauthorized or improper use, and transactions are properly recorded and reported. Disclosure controls and procedures are designed to ensure that information required to be disclosed by a company in reports filed with securities regulatory agencies is recorded, processed, summarized and reported on a timely basis and is accumulated and communicated to Fury Gold’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance with respect to the reliability of reporting, including financial reporting and financial statement preparation.
The Company documented and tested its internal controls over financial reporting during its most recent fiscal year in order to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act (“SOX”). SOX requires an annual assessment by management and an independent assessment by the Company’s independent auditors of the effectiveness of the Company’s internal controls over financial reporting. As the Company is presently a “non-accelerated filer”, the Company’s independent auditors are not required to attest to the effectiveness of the Company’s internal control over financial reporting. While the Company’s management has assessed and made a statement to the effectiveness of the Company’s internal controls over financial reporting as at December 31, 2024, and the Company will be required to detail changes to our internal controls on a quarterly basis, the Company cannot provide assurance that the independent registered public accounting firm’s review process in assessing the effectiveness of our internal controls over financial reporting, if obtained, would not find one or more material weaknesses or significant deficiencies in the Company’s internal control over financial reporting.
The Company may fail to achieve and maintain the adequacy of its internal controls over financial reporting as such standards are modified, supplemented, or amended from time to time, and the Company may not be able to ensure that it can conclude on an ongoing basis that its internal controls over financial reporting are effective. The Company’s failure to maintain effective internal controls over financial reporting could result in the loss of investor confidence in the reliability of its financial statements, which in turn could harm the Company’s business and negatively impact the trading price of its common shares. In addition, any failure to implement required new or improved controls, or difficulties encountered in their implementation, could harm the Company’s operating results or cause it to fail to meet its reporting obligations. There can be no assurance that the Company will be able to remediate material weaknesses, if any, identified in future periods, or maintain all the controls necessary for continued compliance, and there can be no assurance that the Company will be able to retain sufficient skilled finance and accounting personnel, especially in light of the increased demand for such personnel among publicly traded companies. Future acquisitions of companies, if any, may provide the Company with challenges in implementing the required processes, procedures and controls in its acquired operations. Acquired companies may not have disclosure controls and procedures or internal control over financial reporting that are as thorough or effective as those required by the securities laws currently applicable to the Company.
No evaluation can provide complete assurance that the Company’s internal control over financial reporting will detect or uncover all failures of persons within the Company to disclose material information otherwise required to be reported. The effectiveness of the Company’s controls and procedures could also be limited by simple errors or faulty judgment. The challenges involved in implementing appropriate internal controls over financial reporting will likely increase with the Company’s plans for ongoing development of its business and this will require that the Company continues to improve its internal controls over financial reporting. Although the Company intends to devote substantial time and incur costs, as necessary, to ensure ongoing compliance, the Company cannot be certain that it will be successful in complying with SOX.
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Cybersecurity Risks
Information systems and other technologies, including those related to the Company’s financial and operational management, and its technical and environmental date, are an integral part of the Company’s business activities. Network and information systems related events, such as computer hacking, cyber-attacks, computer viruses, works or other destructive or disruptive software, process breakdowns, denial of service attaches, or other malicious activities or any combination of the foregoing, or power outages, natural disasters, terrorist attacks or other similar events could result in damage to the Company’s property, equipment and date. These events also could result in significant expenditures to repair or replace damage property or information systems and/or to protect them from similar events in the future. Furthermore, any security breaches such as misappropriation, misuse, leakage, falsification, accidental release or loss of information contained in the Company’s information technology seems including personal and other data that could damage is reputation and require the Company to expend significant capital and other resources to remedy any such security breach. Insurance held by the Company may mitigate losses; however, in any such events or security breaches may not be sufficient to cover any consequent losses or otherwise adequately compensate the Company for disruptions to its business that may result and the occurrence of any such events or security breaches could have a material adverse effect on the Company’s operations and financial results. There can be no assurances that these events and/or security breaches will not occur in the future or not have an adverse effect on the Company’s operations and financial results.
Social Media Risks
As a result of social media and other web-based applications, companies today are at much greater risk of losing control over how they are perceived. Damage to Fury Gold’s reputation can be the result of the actual or perceived occurrence of any number of events, and could include any negative publicity, whether true or not. Although the Company places a great emphasis on protecting its image and reputation, it does not ultimately have direct control over how it is perceived by others. Reputation loss may lead to increased challenges in developing and maintaining community relations, decreased investor confidence and act as an impediment to the Company’s overall ability to advance its projects, thereby having a material adverse impact on the Company’s business, financial condition or results of operations.
Liabilities relating to Past Issuances of Flow-Through Shares
The Company has issued Flow-Through (or FT) Shares which are Canadian tax-incentivized common shares for initial purchasers of treasury common shares for which the rules require that the Company expend the FT Share issuance proceeds on exploration in Canada. FT Shares are sold pursuant to the requirements of Canadian tax legislation, which incentivize investors to purchase these shares by allowing a deduction from income for their purchase price (aside from the tax aspects, FT Shares are in all respects ordinary common shares). Although the Company believes it will be able to incur the necessary amount of exploration expenditures as required by the Flow-Through Share subscription agreements, there is a risk that expenditures incurred by the Company may not be expended within the time limits, or that they will qualify as “Canadian exploration expenditures” (“CEE”), as such term is defined in the Income Tax Act (Canada) (the “Tax Act”), or that any such resource expenses incurred will be reduced by other events including failure to comply with the provisions of the Flow-Through Share subscription agreements or of applicable income tax legislation.
If the Company does not renounce to Flow-Through Share subscribers CEE within 2024, or if there is a reduction in such amount renounced pursuant to the provisions of the Tax Act, the Company may need to indemnify such subscribers, on the terms included in the Flow-Through Share subscription agreements, for an amount equal to the amount of any tax payable or that may become payable under the Tax Act. There were $0.9 million remaining expenditures as of December 31, 2024, which are to be used by December 31, 2025, in connection with the requirement to incur CEE in 2025.
On June 13, 2024, the Company issued 5,320,000 FT Shares of the Company for gross proceeds of $5 million. The Company is required to deploy the remaining $0.9 million of CEE on or before December 31, 2025 in respect of this financing and the balance in 2025 and failure to do so will result in financial penalties.
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Description of Capital Structure
The Company’s authorized share capital consists of an unlimited number of Common Shares and an unlimited number of preferred shares in the capital of the Company (none of which has been allotted or issued). As of the date of this AIF, 151,938,300 Common Shares are issued and outstanding. In addition, as at the date of this AIF, there were 8,189,272 Common Shares issuable upon the exercise of outstanding share purchase options (“Options”), at a weighted average exercise price of $1.14 and 1,843,641 Common Shares issuable upon the vesting of outstanding restricted share units (“RSUs”), over the next 36 months. Additionally, 480,000 Common Shares are issuable upon a) the vesting of outstanding deferred share units (“DSUs”), with vesting dates over the next 36 months, and b) the cessation of employment or directorship with Fury.
Attributes of Common Shares
Each Common Share entitles the holder to: (i) one vote at all meetings of shareholders (except meetings at which only holders of a specified class of shares are entitled to vote); (ii) receive, subject to the holders of another class of shares, any dividend declared by the Board; and (iii) receive, subject to the rights of the holders of another class of shares, the remaining property of Fury Gold on the liquidation, dissolution or winding up of Fury Gold, whether voluntary or involuntary, or for the purposes of a reorganization or otherwise or upon any distribution of capital, on a pro-rata basis. No pre-emptive, redemption, sinking fund or conversion rights are attached to the Common Shares.
Authorized Preferred Shares- Nil issued
Preferred Shares are authorized to be issued from time to time in one or more series, and the Board may fix from time to time before such issue the number of Preferred Shares, the designation, rights and privileges attached thereto including any voting rights, dividend rights, redemption, purchase or conversion rights, sinking fund or other provisions. Preferred Shares generally rank in priority over Common Shares and any other shares ranking by their terms junior to the Preferred Shares as to dividends and return of capital upon, liquidation, dissolution or winding up of the Company or any other return of capital or distribution of the assets of the Company.
Market for Securities
Trading Price and Volume
The following table sets out the high and low sale prices and the aggregate volume of trading of the Common Shares on the TSX and the NYSE American on a monthly basis for the most recently completed fiscal year ended December 31, 2024.
Trading Price and Volume of Common Shares on the TSX
| Date | High (CAD$) | Low (CAD$) | Volume | ||||||||||
| December 2024 | 0.61 | 0.52 | 855,415 | ||||||||||
| November 2024 | 0.66 | 0.56 | 715,770 | ||||||||||
| October 2024 | 0.69 | 0.56 | 1,463,115 | ||||||||||
| September 2024 | 0.64 | 0.50 | 1,028,497 | ||||||||||
| August 2024 | 0.60 | 0.48 | 953,651 | ||||||||||
| July 2024 | 0.64 | 0.52 | 894,128 | ||||||||||
| June 2024 | 0.64 | 0.50 | 1,009,615 | ||||||||||
| May 2024 | 0.69 | 0.52 | 3,072,624 | ||||||||||
| April 2024 | 0.80 | 0.57 | 1,761,238 | ||||||||||
| March 2024 | 0.63 | 0.46 | 848,022 | ||||||||||
| February 2024 | 0.54 | 0.42 | 674,607 | ||||||||||
| January 2024 | 0.66 | 0.50 | 922,484 | ||||||||||
| - A-66 - |
Trading Price and Volume of Common Shares on the NYSE American
| Date | High (US$) | Low (US$) | Volume | ||||||||||
| December 2024 | 0.44 | 0.35 | 2,562,232 | ||||||||||
| November 2024 | 0.48 | 0.39 | 2,424,699 | ||||||||||
| October 2024 | 0.51 | 0.41 | 3,109,256 | ||||||||||
| September 2024 | 0.49 | 0.36 | 3,056,934 | ||||||||||
| August 2024 | 0.45 | 0.35 | 2,055,795 | ||||||||||
| July 2024 | 0.46 | 0.38 | 1,583,282 | ||||||||||
| June 2024 | 0.49 | 0.37 | 3,478,460 | ||||||||||
| May 2024 | 0.56 | 0.38 | 6,376,422 | ||||||||||
| April 2024 | 0.59 | 0.41 | 4,083,718 | ||||||||||
| March 2024 | 0.47 | 0.33 | 2,951,168 | ||||||||||
| February 2024 | 0.40 | 0.31 | 1,971,004 | ||||||||||
| January 2024 | 0.50 | 0.36 | 1,791,986 | ||||||||||
Prior Sales
During its financial year ended December 31, 2024, and up until the date of this AIF, Fury Gold issued the following securities that were not listed or quoted on either the TSX or the NYSE American:
| Date of Issuance | Number and Type of Securities Issued | Issue/Exercise Price (C$) | Reason for Issuance |
| February 17, 2023 | 156,000 Options | $0.85 | Option Grant |
| March 1, 2023 | 25,000 Options | $0.92 | Option Grant |
| May 15, 2023 | 40,000 Options | $0.82 | Option Grant |
| January 9, 2024 | 70,000 Options | $0.60 | Option Grant |
| January 9, 2024 | 1,318,623 RSUs | N/A | Long-Term RSU Grant |
| January 9, 2024 | 235,080 RSUs(1) | $0.65 | Short-Term RSU Grant |
| January 30, 2024 | 273,542 RSUs(1) | $0.60 | Short-Term RSU Grant |
| February 2, 2024 | 75,000 Options | $0.55 | Option Grant |
| June 26, 2024 | 100,000 Options | $0.55 | Option Grant |
| January 9, 2025 | 1,142,500 RSU’s | N/A | Long-Term RSU Grant |
| January 9, 2025 | 590,000 DSU’s | N/A | Long-Term DSU Grant |
| January 9, 2025 | 80,000 Options | $0.60 | Option Grant |
| (1) | Common Shares were issued during the year upon the vesting of Short-Term RSUs. |
Directors and Executive Officers
Name, Principal Occupation and Province or State of Residence
The following table sets out the names, province or state and country of residence, positions with or offices held with Fury Gold, and principal occupation for the past five years of each of Fury Gold’s directors and executive officers, as well as the period during which each has been a director of Fury Gold. The following table also identifies the members of each committee of the Board.
The term of office of each director of Fury Gold expires at the annual general meeting of shareholders each year.
| - A-67 - |
Directors and Executive Officers
|
Name, Position and Province and Country of Residence |
Principal Occupation During the Past Five Years |
Director Since |
|
FORRESTER (TIM) A. CLARK CEO & Director Massachusetts, United States |
Executive Director of Fury Gold; Director of Dolly Varden Silver Corporation. Mr. Clark has 25 years of global capital markets experience with numerous US, European and Canadian banks, including Barclays Capital, National Bank Financial, Merrill Lynch, Deutsche Bank and most recently BMO Capital Markets, where he held the role of Managing Director, Institutional Equity Sales. |
March 16, 2021 |
|
BRIAN CHRISTIE (1)(2)(3) Chair Ontario, Canada |
Financial Executive Chair of Fury Gold; Director of Wallbridge Mining Company Limited; Director of Forum Energy Metals Corp; Strategic Advisor for Agnico Eagle Mining Limited (“Agnico Eagle”); Past Director of Denver Gold Group; VP, Investor Relations at Agnico Eagle |
February 22, 2023 |
|
STEVE COOK(1) (4) Director British Columbia, Canada |
Semi-retired Lawyer and Businessman Director of Fury Gold; Past Director of Torq Resources Inc. (until Feb 29, 2025); Past Director of Tier One Silver Inc. (until Aug 7, 2024); Past Director of Coppernico Metals (until April 9, 2024), former tax partner at law firm of Thorsteinssons LLP; Principal at SM Cook Legal Services Law Corporation; Past Director of Cayden Resources Inc; Past Director of Skeena Resources Ltd.; Past Director of SnipGold Corp; Past Director of LaSalle Exploration Corp. |
October 28, 2013 |
|
MICHAEL HOFFMAN (1)(2)(3)(4) Director Ontario, Canada |
Retired Mining Engineer/Mining Executive Director of Fury Gold; Director of 1911 Gold; Director and Chair of NiCAN Ltd; Director of Volta Metals Inc.; Past Director of Eastmain; Past Director of Trevali Mining Corporation; Past Director of Silver X Mining; Past Director of Velocity Minerals; Past Director of LiCAN Ltd. (private). |
October 9, 2020 |
|
ALISON SAGA WILLIAMS (2)(4) Director Ontario, Canada |
Lawyer Director of Fury Gold; Director of NiCAN Ltd Adjunct Professor at Osgoode Hall Law School; Former Elected Official for the Curve Lake First Nation. Principal of AS Williams Consulting firm, where the balance of Ms. Williams professional activities are spent working for Indigenous communities in government and resource development companies in the capacity of negotiations and governance, and as a strategic advisor. |
October 5, 2020 |
|
ISABELLE CADIEUX (3)(5) Director Quebec, Canada
|
Geologist Director of Fury Gold; Past Managing Director, Investment, SIDEX. Past Director of Ordre des géologues du Québec (OGQ; Past Director of the Canadian Council of Professional Geoscientists; Past member of the Executive Committee of the UQAT-UQAM Chair in Mining Entrepreneurship.
|
September 5, 2023 to March 24, 2025 |
|
PHIL VAN STADEN Chief Financial Officer Ontario, Canada |
Accounting Professional Chief Financial Officer of Fury Gold; Past Controller of Fury Gold; |
N/A |
|
BRYAN ATKINSON SVP, Exploration Alberta, Canada |
Geologist Senior Vice President, Exploration of Fury Gold; Past Exploration Manager of Universal Mineral Services; Past Senior Geologist of APEX Geoscience Ltd. |
N/A |
Notes:
| (1) | Member of the Audit Committee. |
| (2) | Member of the Nominating, Compensation and Governance Committee. Effective June 26, 2024, Michael Hoffman was appointed to the Committee, replacing Jeffrey Mason |
| (3) | Member of the Technical, Safety and Risk Management Committee. |
| (4) | Member of the Indigenous and Community Relations Committee. |
| (5) | Isabelle Cadieux resigned from the Board effective March 24, 2025. |
| - A-68 - |
Management Security Holdings
As at the date of this AIF, Fury Gold’s directors and executive officers as a group, beneficially owned, directly and indirectly, or exercised control or direction over, a total of 2,696,493 Common Shares, being approximately 1.77% of Fury Gold’s issued and outstanding Common Shares.
Management History of Cease Trade Orders, Bankruptcies, Penalties or Sanctions
As at the date of this AIF or within the last 10 years before the date of this AIF, no director or executive officer of Fury Gold was a director, chief executive officer or chief financial officer of any company (including Fury Gold), that:
| (a) | was subject to a cease trade or similar order or an order denying the relevant company access to any exemptions under securities legislation, that was in effect for a period of more than 30 consecutive days; or |
| (b) | was subject to a cease trade or similar order or an order denying the relevant company access to any exemptions under securities legislation, that was in effect for a period of more than 30 consecutive days, that was issued after the director, chief executive officer or chief financial officer ceased to be a director, chief executive officer or chief financial officer, and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer. |
Other than as described below, no director or executive officer of Fury Gold, or a shareholder holding a sufficient number of securities of Fury Gold to affect materially the control of Fury Gold,
| (a) | is, at the date of this AIF, or has been within the 10 years before the date of this AIF, a director or executive officer of any company (including Fury Gold) that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets; |
| (b) | has, within the 10 years before the date of this AIF, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the director, executive officer or shareholder; or |
| - A-69 - |
| (c) | has been subject to: |
| i. | any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or |
| ii. | any other penalties or sanctions imposed by a court or a regulatory body that would likely be considered important to a reasonable securityholder in making an investment decision. |
Potential Conflicts of Interest
No directors or officers have any known conflicts of interest in connection with Fury Gold. Several directors serve on the boards of other publicly traded junior mining companies which can lead to potential conflicts of interest in connection with the entitlement to mineral project opportunities which may come to their attention. In response to this risk, the Company and its shared services provider, Universal Mineral Services Ltd. haves established policies to avoid these situations and to comply with legal requirements of their fiduciary obligations and the requirements of the applicable corporate laws (Business Corporations Act (British Columbia)) should such potential conflict of interest situations arise.
Audit Committee
Audit Committee Charter
The primary responsibility of the Audit Committee of the Company (the “Audit Committee”) is that of oversight of the financial reporting process on behalf of the Board. This includes oversight responsibility for financial reporting and continuous disclosure, oversight of external audit activities, oversight of financial risk and financial management control, and oversight responsibility for compliance with tax and securities laws and regulations as well as whistle blowing procedures. The Audit Committee is also responsible for the other matters as set out in this charter and/or such other matters as may be directed by the Board from time to time. The Audit Committee should exercise continuous oversight of developments in these areas.
Composition of the Audit Committee
The current members of the Audit Committee are Steve Cook (Chairperson), Brian Christie and Michael Hoffman, each of whom are considered financially literate and all are independent as such terms are defined under National Instrument 52-110 – Audit Committees of the Canadian Securities Administrators
Relevant Education and Experience of Audit Committee Members
Set out below is a brief description of the education and experience of each Audit Committee member that is relevant to the performance of his responsibilities as an Audit Committee member.
Steve Cook is a retired tax partner at the law firm of Thorsteinssons LLP, Vancouver, BC. Mr. Cook received his B.Comm. and LL.B. degrees from the University of BC and was called to the BC Bar in 1982 and the Ontario Bar in 1992. Mr. Cook is a specialist in corporate and international tax planning, offshore structures, representation, and civil and criminal tax litigation.
Brian Christie worked for over 17 years in the investment industry, primarily as a precious and base metals mining analyst with Desjardins Securities, National Bank Financial, Canaccord Capital and HSBC Securities. Prior to this, Mr. Christie spent 13 years in the mining industry as a geologist for a variety of mining companies, including Homestake, Billiton, Falconbridge Copper and Newmont Mining.
| - A-70 - |
Michael Hoffman is an experienced mining executive with over 30 years of practice including engineering, mine operations, corporate development, projects and construction. Mr. Hoffman also has direct northern Canadian mining experience including operations and projects.
Each member of the Audit Committee has:
| · | an understanding of the accounting principles used by the Company to prepare its financial statements, and the ability to assess the general application of those principles in connection with estimates, accruals and reserves; |
| · | experience preparing, auditing, auditing, analyzing or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the Company’s financial statements, or experience actively supervising individuals engaged in such activities; and |
| · | an understanding of internal controls and procedures for financial reporting. |
Pre-Approval Policies and Procedures
The Audit Committee has adopted specific policies and procedures for the engagement of non-audit services to be provided to the Company or any subsidiaries by the Company’s external auditor. The Chair of the Audit Committee has the authority to pre-approve in between regularly scheduled Audit Committee meetings any non-audit service of less than $50,000, however such approval will be presented to the Audit Committee at the next scheduled meeting for formal approval.
External Auditor Service Fees
The following table discloses the aggregate fees billed for each of the last two fiscal years for professional services rendered by the Company’s auditor for various services.
| Nature of Services | December 31, 2024 | December 31, 2023 |
| Audit Fees(1) | $523,364 | $425,521 |
| Audit-Related Fees(2) | Nil | Nil |
| Tax Fees | Nil | Nil |
| All Other Fees | Nil | Nil |
| Total | $523,364 | $425,521 |
Notes:
| (1) | “Audit Fees” include fees necessary to perform the annual audit and quarterly reviews of the Company’s consolidated financial statements. Audit Fees also include audit or other attest services required by legislation or regulation, such as comfort letters, consents, reviews of securities filings and statutory audits. In 2023 and 2024, the Audit Fees included fees incurred in connection with certain securities filings. |
| (2) | “Audit-Related Fees” include services that are traditionally performed by the auditor. These audit-related services include employee benefit audits, due diligence assistance, accounting consultations on proposed transactions, internal control reviews and audit or attest services not required by legislation or regulation. |
Other Board Committees
The Board currently has three other standing committees in addition to the Audit Committee, namely the Nominating, Compensation and Governance Committee, the Indigenous and Community Relations Committee, and the Technical, Health, Safety and Environment Committee. Each standing committee of the Board operates according to its mandate, which is approved by the Board and sets out the committee’s duties and responsibilities. Copies of the standing committee mandates are available at www.furygoldmines.com/about-us/governance/.
| - A-71 - |
No Legal Proceedings
To the best knowledge of Fury Gold’s management, there are no material legal proceedings involving Fury Gold or its properties as of the date of this AIF and Fury Gold knows of no such proceedings currently contemplated.
No penalties or sanctions have been imposed against Fury Gold by a court relating to securities legislation or by a securities regulatory authority during Fury Gold’s financial year, no penalties or sanctions have been imposed by a court or regulatory body against Fury Gold that would likely be considered important to a reasonable investor in making an investment decision and no settlement agreements have been entered into by Fury Gold before a court relating to securities legislation or with a securities regulatory authority during the financial year.
Interest of Management and Others in Material Transactions
To the knowledge of the directors and executive officers of Fury Gold, there were no material interests, direct or indirect, of directors or executive officers of Fury Gold, any shareholder of Fury Gold who beneficially owns, directly or indirectly, or exercised control or direction over Common Shares carrying more than 10% of the voting rights attached to all outstanding Common Shares, or any known associate or affiliate of such persons, in any transaction during the three most recently completed financial year of Fury Gold or during the current financial year that has materially affected or is reasonably expected to materially affect Fury Gold.
SHARED SERVICES PROVIDER
Universal Mineral Services Ltd. (“UMS”)
The Company shares services with three other junior explorers some of whom now or in the past have one or more common directors. These three are Torq Resources Inc, Coppernico Metals Inc and Tier One Siler Inc. Under the shared services arrangements with the Company’s 25%-owned affiliate service provider company UMS, all transactions have occurred in the normal course of operations, and the shared costs are considered by management to be priced at equal to or better than would be the fair market rates for the shared services. All amounts owing to or from UMS are unsecured, non-interest bearing, and have no specific terms of settlement, unless otherwise noted.
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Exploration and evaluation costs | $ | 233 | $ | 872 | $ | 590 | ||||||
| General and administration | 307 | 714 | 841 | |||||||||
| Total transactions for the year | $ | 540 | $ | 1,586 | $ | 1,431 | ||||||
The outstanding balance owing at December 31, 2024 was $90 (December 31, 2023 – $103, December 31, 2022 – $240) which is included in accounts payable.
As part of the UMS arrangement, the Company is contractually obliged to pay certain rental expenses in respect of a ten-year office lease entered into by UMS on July 1, 2021. As at December 31, 2024, the Company expects to incur approximately $91 in respect of its share of future rental expense of UMS.
The Company issues share options to certain UMS employees, including key management personnel of the Company. The Company recognized a share-based compensation recovery of $3 for the year ended December 31, 2024, in respect of share options issued to UMS employees (December 31, 2023 - $317 expense, December 31, 2022 - $483 expense) which is included within employee benefits and exploration and evaluation costs.
Transfer Agent and Registrar
Fury Gold’s registrar and transfer agent for the Common Shares is Odyssey Trust Company at its principal offices located at the Stock Exchange Tower, 1230 – 300 5th Avenue SW, Calgary, AB, T2P 3C4, Canada (888) 290-1175.
| - A-72 - |
Auditor
The auditor of the Company is Deloitte LLP, Chartered Professional Accountants, of 410 W Georgia St, Vancouver, BC, V6B 0S7. Deloitte LLP is independent with respect to the Company within the meaning of the U.S. Securities Act of 1933, as amended, and the applicable rules and regulations thereunder adopted by the SEC and the Public Company Accounting Oversight Board (United States) and within the meaning of the rules of professional conduct of the Chartered Professional Accountants of British Columbia.
Material Contracts
Except for contracts entered into in the ordinary course of business, the following are the only material agreements to which the Company is party (the “Material Contracts”):
| (1) | UMS is the private company through which its shareholders, including the Company, share geological, financial, and transactional advisory services as well as administrative services on a full, cost recovery basis. This allows the Company to maintain a more efficient and cost-effective corporate overhead structure by hiring fewer full-time employees and engaging outside professional advisory firms less frequently. The agreement has an indefinite term and can be terminated by either party upon providing 180 days notice. The Company is committed to certain office rental expense in respect of shared head office including after termination of the UMS agreement which the Company may terminate anytime on 180 days notice. See Shared Services Provider above. |
| (2) | The Amended and Restated Arrangement Agreement, together with the Amending Agreement, as described above under “General Development of Business – Three Year History – 2025”. |
Interests of Experts
Certain of the scientific and technical information relating to the Company’s mineral projects has been derived from the two Technical Reports prepared by the experts named below and has been included in reliance on such person’s expertise. Copies of the Technical Reports can be accessed online on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov.
Bryan Atkinson, P.Geo as Senior Vice President Exploration at Fury Gold Mines and Andrew Turner P.Geol., as principal with APEX Geoscience Ltd., have acted as a “qualified person” as defined in NI 43-101 in connection with the Committee Bay Report. Mr. Atkinson has reviewed and approved the information related to the Committee Bay Project contained in this AIF.
Maxime Dupéré, P. Geo., Ben Eggers, P. Geo. And Sarah Dean, P. Geo as geologists for SGS Geological Services, have acted as a “qualified persons” as defined in NI 43-101 in connection with the Eau Claire Technical Report. Ms. Valerie Doyon, P.Geo., as Senior Project Geologist at Fury Gold Mines, has reviewed and approved the information related to the Eau Claire Project contained in this AIF.
Valerie Doyon, P.Geo., Senior Project Geologist at Fury Gold Mines, has acted as “qualified Person” as defined in NI 43-101 in connection with the Technical Report in connection with the Éléonore South Project. Mrs. Doyon has reviewed and approved the information related to the Éléonore South Project contained in this AIF.
All other scientific and technical information in this Prospectus and relating to the mineral projects or properties material to Fury Gold, including information given after the date of the applicable Technical Reports, has been reviewed and approved by Bryan Atkinson, P.Geo., Senior Vice President Exploration and Valerie Doyon, Senior Project Geologist as a “qualified persons” under NI 43-101.
Each of the aforementioned firms or persons held less than one percent of any class of the Company’s securities or of any of the Company’s associates or affiliates when they prepared the Technical Reports referred to above or following the preparation of such Technical Reports. None of the aforementioned firms or persons received any direct or indirect interest in any of the Securities or property or of any of the Company’s associates or affiliates in connection with the preparation of such Technical Reports and the recipient of management incentive stock options in the Company commensurate with his role.
| - A-73 - |
None of the aforementioned firms or persons, nor any directors, officers or employees of such firms, are currently expected to be elected, appointed or employed as a director, officer or employee of the Company or of any of its associates or affiliates, other than Bryan Atkinson, P.Geo, Senior Vice President Exploration of the Company and Valerie Doyon, Senior Project Geologist of the Company, who was at the time of reviewing and approving the applicable information and remain as of the date of this AIF a director, officer or employee of the Company or one of its subsidiaries.
Additional Information
Additional information relating to Fury Gold, including directors’ and officers’ remuneration and indebtedness, principal holders of Fury Gold’s securities, and securities authorized for issuance under equity compensation plans, is contained in annual financial statements, management’s discussion and analysis, proxy circulars and interim financial statements of the Company, available under the Company’s profile on SEDAR+ at www.sedarplus.ca. A copy of the Company’s audit Committee charter is available at www.furygoldmines.com/about-us/governance/.
Exhibit 99.2
(An exploration company)
CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2024
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of
Fury Gold Mines Limited
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of financial position of Fury Gold Mines Limited and subsidiaries (the "Company") as of December 31, 2024 and 2023, the related consolidated statements of (earnings) loss and comprehensive (income) loss, equity, and cash flows, for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and its financial performance and its cash flows for each of the three years in the period ended December 31, 2024, in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Mineral property interests – Impairment analysis – Refer to Notes 3 g) and 16 to the financial statements
Critical Audit Matter Description
The Company determined that an impairment indicator existed at December 31, 2024. The recoverable amount for its cash generating units (“CGUs”) is the greater of the fair value less cost of disposal and the value in use. The fair value less cost of disposal for its CGUs was calculated using the in-situ ounce multiples method. As the carrying values exceeded the recoverable amounts, an impairment loss was recorded.
While there are several estimates and assumptions that are required to determine the recoverable amount, the estimates and assumptions with the highest degree of subjectivity are the in-situ once multiples. This required a high degree of auditor judgment and an increased extent of audit effort, including the involvement of fair value specialists.
How the Critical Audit Matter Was Addressed in the Audit
With the assistance of fair value specialists, our audit procedures related to the in-situ ounce multiples used to determine the recoverable amounts included evaluating the reasonableness of management’s determination of the in-situ ounce multiples by comparing to independent market data, among others.
/s/ Deloitte LLP
Chartered Professional Accountants
March 31, 2025
Vancouver, Canada
We have served as the Company's auditor since 2015.
Fury Gold Mines Limited
Consolidated Statements of Financial Position
(Expressed in thousands of Canadian dollars)
| At December 31 | At December 31 | |||||||||
| Note | 2024 | 2023 | ||||||||
| Assets | ||||||||||
| Current assets: | ||||||||||
| Cash | 7 | $ | 4,912 | $ | 7,313 | |||||
| Marketable securities | 8 | 2,358 | 1,166 | |||||||
| Other investments | 9 | 2,063 | - | |||||||
| Accounts receivable | 54 | 374 | ||||||||
| Prepaid expenses and deposits | 522 | 592 | ||||||||
| 9,909 | 9,445 | |||||||||
| Non-current assets: | ||||||||||
| Restricted cash | 7 | 144 | 144 | |||||||
| Prepaid expenses and deposits | 77 | 111 | ||||||||
| Property and equipment | 10 | 326 | 588 | |||||||
| Mineral property interests | 11 | 45,200 | 142,639 | |||||||
| Investments in associates | 12 | 29,456 | 36,248 | |||||||
| 75,203 | 179,730 | |||||||||
| Total assets | $ | 85,112 | $ | 189,175 | ||||||
Liabilities and Equity | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable and accrued liabilities | $ | 855 | $ | 1,034 | ||||||
| Lease liability | 65 | 154 | ||||||||
| Flow-through share premium liability | 13 | 944 | 544 | |||||||
| 1,864 | 1,732 | |||||||||
| Non-current liabilities: | ||||||||||
| Lease liability | - | 74 | ||||||||
| Provision for site reclamation and closure | 14 | 5,045 | 4,495 | |||||||
| Total liabilities | $ | 6,909 | $ | 6,301 | ||||||
| Equity: | ||||||||||
| Share capital | 18 | $ | 312,723 | $ | 310,277 | |||||
| Share option and warrant reserve | 19 | 22,684 | 21,660 | |||||||
| Accumulated other comprehensive loss | (12 | ) | (9 | ) | ||||||
| Deficit | (257,192 | ) | (149,054 | ) | ||||||
| Total equity | $ | 78,203 | $ | 182,874 | ||||||
| Total liabilities and equity | $ | 85,112 | $ | 189,175 | ||||||
Commitments (notes 12(b), 13, 23); Subsequent events (note 26)
Approved on behalf of the Board of Directors:
| “Forrester A. Clark” | “Steve Cook” | ||
| Chief Executive Officer | Director |
The accompanying notes form an integral part of these consolidated financial statements.
Fury Gold Mines Limited | 1 |
Fury Gold Mines Limited
Consolidated Statements of (Earnings) Loss and Comprehensive (Income) Loss
(Expressed in thousands of Canadian dollars, except per share amounts)
| Years ended December 31 | ||||||||||||||
| Note | 2024 | 2023 | 2022 | |||||||||||
| Operating expenses: | ||||||||||||||
| Exploration and evaluation | 15 | $ | 5,512 | $ | 9,311 | $ | 9,217 | |||||||
| Fees, salaries and other employee benefits | 2,202 | 2,630 | 3,199 | |||||||||||
| Insurance | 522 | 646 | 728 | |||||||||||
| Legal and professional | 789 | 863 | 804 | |||||||||||
| Marketing and investor relations | 677 | 737 | 809 | |||||||||||
| Office and administration | 461 | 384 | 398 | |||||||||||
| Regulatory and compliance | 214 | 275 | 218 | |||||||||||
| 10,377 | 14,846 | 15,373 | ||||||||||||
| Other (income) expense, net: | ||||||||||||||
| Accretion on provision for site reclamation and closure | 14 | 146 | 148 | 94 | ||||||||||
| Amortization of flow-through share premium | 13 | (1,621 | ) | (3,345 | ) | (3,124 | ) | |||||||
| Foreign exchange loss | 13 | 13 | 9 | |||||||||||
| Impairment expense | 16 | 100,873 | - | 5,506 | ||||||||||
| Interest expense | 33 | 61 | 115 | |||||||||||
| Interest income | (300 | ) | (590 | ) | (228 | ) | ||||||||
| Net gain on disposition of mineral interests | 6,11 | - | (468 | ) | (48,390 | ) | ||||||||
| Net loss from associates | 12 | 3,858 | 6,182 | 5,880 | ||||||||||
| Gain on investments | 12 | (4,109 | ) | - | - | |||||||||
| Net (gain) loss on marketable securities | 8 | (373 | ) | 655 | 135 | |||||||||
| Other income | 17 | (566 | ) | - | (91 | ) | ||||||||
| 97,954 | 2,656 | (40,094 | ) | |||||||||||
| (Earnings) loss before taxes | 108,331 | 17,502 | (24,721 | ) | ||||||||||
| Income tax recovery | 25 | (193 | ) | (289 | ) | (187 | ) | |||||||
| Net (earnings) loss for the year | 108,138 | 17,213 | (24,908 | ) | ||||||||||
Other comprehensive loss, net of tax | ||||||||||||||
| Unrealized currency loss on translation of foreign operations | 3 | 6 | 3 | |||||||||||
| Total comprehensive (income) loss for the year | $ | 108,141 | 17,219 | $ | (24,905 | ) | ||||||||
(Earnings) loss per share: | ||||||||||||||
| Basic and diluted (earnings) loss per share | 22 | $ | 0.73 | $ | 0.12 | $ | (0.18 | ) | ||||||
The accompanying notes form an integral part of these consolidated financial statements.
Fury Gold Mines Limited | 2 |
Fury Gold Mines Limited
Consolidated Statements of Equity
(Expressed in thousands of Canadian dollars, except share amounts)
| Number of common shares |
Share capital | Share option and warrant reserve | Accumulated other comprehensive loss |
Deficit |
Total | |||||||||||||||||||
| Balance at December 31, 2021 | 125,720,950 | $ | 295,464 | $ | 18,640 | $ | - | $ | (156,749 | ) | $ | 157,355 | ||||||||||||
| Comprehensive income (loss) for the year | - | - | - | (3 | ) | 24,908 | 24,905 | |||||||||||||||||
| Shares issued pursuant to offering, net of share issue costs | 13,750,000 | 10,864 | - | - | - | 10,864 | ||||||||||||||||||
| Share-based compensation | - | - | 1,669 | - | - | 1,669 | ||||||||||||||||||
| Balance at December 31, 2022 | 139,470,950 | $ | 306,328 | $ | 20,309 | $ | (3 | ) | $ | (131,841 | ) | $ | 194,793 | |||||||||||
| Comprehensive loss for the year | - | - | - | (6 | ) | (17,213 | ) | (17,219 | ) | |||||||||||||||
| Shares issued pursuant to offering, net of share issue costs | 6,076,500 | 3,949 | - | - | - | 3,949 | ||||||||||||||||||
| Share-based compensation | 197,345 | - | 1,351 | - | - | 1,351 | ||||||||||||||||||
| Balance at December 31, 2023 | 145,744,795 | $ | 310,277 | $ | 21,660 | $ | (9 | ) | $ | (149,054 | ) | $ | 182,874 | |||||||||||
| Comprehensive loss for the year | - | - | - | (3 | ) | (108,138 | ) | (108,141 | ) | |||||||||||||||
| Shares issued pursuant to offering, net of share issue costs (note 18) | 5,320,000 | 2,446 | - | - | - | 2,446 | ||||||||||||||||||
| Share-based compensation (note 19) | 491,478 | - | 1,024 | - | - | 1,024 | ||||||||||||||||||
| Balance at December 31, 2024 | 151,556,273 | $ | 312,723 | $ | 22,684 | $ | (12 | ) | $ | (257,192 | ) | $ | 78,203 | |||||||||||
The accompanying notes form an integral part of these consolidated financial statements.
Fury Gold Mines Limited | 3 |
Fury Gold Mines Limited
Consolidated Statements of Cash Flows
(Expressed in thousands of Canadian dollars)
| Years ended December 31 | ||||||||||||||
| Note | 2024 | 2023 | 2022 | |||||||||||
| Operating activities: | ||||||||||||||
| Earnings (loss) for the year | $ | (108,138 | ) | $ | (17,213 | ) | 24,908 | |||||||
| Adjusted for: | ||||||||||||||
| Interest income | (300 | ) | (590 | ) | (228 | ) | ||||||||
| Items not involving cash: | ||||||||||||||
| Accretion of provision for site reclamation and closure | 14 | 146 | 148 | 94 | ||||||||||
| Amortization of flow-through share premium | 13 | (1,621 | ) | (3,345 | ) | (3,124 | ) | |||||||
| Depreciation | 10 | 297 | 343 | 341 | ||||||||||
| Impairment expense | 16 | 100,873 | - | 5,506 | ||||||||||
| Interest expense | 25 | 61 | 100 | |||||||||||
| Net gain on disposition of mineral interests | 6,11 | - | (468 | ) | (48,390 | ) | ||||||||
| Net loss from associates | 12 | 3,858 | 6,182 | 5,880 | ||||||||||
| Net (gain) loss on marketable securities | 8 | (373 | ) | 655 | 135 | |||||||||
| Gain on investments | (4,109 | ) | - | - | ||||||||||
| Share-based compensation | 19 | 859 | 1,351 | 1,669 | ||||||||||
| Changes in non-cash working capital | 21 | 410 | (184 | ) | (903 | ) | ||||||||
| Cash used in operating activities | (8,073 | ) | (13,060 | ) | (14,012 | ) | ||||||||
| Investing activities: | ||||||||||||||
| Acquisition of mineral interests, inclusive of transaction fees | 11 | (3,030 | ) | - | (1,281 | ) | ||||||||
| Acquisition of Universal Mineral Services Ltd | - | - | (1 | ) | ||||||||||
| Increase in restricted cash | 7 | - | - | (14 | ) | |||||||||
| Interest income | 300 | 590 | 228 | |||||||||||
| Marketable securities additions | 8 | (1,300 | ) | - | (60 | ) | ||||||||
| Option payment received | 11 | - | 125 | 310 | ||||||||||
| Other investments additions | 9 | (2,063 | ) | - | - | |||||||||
| Proceeds from disposition of mineral interests, net of transaction costs | 6 | - | 1,350 | 4,479 | ||||||||||
| Proceeds from disposition of investment in associate, net of transaction costs | 12 | 7,042 | - | 6,774 | ||||||||||
| Proceeds from disposition of marketable securities, net of transaction costs | 8 | 481 | 381 | - | ||||||||||
| Property and Equipment additions | 10 | (35 | ) | - | - | |||||||||
| Cash provided by investing activities | 1,395 | 2,446 | 10,435 | |||||||||||
| Financing activities: | ||||||||||||||
| Proceeds from issuance of common shares, net of costs | 18 | 4,468 | 7,838 | 10,864 | ||||||||||
| Lease payments | (191 | ) | (214 | ) | (235 | ) | ||||||||
| Cash provided by financing activities | 4,277 | 7,624 | 10,629 | |||||||||||
| Effect of foreign exchange on cash | - | (6 | ) | (2 | ) | |||||||||
| Increase (decrease) in cash | (2,401 | ) | (2,996 | ) | 7,050 | |||||||||
| Cash, beginning of the year | 7,313 | 10,309 | 3,259 | |||||||||||
| Cash, end of the year | 7 | $ | 4,912 | $ | 7,313 | $ | 10,309 | |||||||
Supplemental cash flow information (note 21)
The accompanying notes form an integral part of these consolidated financial statements.
Fury Gold Mines Limited | 4 |
Note 1: Nature of operations
Fury Gold Mines Limited (the “Company” or “Fury Gold”) was incorporated on June 9, 2008, under the Business Corporations Act (British Columbia) and is listed on the Toronto Stock Exchange and the NYSE-American, with its common shares trading under the symbol FURY. The Company’s registered and records office is at 1500-1055 West Georgia Street Vancouver, BC, V6E 4N7 and the mailing address is 401 Bay Street, 16th Floor, Toronto, Ontario, M5H 2Y4.
The Company’s principal business activity is the acquisition and exploration of resource projects in Canada. At December 31, 2024, the Company had three principal projects: Committee Bay in Nunavut, and Eau Claire and Éléonore South in Quebec, which the Company now owns 100%, after acquiring the 49.978% interest, previously held by Newmont Corporation (“Newmont”), in February 2024. Additionally, the Company holds a 16.11% common share interest in Dolly Varden Silver Corporation (“Dolly Varden”) at December 31, 2024, which owns the Kitsault project in British Columbia and a 25% interest in Universal Mineral Services Limited (“UMS”), a private shared- services provider.
Sale of Homestake Resources Corporation (“Homestake Resources”)
On December 6, 2021, the Company entered into a definitive agreement (the "Purchase Agreement") with Dolly Varden pursuant to which the Company agreed to sell to Dolly Varden a 100% interest in Fury Gold's wholly owned subsidiary, Homestake Resources, in exchange for $5,000 in cash and 76,504,590 common shares in Dolly Varden. Homestake Resources was the owner of a 100% interest in the Homestake Ridge gold-silver project which is located adjacent to the Dolly Varden Project owned by Dolly Varden in the Golden Triangle, British Columbia (“the Dolly Varden Transaction”). The Dolly Varden Transaction completed on February 25, 2022. As a result, Fury acquired the 76,504,590 Dolly Varden Shares on February 25, 2022, representing approximately 35.33% of the Dolly Varden Shares outstanding and 32.88% of Dolly Varden on a fully diluted basis as of that date.
In connection with the Dolly Varden Transaction and as contemplated in the Purchase Agreement, Dolly Varden and Fury Gold had also entered into an investor rights agreement dated February 25, 2022 (the "Investor Rights Agreement"). Pursuant to its obligations under the Investor Rights Agreement, Dolly Varden had appointed Forrester “Tim” Clark, the Chief Executive Officer (“CEO”) of Fury Gold, and Michael Henrichsen, the former Chief Geological Officer of Fury Gold, to the board of directors of Dolly Varden.
| (a) | On October 13, 2022, the Company announced that it had completed a non-brokered sale agreement to sell 17,000,000 common shares of Dolly Varden at $0.40 per share, representing approximately 7.4% of the outstanding common shares. The net proceeds received by the Company upon close of the transaction was $6,774. |
| (b) | On March 12, 2024, the Company sold 5,450,000 common shares of Dolly Varden at $0.735 per Share for gross proceeds of $4,006, thus reducing its position to 19.99% of Dolly Varden, and decreasing its right to one director on Dolly Varden under its Investors Rights Agreement, to which notice had been given. |
| (c) | On October 4, 2024, the Company further sold 3,000,000 common shares of Dolly Varden at $1.119 per Share for gross proceeds of $3,356. As at December 31, 2024, the Company held a 16.11% interest in Dolly Varden. |
Acquisition of 25% equity interest in Universal Mineral Services Ltd.
On April 1, 2022, the Company purchased a 25% share interest in UMS, a private shared-services provider for nominal consideration. The remaining 75% of UMS is owned equally by three other junior resource issuers, namely Tier One Silver Inc., Coppernico Metals Inc., and Torq Resources Inc. Previously, UMS had been privately owned by a director in common, Mr. Ivan Bebek, then subsequently from January 1, 2022, by Mr. Steve Cook, another director in common, until March 31, 2022.
UMS is the private company through which its shareholders, including Fury Gold, share geological, financial, and transactional advisory services as well as administrative services on a full cost recovery basis. Having these services
Fury Gold Mines Limited | 5 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
available through UMS, on an as needed basis, allows the Company to maintain a more efficient and cost-effective corporate overhead structure by hiring fewer full-time employees and engaging outside professional advisory firms less frequently. The agreement has an indefinite term and can be terminated by either party upon providing 180 days notice.
Increase in ownership interest of Éléonore South
On September 12, 2022, the Company and its joint operation partner Newmont, through their respective subsidiaries, completed the acquisition of the remaining approximately 23.77% participating interest of Azimut Exploration Inc. in the Éléonore South Joint Venture (“ESJV”), on a pro-rata basis. As a result of the transaction, the 100% ESJV participating interests at December 31, 2022 and 2023 were held 50.022% by the Company and 49.978% by Newmont, with Fury Gold remaining the operator under an amended and restated joint operating agreement.
On February 29, 2024, the Company and Newmont, through their respective subsidiaries, entered into a new agreement whereby the Company acquired 100% control of the interests, consolidating these properties into the Company’s portfolio and dissolving the joint venture.
Note 2: Basis of presentation
These consolidated financial statements have been prepared in accordance with IFRS® Accounting Standards as issued by the International Accounting Standards Board (“IASB”), effective for the year ended December 31, 2024. IFRS Accounting Standards as issued by the IASB comprises IFRSs, International Accounting Standards (“IASs”), and interpretations issued by the IFRS Interpretations Committee (“IFRICs”), and the former Standing Interpretations Committee (“SICs”).
These consolidated financial statements were approved and authorized for issuance by the Board of Directors of the Company on March 31, 2025.
Note 3: Material Accounting Policy Information
| a) | Basis of measurement |
These consolidated financial statements have been prepared on a historical cost basis, except for those assets and liabilities that are measured at revalued amounts or fair values at the end of each reporting period.
| b) | Currency of presentation |
The Company’s presentation currency is the Canadian (“CAD”) dollar. All amounts, with the exception of per share amounts, are expressed in thousands of Canadian dollars, unless otherwise stated. References to US$ are to United States (“US”) dollars.
| c) | Basis of preparation and consolidation |
These consolidated financial statements include the accounts of the Company and its subsidiaries. Subsidiaries are entities controlled by the Company. Control exists when the Company has power over an investee, when the Company is exposed, or has rights, to variable returns from the investee and when the Company has the ability to affect those returns through its power over the investee. Subsidiaries are included in the consolidated financial results of the Company from the effective date of acquisition up to the effective date of disposition or loss of control. All intercompany balances and transactions have been eliminated.
The subsidiaries (with a beneficial interest of 100%) of the Company as at December 31, 2024 were as follows:
| Subsidiary | Place of incorporation | Functional currency |
| Eastmain Mines Inc. (“Eastmain Mines”) (a) | Canada | CAD |
| Eastmain Resources Inc. (“Eastmain”) | ON, Canada | CAD |
| Fury Gold USA Limited (“Fury Gold USA”) (b) | Delaware, U.S.A. | USD |
| North Country Gold Corp. (“North Country”) | BC, Canada | CAD |
(a) The entity is incorporated federally in Canada.
(b) Fury Gold USA provided certain administrative services with respect to employee benefits for US resident personnel.
Fury Gold Mines Limited | 6 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Investments in associates
These consolidated financial statements also include the following investments in associates:
| Associates | Ownership interest | Location | Classification and accounting method |
| Dolly Varden | 16.11% | BC, Canada | Associate; equity method |
| UMS | 25.00% | BC, Canada | Associate; equity method |
| d) | Foreign currency translation |
The financial statements of the Company and each of its subsidiaries are prepared in its functional currency determined on the basis of the currency of the primary economic environment in which such entities operate. The presentation and functional currency of the Company and each of its subsidiaries, with the exception of Fury Gold USA, is the Canadian dollar. Fury Gold USA’s functional currency has been determined to be the US dollar.
Transactions in currencies other than the functional currency are recorded at the rates of exchange prevailing at the transaction dates. At each reporting date, monetary items denominated in foreign currencies are translated into the entity’s functional currency at the then prevailing rates and non-monetary items measured at historical cost are translated into the entity’s functional currency at rates in effect at the date the transaction took place.
Exchange differences arising on the settlement of monetary items or on translating monetary items at rates different from those at which they were translated on initial recognition during the period or in previous financial statements are included in the consolidated statements of (earnings) loss and comprehensive (income) loss for the period in which they arise.
| e) | Cash and cash equivalents |
Cash and cash equivalents consist of cash and highly liquid short-term investments that are readily convertible to cash and have maturities with terms of less than ninety days and/or with original maturities over ninety days but redeemable on demand without penalty. As at December 31, 2024 and 2023, the Company did not have any cash equivalents.
| f) | Property and equipment |
Property and equipment are stated at cost less accumulated amortization and impairment losses. Amortization is calculated using the straight-line method over the estimated useful lives as follows:
| · | Computer equipment | 3 years | |
| · | Machinery and equipment | 5-10 years | |
| · | Right-of-use (“ROU”) assets | the lease term, unless the transfer of the asset ownership is reasonably certain at the end of the lease term, whereupon depreciation is over the useful life. |
| g) | Mineral property interests and exploration expenditures |
Title to mineral properties involves certain inherent risks due to the difficulties of determining the validity of certain claims as well as the potential for problems arising from the frequently ambiguous conveyancing historical characteristic of many properties. The Company has investigated title to all of its mineral properties and, to the best of its knowledge, title to all of its properties is in good standing.
Fury Gold Mines Limited | 7 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
The Company accounts for mineral property interests in accordance with IFRS 6 – Exploration for and evaluation of mineral properties (“IFRS 6”).
Costs directly related to acquiring the legal right to explore a mineral property including acquisition of licenses, mineral rights, and similar acquisition costs are recognized and capitalized as mineral property interests. Acquisition costs incurred in obtaining the legal right to explore a mineral property are deferred until the legal right is granted and thereon reclassified to mineral property interests. Transaction costs incurred in acquiring an asset are deferred until the transaction is completed and then included in the purchase price of the asset acquired.
Once the legal right to explore a property has been acquired, costs directly related to exploration and evaluation activities including, but not limited to, researching and analyzing existing exploration data, conducting geological studies, exploration drilling and sampling, and payments made to contractors and consultants in connection with the exploration and evaluation of the property, are expensed in the period in which they are incurred as exploration and evaluation costs on the consolidated statements of (earnings) loss and comprehensive (income) loss.
Costs not directly attributable to exploration and evaluation activities, including general administrative overhead costs, are expensed as administrative costs in the period in which they occur.
As the Company currently has no operational income, any incidental revenues earned in connection with exploration activities are applied as a reduction to exploration and evaluation costs.
When a project is deemed to no longer have commercially viable prospects to the Company, all capitalized acquisition costs in respect of that project are deemed to be impaired. As a result, those costs, in excess of the estimated recoverable amount, are expensed to the consolidated statements of (earnings) loss and comprehensive (income) loss.
The Company considers each group of claims in close proximity to one another as individual cash-generating units (“CGU”). The Company assesses mineral property interests as a CGU for impairment when facts and circumstances suggest that the carrying amount of the asset may exceed its recoverable amount. The recoverable amount is the higher of the asset’s fair value less costs to sell and its value in use and can be determined by factors including comparable public company resources, precedent transactions and valuing the Company’s projects using a reasonable per ounce valuation.
Once the technical feasibility and commercial viability of extracting the mineral resources has been determined, the property is considered to be a mine under development at which point the assets and further related costs no longer fall under the guidance of IFRS 6.
| h) | Joint arrangement |
The Company conducts a portion of its business through a joint arrangement where the parties are bound by contractual arrangements establishing joint control with decisions about the relevant activities that significantly affect the returns of the investee requiring unanimous consent. A joint arrangement is classified as either a joint operation or a joint venture, subject to the terms that govern each investor's rights and obligations in the arrangement.
In a joint operation, the investor has rights and obligations to the separate assets and liabilities of the investee, therefore the Company recognizes its share of the assets, liabilities, revenue, and expenses of the joint arrangement.
| i) | Investments in associates |
The Company conducts a portion of its business through equity interests in associates. An associate is an entity over which the Company has significant influence and is neither a subsidiary nor a joint venture. The Company has significant influence when it has the power to participate in the financial and operating policy decisions of the associate but does not have control or joint control over those policy decisions.
The Company accounts for its investments in associates using the equity method. Under the equity method, the Company’s investment in an associate is initially recognized at cost and subsequently increased or decreased to recognize the Company's share of earnings and losses of the associate, after any adjustments necessary to give
Fury Gold Mines Limited | 8 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
effect to uniform accounting policies, and for impairment losses after the initial recognition date. The Company’s share of an associate’s losses that are in excess of its investment in the associate are recognized only to the extent that the Company has incurred legal or constructive obligations or made payments on behalf of the associate. The Company's share of earnings and losses of its associate are recognized in net (earnings)/loss during the period.
| j) | Impairment of non-financial assets |
At each reporting date, the Company reviews the carrying amounts of its non-financial assets to determine whether there are any indicators of impairment. If any such indicator exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment, if any.
Where the asset does not generate cash inflows that are independent from other assets, the Company estimates the recoverable amount of the CGU to which the asset belongs. Any intangible asset with an indefinite useful life is tested for impairment annually and whenever there is an indication that the asset may be impaired. An asset’s recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset or CGU is estimated to be less than its carrying amount, the carrying amount is reduced to the recoverable amount and an impairment loss is recognized immediately in the consolidated statements of (earnings) loss and comprehensive (income) loss. Where an impairment subsequently reverses, the carrying amount is increased to the revised estimate of recoverable amount but only to the extent that this does not exceed the carrying value that would have been determined if no impairment had previously been recognized. A reversal of impairment is recognized in the consolidated statements of (earnings) loss and comprehensive (income) loss.
| k) | Leases |
The Company assesses if a contract is or contains a lease at inception of the contract. Control is considered to exist if the contract conveys the right to control the use of an identified asset during the term of the lease. When a lease is identified, a right-of-use asset and a corresponding lease liability are recognized, except for short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value assets. For these leases, the Company recognizes the lease payments as an expense in profit or loss on a straight-line basis.
Right-of-use assets, which are included in property and equipment, are recognized at cost, which is comprised of the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs and decommissioning and restoration costs, less any lease incentives received. Right- of-use assets are depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis, except where ownership is expected to be transferred at the end of the lease, whereby the asset is depreciated over its useful life.
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date discounted by using the rate implicit in the lease or the Company’s incremental borrowing rate, if the rate implicit in the lease cannot be determined. Lease payments included in the measurement of the lease liability are:
| · | fixed payments (including in-substance fixed payments), less any lease incentives receivable; |
| · | variable payments that depend on an index or rate; |
| · | amount expected to be payable by the lessee under residual value guarantees; |
| · | exercise price of purchase options, if the lessee is reasonably certain to exercise the options; and |
| · | penalties for terminations, unless the Company is reasonably certain the options will not be exercised. |
Fury Gold Mines Limited | 9 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
| l) | Provisions |
Provisions are recorded when a present legal or constructive obligation exists as a result of past events where it is probable that an outflow of resources embodying economic benefit will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made.
| m) | Provision for site reclamation and closure |
An obligation to incur rehabilitation and site restoration costs arises when an environmental disturbance is caused by the exploration, development, or on-going production of a mineral property interest. Such costs arising from the decommissioning of plant and other site preparation work, discounted to their net present value, are provided for and capitalized at the start of each project as soon as the obligation to incur such costs arises, as well when changes in estimates occur year over year. These costs are charged to the consolidated statements of (earnings) loss and comprehensive (income) loss over the life of the operation through amortization and the unwinding of the discount in the provision.
| n) | Flow-through common shares |
Canadian income tax legislation permits companies to issue flow-through instruments whereby the income tax deductions generated by eligible expenditures of the Company, defined in the Income Tax Act (Canada) as qualified Canadian exploration expenses (“CEE”), are claimed by the investors rather than by the Company. Shares issued on a flow-through basis are typically sold at a premium above the market share price which relates to the tax benefits that will flow through to the investors. The Company often issues flow-through shares as part of its equity financing transactions in order to fund its Canadian exploration activities. The Company estimates the portion of the proceeds attributable to the premium as being the excess of the flow-through share price over the market share price of the common shares without the flow-through feature at the time of issuance. The premium is recorded as a liability which represents the Company’s obligation to spend the flow-through funds on eligible expenditures and is amortized through the consolidated statements of (earnings) loss and comprehensive (income) loss as the eligible expenditures are incurred.
| o) | (Earnings) Loss per share |
Basic (earnings) loss per share is calculated by dividing the net (earnings) loss available to common shareholders by the weighted average number of shares outstanding during the reporting period. The diluted loss per share is calculated by dividing the net loss available to common shareholders by the weighted average number of shares outstanding on a diluted basis. The weighted average number of shares outstanding on a diluted basis takes into account the additional shares for the assumed exercise of share options and warrants, if dilutive. The number of additional shares is calculated by assuming that outstanding share options were exercised and that the proceeds from such exercises were used to acquire common shares at the average market price during the reporting period.
| p) | Share-based compensation |
Options
From time to time, the Company grants share options to employees and non-employees. An individual is classified as an employee, versus a non-employee, when the individual is an employee for legal or tax purposes (direct employee) or provides services similar to those performed by a direct employee.
The fair value of share options, measured using the Black-Scholes option pricing model at the date of grant, is charged to the consolidated statements of (earnings) loss and comprehensive (income) loss over the vesting period. Performance vesting conditions and forfeitures are taken into account by adjusting the number of equity instruments expected to vest at each reporting date so that, ultimately, the cumulative amount recognized over the vesting period is based on the number of options that eventually vest.
Where the terms and conditions of options are modified before they vest, any change in the fair value of the options, measured immediately before and after the modification, is also charged to the consolidated statements of (earnings) loss and comprehensive (income) loss over the remaining vesting period.
Fury Gold Mines Limited | 10 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Equity instruments granted to non-employees are recorded in the consolidated statements of (earnings) loss and comprehensive (income) loss at the fair value of the goods or services received, unless they are related to the issuance of shares. Costs related to the issuance of shares are recorded as a reduction of share capital.
When the value of goods or services received in exchange for a share-based payment cannot be reliably estimated, the fair value is measured by use of a valuation model. The expected life used in the model is adjusted, based on management’s best estimate, for the effects of non-transferability, exercise restrictions, and behavioral considerations.
All equity-settled share-based payments are recorded in the share option and warrant reserve until exercised. Upon exercise, shares are issued from treasury and the amount previously recorded in share option and warrant reserve is reclassified to share capital along with any consideration paid.
Deferred, Performance and Restricted Share Units (“DSU”, “PSU” and “RSU”)
Under the Company’s Long-term incentive (“LTI”) plan, the board can issue DSU’s, PSU’s or RSU’s to eligible members of management and or the board. The fair value of these shares will be determined at the time that they are granted and will be charged to the consolidated statements of (earnings) loss and comprehensive (income) loss at the time all vesting criteria have been met.
DSU’s, PSU’s or RSU’s issued under the Company’s LTI plan vest on or before the third anniversary of the grant or as otherwise provided and may be settled in the form of the Company's common shares or, at the option of the Company, the cash equivalent based on the market price of the common shares as of the vesting date.
The Company has historically settled RSUs in common shares. The Company has no present obligation to settle these in cash.
| q) | Income taxes |
Income tax reported in the consolidated statements of (earnings) loss and comprehensive (income) loss for the period presented comprises current and deferred income tax. Income tax is recognized in the consolidated statements of (earnings) loss and comprehensive (income) loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.
Current income tax for each taxable entity in the Company is based on the local taxable income at the local statutory tax rate enacted or, substantively enacted, at the reporting date and includes any adjustments to tax payable or recoverable with regards to previous periods.
Deferred income tax is determined using the liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The amount of deferred income tax provided is based on the expected manner of realization or settlement of the carrying amount of assets and liabilities, using the expected future tax rates enacted or substantively enacted at the reporting date.
A deferred income tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realized.
Deferred income tax assets and liabilities are offset only when there is a legally enforceable right to set off current tax assets against current tax liabilities, when they relate to income taxes levied by the same taxation authority and the Company intends to settle its tax assets and liabilities on a net basis.
| r) | Financial instruments |
The Company recognizes financial assets and liabilities on its consolidated statements of financial position when it becomes a party to the contract creating the asset or liability.
Fury Gold Mines Limited | 11 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
On initial recognition, all financial assets and liabilities are recorded by the Company at fair value, net of attributable transaction costs, except for financial assets and liabilities classified as fair value through profit or loss for which transaction costs are expensed in the period in which they are incurred.
| i) | Amortized cost |
Financial assets that meet the following conditions are measured subsequently at amortized cost:
| · | the financial asset is held within a business model whose objective is to hold financial assets in order to collect contractual cash flows; and |
| · | the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. |
The amortized cost of a financial asset is the amount at which the financial asset is measured at initial recognition minus the principal repayments, plus the cumulative amortization using the effective interest method of any difference between that initial amount and the maturity amount, adjusted for any loss allowance. Interest income is recognized using the effective interest method.
| ii) | Fair value through other comprehensive income (”FVTOCI") |
Financial assets that meet the following conditions are measured at FVTOCI:
| · | the financial asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and |
| · | the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. |
The Company does not have any financial assets classified as FVTOCI at December 31, 2024 and 2023.
| iii) | Financial assets measured subsequently at fair value through profit or loss (“FVTPL”) |
By default, all other financial assets are measured subsequently at FVTPL.
The Company, at initial recognition, may also irrevocably designate a financial asset as measured at FVTPL if doing so eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise from measuring assets or liabilities or recognizing the gains and losses on them on different bases. Financial assets measured at FVTPL are measured at fair value at the end of each reporting period, with any fair value gains or losses recognized in profit or loss to the extent they are not part of a designated hedging relationship. Fair value is determined in the manner described in note 23.
| iv) | Financial liabilities and equity |
Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements, and the definitions of a financial liability and an equity instrument.
An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all its liabilities. Equity instruments issued by the Company are recognized at the proceeds received, net of direct issue costs. Repurchase of the Company’s own equity instruments is recognized and deducted directly in equity. No gain or loss is recognized in profit or loss on the purchase, sale, issue, or cancellation of the Company’s own equity instruments.
Financial liabilities that are not contingent consideration of an acquirer in a business combination, held for trading, or designated as at FVTPL, are measured at amortized cost using the effective interest method.
| v) | Impairment |
The Company recognizes a loss allowance for expected credit losses on its financial assets. The amount of expected credit losses is updated at each reporting period to reflect changes in credit risk since initial recognition of the respective financial instruments.
Fury Gold Mines Limited | 12 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
| s) | Other Comprehensive (Income) loss |
Other comprehensive (income) loss is the change in net assets arising from transactions and other events and circumstances from non-owner sources. Comprehensive (income) loss comprises net (earnings) loss and other comprehensive loss. Foreign currency translation differences arising on translation of subsidiaries with a different functional currency are also included in other comprehensive loss.
Note 4: Changes in accounting standards
Application of new and revised accounting standards:
The Company has adopted the following amended accounting standards and policies effective January 1, 2024.
Amendments to IAS 1 Presentation of Financial Statements — Classification of Liabilities as Current or Non-current
The amendments to IAS 1 published in January 2020 affect only the presentation of liabilities as current or non- current in the statement of financial position and not the amount or timing of recognition of any asset, liability, income or expenses, or the information disclosed about those items.
The amendments clarify that the classification of liabilities as current or non-current is based on rights that are in existence at the end of the reporting period, specify that classification is unaffected by expectations about whether an entity will exercise its right to defer settlement of a liability, explain that rights are in existence if covenants are complied with at the end of the reporting period, and introduce a definition of ‘settlement’ to make clear that settlement refers to the transfer to the counterparty of cash, equity instruments, other assets or services.
There was no impact to the Company’s financial statements for the year ended December 31, 2024, upon adoption.
Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures — Supplier Finance Arrangements
The amendments add a disclosure objective to IAS 7 stating that an entity is required to disclose information about its supplier finance arrangements that enables users of financial statements to assess the effects of those arrangements on the entity’s liabilities and cash flows. In addition, IFRS 7 was amended to add supplier finance arrangements as an example within the requirements to disclose information about an entity’s exposure to concentration of liquidity risk.
There was no impact to the Company’s financial statements for the year ended December 31, 2024, upon adoption.
Amendment to IFRS 16 Leases — Lease Liability in a Sale and Leaseback
The amendments to IFRS 16 add subsequent measurement requirements for sale and leaseback transactions that satisfy the requirements in IFRS 15 to be accounted for as a sale. The amendments require the seller-lessee to determine ‘lease payments’ or ‘revised lease payments’ such that the seller-lessee does not recognise a gain or loss that relates to the right of use retained by the seller-lessee, after the commencement date.
There was no impact to the Company’s financial statements for the year ended December 31, 2024, upon adoption.
New and amended standards not yet effective:
The following new and amended standards, which are not yet effective, have not been applied by the Company in these financial statements.
Fury Gold Mines Limited | 13 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7)
The IASB has issued 'Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7)' to address matters identified during the post-implementation review of the classification and measurement requirements of IFRS 9 'Financial Instruments'. The amendments include changes to derecognition of a financial liability settled through electronic transfer, classification of financial assets, and disclosures, and are effective for reporting periods beginning on or after January 1, 2026. The Company is currently evaluating the impact of the new standard on its financial statements.
IFRS 18 Presentation and Disclosures in Financial Statements
In April 2024, the IASB issued a new standard which replaces IAS 1. IFRS 18 Presentation and Disclosure in Financial Statements carries forward many requirements in IAS 1 and complements them with new requirements. IFRS 18 includes requirements for all entities applying IFRS for the presentation and disclosure of information in financial statements. The new standard applies to annual reporting period beginning on or after January 1, 2027. The Company is currently evaluating the impact of the new standard on its financial statements.
Note 5: Critical accounting estimates and judgments
The preparation of financial statements in conformity with IFRS Accounting Standards as issued by the IASB requires management to select accounting policies and make estimates and judgments that may have a significant impact on the consolidated financial statements. Estimates are continuously evaluated and are based on management’s experience and expectations of future events that are believed to be reasonable under the circumstances. Actual outcomes may differ from these estimates.
Critical accounting judgments exercised in applying accounting policies, apart from those involving estimates, which have the most significant effect on the amounts recognized in these consolidated financial statements are as follows:
| (a) | Functional currency |
The functional currency for each of the Company’s subsidiaries is the currency of the primary economic environment in which the entity operates. Determination of functional currency may involve certain judgments to determine the primary economic environment and the Company reconsiders the functional currency of its entities if there is a change in events and conditions that determined the primary economic environment.
| (b) | Economic recoverability and probability of future economic benefits of mineral property interests |
Management has determined that the acquisition of mineral properties and related costs incurred, which have been recognized on the consolidated statements of financial position, are economically recoverable. Management uses several criteria in its assessments of economic recoverability and probability of future economic benefit including geological data, scoping studies, accessible facilities, and existing and future permits.
| (c) | Indications of impairment of assets |
Assessments of impairment indicators are performed at the CGU level and judgment is involved in assessing whether there is any indication that an asset or a CGU may be impaired. The assessment of the impairment indicators involves the application of a number of significant judgments and estimates to certain variables, including metal price trends, exploration plans for properties, and the results of exploration and evaluation to date.
| (d) | Income taxes |
The provision for income taxes and composition of income tax assets and liabilities requires management’s judgment. The application of income tax legislation also requires judgment in order to interpret legislation and to apply those findings to the Company’s transactions.
Fury Gold Mines Limited | 14 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Credit on duties refundable for loss and refundable tax credits for resource investment
The Company is entitled to a refundable credit on duties of 12% for eligible losses under the Quebec Mining Duties Act and a refundable resource investment tax credit of 38.75% under the Quebec Income Tax Act. These credits are applicable to qualified exploration expenditures on properties located within the province of Quebec. Application for these credits is subject to verification and, as such, they are recognized only when they are received or when a notice of assessment confirming the amount to be paid is issued. During the year ended December 31, 2024, the Company received a refund of $193 (December 31, 2023 – $307, December 31, 2022 – $187) which was classified as income tax recoveries on the consolidated statements of (earnings) loss and comprehensive (income) loss.
| (e) | Determination of control of subsidiaries and joint arrangements |
Judgment is required to determine when the Company has control of subsidiaries or joint control of joint arrangements. This requires an assessment of the relevant activities of the investee, being those activities that significantly affect the investee’s returns (including operating and capital expenditure decision-making, financing of the investee, and the appointment, remuneration, and termination of key management personnel) and when the decisions in relation to those activities are under the control of the Company or require unanimous consent from the investors.
| (f) | Investments in associates |
The Company conducts a portion of its business through equity interests in associates. An associate is an entity over which the Company has significant influence and is neither a subsidiary nor a joint venture. The Company has significant influence when it has the power to participate in the financial and operating policy decisions of the associate but does not have control or joint control over those policy decisions.
| (g) | Financial instruments |
Financial instruments are assessed upon initial recognition to determine whether they meet the definition of a financial asset, financial liability, or equity instrument depending on the substance of the contractual arrangement. Judgement is required in making this determination as the substance of a transaction may differ from its legal form. Once a determination is made, IFRS Accounting Standards as issued by the IASB require that financial instruments be measured at fair value on initial recognition. For financial instruments that do not have quoted market prices or observable inputs, judgements are made in determining what are appropriate inputs and assumptions to use in calculating the fair value.
Key sources of estimation uncertainty that have significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows:
| (h) | Reclamation obligations |
Management assesses its reclamation obligations annually and when circumstances suggest that a material change to the obligations have occurred. Significant estimates and assumptions are made in determining the provision for site reclamation and closure because there are numerous factors that will affect the ultimate liability that becomes payable. These factors include estimates of the extent, the timing, and the cost of reclamation activities, regulatory change, cost increases, and changes in discount rates. Those uncertainties may result in actual expenditures differing from the amounts currently provided. The provision at the reporting date represents management’s best estimate of the present value of the future reclamation costs required. Changes to estimated future costs are recognized in the consolidated statements of financial position by adjusting the reclamation asset and liability.
Key assumptions included in the estimate of the reclamation obligations for the Company’s properties in Quebec and Nunavut were as follows:
| Years ended December 31 | ||||||||||
| 2024 | 2023 | 2022 | ||||||||
| Risk-free interest rate | 3.23%-3.33% | 3.02 | % | 3.28 | % | |||||
| Annual inflation | 2.29%-2.83% | 2.25 | % | 2.50 | % | |||||
Fury Gold Mines Limited | 15 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
| (i) | Share-based compensation |
The Company determines the fair value of equity-settled share-based payments using the fair value of the equity instruments at the grant date. For options granted, the Company uses the Black-Scholes option pricing model. This option pricing model requires the development of market-based subjective inputs, including the risk-free interest rate, expected price volatility, and expected life of the option. Changes in these inputs and the underlying assumption used to develop them can materially affect the fair value estimate.
| (j) | Deferred tax assets and liabilities |
Management judgment and estimates are required in assessing whether deferred tax assets and deferred tax liabilities are recognized in the consolidated statements of financial position. Judgments are made as to whether future taxable profits will be available in order to recognize deferred tax assets. Assumptions about the generation of future taxable profits depend on management’s estimates of future cash flows. These depend on estimates of future production and sales volumes, commodity prices, reserves, operating costs, and other capital management transactions. These judgments and assumptions are subject to risk and uncertainty, and changes in circumstances may alter expectations which may impact the amount of deferred tax assets and deferred tax liabilities recognized on the consolidated statements of financial position and the benefit of other tax losses and temporary differences not yet recognized.
Note 6: Sale of Homestake Resources
On February 25, 2022, the Company completed the sale of Homestake Resources to Dolly Varden for cash proceeds of $5,000 and 76,504,590 common shares of Dolly Varden (note 1). The Company’s resulting interest in Dolly Varden represented approximately 35.3% of the issued and outstanding common shares of Dolly Varden on February 25, 2022, which has been accounted for using the equity method (note 3). The Company recognized a gain of $48,390, net of transaction costs of $589, on the date of disposition, calculated as follows:
| Total | ||||
| Net assets derecognized: | ||||
| Mineral interests | $ | 16,460 | ||
| Reclamation bond | 68 | |||
| $ | 16,528 | |||
| Net proceeds: | ||||
| Cash | $ | 5,000 | ||
| Working capital adjustment | 68 | |||
| 76,504,590 common shares of Dolly Varden | 60,439 | |||
| Transaction costs | (589 | ) | ||
| $ | 64,918 | |||
| Net gain on disposition | $ | 48,390 | ||
The fair value of the common shares of Dolly Varden received on date of disposition is based on the market price of the shares at the date of disposition of $0.79 per share.
The Company had sufficient non-capital losses at December 31, 2022 to offset the capital gain arising on disposition of Homestake Resources. As such, there was nil tax payable on the sale of Homestake Resources.
Note 7: Cash and restricted cash
Cash and restricted cash held by the Company were as follows:
| At December 31 | ||||||||
| 2024 | 2023 | |||||||
| Cash | $ | 4,912 | $ | 7,313 | ||||
| Restricted cash | 144 | 144 | ||||||
| $ | 5,056 | $ | 7,457 | |||||
Fury Gold Mines Limited | 16 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Restricted cash includes an amount of $75 (December 31, 2023 – $75) in connection with an irrevocable standby letter of credit in favor of Kitikmeot Inuit Association in connection with the Company’s Committee Bay project. The balance are mainly GIC’s held with financial institutions as security for the Company credit cards. Restricted cash is classified as a non-current asset and is not available for use within one year of the date of the consolidated statements of financial position.
Note 8: Marketable securities
The marketable securities held by the Company were as follows:
| Total | ||||
| Balance at December 31, 2022 | $ | 582 | ||
| Additions | 1,619 | |||
| Sale of marketable securities | (381 | ) | ||
| Realized gain on disposition | 293 | |||
| Unrealized net loss | (947 | ) | ||
| Balance at December 31, 2023 | $ | 1,166 | ||
| Additions | 1,300 | |||
| Sale of marketable securities | (481 | ) | ||
| Realized loss on disposition | (60 | ) | ||
| Unrealized net gain | 433 | |||
| Balance at December 31, 2024 | $ | 2,358 | ||
On February 29, 2024, the Company acquired a 10.9% common share ownership of Sirios Resources Inc. (“Sirios”) for $1,300, as part of another transaction (note 11) to consolidate its Éléonore South project ownership. The 30,392,372 Sirios common shares had been acquired for investment purposes and the Company will evaluate its investment in Sirios on an ongoing basis with respect to any possible additional purchases or dispositions, whereupon any such marketable securities transactions are accounted for as of the trade date.
During the first quarter of 2024, Fury Gold sold an aggregate of 1,514,000 Sirios common shares, lowering its holdings to less than 9.9% as at December 31, 2024.
During the year ended December 31, 2023, the Company received 3,500,000 common shares of Ophir Gold Corp in respect of the sale of certain mineral claims in Quebec. Additionally, the Company received 650,000 Q2 Metals Corp common shares as settlement for a royalty extinguishment agreement which had nil carrying value at the time of the transaction as well as 1,237,216 Benz Mining Corp common shares as part of the 3rd option payment for the Eastmain Mine property agreement.
Purchases and sales of marketable securities are accounted for as of the trade date.
Note 9: Other investments
On August 13, 2024, the Company purchased 764,993 Series C Preferred Shares of Alsym Energy Inc. for a total cash purchase price of $2,063. This investment is accounted for as an investment in equity.
This investment is classified as a Level 3 Financial Asset and is accounted for at its fair value and revalued at each reporting date through profit and loss (note 23).
Fury Gold Mines Limited | 17 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Note 10: Property and equipment
Property and equipment are recorded at cost, and at December 31, 2024 and 2023, were comprised as follows:
| Machinery and equipment | Office lease | Other | Total | |||||||||||||
| Cost | ||||||||||||||||
| At December 31, 2022 and 2023 | $ | 2,272 | $ | 531 | $ | 11 | $ | 2,814 | ||||||||
| Additions | 35 | - | - | 35 | ||||||||||||
| At December 31, 2024 | $ | 2,307 | $ | 531 | $ | 11 | $ | 2,849 | ||||||||
| Accumulated depreciation | ||||||||||||||||
| At December 31, 2022 | $ | (1,593 | ) | $ | (283 | ) | $ | (7 | ) | $ | (1,883 | ) | ||||
| Depreciation | (205 | ) | (134 | ) | (4 | ) | (343 | ) | ||||||||
| At December 31, 2023 | $ | (1,798 | ) | $ | (417 | ) | $ | (11 | ) | $ | (2,226 | ) | ||||
| Depreciation | (207 | ) | (90 | ) | - | (297 | ) | |||||||||
| At December 31, 2024 | $ | (2,005 | ) | $ | (507 | ) | $ | (11 | ) | $ | (2,523 | ) | ||||
| Net book value | ||||||||||||||||
| At December 31, 2023 | $ | 474 | $ | 114 | $ | - | $ | 588 | ||||||||
| At December 31, 2024 | $ | 302 | $ | 24 | $ | - | $ | 326 | ||||||||
Note 11: Mineral property interests
The Company’s principal resource properties are located in Canada.
Quebec
The Company maintains interests in 12 properties within the James Bay region of Quebec. The three largest projects are:
Eau Claire
The Company owns a 100% interest in the Eau Claire project located immediately north of the Eastmain reservoir, approximately 10 kilometres (km) northeast of Hydro Quebec’s EM-1 hydroelectric power facility, 80 km north of the town of Nemaska, 320 km northeast of the town of Matagami, and 800 km north of Montreal, Quebec. The property consists of map-designated claims totaling approximately 23,000 hectares.
Eastmain Mine
The Eastmain Mine project hosts the Eastmain Mine gold deposit. The past-producing Eastmain Mine project comprises 152 mineral claims and an industrial lease. Located on the eastern most part of the Upper Eastmain River Greenstone Belt of the James Bay District of northern Quebec, the property covers approximately 80 km2 of highly prospective terrain.
In 2019, Benz Mining entered into an option agreement with Eastmain to allow Benz Mining the option to earn a 75% interest in certain Eastmain Mine property in return for making option payments of $2,320 between October 2019 and October 2023, and incurring exploration expenditures of $3,500 on the property. The option payments may be settled in both cash and shares. This option agreement was subsequently amended in April 2020 to grant Benz Mining the option to earn up to 100% of the Ruby Hill properties located to the west of the Eastmain Mine project. The Company would retain 1-2% net smelter royalties in respect of the properties following completion of the option agreement requirements. During November 2023 the Company received $1,350 in cash and $396 worth of Benz Mining common shares to finalize the 75% interest acquisition. After completion of the 75% acquisition,
Fury Gold Mines Limited | 18 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Benz Mining may acquire the remaining 25% interest upon payment of $1,000 upon closing of project financing, and $1,500 upon commencement of commercial production.
Éléonore South
The Éléonore South project consists of two separate blocks of map-designated claims, comprising a total of 282 claims covering approximately 147 km2 of the Opinaca area of James Bay, Quebec. The Éléonore West block consists of 34 mineral claims covering approximately 18 km2, while the Éléonore South block contains 248 claims extending over an area of approximately 130 km2. The project was a joint operation, and the project ownership was based on participation in the funding of annual exploration programs. At December 31, 2023, the project was held by the partners approximately as follows: Fury Gold 50.022% and Newmont 49.978%. The Company was the operator of the project.
On February 29, 2024, the Company and Newmont, through their respective subsidiaries, entered into a new agreement whereby the Company acquired 100% control of the interests, consolidating these properties into the Company’s portfolio.
Nunavut
Committee Bay
The Company, through its wholly owned subsidiary North Country, owns a 100% interest in the Committee Bay project located in Nunavut, Canada. The Committee Bay project includes approximately 250,000 hectares situated along the Committee Bay Greenstone Belt located within the Western Churchill province of Nunavut. The Committee Bay project is subject to a 1% Net Smelter Royalty (“NSR”) on gold production, with certain portions subject to an additional 1.5% NSR. The 1.5% NSR is payable on only 7,596 hectares and can be purchased by the Company within two years of commencement of commercial production for $2,000 for each one-third (0.5%) of the 1.5% NSR.
Gibson MacQuoid
In 2017, the Company acquired a number of prospecting permits and mineral claims along the Gibson MacQuoid Greenstone Belt in Nunavut, Canada. In 2019, the Company staked additional claims, which overlapped the Company’s prospecting claims that expired in February 2020, to maintain a contiguous land package over the Company’s current areas of interest. The Company’s claims, which are located between the Meliadine deposit and Meadowbank mine, cover approximately 120 km of strike length of the prospective greenstone belt and total 51,622 hectares collectively.
A summary of the carrying amounts is as follows:
| Quebec | Nunavut | Total | ||||||||||
| Balance at December 31, 2022 | $ | 125,656 | $ | 19,534 | $ | 145,190 | ||||||
| Option payment received | (880 | ) | - | (880 | ) | |||||||
| Disposition | (1,746 | ) | - | (1,746 | ) | |||||||
| Change in estimate of provision for site reclamation and closure (note 14) | (52 | ) | 127 | 75 | ||||||||
| Balance at December 31, 2023 | $ | 122,978 | $ | 19,661 | $ | 142,639 | ||||||
| Additions(a) | 3,030 | - | 3,030 | |||||||||
| Change in estimate of provision for site reclamation and closure (note 14) | (23 | ) | 427 | 404 | ||||||||
| Impairment | (88,885 | ) | (11,988 | ) | (100,873 | ) | ||||||
| Balance at December 31, 2024 | $ | 37,100 | $ | 8,100 | $ | 45,200 | ||||||
(a) On February 29, 2024, the Company, and its joint operation partner Newmont, through their respective subsidiaries, closed a transaction whereby the Company acquired 100% control of the joint operation interests, the Éléonore South project, consolidating these properties into the Company’s portfolio at which time the joint venture operation was dissolved. The
Fury Gold Mines Limited | 19 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
49.978% that Newmont held was acquired by the Company for $3,000 while incurring $30 in transaction costs. As part of the same transaction, the Company also acquired a 10.9% interest in Sirios, as disclosed in note 8.
During the year ended December 31, 2023, the Company received settlement for the sale of claims, certain common shares of publicly traded entities. These have been classified as marketable securities (note 8).
On December 12, 2022, the Company entered into an Option Agreement (“the Ophir Agreement”), pursuant to which Ophir Gold Corp. (the “Optionee”) would acquire a 100% interest in the Radis Property through payment of certain cash and common shares over a three-year period, payments of which may be accelerated by the Optionee. The Company shall retain a 2% NSR on the property, three-quarters of which may be purchased by the Optionee for $1,500. The Agreement was subject to certain closing conditions, which were met on January 25, 2023. The first option payment, comprising a cash payment of $50 and 2,500,000 common shares of Ophir Gold with a fair value of $625, was received upon closing, while the second option payment was received during December 2023 comprising of $75 cash and 1,000,000 common shares with a fair value of $130 upon date of receipt for a total of $880. The common shares of Ophir Gold have been classified as marketable securities (note 3). During November 2024, prior to the receipt of the third option payment, the Optionee informed the Company that it is terminating the agreement.
On August 16, 2023, the Company entered into a royalty extinguishment agreement whereby certain Eastmain net smelter royalties of the Mia project were extinguished in exchange for marketable securities to the value of $468 as at the date of the agreement.
In November 2023, the Company received the final option payment of $1,725, comprising of $1,350 cash and 1,237,216 shares with a fair value upon date of receipt of $396 for a total of $1,746, from Benz Mining in respect of the option agreement to acquire 75% of certain Eastmain Mine properties and Ruby Hill properties. The transfer of the 75% ownership was accepted by the Resource Minister of Quebec on January 17, 2025.
The Company’s market capitalization has persistently been below the carrying value of its mineral properties over the last few years, and, as a consequence, the Company engaged a third-party valuation specialist to conduct a review to determine a more reflective carrying value. As a result, the report recommended an impairment charge to these properties, to better align with the market capitalization value (note 16).
Note 12: Investments in associates
| (a) | Summarized financial information of the Company’s investments in associates: |
The carrying amounts of the Company’s investments in associates were as follows:
| Dolly Varden | UMS | Total | ||||||||||
| Carrying amount at December 31, 2022 | $ | 42,303 | $ | 127 | $ | 42,430 | ||||||
| Company’s share of net loss of associates | (6,177 | ) | (5 | ) | (6,182 | ) | ||||||
| Carrying amount at December 31, 2023 | $ | 36,126 | $ | 122 | $ | 36,248 | ||||||
| Company’s share of net loss of associates | (3,837 | ) | (21 | ) | (3,858 | ) | ||||||
| Disposition | (5,017 | ) | - | (5,017 | ) | |||||||
| Dilution gain | 2,083 | - | 2,083 | |||||||||
| Carrying amount at December 31, 2024 | $ | 29,355 | $ | 101 | $ | 29,456 | ||||||
The quoted fair market value of the Company’s equity interest in Dolly Varden at December 31, 2024 was $49,012 (December 31, 2023 - $51,769) based on the closing share price on the TSX Venture Exchange on that date.
During the year ended December 31, 2024 the Company sold an aggregate of 8,450,000 shares of Dolly Varden for net proceeds of $7,042. The Company’s investment was also diluted through financing rounds by Dolly Varden in which the Company did not participate. As a results, the Company had a Gain on investments of $4,109 consisting of a realized gain on disposal of $2,026 and a gain on dilution of $2,083.
Fury Gold Mines Limited | 20 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
On October 13, 2022, the Company completed the sale of 17,000,000 common shares of Dolly Varden, comprising 22.2% of the Company’s equity interest in Dolly Varden acquired as part of the disposition of Homestake Resources (note 1), for total gross proceeds of $6,800. As at September 30, 2022, the sale was considered highly probable; therefore, the partial investment in associate represented by the 17,000,000 common shares was classified as an asset held for sale. The Company remeasured the carrying amount of the shares held for sale as the lower of cost and FVLCD and recognized an impairment expense of $5,506 in respect of the disposal.
A reconciliation of the impairment expense is as follows:
| Carrying amount, investment in Dolly Varden | $ | 55,265 | ||
| Equity interest transferred to held for sale | 22.2 | % | ||
| Carrying amount transferred to asset held for sale | 12,280 | |||
| Less: FVLCD | (6,774 | ) | ||
| Impairment expense recognized | $ | 5,506 |
For the year ended December 31, 2024, the Company’s equity share of net loss of the Company’s associates on a 100% basis were as follows:
| Dolly Varden | UMS | Total | ||||||||||
| Cost recoveries | $ | - | $ | (3,508 | ) | $ | (3,508 | ) | ||||
| Exploration and evaluation | 17,875 | 1,208 | 19,083 | |||||||||
| Marketing | 1,781 | 131 | 1,912 | |||||||||
| Share-based compensation | 2,601 | - | 2,601 | |||||||||
| Administrative and other | (1,608 | ) | 2,255 | 647 | ||||||||
| Net loss of associate, 100% | 20,649 | 86 | 20,735 | |||||||||
| Average equity interest for the period | 18.58 | % | 25 | % | ||||||||
| Company’s share of net loss of associates | $ | 3,837 | $ | 21 | $ | 3,858 | ||||||
For the year ended December 31, 2023, the Company’s equity share of net loss of the Company’s associates on a 100% basis were as follows:
| Dolly Varden | UMS | Total | ||||||||||
| Cost recoveries | $ | - | $ | (5,517 | ) | $ | (5,517 | ) | ||||
| Exploration and evaluation | 24,806 | 1,907 | 26,713 | |||||||||
| Marketing | 1,409 | 464 | 1,873 | |||||||||
| Share-based compensation | 1,971 | - | 1,971 | |||||||||
| Administrative and other | (1,536 | ) | 3,166 | 1,630 | ||||||||
| Net loss of associate, 100% | 26,650 | 20 | 26,670 | |||||||||
| Average equity interest for the period | 23.18 | % | 25 | % | ||||||||
| Company’s share of net loss of associates | $ | 6,177 | $ | 5 | $ | 6,182 | ||||||
For the year ended December 31, 2022, the Company’s equity share of net loss of the Company’s associates on a 100% basis were as follows:
| Dolly Varden | UMS | Total | ||||||||||
| Cost recoveries | $ | - | $ | (4,412 | ) | $ | (4,412 | ) | ||||
| Exploration and evaluation | 16,936 | 1,642 | 18,578 | |||||||||
| Marketing | 1,057 | 312 | 1,369 | |||||||||
| Share-based compensation | 1,786 | 2,433 | 4,219 | |||||||||
| Administrative and other | (508 | ) | 121 | (387 | ) | |||||||
| Net loss of associate, 100% | 19,271 | 96 | 19,367 | |||||||||
| Average equity interest for the year | 30.4 | % | 25 | % | ||||||||
| Company’s share of net loss of associates | $ | 5,856 | $ | 24 | $ | 5,880 | ||||||
Fury Gold Mines Limited | 21 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
The Company’s equity share of net assets of associates at December 31, 2024, is as follows:
| Dolly Varden | UMS | |||||||
| Current assets | $ | 34,573 | $ | 934 | ||||
| Non-current assets | 151,170 | 2,043 | ||||||
| Current liabilities | (4,400 | ) | (1,345 | ) | ||||
| Non-current liabilities | - | (1,231 | ) | |||||
| Net assets, 100% | 181,343 | 401 | ||||||
| Company’s equity share of net assets of associate | $ | 29,355 | $ | 101 | ||||
The Company’s equity share of net assets of associates at December 31, 2023, is as follows:
| Dolly Varden | UMS | |||||||
| Current assets | $ | 11,468 | $ | 844 | ||||
| Non-current assets | 153,296 | 2,468 | ||||||
| Current liabilities | (804 | ) | (1,484 | ) | ||||
| Non-current liabilities | - | (1,340 | ) | |||||
| Net assets, 100% | 163,960 | 488 | ||||||
| Company’s equity share of net assets of associate | $ | 36,126 | $ | 122 | ||||
| (b) | Services rendered and balances with UMS |
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Exploration and evaluation costs | $ | 233 | $ | 872 | $ | 590 | ||||||
| General and administration | 307 | 714 | 841 | |||||||||
| Total transactions for the year | $ | 540 | $ | 1,586 | $ | 1,431 | ||||||
The outstanding balance owing at December 31, 2024 was $90 (December 31, 2023 – $103, December 31, 2022 – $240) which is included in accounts payable.
As part of the UMS arrangement, the Company is contractually obliged to pay certain rental expenses in respect of a ten-year office lease entered into by UMS on July 1, 2021. As at December 31, 2024, the Company expects to incur approximately $91 in respect of its share of future rental expense of UMS.
The Company issues share options to certain UMS employees, including key management personnel of the Company (note 20). The Company recognized a share-based compensation recovery of $3 for the year ended December 31, 2024, in respect of share options issued to UMS employees (December 31, 2023 - $317 expense, December 31, 2022 - $483 expense) which is included within employee benefits and exploration and evaluation costs.
Fury Gold Mines Limited | 22 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Note 13: Flow-through share premium liability
Flow-through shares are issued at a premium, calculated as the difference between the price of a flow-through share and the price of a common share at that date. Tax deductions generated by eligible expenditures are passed through to the shareholders of the flow-through shares once the eligible expenditures are incurred and renounced.
On March 23, 2023, the Company completed an offering (note 18) and raised $8,750 through the issuance of 6,076,500 common shares designated as flow-through shares. The flow-through proceeds were used for mineral exploration in Quebec.
On June 13, 2024, the Company completed an offering (note 18) and raised $5,001 through the issuance of 5,320,000 common shares designated as flow-through shares. The flow-through proceeds will be used for mineral exploration in Quebec. The Company is committed to incur the full exploration expenditures of $5,001 before December 31, 2025.
The flow-through share funding and expenditures along with the corresponding impact on the flow-through share premium liability were as follows:
| Flow-through funding (expenditures) | Flow-through premium liability | |||||||
| Balance at December 31, 2021 | $ | 7,290 | $ | 3,124 | ||||
| Flow-through eligible expenditures | (7,290 | ) | (3,124 | ) | ||||
| Balance at December 31, 2022 | $ | - | $ | - | ||||
| Flow-through funds raised | 8,750 | 3,889 | ||||||
| Flow-through eligible expenditures | (7,527 | ) | (3,345 | ) | ||||
| Balance at December 31, 2023 | $ | 1,223 | $ | 544 | ||||
| Flow-through eligible expenditures | (1,223 | ) | (544 | ) | ||||
| Flow-through funds raised | 5,001 | 2,022 | ||||||
| Flow-through eligible expenditures | (2,666 | ) | (1,078 | ) | ||||
| Balance at December 31, 2024 | $ | 2,335 | $ | 944 | ||||
Note 14: Provision for site reclamation and closure
The Company recognizes a provision for site reclamation and closure, which reflects the present value of the estimated amount of cash flows required to satisfy the asset retirement obligation in respect of the Committee Bay and Quebec properties. The components of this obligation are the removal of equipment currently being used at the site as well as costs associated with the reclamation of the camp housing and work sites on the property. The estimate of future asset retirement obligations is subject to change based on amendments to applicable laws, management’s intentions, and mining lease renewals.
The key assumptions used to calculate the present value of the future estimated cash flows of the Company’s projects are as follows:
| § | Undiscounted cash flow obligation for site reclamation of $7,013 (December 31, 2023 – $6,246, December 31, 2022 – $6,065); |
| § | Expected timing of future cash flows which is between the years 2026 and 2041; |
| § | Annual inflation rates of 2.29% and 2.83% (December 31, 2023 – 2.25 and 2.61%, December 31, 2022 – 2.5%); and |
| § | Risk-free interest rates of 3.33% and 3.23% (December 31, 2023 – 3.02%, December 31, 2022 – 3.28%). |
Fury Gold Mines Limited | 23 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
The present value of the liability for the site reclamation and closure provision for the Company’s projects was as follows:
| Quebec | Nunavut | Total | ||||||||||
| Balance at December 31, 2022 | $ | 1,567 | $ | 2,704 | $ | 4,271 | ||||||
| Accretion | 54 | 94 | 148 | |||||||||
| Change in estimate | (52 | ) | 128 | 76 | ||||||||
| Balance at December 31, 2023 | $ | 1,569 | $ | 2,926 | $ | 4,495 | ||||||
| Accretion | 50 | 96 | 146 | |||||||||
| Change in estimate | (23 | ) | 427 | 404 | ||||||||
| Balance at December 31, 2024 | $ | 1,596 | $ | 3,449 | $ | 5,045 | ||||||
Exploration and evaluation costs
For the years ended December 31, 2024, the Company’s exploration and evaluation costs were as follows:
| Quebec | Nunavut | Total | ||||||||||
| Assaying | $ | 874 | $ | 100 | $ | 974 | ||||||
| Exploration drilling | 843 | - | 843 | |||||||||
| Camp cost, equipment and field supplies | 651 | 203 | 854 | |||||||||
| Geological consulting services | 7 | 51 | 58 | |||||||||
| Permitting, environmental and community costs | 122 | 172 | 294 | |||||||||
| Expediting and mobilization | - | 22 | 22 | |||||||||
| Salaries and wages | 1,403 | 70 | 1,473 | |||||||||
| Fuel and consumables | 182 | 10 | 192 | |||||||||
| Aircraft and travel | 456 | 208 | 664 | |||||||||
| Share-based compensation | 128 | 10 | 138 | |||||||||
| Total for year ended December 31, 2024 | $ | 4,666 | $ | 846 | $ | 5,512 | ||||||
For the years ended December 31, 2023, the Company’s exploration and evaluation costs were as follows:
| Quebec | Nunavut | Total | ||||||||||
| Assaying | $ | 1,538 | $ | 44 | $ | 1,582 | ||||||
| Exploration drilling | 2,250 | - | 2,250 | |||||||||
| Camp cost, equipment and field supplies | 936 | 194 | 1,130 | |||||||||
| Geological consulting services | 7 | 16 | 23 | |||||||||
| Geophysical analysis | 165 | - | 165 | |||||||||
| Permitting, environmental and community costs | 235 | 158 | 393 | |||||||||
| Expediting and mobilization | 17 | - | 17 | |||||||||
| Salaries and wages | 1,987 | 23 | 2,010 | |||||||||
| Fuel and consumables | 481 | - | 481 | |||||||||
| Aircraft and travel | 784 | (1 | ) | 783 | ||||||||
| Share-based compensation | 465 | 12 | 477 | |||||||||
| Total for year ended December 31, 2023 | $ | 8,865 | $ | 446 | $ | 9,311 | ||||||
For the years ended December 31, 2022, the Company’s exploration and evaluation costs were as follows:
Quebec |
Nunavut | British Columbia |
Total | |||||||||||||
| Assaying | $ | 1,638 | $ | 50 | $ | 2 | $ | 1,690 | ||||||||
| Exploration drilling | 1,768 | - | - | 1,768 | ||||||||||||
| Camp cost, equipment and field supplies | 844 | 193 | 10 | 1,047 | ||||||||||||
| Geological consulting services | 50 | 13 | - | 63 | ||||||||||||
| Geophysical analysis | 127 | - | - | 127 | ||||||||||||
| Permitting, environmental and community costs | 163 | 164 | - | 327 | ||||||||||||
| Expediting and mobilization | 12 | - | - | 12 | ||||||||||||
| Salaries and wages | 2,330 | 45 | 1 | 2,376 | ||||||||||||
| Fuel and consumables | 537 | - | - | 537 | ||||||||||||
| Aircraft and travel | 768 | 21 | - | 789 | ||||||||||||
| Share-based compensation | 471 | 9 | 1 | 481 | ||||||||||||
| Total for year ended December 31, 2022 | $ | 8,708 | $ | 495 | $ | 14 | $ | 9,217 | ||||||||
Fury Gold Mines Limited | 24 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Note 16: Impairment
A summary of the Company’s impairment expenses is as follows:
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Impairment on mineral properties interests | $ | 100,873 | $ | - | $ | - | ||||||
| Impairment on assets held for sale | - | - | 5,506 | |||||||||
| Total transactions for the year | $ | 100,873 | $ | - | $ | 5,506 | ||||||
As required under IFRS Accounting Standards as issued by the IASB, we regularly assess whether impairment indicators are present and perform impairment testing as required.
In accordance with the Company’s accounting policies and processes, each asset or CGU is evaluated annually, to determine whether there are any indications of impairment or impairment reversal. If any such indications of impairment exist, a formal estimate of the recoverable amount is performed. Given the Company’s persistent lower market capitalization compared to its mineral properties carrying value, the Company engaged a third-party valuation specialist, in consultation with management, to assess the recoverability of the carrying value of the Company’s properties. The Company assessed the recoverable value of the CGUs based on its fair value less cost of disposal (“FVLCD”).
The Company utilized a market approach, which takes into account valuations of similar public companies and comparable transactions, to determine a recoverable amount. The recoverable amount was calculated using in situ multiples identified through independent research. This analysis along with specific attributes of the Eau Claire and Committee Bay Project was used as the basis of determining a reasonable per ounce valuation for these to projects. The Éléonore South Project which does not yet have a Mineral Resource Estimate, was valued through a primary market approach, based on its recent acquisition by the Company. The CGUs were categorised within the Level 3 of the fair value hierarchy, using a combination of inputs other than quoted prices which were observable and unobservable to determine the fair value of the assets.
Based on the Company’s assessment with respect to possible indicators of impairment, the Company concluded that as at December 31, 2024 impairment indicators exist and based on the impairment analysis performed, an impairment on its Eau Claire project of $89,263 and Committee Bay project of $11,610 totaling $100,873 was recorded. Estimating the in-situ multiples requires a significant management judgement due to the high degree of estimation uncertainty. Changes in the inputs used to determine the recoverable amount will result in a change to the valuation of the mineral properties and impairment expense. A 15% change in the in-situ values used, would give rise to a 13% change in the mineral properties values.
The result of the impairment better aligns the carrying value of these properties to the Company’s market capitalization value as per the guidance of IFRS 6.20(d).
Fury Gold Mines Limited | 25 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Note 17: Other income
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Excess fuel resold | $ | 566 | $ | - | $ | - | ||||||
| Flow-through investors liability reversal | - | - | 91 | |||||||||
| Total transactions for the year | $ | 566 | $ | - | $ | 91 | ||||||
Note 18: Share capital
| (a) | Authorized |
Unlimited common shares without par value.
Unlimited preferred shares – nil issued and outstanding.
| (b) | Share issuances |
During the year ended December 31, 2024:
During June 2024, the Company issued 5,320,000 flow-through shares for gross proceeds of $5,001 (“June 2024 Offering”). Share issue costs related to the June 2024 Offering totaled $533, which included $300 in commissions and $233 in other issuance costs. A reconciliation of the impact of the June 2024 Offering on share capital is as follows:
| Number of common shares | Impact on share capital | |||||||
| Flow-through shares issued at $0.94 per share | 5,320,000 | $ | 5,001 | |||||
| Cash share issue costs | - | (533 | ) | |||||
| Proceeds net of share issue costs | 5,320,000 | 4,468 | ||||||
| Less: flow-through share premium liability (note 13) | - | (2,022 | ) | |||||
| Total allocated to share capital | 5,320,000 | $ | 2,446 | |||||
During the year ended December 31, 2023:
The Company closed the “March 2023 Offering”, issuing 6,076,500 flow-through common shares for gross proceeds of $8,750. Share issue costs related to the March 2023 Offering totaled $912, which included $525 in commissions and $387 in other issuance costs. A reconciliation of the impact of the March 2023 Offering on share capital is as follows:
| Number of common shares | Impact on share capital | |||||||
| Flow-through shares issued at $1.44 per share | 6,076,500 | $ | 8,750 | |||||
| Cash share issue costs | - | (912 | ) | |||||
| Proceeds net of share issue costs | 6,076,500 | $ | 7,838 | |||||
| Less: flow-through share premium liability (note 13) | - | (3,889 | ) | |||||
| Total allocated to share capital | 6,076,500 | $ | 3,949 | |||||
During the year ended December 31, 2022:
The Company closed the “April 2022 Offering”, a non-brokered private equity placement, for gross proceeds of $11,000 which consisted of 13,750,000 common shares priced at $0.80 per share. Proceeds from the Private Placement were used to fund exploration at the Company’s Eau Claire project in Quebec and for general working capital.
Fury Gold Mines Limited | 26 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Share issue costs related to the April 2022 Offering totaled $136. A reconciliation of the impact of the private placement on share capital is as follows:
| Number of common shares | Impact on share capital | |||||||
| Common shares issued at $0.80 per share | 13,750,000 | $ | 11,000 | |||||
| Cash share issue costs | - | (136 | ) | |||||
| Proceeds net of share issue costs | 13,750,000 | $ | 10,864 | |||||
Note 19: Share-based compensation and warrant reserve
| (a) | Share-based compensation expense |
The Company uses the fair value method of accounting for all share-based payments to directors, officers, employees, and other service providers. During the years ended December 31, 2024, 2023, and 2022, the Company recognized share-based compensation expense as follows:
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Recognized in net loss (earnings) and included in: | ||||||||||||
| Exploration and evaluation costs | $ | 138 | $ | 477 | $ | 481 | ||||||
| Fees, salaries and other employee benefits | 721 | 874 | 1,188 | |||||||||
| Total share-based compensation expense | $ | 859 | $ | 1,351 | $ | 1,669 | ||||||
During the year ended December 31, 2024, the Company granted 245,000 share options (December 31, 2023 – 3,134,800) to directors, officers, employees, and certain consultants who provide certain on-going services to the Company, representative of employee services. Certain of the Company’s executive officer option grants were subject to vesting restrictions, representing certain performance measures, which were met during the year ended December 31, 2024 and an expense of $177 was recognized (December 31, 2023 and 2022 - $nil).
The weighted average fair value per option of these share options was calculated as $0.31 (December 31, 2023 – $0.47, December 31, 2022 – $0.46) using the Black-Scholes option valuation model at the grant date.
In addition to options, the Company also granted RSU’s during the year ended December 31, 2024 to officers and employees (note 18(b)).
The fair value of the share-based options granted during the years ended December 31, 2024, 2023 and 2022 was estimated using the Black-Scholes option valuation model with the following weighted average assumptions:
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Risk-free interest rate | 3.45 | % | 3.06 | % | 2.20 | % | ||||||
| Expected dividend yield | Nil | Nil | Nil | |||||||||
| Share price volatility | 70 | % | 68 | % | 67 | % | ||||||
| Expected forfeiture rate | 12.2 | % | 4.7 | % | 2.5 | % | ||||||
| Expected life in years | 5.0 | 5.0 | 5.0 | |||||||||
The risk-free interest rate assumption is based on the Government of Canada benchmark bond yields and treasury bills with a remaining term that approximates the expected life of the share-based options. The expected volatility
Fury Gold Mines Limited | 27 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
assumption is based on the historical and implied volatility of the Company’s common shares. The expected forfeiture rate and the expected life in years are based on historical trends.
| (b) | Long-term incentive plan |
On June 29, 2023, the Company adopted a Long-Term Incentive Plan (“LTI Plan”) which strives to accelerate and encourage additional share ownership by its employees, officers and directors. The LTI plan provides for the awarding of share options, performance share units, restricted share units and deferred share units. The LTI Plan limits the number of shares reserved for issuance under the LTI Plan, together with all other security-based compensation arrangements of the Company, to a maximum of 10% of the Common Shares issued and outstanding.
The number of share options issued and outstanding and the weighted average exercise price were as follows:
| Number
of share options | Weighted average exercise price ($/option) | |||||||
| Outstanding, December 31, 2022 | 8,880,324 | $ | 1.44 | |||||
| Granted | 3,134,800 | 0.80 | ||||||
| Expired | (1,672,087 | ) | 1.58 | |||||
| Forfeited | (391,435 | ) | 0.95 | |||||
| Outstanding, December 31, 2023 | 9,951,602 | $ | 1.23 | |||||
| Granted | 245,000 | 0.56 | ||||||
| Expired | (472,937 | ) | 1.92 | |||||
| Forfeited | (1,502,487 | ) | 1.40 | |||||
| Outstanding, December 31, 2024 | 8,221,178 | $ | 1.14 | |||||
As at December 31, 2024, the number of share options outstanding was as follows:
| Options outstanding | Options exercisable | |||||
| Exercise price ($/option) |
Number of shares |
Weighted average exercise price ($/option) |
Weighted average remaining life (years) |
Number of shares |
Weighted average exercise price ($/option) |
Weighted average remaining life (years) |
| $0.53 – $1.00 | 3,900,506 | 0.82 | 2.74 | 3,776,631 | 0.83 | 2.69 |
| $1.00 – $1.85 | 2,800,672 | 1.09 | 2.03 | 2,800,672 | 1.09 | 2.03 |
| $2.05 | 1,520,000 | 2.05 | 0.80 | 1,520,000 | 2.05 | 0.80 |
| 8,221,178 | 1.14 | 2.14 | 8,097,303 | 1.15 | 2.11 | |
On January 9, 2024, the Company issued 1,318,623 RSU’s to directors, officers, and employees. The RSU’s were issued in accordance with the Company’s LTI plan, one third vesting annually on the anniversary and paid out as fully paid shares. The Company also approved 235,080 RSU’s to directors vesting quarterly in 2024. These RSU’s are fully vested and paid out as fully paid shares in 2024.
On January 31, 2024, the Company issued 273,542 RSU’s to an officer. The RSU’s were issued in accordance with the Company’s LTI plan, which vested on the same day and paid out as fully paid shares.
The number of RSU’S issued and outstanding and the weighted average grant date fair value were as follows:
| Number of RSU’s | Weighted Average grant date fair value ($/ share) | |||||||
| Outstanding, December 31, 2022 | - | $ | - | |||||
| Granted | 197,345 | 0.60 | ||||||
| Settled | (197,345 | ) | 0.60 | |||||
| Outstanding, December 31, 2023 | - | $ | - | |||||
| Granted | 1,827,245 | 0.57 | ||||||
| Settled | (491,478 | ) | 0.59 | |||||
| Forfeited | (189,687 | ) | 0.57 | |||||
| Outstanding, December 31, 2024 | 1,146,080 | $ | 0.57 | |||||
Fury Gold Mines Limited | 28 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
| (c) | Share purchase warrants |
The number of share purchase warrants outstanding at December 31, 2024 was as follows:
| Warrants outstanding | Exercise price ($/share) | |||||||
| Outstanding, December 31, 2022 and 2023 | 7,461,450 | $ | 1.20 | |||||
| Expired | (7,461,450 | ) | 1.20 | |||||
| Outstanding, December 31, 2024 | - | - | ||||||
Note 20: Key management personnel
Key management personnel include Fury Gold’s board of directors and certain executive officers of the Company, including the CEO, Chief Financial Officer (“CFO”) and Senior Vice President, Exploration.
The remuneration of the Company’s key management personnel was as follows:
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Short-term benefits provided to executives (a) | $ | 1,306 | $ | 1,109 | $ | 1,719 | ||||||
| Directors’ fees paid to non-executive directors | 161 | 289 | 203 | |||||||||
| Share-based payments | 724 | 1,013 | 1,059 | |||||||||
| Total | $ | 2,191 | $ | 2,411 | $ | 2,981 | ||||||
| (a) | Short-term employee benefits include salaries, bonuses payable within twelve months of the date of the consolidated statements of financial position, and other annual employee benefits. |
Fury Gold Mines Limited | 29 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Note 21: Supplemental cash flow information
The impact of changes in non-cash working capital was as follows:
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Accounts receivable | $ | 321 | $ | (5 | ) | $ | (47 | ) | ||||
| Prepaid expenses and deposits | 104 | (59 | ) | (94 | ) | |||||||
| Accounts payable and accrued liabilities | (15 | ) | (120 | ) | (762 | ) | ||||||
| Changes in non-cash working capital | $ | 410 | $ | (184 | ) | $ | (903 | ) | ||||
Operating activities include the following cash received:
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Income taxes refunded | $ | (193 | ) | $ | (307 | ) | $ | (187 | ) | |||
| Income taxes paid | - | 18 | - | |||||||||
| Income tax expense (recovery) | $ | (193 | ) | $ | (289 | ) | $ | (187 | ) | |||
Fury Gold Mines Limited | 30 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
Note 22: (Earnings) loss per share
For the years ended December 31, 2024, 2023, and 2022, the weighted average number of shares outstanding and (earnings) loss per share were as follows:
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Net loss (earnings) | $ | 108,138 | $ | 17,213 | $ | (24,908 | ) | |||||
| Weighted average basic number of shares outstanding | 149,019,020 | 144,184,481 | 139,470,950 | |||||||||
| Basic loss (earnings) per share | $ | 0.73 | $ | 0.12 | $ | (0.18 | ) | |||||
| Weighted average diluted number of shares outstanding | 149,019,020 | 144,184,481 | 139,481,236 | |||||||||
| Diluted loss (earnings) per share | $ | 0.73 | $ | 0.12 | $ | (0.18 | ) | |||||
Diluted net loss per share excludes, when applicable, the potential impact of stock options and other unvested stock because their effect would be anti-dilutive due to the net loss. The Company reported a loss for the years ended December 31, 2024, 2023, the numbers of dilutive shares were 9,367,258 and 17,413,052 respectively for these years.
Note 23: Financial instruments
The Company’s financial instruments as at December 31, 2024, consisted of cash, marketable securities, accounts receivable, other investments, deposits, and accounts payable and accrued liabilities. The fair values of these financial instruments approximate their carrying values, unless otherwise noted.
| (a) | Financial assets and liabilities by categories |
| At December 31, 2024 | At December 31, 2023 | |||||||||||||||||||||||
| Amortized Cost | FVTPL | Total | Amortized Cost | FVTPL | Total | |||||||||||||||||||
| Cash | $ | 4,912 | $ | - | $ | 4,912 | $ | 7,313 | $ | - | $ | 7,313 | ||||||||||||
| Marketable securities | - | 2,358 | 2,358 | - | 1,166 | 1,166 | ||||||||||||||||||
| Other investments | - | 2,063 | 2,063 | - | - | - | ||||||||||||||||||
| Deposits | 191 | - | 191 | 100 | - | 100 | ||||||||||||||||||
| Accounts receivable | 54 | 54 | 374 | - | 374 | |||||||||||||||||||
| Total financial assets | $ | 5,157 | $ | 4,421 | $ | 9,578 | $ | 7,787 | $ | 1,166 | $ | 8,953 | ||||||||||||
| Accounts payable and accrued liabilities | 855 | - | 855 | 1,034 | - | 1,034 | ||||||||||||||||||
| Total financial liabilities | $ | 855 | $ | - | $ | 855 | $ | 1,034 | $ | - | $ | 1,034 | ||||||||||||
| (b) | Financial assets and liabilities measured at fair value |
The categories of the fair value hierarchy that reflect the significance of inputs used in making fair value measurements are as follows:
Level 1 – fair values based on unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2 – fair values based on inputs that are observable for the asset or liability, either directly or indirectly; and
Level 3 – fair values based on inputs for the asset or liability that are not based on observable market data.
The Company’s policy to determine when a transfer occurs between levels is to assess the impact at the date of the event or the change in circumstances that could result in a transfer. No transfers occurred between the levels during the year.
Fury Gold Mines Limited | 31 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
As at December 31, 2024, the Company’s financial instruments measured at fair value on a recurring basis were the Company’s marketable securities which were classified as Level 1, and other investments which were classified as Level 3. There were no financial assets or financial liabilities measured and recognized in the consolidated statements of financial position at fair value that would be categorized as level 2 in the fair value hierarchy.
The Company’s financial instruments measured at fair value on a recurring basis were as follows:
| At December 31 | ||||||||||||
| 2024 | 2023 | |||||||||||
| Level 1 | Level 3 | Level 1 | ||||||||||
| Marketable securities | $ | 2,358 | - | $ | 1,166 | |||||||
| Other investments | - | $ | 2,063 | - | ||||||||
Other investments categorized within Level 3 of the fair value hierarchy is an investment in equity and measured subsequently at FVTPL.
During the years ended December 31, 2023, there were no financial assets or financial liabilities measured and recognized on the consolidated statements of financial position at fair value that would be categorized as level 2 or 3 in the fair value hierarchy.
| (c) | Financial instruments and related risks |
The Company’s financial instruments are exposed to liquidity risk, credit risk and market risks, which include currency risk, interest rate risk and price risk. As at December 31, 2024, the primary risks were as follows:
Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities. The Company proactively manages its capital resources and has in place a budgeting and cash management process to help determine the funds required to ensure the Company has the appropriate liquidity to meet its current exploration plans and achieve its growth objectives. The Company ensures that there is sufficient liquidity available to meet its short-term business requirements, taking into account its anticipated cash outflows from exploration activities, and its holdings of cash and marketable securities. The Company monitors and adjusts, when required, these exploration programs as well as corporate administrative costs to ensure that adequate levels of working capital are maintained.
As at December 31, 2024, the Company had unrestricted cash of $4,912 (December 31, 2023 – $7,313), working capital surplus of $8,045 (December 31, 2023 – $7,713), which the Company defines as current assets less current liabilities, and an accumulated deficit of $257,192 (December 31, 2023 – $149,054). During the year ended December 31, 2024, Fury Gold incurred a comprehensive loss of $108,141 (December 31, 2023 – $17,219, December 31, 2022 – income of $24,905). The Company expects to incur future operating losses in relation to exploration activities. With no source of operating cash flow, there is no assurance that sufficient funding will be available to conduct further exploration of its mineral properties.
The Company’s contractual obligations are as follows:
| Within 1 year | 2 to 3 years | Over 3 years | At December 31 2024 | |||||||||||||
| Accounts payable and accrued liabilities | $ | 855 | $ | - | $ | - | $ | 855 | ||||||||
| Quebec flow-through expenditure requirements | 944 | - | - | 944 | ||||||||||||
| Undiscounted lease payments | 65 | - | - | 65 | ||||||||||||
| Total | $ | 1,864 | $ | - | $ | - | $ | 1,864 | ||||||||
Fury Gold Mines Limited | 32 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
The Company also makes certain payments arising on mineral claims and leases on an annual or bi-annual basis to ensure all the Company’s properties remain in good standing. Cash payments of $212 were made during the year ended December 31, 2024, in respect of these mineral claims (December 31, 2023 - $298), with $27 recognized in prepaid expenses as at December 31, 2024 (December 31, 2023 – $78).
Credit risk
The Company’s cash and accounts receivables are exposed to credit risk, which is the risk that the counterparties to the Company’s financial instruments will cause a loss to the Company by failing to pay their obligations. The amount of credit risk to which the Company is exposed is considered insignificant as the Company’s cash is held with highly rated financial institutions in interest-bearing accounts and the accounts receivable primarily consist of sales tax receivables.
Market risk
This is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Significant market risks to which the Company is exposed are as follows:
| i. | Currency risk |
The Company is exposed to currency risk by having balances and transactions in currencies that are different from the relevant functional currency (the Canadian dollar). The Company’s foreign currency exposure related to its financial assets and liabilities held in US dollars was as follows:
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Financial assets | ||||||||||||
| US$ bank accounts | $ | 1 | $ | 1 | $ | 1 | ||||||
| Financial liabilities | ||||||||||||
| Accounts payable | - | (7 | ) | (61 | ) | |||||||
| $ | 1 | $ | (6 | ) | $ | (60 | ) | |||||
A 10% increase or decrease in the US dollar to Canadian dollar exchange rate would not have a material impact on the Company’s net loss.
| ii. | Price risk |
The Company holds certain investments in marketable securities (note 8) which are measured at fair value, being the closing share price of each equity security at the date of the consolidated statements of financial position. The Company is exposed to changes in share prices which would result in gains and losses being recognized in the loss for the year. A 10% increase or decrease in the Company’s marketable securities’ share prices would not have a material impact on the Company’s net loss.
Note 24: Management of capital
The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern in order to pursue exploration of resource properties and to maintain a flexible capital structure which optimizes the costs of capital at an acceptable risk.
The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may issue new shares or debt, acquire or dispose of assets, or adjust the amount of cash and investments.
Fury Gold Mines Limited | 33 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
In order to maximize ongoing exploration efforts, the Company does not pay out dividends, does not have any long-term debt, and is not subject to any externally imposed capital requirements. The capital of the Company was determined as follows:
| Years ended December 31 | ||||||||
| 2024 | 2023 | |||||||
| Equity | $ | 78,203 | $ | 182,874 | ||||
| Less: cash | (4,912 | ) | (7,313 | ) | ||||
| $ | 73,291 | $ | 175,561 | |||||
The Company expects its capital resources to support its current forecasted project expenditures at the Eau Claire project and the Éléonore South project and other corporate activities. While the Company has been successful at raising capital in the past, there can be no assurance that the Company will have sufficient financing to meet its future capital requirements or that additional financing will be available on terms acceptable to the Company in the future.
Income taxes
The reconciliation of the income tax recovery computed at statutory rates to the reported income tax recovery is:
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| (Earnings) Loss before income taxes | $ | 108,331 | $ | 17,502 | $ | (24,721 | ) | |||||
| Canadian federal and provincial income tax rates | 27 | % | 27 | % | 27 | % | ||||||
| Expected income tax expense (recovery) | (29,250 | ) | (4,725 | ) | 6,675 | |||||||
| Increase (decrease) in income tax recovery resulting from: | ||||||||||||
| Impairment | 23,555 | - | - | |||||||||
| Share-based compensation | 197 | 432 | 448 | |||||||||
| Share issuance costs | (144 | ) | (246 | ) | (37 | ) | ||||||
| Adjustment to tax estimates | (45 | ) | 934 | 114 | ||||||||
| Amortization of flow-through share premium | (439 | ) | (903 | ) | (844 | ) | ||||||
| Flow-through expenditures renunciation | 1,033 | 1,995 | 1,934 | |||||||||
| Difference in future and foreign tax rates | 466 | 42 | 81 | |||||||||
| Sale of investments | (119 | ) | - | (3,021 | ) | |||||||
| Other | 7 | 503 | 497 | |||||||||
| Increase (decrease) in unrecognized tax asset | 4,546 | 1,679 | (6,034 | ) | ||||||||
| Income tax expense (recovery) | $ | (193 | ) | $ | (289 | ) | $ | (187 | ) | |||
Significant components of deferred tax asset and liabilities are:
| December 31 2023 | Net loss | December 31 2024 | ||||||||||
| Deferred income tax assets | ||||||||||||
| Non-capital losses carried forward | $ | 14,192 | $ | 990 | $ | 15,182 | ||||||
| Capital losses carried forward | 55 | (6 | ) | 49 | ||||||||
| Share issuance costs and CEC | 356 | (66 | ) | 290 | ||||||||
| Investments | 98 | (38 | ) | 60 | ||||||||
| Investments in associates | 1,472 | 16 | 1,488 | |||||||||
| Site reclamation obligations | 1,206 | 148 | 1,354 | |||||||||
| Property and equipment | 479 | 52 | 531 | |||||||||
| Mineral property interests | 5,003 | 3,231 | 8,234 | |||||||||
| Capital lease obligation | 61 | (43 | ) | 18 | ||||||||
| $ | 22,922 | 4,284 | 27,206 | |||||||||
| Deferred income tax liabilities | ||||||||||||
| Property and equipment | (24 | ) | 27 | 3 | ||||||||
| Mineral property interests | (517 | ) | 235 | (282 | ) | |||||||
| Net deferred tax assets | 22,381 | 4,546 | 26,927 | |||||||||
| Unrecognized deferred tax assets | (22,381 | ) | (4,546 | ) | (26,927 | ) | ||||||
| Net deferred tax balance | $ | - | $ | - | $ | - | ||||||
Fury Gold Mines Limited | 34 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
| December 31 2022 |
Net loss | December 31 2023 | ||||||||||
| Deferred income tax assets | ||||||||||||
| Non-capital losses carried forward | $ | 13,635 | $ | 557 | $ | 14,192 | ||||||
| Capital losses carried forward | 73 | (18 | ) | 55 | ||||||||
| Share issuance costs and CEC | 317 | 39 | 356 | |||||||||
| Investments | 22 | 76 | 98 | |||||||||
| Investments in associates | 633 | 839 | 1,472 | |||||||||
| Site reclamation obligations | 1,145 | 61 | 1,206 | |||||||||
| Property and equipment | 427 | 52 | 479 | |||||||||
| Mineral property interests | 4,973 | 30 | 5,003 | |||||||||
| Capital lease obligation | 104 | (43 | ) | 61 | ||||||||
| 21,329 | 1,593 | 22,922 | ||||||||||
| Deferred income tax liabilities | ||||||||||||
| Property and equipment | (53 | ) | 29 | (24 | ) | |||||||
| Mineral property interests | (545 | ) | 28 | (517 | ) | |||||||
| Investments | (28 | ) | 28 | - | ||||||||
| Net deferred tax assets | 20,703 | 1,678 | 22,381 | |||||||||
| Unrecognized deferred tax assets | (20,703 | ) | (1,678 | ) | (22,381 | ) | ||||||
| Net deferred tax balance | $ | - | $ | - | $ | - | ||||||
| December 31 2021 |
Net loss | December 31 2022 | ||||||||||
| Deferred income tax assets | ||||||||||||
| Non-capital losses carried forward | $ | 21,032 | $ | (7,397 | ) | $ | 13,635 | |||||
| Capital losses carried forward | 183 | (110 | ) | 73 | ||||||||
| Share issuance costs and CEC | 552 | (235 | ) | 317 | ||||||||
| Investments | 18 | 4 | 22 | |||||||||
| Investments in associates | - | 633 | 633 | |||||||||
| Site reclamation obligations | 1,121 | 24 | 1,145 | |||||||||
| Property and equipment | 376 | 51 | 427 | |||||||||
| Mineral property interests | 5,001 | (28 | ) | 4,973 | ||||||||
| Capital lease obligation | 124 | (20 | ) | 104 | ||||||||
| Other | 63 | (63 | ) | - | ||||||||
| 28,470 | (7,141 | ) | 21,329 | |||||||||
| Deferred income tax liabilities | ||||||||||||
| Property and equipment | (86 | ) | 33 | (53 | ) | |||||||
| Mineral property interests | (1,606 | ) | 1,061 | (545 | ) | |||||||
| Investments | (42 | ) | 14 | (28 | ) | |||||||
| Net deferred tax assets | 26,736 | (6,033 | ) | 20,703 | ||||||||
| Unrecognized deferred tax assets | (26,736 | ) | 6,033 | (20,703 | ) | |||||||
| Net deferred tax balance | $ | - | $ | - | $ | - | ||||||
Fury Gold Mines Limited | 35 |
Notes to the 2024 Consolidated Financial Statements | |
(Expressed in thousands of Canadian dollars, except where noted) |
The Company has accumulated non-capital tax losses of approximately $57,721 (December 31, 2023 – $54,073, December 31, 2022 – $51,335) in Canada, which may be carried forward to reduce taxable income of future years. The non-capital tax losses will, if unused, expire between 2025 and 2044. The Company has not recognized any deferred tax assets at December 31, 2024, in respect of these non-capital losses due to the uncertainty that future operations will generate sufficient taxable income to utilize these non-capital losses.
The Company has $67 accumulated tax capital losses (December 31, 2023 – $111, December 31, 2022 – $247) in Canada which may be carried forward indefinitely and used to reduce capital gains in future years.
Note 26: Subsequent events
| (a) | On January 9, 2025, the Company issued 590,000 DSU’s to directors and 1,142,500 RSU’s to officers, and employees. The DSU’s and RSU’s were issued in accordance with the Company’s LTI plan (note 18), with a grant-date fair value of $0.55 per unit, one third vesting annually on anniversary. The Company also approved 80,000 stock options, vesting over 18 months with an exercise price of $0.60 per option, to certain UMS employees. |
| (b) | On February 26, 2025, the Company announced that it has entered into an Arrangement Agreement with Quebec Precious Metals Corporation (“QPM”), whereby the Company intends to acquire all the outstanding common shares of QPM. The holders of QPM common shares will receive 0.0741 Company shares for each one QPM share held. It is expected that QPM shareholders will receive around 8.4 million Fury Gold common shares which will collectively make them 5% shareholders of the Company. The transaction is expected to close at the end of April 2025. |
| (c) | On March 26, 2025, the Company announced that QPM has now secured the required no-objection letter from Corporations Canada as well as the interim order from the Quebec Superior Court in connection with convening the QPM shareholders meeting scheduled for April 22, 2025. The Company has also secured conditional approval of the TSX and NYSE American for the QPM transaction. The Company also announced that director Isabelle Cadieux has resigned from the Fury Board of directors to pursue other opportunities. |
| Fury Gold Mines Limited | 36 |
| Notes to the 2024 Consolidated Financial Statements | |
| (Expressed in thousands of Canadian dollars, except where noted) |
Exhibit 99.3
(An exploration company)
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2024
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2024
This Management’s Discussion and Analysis (the “MD&A”) for Fury Gold Mines Limited (“Fury Gold” or the “Company”) should be read in conjunction with the consolidated financial statements of the Company and related notes thereto for the year ended December 31, 2024. The consolidated financial statements have been prepared in accordance with IFRS® Accounting Standards as issued by the International Accounting Standards Board (“IASB”) and interpretations issued by the IFRS Interpretations Committee (“IFRIC”). All dollar amounts presented are expressed in thousands of Canadian dollars unless otherwise stated. Certain amounts presented in this MD&A have been rounded. The effective date of this MD&A is March 31, 2025.
| SECTION 1: FORWARD-LOOKING STATEMENTS AND RISK FACTORS | 2 | |||
| SECTION 2: BUSINESS OVERVIEW | 5 | |||
| SECTION 3: 2024 HIGHLIGHTS AND SUBSEQUENT EVENTS | 6 | |||
| SECTION 4: PROJECTS OVERVIEW | 8 | |||
| SECTION 5: REVIEW OF ANNUAL FINANCIAL INFORMATION | 12 | |||
| SECTION 6: REVIEW OF QUARTERLY FINANCIAL INFORMATION | 14 | |||
| SECTION 7: FINANCIAL POSITION, LIQUIDITY, AND CAPITAL RESOURCES | 16 | |||
| SECTION 8: FINANCIAL RISK SUMMARY | 21 | |||
| SECTION 9: RELATED PARTY TRANSACTIONS AND BALANCES | 21 | |||
| SECTION 10: CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS | 22 | |||
| SECTION 11: APPLICATION OF NEW AND REVISED ACCOUNTING STANDARDS | 24 | |||
| SECTION 12: CONTROLS AND PROCEDURES | 25 |
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 1 |
Section 1: Forward-looking statements and risk factors
| 1.1 | Forward-looking statements |
Certain statements made in this MD&A contain forward-looking information within the meaning of applicable Canadian and United States securities laws (“forward-looking statements”). These forward-looking statements are presented for the purpose of assisting the Company’s securityholders and prospective investors in understanding management’s views regarding those future outcomes and may not be appropriate for other purposes. When used in this MD&A, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “seek”, “propose”, “estimate”, “expect”, and similar expressions, as they relate to the Company, are intended to identify forward- looking statements. Specific forward-looking statements in this MD&A include, but are not limited to: the Company’s exploration plans and objectives and the timing and costs of these plans; future capital expenditures and requirements, and sources and timing of additional financing; the timing, costs and success of the Company’s exploration activities, estimates of the Company’s mineral resources; the realization of mineral resource estimates; any objectives, expectations, intentions, plans, results, levels of activity, goals or achievements; capital expenditures; the Company’s plans for its ownership interests in Dolly Varden Silver Corporation and Sirios Resources Inc. and the realization of carrying values of securities held for resale, and liabilities related to unused tax benefits or flow-through obligations; statements relating to the business, operations or prospects of the Company; and other events or conditions that may occur in the future.
The forward-looking statements contained in this MD&A represent the Company’s views only as of the date such statements were made and may change. Many assumptions are subject to risks and uncertainties, and so may prove to be incorrect, including the Company’s budget, including expected costs and the assumptions regarding market conditions and other factors upon which the Company has based its expenditure expectations; the Company’s ability to complete its planned exploration activities with its available working capital; the Company’s ability to raise additional capital to proceed with its exploration plans; the Company’s ability to obtain or renew the licences and permits necessary for exploration; the Company’s ability to obtain all necessary regulatory approvals, permits and licences for its planned exploration activities under governmental and other applicable regulatory regimes including the legally, mandated consultation process with affected First Nations; the Company’s ability to complete and successfully integrate acquisitions; the effects of climate change, extreme weather events, tariffs, water scarcity, and seismic events, and the effectiveness of strategies to deal with these issues; the Company’s expectations regarding the demand for, and supply and price of, precious metals; the Company’s ability to recruit and retain qualified personnel; the Company’s resource estimates, and the assumptions upon which they are based; the Company’s ability to comply with current and future environmental, safety and other regulatory requirements.
The foregoing is not an exhaustive list of the risks and other factors that may affect any of the Company’s forward- looking statements. Readers should refer to the risks discussed herein and in the Company’s Annual Information Form (the “Annual Information Form”) for the year ended December 31, 2024, subsequent disclosure filings with the Canadian Securities Administrators, the Company’s annual report on Form 20-F for the year ended December 31, 2024 to be filed with the United States Securities and Exchange Commission (the “SEC”) (the “2024 Form 20- F Annual Report”), and subsequent disclosure filings with the SEC, available on SEDAR+ at www.sedarplus.com and with the SEC at www.sec.gov, as applicable.
The Company does not undertake to update any forward-looking statements, except to the extent required by applicable securities laws.
Readers are cautioned not to place heavy reliance on forward looking statements.
Cautionary Note to United States Investors concerning Estimates of Measured, Indicated, and Inferred Resource Estimates:
This MD&A uses the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource”, which are Canadian mining terms as defined in, and required to be disclosed in accordance with, National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”), which references the guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) – CIM Definition Standards on mineral resources and mineral reserves (“CIM Definition Standards”), adopted by the CIM
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 2 |
Council, as amended. Mining disclosure under U.S. securities law was previously required to comply with SEC Industry Guide 7 (“SEC Industry Guide 7”) under the United States Securities Exchange Act of 1934, as amended. The SEC has adopted rules to replace SEC Industry Guide 7 with new mining disclosure rules under sub-part 1300 of Regulation S-K of the U.S. Securities Act (“Regulation S-K 1300”) which became mandatory for U.S. reporting companies beginning with the first fiscal year commencing on or after January 1, 2021. Under Regulation S-K 1300, the SEC now recognizes estimates of “Measured Mineral Resources”, “Indicated Mineral Resources” and “Inferred Mineral Resources”. In addition, the SEC has amended its definitions of “Proven Mineral Reserves” and “Probable Mineral Reserves” to be substantially similar to international standards. Readers are cautioned that despite efforts to harmonize U.S. mining disclosure rules with NI 43-101 and other international requirements, there are differences between the terms and definitions used in Regulation S-K 1300 and mining terms defined by CIM and used in NI 43 101, and there is no assurance that any mineral reserves or mineral resources that an owner or operator may report as “proven mineral reserves”, “probable mineral reserves”, “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources” under NI 43-101 would be the same had the owner or operator prepared the reserve or resource estimates under the standards of Regulation S-K 1300.
As a “foreign private issuer” under United States securities laws, the Company was previously eligible to file its annual report on Form 40-F with the SEC pursuant to the multi-jurisdictional disclosure system. Consequently, the Company was not required to provide disclosure on its mineral properties under US Regulation S-K 1300 but rather provided disclosure under Canadian NI 43-101 and the Canadian Institute of Mining and Metallurgy (CIM) Standards. The Company has lost its eligibility to file its annual report on Form 40-F using Canadian standards due to the non- affiliate market capitalization of its public share float having a market value less than US$75 million from the year ended December 31, 2023. Consequently, all Form 20-F Annual Reports filed by the Company with the SEC will include disclosure on the Company’s material properties in accordance with the requirements of Regulation S-K 1300 which as noted above may materially differ from the requirements of NI 43-101 and the CIM Definition Standards.
There is no assurance any mineral resources that the Company may report as “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources” under NI 43- 101 would be the same had the Company prepared the resource estimates under the standards adopted under the Regulation S-K 1300. United States investors are also cautioned that while the SEC will now recognize “measured mineral resources”, “indicated mineral resources” and “inferred mineral resources”, investors should not assume that any part or all of the mineralization in these categories will ever be converted into a higher category of mineral resources or into mineral reserves. Mineralization described using these terms has a greater amount of uncertainty as to their existence and feasibility than mineralization that has been characterized as reserves.
The Company has no mineral reserves which require that the estimated resources be demonstrated to be economic in at least a pre-feasibility study. Accordingly, investors are cautioned not to assume that any “measured mineral resources”, “indicated mineral resources” or “inferred mineral resources” that the Company reports are or will be economically or legally mineable. Although in Canada, “inferred mineral resources” are subject to an expectation that there must be a reasonable probability of upgrading a majority of an inferred resource into a measured or indicated category, inferred resources have a greater amount of uncertainty as to their existence and as to whether they can be mined legally or economically. Therefore, United States investors are also cautioned not to assume that all or any part of the “inferred mineral resources” exist. In accordance with Canadian securities laws, estimates of “inferred mineral resources” cannot form the basis of feasibility or other economic studies, except in limited circumstances where permitted under NI 43-101.
Accordingly, information contained in this MD&A describing the Company’s mineral deposits may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations thereunder.
See the heading “Resource Category (Classification) Definitions” in the 2024 Form 20-F Annual Report for a more detailed description of certain of the mining terms used in this MD&A.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 3 |
| 1.2 | Qualified persons and technical disclosures |
Bryan Atkinson. P.Geol., Senior Vice President, Exploration, and Valerie Doyon, P.Geo., Senior Project Geologist, of the Company are each a “qualified person” or “QP” under and for the purposes of NI 43-101 with respect to the technical disclosures in this MD&A in respect to the Committee Bay and Eau Claire projects respectively.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 4 |
Section 2: Business Overview
Fury Gold is a Canadian-focused gold exploration company strategically positioned in two prolific mining regions: the Eeyou Istchee James Bay Region of Quebec and the Kitikmeot Region in Nunavut. The Company’s vision is to deliver shareholder value by growing our multi-million-ounce gold portfolio through additional significant gold discoveries in Canada.
The Company was incorporated on June 9, 2008, under the Business Corporations Act (British Columbia) and is listed on the Toronto Stock Exchange and the NYSE-American, with its common shares trading under the symbol FURY. The Company’s registered and records office is located at 1055 West Georgia Street, Suite 1500, Vancouver, British Columbia, V6E 4N7, and the mailing address is 401 Bay Street, 16th Floor, Toronto, Ontario, M5H 2Y4.
At December 31, 2024, the Company had three principal projects: Committee Bay in Nunavut, and Eau Claire and Éléonore South in Quebec, which the Company now own 100%, after acquiring the 49.978% interest, previously held by Newmont Corporation (“Newmont”), in February 2024. Additionally, the Company holds a 16.11% common share interest in Dolly Varden Silver Corporation (“Dolly Varden”) at December 31, 2024, which owns the Kitsault project in British Columbia and a 25% interest in Universal Mineral Services Limited (“UMS”), a private shared- services provider. The Company’s equity interests in Dolly Varden and UMS are accounted for as investments in associates meaning cost less a share of its losses and the carrying value does not reflect market value of these securities.
The Company is a junior resource exploration issuer and does not have material revenues nor reportable segments. Its business success must be measured primarily by the success of its exploration programs in establishing that the Company’s mineral properties contain potential commercial deposits of precious metals.
Material developments over the past three years in chronological order include:
| 2.1 | 2022 Sale of Subsidiary Homestake Resources Corporation (“Homestake Resources”) to Dolly |
Varden
On December 6, 2021, the Company entered into a definitive agreement (the "Purchase Agreement") with Dolly Varden Silver Corporation (“Dolly Varden”) pursuant to which the Company agreed to sell to Dolly Varden a 100% interest in Fury Gold's wholly owned subsidiary, Homestake Resources in exchange for $5,000 in cash and 76,504,590 common shares in Dolly Varden. Homestake Resources was the owner of a 100% interest in the Homestake Ridge gold-silver project which is located adjacent to the Dolly Varden Project owned by Dolly Varden in the Golden Triangle, British Columbia (the “Dolly Varden Transaction”). The Dolly Varden Transaction completed on February 25, 2022. As a result, Fury acquired the 76,504,590 Dolly Varden Shares on February 25, 2022, representing approximately 35.33% of the Dolly Varden Shares outstanding and 32.88% of Dolly Varden on a fully diluted basis as of that date.
In connection with the Dolly Varden Transaction and as contemplated in the Purchase Agreement, Dolly Varden and Fury Gold had also entered into an investor rights agreement dated February 25, 2022 (the "Investor Rights Agreement"). Pursuant to its obligations under the Investor Rights Agreement, Dolly Varden had appointed Forrester “Tim” Clark, the Chief Executive Officer (“CEO”) of Fury Gold, and Michael Henrichsen, the former Chief Geological Officer of Fury Gold, to the board of directors of Dolly Varden.
| (a) | On October 13, 2022, the Company announced that it had completed a non-brokered sale agreement to sell 17,000,000 common shares of Dolly Varden at $0.40 per share, representing approximately 7.4% of the outstanding common shares. The net proceeds received by the Company upon close of the transaction was $6,775. |
| (b) | On March 12, 2024, the Company sold 5,450,000 common shares of Dolly Varden at $0.735 per Share for gross proceeds of $4,006, thus reducing its position to 19.99% of Dolly Varden, and decreasing its right to one director on Dolly Varden under its Investors Rights Agreement, to which notice had been given. |
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 5 |
| (c) | On October 4, 2024, the Company further sold 3,000,000 common shares of Dolly Varden at $1.119 per Share for gross proceeds of $3,356. As at December 31, 2024, the Company held a 16.11% interest in Dolly Varden. |
| 2.2 | For 2024 exploration events see Section 3, below. |
| 2.3 | Increase in ownership interest of Éléonore South to 100% |
On September 12, 2022, the Company and its joint operation partner Newmont, through their respective subsidiaries, completed the acquisition of the remaining approximately 23.77% participating interest of Azimut Exploration Inc. in the Éléonore South Joint Venture (“ESJV”), on a pro-rata basis. As a result of the transaction, the 100% ESJV participating interests were then held 50.022% by the Company and 49.978% by Newmont with Fury Gold remaining operator under an amended and restated joint operating agreement.
On February 29, 2024, the Company and Newmont, through their respective subsidiaries, entered into a new agreement whereby the Company acquired 100% control of the interests, consolidating these properties into the Company’s portfolio. As part of the transaction, the Company acquired 30,392,372 shares of Sirios Resources Inc. from Newmont which represented a 10.98% share at the time.
Section 3: 2024 Highlights and subsequent events
| 3.1 | Operational highlights |
| § | On February 3, 2025, the Company announced the commencement of a diamond drilling program on the greenfield exploration Éléonore South gold project located in the Eeyou Istchee Territory in the James Bay region of Northern Quebec. Drilling will target robust multi-faceted geological, geophysical, and geochemical gold anomalies within the same sedimentary rock package that hosts the Éléonore Mine. The fully funded first phase drilling campaign will comprise approximately 4,000 – 6,000 metres (m) targeting an interpreted fold nose within the Low Formation sediments. Within the prospective folded stratigraphy are six undrilled priority targets spanning over 3 kilometres (km) of strike length that have been identified through a combination of biogeochemical sampling and interpretation of magnetics and electromagnetics survey data. The first phase of drilling will be focused within a northwest-southeast structural corridor where a strong correlation between anomalous gold, stratigraphy, and structure has been identified. The drill targets occur in a structurally complex setting with little to no outcrop exposure and the targeting model will evolve with each hole drilled. The Company plans to complete approximately 15 of the 77 permitted drill holes as part of the first phase of drilling and will guide additional drilling based on the results and observations from this phase. |
| § | On November 12, 2024, the Company announced the finalization of drill targeting at the Éléonore South gold project in the Eeyou Istchee Territory in the James Bay Region of Quebec. Drilling will target robust geochemical gold anomalies within the same sedimentary rock package that hosts Newmont’s Éléonore Mine. Six priority drill targets across over 3 kilometres (km) of prospective folded sedimentary stratigraphy have been identified. These six targets encompass multi point gold anomalies above the 90th percentile of the data and correlate with moderate pathfinder elemental anomalies, most notably arsenic which is associated with gold mineralization at the Éléonore Mine. The Company has mobilized crews during February 2025 for an initial fully funded 3,000 – 5,000 metre (m) diamond drilling program. |
| § | On October 24, 2024, the Company announced the results from the summer exploration program at its 100% Committee Bay project in the Kitikmeot Region of Nunavut. The 2024 exploration program defined three drill ready shear zone hosted targets advanced through a combination of till sampling, rock sampling and geological mapping: |
| o | Three Bluffs Shear, where drilling in 2021 intercepted 13.93 g/t Au over 10 metres (m) (see news release dated December 1, 2021); |
| o | Raven Shear where 7 rock samples have averaged 16.12 g/t gold; and |
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 6 |
| o | Burro West where a 300 by 300 m discrete >90th percentile gold in till anomaly has been defined with a peak value of 50 ppb gold. |
| § | On October 7, 2024, the Company announced the discovery of high-grade lithium outcrop on the western claim block of its 100% owned Éléonore South project in the Eeyou Istchee Territory in the James Bay region of Quebec. The outcrop sampling program targeted the historical Fliszar showing lepidolite bearing pegmatite as well as new rock exposures over an area of approximately 1000 x 500 metres (m) resulting in the collection of 34 samples. Seven samples returned high-grade values above 1.75% lithium oxide (Li2O) with a peak value of 4.67% Li2O. The Company’s focus remains on the gold prospectivity of the Éléonore South project. However, the announced lithium results provide additional exploration targets as the overall project is advanced. |
| § | On September 9, 2024, the Company announced results from the diamond drilling program at the greenfield Serendipity Prospect on its wholly owned Eau Claire project in the Eeyou Istchee Territory in the James Bay region of Quebec. The Serendipity Prospect lies within the same prospective geological setting as the Company’s Percival Deposit. In total 3,871 metres (m) were drilled in 10 holes across five distinct targets at Serendipity. Drill hole 24SD-009 targeted a biogeochemical anomaly overlying the easterly extension of the structure controlling the mineralization at Serendipity and intercepted 12.16 g/t gold over |
3.0 m. Drill hole 24SD-002 targeted a biogeochemical anomaly at the hinge of an interpreted fold within volcanic stratigraphy and intercepted 5.27 g/t gold over 1.0 m. The two noted intercepts above are separated by over 2 km indicating the potential for a large mineralizing system at Serendipity. The Company is in the process of planning follow-up drilling at Serendipity for 2025.
| § | On June 28, 2024, the Company announced the filing of a NI43-101 Technical Report for the Increased Mineral Resource Estimate for the high-grade Eau Claire deposit as well as a Maiden Mineral Resource Estimate for the Percival deposit located in the Eeyou Istchee Territory of the James Bay region of Quebec. The Eau Claire project now contains a combined mineral resource of 1.16Moz gold (Au) at a grade of 5.64 g/t Au in the Measured and Indicated category as well as an additional 723koz gold at a grade of 4.13 g/t Au in the Inferred Category. Gold mineralization remains open for expansion in all directions at both the Eau Claire and Percival deposits through additional drilling. |
| 3.2 | 2024 Corporate highlights and subsequent events |
| § | On March 26, 2025, the Company announced that QPM has now secured the required no-objection letter from Corporations Canada as well as the interim order from the Quebec Superior Court in connection with convening the QPM shareholders meeting scheduled for April 22, 2025. The Company has also secured conditional approval of the TSX and NYSE American for the QPM transaction. The Company also announced that director Isabelle Cadieux has resigned from the Fury Board of directors to pursue other opportunities. |
| § | On February 26, 2025, the Company entered into an Arrangement Agreement with Quebec Precious Metals Corporation (“QPM”), whereby the Company intends to acquire all the outstanding common shares of QPM. The holders of QPM common shares will receive 0.0741 Company shares for each one QPM share held. It is expected that QPM shareholders will receive around 8.4 million Fury Gold common shares which will collectively make them 5% shareholders of the Company. The transaction is expected to close at the end of April 2025. |
| § | On January 9, 2025, the Company issued 590,000 DSU’s to directors and 1,142,500 RSU’s to officers, and employees. The DSU’s and RSU’s were issued in accordance with the Company’s LTI plan (note 18), with a grant-date fair value of $0.55 per unit, one third vesting annually on anniversary and to be paid out as fully paid shares. The Company also approved 80,000 stock options, vesting over 18 months with an exercise price of $0.60 per option, to certain UMS employees. |
| § | On October 4, 2024, the Company further sold 3,000,000 common shares of Dolly Varden at $1.119 per Share for gross proceeds of $3,356, reducing the Company’s percentage of Dolly Varden shares to 16.11% as at December 31, 2024. |
| § | On June 27, 2024, the Company announced the results of its Annual General Meeting (“AGM”) of Shareholders held on June 26, 2024. The Company confirmed that each director nominee listed in the Company’s management information circular dated May 14, 2024, in connection with the AGM were re-elected as directors of the Company, with the exception of Mr. Mason who did not stand for re-election as a director in 2024 and that Deloitte LLP was re-appointed as the Company’s auditor. |
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 7 |
| § | On June 13, 2024, the Company closed the $5M financing announced on May 23, 2024. The Company issued 5,320,000 common shares of the Company that qualify as “flow-through shares” as defined under subsection 66(15) of the Income Tax Act (Canada) and section 359.1 of the Taxation Act (Québec) (the “FT Shares”) at a price of C$0.94 per FT Share for total gross proceeds to the Company of C$5,001. |
| § | On March 12, 2024, the Company sold 5,450,000 common shares of Dolly Varden at $0.735 per Share for gross proceeds of $4,006, thus reducing its position to 19.99% of Dolly Varden, and decreasing its right to one director on Dolly Varden under its Investors Rights Agreement, to which notice have been given. |
| § | On February 29, 2024, the Company increased its interest in Éléonore South to 100% through the acquisition of Newmont’s interest for $3M. As part of the consolidation of Éléonore South, the Company purchased Newmont’s 30,392,372 shares of Canadian junior resource explorer Sirios Resources Inc. (“Sirios”) for $1.3M. These Sirios shares, representing approximately 10.98% of issued Sirios shares at the time, were acquired for investment purposes. |
| § | On January 10, 2024, the Company announced the appointment of Phil van Staden, the current Interim CFO of the Company, to the position of Chief Financial Officer effective as of January 1, 2024. |
Section 4: Projects overview
| 4.1 | Indigenous community relations and environmental |
The pursuit of environmentally sound and socially responsible mineral development guides all of Fury Gold’s activities as the Company understands the broad societal benefits that responsible mining can bring, as well as the risks that must be managed through the implementation of sustainable development practices. The Company strives to maintain the highest standards of environmental protection and community engagement at all its projects.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 8 |
The Company considers sustainability to include the pursuit of four mutually reinforcing pillars: environmental and cultural heritage protection; social and community development; economic growth and opportunity; and cultural intelligence development for all employees. The Company assesses the environmental, social, and financial benefits and risks of all business decisions and believes this commitment to sustainability generates value and benefits for local communities and shareholders alike.
The Company’s approach to Indigenous and stakeholder engagement provides opportunities and benefits through:
| § | the provision of jobs and training programs |
| § | contracting opportunities |
| § | capacity funding for Indigenous engagement |
| § | sponsorship of community events |
| § | supporting professional development opportunities, building cultural and community intelligence capacity. |
The Company places a priority on creating mutually beneficial, long-term relationships with the communities in which it operates. Engagement goals include providing First Nations governments, communities, and residents with corporate and project-related information, including details of work programs, collaborative opportunities, and other activities being undertaken in the field.
During the year ended December 31, 2024, the Company received its Ecologo certification for mineral exploration. Ecologo is the first comprehensive certification for mineral exploration companies and their service providers that features third-party certification of environmental, social and economic practices in Quebec. Additionally, during the third quarter of 2024, the Company renewed its qualitative environmental, social and governance (“ESG”) assessment with Digbee, a technology company which provides qualitative assessment tools to mining companies to track their ESG achievements. Fury Gold received an overall score of BBB with a range of CC to AA broken down into a corporate score of A with a range of BB to A and a project score of BB with a range of CC to AA for both the Eau Claire project. These results are considered strong for an exploration company and the Company continues to evaluate and implement initiatives to improve future scores.
| 4.2 | Quebec |
Fury Gold holds 100% interests in the Eau Claire project as well as interests in seven other properties covering approximately 93,000 hectares within the Eeyou Istchee James Bay region of Quebec. This now includes a 100% interest in the Éléonore South Project. The Eastmain Mine project along with the Ruby Hill East and Ruby Hill West projects are under option to Benz Mining Corp. (“Benz Mining”) whereby Benz Mining has earned a 75% interest in those properties, by completing certain option payments and exploration expenditures, with a further option to increase Benz Mining’s holding to 100% in the Eastmain Mine property upon receipt of a final milestone payment. Benz Mining currently acts as operator and is current with regards to all option payment and expenditure obligations. On December 6, 2024, Ophir Metals Corp. (“Ophir”) provided notice of termination of The Radis project option, this project has returned 100% to the Company with Ophir finalizing the work reporting and claims renewals as required.
| 4.2.1 | Eau Claire |
The Eau Claire project is located immediately north of the Paix Des Braves reservoir, 10km northeast of Hydro Quebec’s EM-1 hydroelectric power facility, 80km north of the town of Nemaska, approximately 320km northeast of the town of Matagami, and 800km north of Montreal. This property consists of map-designated claims totaling approximately 23,000 hectares. These claims are held 100% by Fury Gold and are in good standing. Permits are obtained on a campaign basis for all surface exploration, particularly trenching and drilling, undertaken on the property.
The Eau Claire project is underlain by typical Archean greenstone assemblages of the Eastmain Greenstone Belt, which are composed of volcanic rocks of basaltic to rhyolitic composition and related clastic and chemical sedimentary rocks. These rocks have been intruded by an assemblage of mafic to felsic sills, stocks, and dykes. Metamorphism ranges from upper greenschist to amphibolite facies in the greenstone assemblages, while higher- grade facies, up to granulite level, typically characterize the Opinaca sub-province. Archean-aged deformation affects all rocks on the property. Near the Eau Claire deposit, the volcano-sedimentary assemblage has been folded,
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 9 |
forming a closed antiform plunging gently to the west. Regional rock foliation and lithology are generally east-west in strike with moderate to sub-vertical southerly dips in the vicinity of the Eau Claire gold deposit.
On May 14, 2024, the Company announced that it had received the results of an updated mineral resource estimate for Eau Claire which resulted in the addition of 307koz Au in the Measured and Indicated category (a 36.0% increase) and 223koz Au in the Inferred category (a 44.6% increase). The Eau Claire project now contains a combined mineral resource of 1.16Moz gold (Au) at a grade of 5.64 g/t Au in the Measured and Indicated category as well as an additional 723koz gold at a grade of 4.13 g/t Au in the Inferred Category:
Combined Mineral Resource Estimate for the Eau Claire Project
In 2024, the Company completed plans to drill approximately 3,871 m of Diamond Drilling at the project targeting biogeochemical anomalies within the Percival – Serendipity trend 14km to the east of Eau Claire. The 2024 drill program resulted in the discovery of high-grade gold mineralization at Serendipity with two intercepts: 3m of 12.16 g/t gold and 1m of 5.27 g/t gold separated by over 2 km of prospective stratigraphy. The 2024 drilling cost $1,800.
Percival to Serendipity trend:
The Serendipity Prospect is situated 16 km northeast of the Eau Claire Deposit and 6.5 km north northeast of the Percival Deposit along the Hashimoto Deformation Zone, which is related to the Cannard Deformation Zone, one of the primary controls on gold mineralization within the region. The planned 2024 drilling tested five robust distinct geochemical targets up to 150x background values proximal to the regional scale Hashimoto Deformation Zone within prospective folded stratigraphy across approximately 2 km of strike length. Limited historical drilling near Serendipity intercepted 7.9 m of 1.23 g/t gold; 12.1 m of 1.38 g/t gold and 1.5 m of 4.27 g/t gold.
Fury’s technical team has again proven the effectiveness of drilling biogeochemical anomalies in covered terrain within our project areas and continues to build a better understanding of the combination of pathfinder elements and structural controls on the gold mineralization along the Percival to Serendipity trend. Broad low-grade gold mineralization occurs along well-defined structural splays sub-parallel to the regional Cannard and Hashimoto Deformation Zones. Certain elemental associations, most notably Arsenic, Bismuth, and Tungsten, are proving to be important pathfinders for gold mineralization. Higher-grade gold within the broader corridor is controlled by secondary shearing and is identified by the high degree of silicification and alteration. The proximity of the main Cannard and Hashimoto Deformation Zones varies from one target to the other and Fury believes the varying degrees of deformation are an important control on both gold mineralization and the potential preservation of a sizeable, mineralized body.
The Company expects to incur approximately $35 annually in project maintenance costs, including certain mineral claims payments, in order to keep the properties in good standing in 2025.
Eau Claire resource estimate technical report
The Eau Claire resource estimation was completed by Maxime Dupere, Geologist at SGS Geological Services (“Mineral Resource Estimate Update for the Eau Claire Project, Eeyou Istchee James Bay Region of Quebec, Canada” is dated June 25, 2024, has an effective date of May 10, 2024, and filed on SEDAR+).
A NI 43-101 technical report supporting the updated mineral resource estimate was filed on June 28, 2024.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 10 |
| 4.2.2 | Éléonore South |
On March 1, 2024, Fury Gold completed the purchase of Newmont Corporation’s 49.978% interest in the Éléonore South project for $3,000 consolidating Fury’s interest in the project to 100%.
The Éléonore South property is strategically located in an area of prolific gold mineralization within the Eeyou Istchee James Bay gold camp and is locally defined by Newmont’s Éléonore mine and Sirios Resources’ Cheechoo deposit. Exploration over the past 13 years has largely been focused on the extension of the Cheechoo deposit mineralization within the portion of the Cheechoo Tonalite on the Property. Approximately 27,000m of drilling in 172 drill holes, covering only a small proportion of the property at the Moni and JT prospects has been completed. Notable drill intercepts include 53.25m of 4.22 g/t gold (Au); 6.0m of 49.50 g/t Au including 1.0m of 294 g/t Au and 23.8m of 3.08 g/t Au including 1.5m of 27.80 g/t Au.
On March 5, 2024, the Company announced that it has identified a robust biogeochemical gold anomaly within the same sedimentary rock package that hosts Newmont’s Éléonore Mine at the Éléonore South project. The orientation level biogeochemical sampling survey was designed to target an interpreted fold nose within the Low Formation sediments in an area where conventional soil or till sampling was not possible due to the ground conditions. The targeted area exhibited similar geological, geophysical, and structural characteristics to those present at the nearby Éléonore Mine. The identified anomaly is up to 200x the background value in gold and outlines the folded sedimentary package.
On March 20, 2024, Fury announced its intention to commence diamond core drilling operations at the Éléonore South gold project. The diamond drilling program commenced in late March and will comprise approximately 2,000 metres (m) focussed on the Moni showing trend where previous drilling intercepted up to; 53.25 m of 4.22 g/t gold (Au); 6.0 m of 49.50 g/t Au including 1.0 m of 294 g/t Au and 23.8 m of 3.08 g/t Au including 1.5 m of 27.80 g/t Au, several of which remain open.
On June 4, 2024, Fury announced the results from its Spring 2024 diamond core drilling program at the Éléonore South gold project. The Spring 2024 diamond drilling program comprised 2,331.4 m completed in seven diamond drill holes testing 2.3 km of strike along the JT – Moni Trend. The drilling targeted 100 to 125 m downdip extensions from historical drilling. All seven drill holes intercepted anomalous gold mineralization including 137.5 m of 0.44 g/t gold and 18.7 m of 0.97 g/t from drill hole 24ES-161, 115.5 m of 0.50 g/t gold from drill hole 24ES-162 and, 28.0 m of 0.47 g/t gold from drill hole 24ES-160. The limited drilling completed confirms that the gold mineralization hosted within the Cheechoo tonalite remains open.
On October 7, 2024, the Company announced the discovery of high-grade lithium outcrop on the western claim block of its 100% owned Éléonore South project in the Eeyou Istchee Territory in the James Bay region of Quebec. The outcrop sampling program targeted the historical Fliszar showing lepidolite bearing pegmatite as well as new rock exposures over an area of approximately 1000 x 500 metres (m) resulting in the collection of 34 samples. Seven samples returned high-grade values above 1.75% lithium oxide (Li2O) with a peak value of 4.67% Li2O. The Company’s focus remains on the gold prospectivity of the Éléonore South project; however, the announced lithium results provide additional exploration targets as the overall project is advanced.
On November 12, 2024, the Company announced the finalization of drill targeting at the Éléonore South gold project in the Eeyou Istchee Territory in the James Bay Region of Quebec. Drilling will target robust geochemical gold anomalies within the same sedimentary rock package that hosts Newmont’s Éléonore Mine. The completed biogeochemical sampling survey covered an interpreted fold nose within the Low Formation sediments where an orientation level study identified a large-scale gold anomaly in a similar geological, geophysical, and structural setting to that of the nearby Éléonore Mine. Six priority drill targets across over 3 kilometres (km) of prospective folded sedimentary stratigraphy have been identified. These six targets encompass multi point gold anomalies above the 90th percentile of the data and correlate with moderate pathfinder elemental anomalies, most notably arsenic which is associated with gold mineralization at the Éléonore Mine. The Company has mobilized crews during February 2025 for an initial fully funded 3,000 – 5,000 metre (m) diamond drilling program.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 11 |
On February 3, 2025, the Company announced the commencement of a diamond drilling program on the greenfield exploration Éléonore South gold project located in the Eeyou Istchee Territory in the James Bay region of Northern Quebec. Drilling will target robust multi-faceted geological, geophysical, and geochemical gold anomalies within the same sedimentary rock package that hosts the Éléonore Mine. The fully funded first phase drilling campaign will comprise approximately 4,000 – 6,000 metres (m) targeting an interpreted fold nose within the Low Formation sediments. Within the prospective folded stratigraphy are six undrilled priority targets spanning over 3 kilometres (km) of strike length that have been identified through a combination of biogeochemical sampling and interpretation of magnetics and electromagnetics survey data. The first phase of drilling will be focused within a northwest- southeast structural corridor where a strong correlation between anomalous gold, stratigraphy, and structure has been identified. The drill targets occur in a structurally complex setting with little to no outcrop exposure and the targeting model will evolve with each hole drilled. The Company plans to complete approximately 15 of the 77 permitted drill holes as part of the first phase of drilling and will guide additional drilling based on the results and observations from this phase.
In addition to the Éléonore style biogeochemical targets several gold in-till anomalies remain undrilled throughout the project. These gold in-till anomalies have similar geological and geochemical characteristics to the Cheechoo style of mineralization.
The Company expects to incur approximately $35 annually in project maintenance costs, including certain mineral claims payments, in order to keep the properties in good standing in 2025.
| 4.3 | Nunavut |
Committee Bay and Gibson MacQuoid
The Committee Bay project comprises approximately 250,000 hectares situated along the Committee Bay Greenstone Belt located 180km northeast of the Meadowbank mine operated by Agnico Eagle Mines Limited. The Committee Bay belt comprises one of a number of Archean-aged greenstone belts occurring within the larger Western Churchill province of northeastern Canada. The Committee Bay project is held 100% by the Company, subject to a 1% Net Smelter Return (“NSR”), and an additional 1.5% NSR payable on only 7,596 hectares which may be purchased within two years of the commencement of commercial production for $2,000 for each one-third (0.5%) of the NSR.
On October 24, 2024, the Company announced the results from the summer exploration program at its 100% Committee Bay project in the Kitikmeot Region of Nunavut. The 2024 exploration program defined three drill ready shear zone hosted targets advanced through a combination of till sampling, rock sampling and geological mapping:
| o | Three Bluffs Shear, where drilling in 2021 intercepted 13.93 g/t Au over 10 metres (m) (see news release dated December 1, 2021); |
| o | Raven Shear where 7 rock samples have averaged 16.12 g/t gold; and |
| o | Burro West where a 300 by 300 m discrete >90th percentile gold in till anomaly has been defined with a peak value of 50 ppb gold. |
The Company expects to incur approximately $160 in annual mineral claims expenditures in 2025, in order to keep the property in good standing. Payments totalling $157 were made during the year ended December 31, 2024, in respect of these mineral claims.
Committee Bay resource estimate and technical report
Three Bluffs resource estimations were completed by APEX Geoscience Ltd. (“APEX”) (see the Technical Report on the Committee Bay Project, Nunavut Territory, Canada, dated September 11, 2023, and filed under Fury’s SEDAR+ profile). It supersedes prior all previous Committee Bay technical reports.
Section 5: Review of annual financial information
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Net (earnings) loss | 108,138 | 17,213 | (24,908 | ) | ||||||||
| Total comprehensive (income) loss | 108,141 | 17,219 | (24,905 | ) | ||||||||
| Basic and diluted (earnings) loss per share | $ | 0.73 | $ | 0.12 | $ | (0.18 | ) | |||||
| Total assets | 85,112 | 189,175 | 200,599 | |||||||||
| Total non-current financial liabilities | - | 74 | 227 | |||||||||
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 12 |
| 5.1 | Year ended December 31, 2024, as compared to the years ended December 31, 2023 and 2022 |
During the year ended December 31, 2024, the Company reported a total net loss of $108,138 and loss per share of $0.73 compared to a total net loss of $17,213 and loss per share of $0.12 for the year ended December 31, 2023, and total net earnings of $24,908 and earnings per share of $0.18 for the year ended December 31, 2022.
The significant increase in net loss was primarily due to impairment expenses of $100,873 assessed on the Company’s mineral properties interests. Additionally, other significant changes were as follows:
Operating expenses:
| § | Exploration and evaluation costs decreased from $9,217 for the year ended December 31, 2022, compared to $9,311 for the year ended December 31, 2023, and $5,512 for the year ended December 31, 2024, The decrease resulted from a break between programs in 2024, after the initial Elenore South drill program that commenced in March wrapped up; the program at Eau Claire only started during the last part of June and concluded mid-August. In comparison, during 2023, the program started at the end of March, but had to shut down during most of June due to the wildfires but was still active until the end of 2023; |
| § | Fees, salaries, and other employment benefits decreased to $2,202 for the year ended December 31, 2024, compared to $2,630 for the year ended December 31, 2023, and $3,199 for the year ended December 31, 2022, primarily due to a combination of lower share-based compensation and a decrease in headcount in 2024; and |
| § | Insurance expense decreased from $728 for the year ended December 31, 2022, to $646 for the year ended December 31, 2023, to $522 for the year ended December 31, 2024, primarily due to negotiated fees that resulted in overall lower insurance premiums. |
Other expenses (income), net:
| § | An impairment expense of $5,506 for the year ended December 31, 2022, arose from the sale of the 17 million common shares of Dolly Varden. There was no similar transaction in the year ended December 31, 2023, while $100,873 impairment expense for the year ended December 31, 2024, arose from the assessment of the Company’s mineral property interests; |
| § | Net loss from associates decreased to $3,858 for the year ended December 31, 2024, compared to $6,182 for the year ended December 31, 2023, and $5,880 for the year ended December 31, 2022, primarily due to Dolly Varden's net loss significantly decreasing from the prior year. In addition, the Company’s decreased ownership of Dolly Varden compared to 2023 and 2022 also lowered the attributed loss portion; |
| § | Gain on investments of $4,109 for the year ended December 31, 2024, was a result of the Company’s disposition of Dolly Varden shares in the current year, combined with the dilution gain, whereas there was no comparable transaction in the prior years; |
| § | Net gain from marketable securities for the year ended December 31, 2024, compared to net loss from marketable securities in 2023 and 2022 was due to an increase in fair value of securities held in 2024 compared to the fair value of securities held that plummeted in 2023; and |
| § | Amortization of flow-through share premium of $1,621 for the year ended December 31, 2024, compared to $3,345 for the year ended December 31, 2023, and $3,124 for the year ended December 31, 2022, reflected the smaller program at Eau Claire and Éléonore South in 2024 compared to prior years. |
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 13 |
Section 6: Review of quarterly financial information
| Three months ended: | Interest income | Net Loss (earnings)(1) | Comprehensive (income) loss(1) | Loss (earnings) per share ($/share) | ||||||||||||
| December 31, 2024 | $ | 60 | $ | 101,256 | $ | 101,257 | $ | 0.68 | ||||||||
| September 30, 2024 | 75 | 2,673 | 2,673 | 0.02 | ||||||||||||
| June 30, 2024 | 82 | 3,496 | 3,497 | 0.02 | ||||||||||||
| March 31, 2024 | 82 | 714 | (1) | 715 | 0.01 | |||||||||||
| December 31, 2023 | 119 | 4,609 | 4,612 | 0.03 | ||||||||||||
| September 30, 2023 | 162 | 6,650 | 6,649 | 0.05 | ||||||||||||
| June 30, 2023 | 188 | 3,293 | 3,296 | 0.02 | ||||||||||||
| March 31, 2023 | 121 | 2,661 | 2,662 | 0.02 | ||||||||||||
| December 31, 2022 | 112 | 2,871 | 2,872 | 0.03 | ||||||||||||
| September 30, 2022 | 67 | 12,280 | 12,282 | 0.09 | ||||||||||||
| June 30, 2022 | 45 | 5,577 | 5,577 | 0.04 | ||||||||||||
| March 31, 2022 | 4 | (45,636 | ) | (45,636 | ) | (0.36 | ) | |||||||||
(1) Certain periods have been restated within this document to correct a misstatement which was identified in the fourth quarter of 2024. See section 6.2 below for details
| 6.1 | Three months ended December 31, 2024, compared to three months ended December 31, 2023 and 2022 |
During the three months ended December 31, 2024, the Company reported net loss of $101,261 and loss per share of $0.68 compared to a net loss of $4,609 and loss per share of $0.03 for the three months ended December 31, 2023, and a net loss of $2,871 and loss per share of $0.03 for the three months ended December 31, 2022. The significant drivers of the change in total net loss were as follows:
Operating expenses:
| § | Exploration and evaluation costs decreased to $720 for the three months ended December 31, 2024 compared to $2,784 for the three months ended December 31, 2023, and $1,346 for the three months ended December 31, 2022. The higher exploration expense in the fourth quarter of 2023 was a result of the Quebec wildfires in summer of 2023, which compelled us to postpone some of the work and the site continued operating until the end of November. Due to this, certain assaying costs were also postponed into the last quarter; |
| § | Fees, salaries, and other employment benefits decreased to $685 for the three months ended December 31, 2024, compared to $788 for the three months ended December 31, 2023, and $897 for the three months ended December 31, 2022, primarily due to lower share based compensation; and |
| § | Office and administration increased to $181 for the three months ended December 31, 2024, compared to $99 for the three months ended December 31, 2023, and $111 for the three months ended December 31, 2022, as a result of expenses related to an executive compensation review and some community engagement and recruitment fees. |
Other (income) expense, net:
| § | $100,873 impairment expense for the three months ended December 31, 2024, arose from the fair value assessment of the Company’s mineral property interests, compared to $nil for the three months ended December 31, 2023, and $13 for the three months ended December 31, 2022, that arose from the sale of 17M Dolly Varden shares; |
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 14 |
| § | Gain on investments of $1,599 for the three months ended December 31, 2024, was a result of the Company’s disposition of Dolly Varden shares during the period, whereas there was no comparable transaction in the prior years; |
| § | Net gain on marketable securities of $182 for the three months ended December 31, 2024, compared to a net loss of $1,024 for the three months ended December 31, 2023, and net gain of $166 for the three months ended December 31, 2022, primarily due to the downturn in market value of certain securities within the lithium exploration space of which the Company had significant additions in 2023 through mineral property agreements; and |
| § | Amortization of flow-through share premium decreased to $215 for the three months ended December 31, 2024, compared to $1,123 for the three months ended December 31, 2023, and $234 for the three months ended December 31, 2022, was a result of the increased activity at sites in 2023 compared to the last quarters of 2024 and 2022. The wildfires in 2023 caused the work to get pushed back until the end of November, which in turn created a higher flow-through expenditure in Q4 2023. Moreover, in 2022, the flow-through liability balance was extinguished at the beginning of Q4, and minimum work was performed during Q4 2024. |
| 6.2 | Revision of Prior Period Financial Statements |
In preparing the consolidated financial statements for the year ended December 31, 2024, the Company identified an error in its previously issued unaudited consolidated quarterly financial statements for the periods ended March 31, 2024 and September 30, 2024. The error resulted in a misstatement of gain/loss on investments and investments in associates relating to the Company’s investment in Dolly Varden, specifically an understatement of dilution gain on the consolidated statement of (earnings) loss and comprehensive (income) loss, as well as an understatement of our investment in associate balance on the statement of financial position. The impact of the revisions to the periods presented in this report are as follows:
| As reported | Adjustment | Revised | ||||||||||
| Revised Statement of financial position as of March 31, 2024 | ||||||||||||
| Investment in Associates | 32,638 | 220 | 32,858 | |||||||||
| Total assets | 188,023 | 220 | 188,243 | |||||||||
| Deficit | (149,988 | ) | 220 | 149,768 | ||||||||
| Total equity | 182,356 | 220 | 182,576 | |||||||||
| Revised Consolidated Statements of Loss and Comprehensive Loss for the three months ended March 31, 2024 | ||||||||||||
| Gain on Investments | - | (220 | ) | (220 | ) | |||||||
| Net loss | 934 | (220 | ) | 714 | ||||||||
| Total comprehensive loss | 935 | (220 | ) | 715 | ||||||||
| Revised Statement of financial position as of September 30, 2024 | ||||||||||||
| Investment in Associates | 29,341 | 1,780 | 31,121 | |||||||||
| Total assets | 184,099 | 1,780 | 185,879 | |||||||||
| Deficit | (157,932 | ) | 1,780 | (156,152 | ) | |||||||
| Total equity | 177,526 | 1,780 | 179,306 | |||||||||
| Revised Consolidated Statements of Loss and Comprehensive Loss for the three months ended September 30, 2024 | ||||||||||||
| Gain on Investments | - | (1,780 | ) | (1,780 | ) | |||||||
| Net loss | 4,453 | (1,780 | ) | 2,673 | ||||||||
| Total comprehensive loss | 4,453 | (1,780 | ) | 2,673 | ||||||||
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 15 |
| Revised Consolidated Statements of Loss and Comprehensive Loss for the nine months ended September 30, 2024 | ||||||||||||
| Gain on Investments | (538 | ) | (2,000 | ) | (2,538 | ) | ||||||
| Net loss | 8,881 | (2,000 | ) | 6,881 | ||||||||
| Total comprehensive loss | 8,883 | (2,000 | ) | 6,883 | ||||||||
Section 7: Financial position, liquidity, and capital resources
| As at and for the year ended: | December 31 2024 | December 31 2023 | December 31 2022 | |||||||||
| Cash | $ | 4,912 | $ | 7,313 | $ | 10,309 | ||||||
| Restricted cash | 144 | 144 | 144 | |||||||||
| Marketable securities | 2,358 | 1,166 | 582 | |||||||||
| Other investments (1) | 2,063 | - | - | |||||||||
| Other assets | 979 | 1,665 | 1,944 | |||||||||
| Mineral property interests | 45,200 | 142,639 | 145,190 | |||||||||
| Investments in associates | 29,456 | 36,248 | 42,430 | |||||||||
| Current liabilities | 1,864 | 1,732 | 1,308 | |||||||||
| Non-current liabilities | 5,045 | 4,569 | 4,498 | |||||||||
| Working capital surplus (2) | 8,045 | 7,713 | 10,554 | |||||||||
| Accumulated deficit | 257,192 | 149,054 | 131,841 | |||||||||
| Cash used in operating activities | (8,073 | ) | (13,060 | ) | (14,012 | ) | ||||||
| Cash provided by investing activities | 1,395 | 2,446 | 10,435 | |||||||||
| Cash provided by financing activities | 4,277 | 7,624 | 10,629 | |||||||||
(1) Investment in unlisted shares of Alsym Energy Inc.
(2) Defined as total current assets less total current liabilities
| 7.1 | Cash flows |
During the year ended December 31, 2024, the Company used cash of $8,073 in operating activities compared to $13,060 in 2023 and $14,012 in 2022. The cash outflow for 2024 was lower primarily due to lower exploration activities and lower employee costs compared to 2023 and 2022.
During the year ended December 31, 2024, the Company generated cash from investing activities of $1,394, representing proceeds from the sale of some Dolly Varden shares, partially offset by the acquisition of mineral interests, marketable securities, and other investments. During the year ended December 31, 2023, the Company generated cash from investing activities of $2,446, primarily representing option payment received, interest income, and proceeds from the sale of marketable securities. During the year ended December 31, 2022, the Company generated cash from investing activities of $10,435, primarily arising from the sale of the Dolly Varden shares in October 2022 and the net cash proceeds of $4,479 from the Dolly Varden Transaction in February 2022, offset in part by the acquisition cost of the additional ESJV interest.
For the year ended December 31, 2024, cash provided by financing activities of $4,278 primarily represented the net proceeds received in respect of the June 2024 financing (see section 7.4). For the year ended December 31, 2023, cash provided by financing activities of $7,624 primarily represented the net proceeds received in respect of the March 2023 financing. For the year ended December 31, 2022, cash provided by financing activities of $10,629 primarily represented the net proceeds received in respect of the April 2022 financing.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 16 |
| 7.2 | Contractual commitments |
In the normal course of business, the Company enters into contracts that give rise to commitments for future minimum payments. The following table summarizes the remaining contractual maturities of the Company’s financial liabilities and commitments as at December 31, 2024, shown in contractual undiscounted cashflows:
| Within 1 year | 2 to 3 years | Over 3 years | At December 31 2024 | |||||||||||||
| Accounts payable and accrued liabilities | $ | 855 | $ | - | $ | - | $ | 855 | ||||||||
| Quebec flow-through expenditure requirements | 944 | - | - | 955 | ||||||||||||
| Undiscounted lease payments | 65 | - | - | 65 | ||||||||||||
| Total | $ | 1,864 | $ | - | $ | - | $ | 1,864 | ||||||||
The Company also makes certain payments arising on mineral claims and leases on an annual or bi-annual basis to ensure all the Company’s properties remain in good standing. The Company estimates that $361 of payments arising on mineral claims and leases will be payable during the year ended December 31, 2025.
In addition, the Company is committed to certain office rental expense in respect of shared head office premises as noted in section 9.
| 7.3 | Summary of mineral property interests |
A summary of the carrying amounts of the Company’s mineral property interests is as follows:
| Quebec | Nunavut | Total | ||||||||||
| Balance at December 31, 2022 | $ | 125,656 | $ | 19,534 | $ | 145,190 | ||||||
| Option payment received | (880 | ) | - | (880 | ) | |||||||
| Disposition | (1,746 | ) | - | (1,746 | ) | |||||||
| Change in estimate of provision for site reclamation and closure | (52 | ) | 127 | 75 | ||||||||
| Balance at December 31, 2023 | $ | 122,978 | $ | 19,661 | $ | 142,639 | ||||||
| Additions(a) | 3,030 | - | 3,030 | |||||||||
| Change in estimate of provision for site reclamation and closure | (23 | ) | 427 | 404 | ||||||||
| Impairment | (88,885 | ) | (11,988 | ) | (100,873 | ) | ||||||
| Balance at December 31, 2024 | $ | 37,100 | $ | 8,100 | $ | 45,200 | ||||||
(a) On February 29, 2024, the Company, and its joint operation partner Newmont, through their respective subsidiaries, closed a transaction whereby the Company acquired 100% control of the joint operation interests, the Éléonore South project, consolidating these properties into the Company’s portfolio at which time the joint venture operation was dissolved. The 49.978% that Newmont held was acquired by the Company for $3,000 while incurring $30 in transaction costs. As part of the same transaction, the Company also acquired a 10.9% interest in Sirios.
On December 12, 2022, the Company entered into an Option Agreement (“the Ophir Agreement”), pursuant to which Ophir Gold Corp. (the “Optionee”) would acquire a 100% interest in the Radis Property through payment of certain cash and common shares over a three-year period, payments of which may be accelerated by the Optionee. The Company retains a 2% NSR on the property, three-quarters of which may be purchased by the Optionee for $1,500. The Agreement was subject to certain closing conditions, which were met on January 25, 2023. The first option payment, comprising a cash payment of $50 and 2,500,000 common shares of Ophir Gold with a fair value of $625, was received upon closing. The second option payment was received during December 2023 comprising of $75 cash and 1,000,000 common shares with a fair value of $130 upon date of receipt. The common shares of Ophir Gold have been classified as marketable securities. During November 2024, prior to the receipt of the third option payment, the Optionee informed the Company that it is terminating the agreement.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 17 |
On August 16, 2023, the Company entered into a royalty extinguishment agreement whereby certain Eastmain net smelter royalties of the Mia project were extinguished in exchange for marketable securities to the value of $468 as at the date of the agreement.
In November 2023, the Company received the final option payment of $1,725, comprising of $1,350 cash and 1,237,216 shares with a fair value upon date of receipt of $396, from Benz Mining in respect of the option agreement to acquire 75% of the Eastmain Mine and Ruby Hill properties (year ended December 31, 2022 - $310 cash). The transfer of the 75% ownership was accepted by the Resource Minister of Quebec on January 17, 2025.
On February 29, 2024, the Company, and its joint operation partner Newmont, through their respective subsidiaries, closed a transaction whereby the Company acquired 100% control of the joint operation interests, the Éléonore South project, consolidating these properties into the Company’s portfolio at which time the joint venture operation was dissolved. The 49.978% that Newmont held was acquired by the Company for $3,000 while incurring $30 in transaction costs. As part of the same transaction, the Company also acquired a 10.9% interest in Sirios for $1,300 which is held as marketable securities.
The Company’s market capitalization has persistently been below the carrying value of its mineral properties over the last few years, and, as a consequence, the Company engaged a third-party valuation specialist to conduct a review to determine a more reflective carrying value. As a result, the report recommended an impairment charge to these properties to better align with the market capitalization value.
| 7.4 | Capital resources |
The Company proactively manages its capital resources and makes adjustments in light of changes in the economic environment and the risk characteristics of the Company’s assets. To effectively manage its capital requirements, the Company has in place a budgeting and cash management process to help determine the funds required to ensure the Company has the appropriate liquidity to meet its current project plans and achieve its growth objectives. The Company ensures that there is sufficient liquidity available to meet its short-term business requirements, including contractual commitments, taking into account its anticipated cash outflows from exploration activities and its holdings of cash and marketable securities. The Company monitors and adjusts, when required, these exploration programs as well as corporate administrative costs to ensure that adequate levels of working capital are maintained.
As at the date of this MD&A, the Company expects its existing capital resources to support certain planned activities for the next 12 months at the Eau Claire and Éléonore South projects and short-term contractual commitments. The Company’s ability to undertake further project expansionary plans is dependent upon the Company’s ability to obtain adequate financing in the future. While the Company has been successful at raising capital in the past, there can be no assurance that the Company will have sufficient financing to meet its future capital requirements or that additional financing will be available on terms acceptable to the Company in the future.
June 2024 financing
In June 2024 the Company issued 5,320,000 flow-through shares for gross proceeds of $5,001 (“June 2024 Offering”). Share issue costs related to the June 2024 Offering totaled $533, which included $300 in commissions and $233 in other issuance costs. The proceeds of the June 2024 Offering will be used for the Company’s exploration program in Quebec.
March 2023 financing
On March 23, 2023, the Company completed a bought deal private placement financing. At the close of the financing, the Company issued 6,076,500 flow-through shares of the Company for total gross proceeds to the Company of $8,750. The proceeds of the financing will be used to advance the Company’s exploration projects in Quebec. Share issue costs totaled $912.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 18 |
April 2022 financing
On April 14, 2022, the Company completed a non-brokered private placement with two investors comprised of a Canadian corporate investor and a US institutional investor, for a Private Placement of 13.75 million common shares of the Company at a price of $0.80 per share for gross proceeds of $11,000. Proceeds from the Private Placement will be used to fund continued exploration at the Company’s Eau Claire project in Quebec. Share issue costs totaled $136.
Reconciliation of use of funds of 2023-2024 Fundings
Fury’s stated use of proceeds for the June 2024 financing were for (i) exploration at Eau Claire, (ii) Geochemical sampling and exploration at Éléonore South. Fury’s stated use of proceeds for the March 2023 financing were for (i) exploration at Eau Claire, (ii) regional exploration at the Percival prospect, and (iii) exploration for the Éléonore South Joint Venture. The funds raised and the application of these funds and working capital is summarized below.
| Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | |||||||||||||||||||||||||
| Eau Claire Exploration | - | (1,620 | ) | (3,660 | ) | (2,570 | ) | (76 | ) | (456 | ) | (1,773 | ) | (626 | ) | |||||||||||||||||
| G&A expenditures | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||
| Total | - | (1,620 | ) | (3,660 | ) | (2,570 | ) | (76 | ) | (456 | ) | (1,773 | ) | (626 | ) | |||||||||||||||||
| Amount raised | 7,926 | - | - | - | - | 4,565 | - | - | ||||||||||||||||||||||||
| 2023 remaining to be spent | 7,926 | 6,306 | 2,646 | 76 | - | - | - | - | ||||||||||||||||||||||||
| 2024 remaining to be spent | - | - | - | - | - | 4,109 | 2,336 | 1,710 | ||||||||||||||||||||||||
The Company use of funds for the 2023-2024 financings is summarized below:
|
Financing
|
Intended Use of Funds ($,000)
|
Actual Use of Proceeds
|
Variance and Impact on Business Objectives and Milestones
|
|
June 2024 Financing:
· Issuance of 5,320,000 “flow-through” Common Shares for net proceeds of $4,565
|
· $2,500 for exploration on Eau Claire Project
· $2,000 to $2,500 for exploration at Éléonore South
|
Work commenced at Eau Claire at the end of Q2 2024 while drilling at Elenore South commenced in February 2025 | No variance. Planned exploration programs are to be completed in subsequent fiscal quarters. |
|
March 2023 Financing:
· Issuance of 6,076,500 “flow-through” Common Shares for net proceeds of $7,926
|
· $3,000 to $5,000 for exploration on Eau Claire Project
· $2,500 to $3,500 for regional exploration at the Percival prospects
· $1,000 for exploration at the Éléonore South Joint Venture
|
Applied to exploration for the Eau Claire Project, regional projects and Éléonore South. | No variance. Planned exploration programs were completed in line with its intended use for the various projects. |
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 19 |
Exercise of share options and warrants
During the year ended December 31, 2024, there were no exercises of share options and warrants. As at December 31, 2024, the share options and warrants outstanding were as follows:
| Share options outstanding | Share options exercisable | |||||||||||||||||||||||
| Exercise price ($/option) | Number of shares | Weighted average exercise price ($/option) | Weighted average remaining life (years) | Number of shares | Weighted average exercise price ($/option) | Weighted average remaining life (years) | ||||||||||||||||||
| $0.53 – $1.00 | 3,900,506 | 0.82 | 2.74 | 3,776,631 | 0.83 | 2.69 | ||||||||||||||||||
| $1.00 – $1.85 | 2,800,672 | 1.09 | 2.03 | 2,800,672 | 1.09 | 2.03 | ||||||||||||||||||
| $2.05 | 1,520,000 | 2.05 | 0.8 | 1,520,000 | 2.05 | 0.8 | ||||||||||||||||||
| 8,221,178 | 1.14 | 2.14 | 8,097,303 | 1.15 | 2.11 | |||||||||||||||||||
The number of share purchase warrants outstanding at December 31, 2024 was as follows:
| Warrants outstanding | Exercise price ($/share) | |||||||
| Outstanding, December 31, 2022 and 2023 | 7,461,450 | $ | 1.20 | |||||
| Expired | (7,461,450 | ) | 1.20 | |||||
| Outstanding, December 31, 2024 | - | - | ||||||
As at March 31, 2025, there were 8,301,178 share options with a weighted average exercise price of $1.14 and nil warrants outstanding.
| 7.5 | Capital structure |
Authorized: Unlimited common shares without par value. Unlimited preferred shares – nil issued and outstanding.
Number of common shares issued and outstanding as at December 31, 2024: 151,556,273
Number of common shares issued and outstanding as at March 31, 2025: 151,938,300
| 7.6 | Planned Exploration Activities |
The Company is still in the process of finalizing its final 2025 exploration programs while completing its first program at Éléonore South in the first half of 2025. The drill program commenced at the beginning of February 2025 and is testing 6 priority geochemical targets. The following work has been budgeted for the next 12 months:
| Exploration Program | Projected Cost |
|
Éléonore South: · Exploration Program: completion of a 4,000m – 6,000m drill program targeting an interpreted fold nose within the Low Formation sediments at Éléonore South. · Objective: Maiden drill program to test 6 priority geochemical targets to determine their potential to host significant gold mineralization while continuing to advance other targets and prospects to the drill stage. |
2,500 |
As at December 31, 2024, the Company had working capital surplus of approximately $8 million, which the Company defines as total current assets less total current liabilities including a cash balance of $4.9 million (which excludes $0.1 million of restricted cash). As of the date of this MD&A, the Company's working capital is estimated to have declined by approximately $2 million since December 31, 2024, to pay for general corporate costs. The Company does not include its shares in Dolly Varden (current market value $53 million) in working capital because it accounts for these shares as an affiliated entity. The Dolly Varden shares are eligible for sale and there is a reasonably liquid market for them.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 20 |
| 7.7 | Impairment of Mineral Properties |
As required under IFRS Accounting Standards as issued by the IASB, we regularly assess whether impairment indicators are present and perform impairment testing as required.
In accordance with the Company’s accounting policies and processes, each asset or CGU is evaluated annually, to determine whether there are any indications of impairment or impairment reversal. If any such indications of impairment exist, a formal estimate of the recoverable amount is performed. Given the Company’s persistent lower market capitalization compared to its mineral properties carrying value, the Company engaged a third-party valuation specialist, in consultation with management, to assess the recoverability of the carrying value of the Company’s properties. The Company assessed the recoverable value of the CGUs based on its fair value less cost of disposal (“FVLCD”).
The Company utilized a market approach, which takes into account valuations of similar public companies and comparable transactions, to determine a recoverable amount. The recoverable amount was calculated using in situ multiples identified through independent research. This analysis along with specific attributes of the Eau Claire and Committee Bay Project was used as the basis of determining a reasonable per ounce valuation for these to projects. The Éléonore South Project which does not yet have a Mineral Resource Estimate, was valued through a primary market approach, based on its recent acquisition by the Company. The CGUs were categorised within the Level 3 of the fair value hierarchy, using a combination of inputs other than quoted prices which were observable and unobservable to determine the fair value of the assets.
Based on the Company’s assessment with respect to possible indicators of impairment, the Company concluded that as at December 31, 2024 impairment indicators exist and based on the impairment analysis performed, an impairment on its Eau Claire project of $89,263 and Committee Bay project of $11,610 totaling $100,873 was recorded. Estimating the in-situ multiples requires a significant management judgement due to the high degree of estimation uncertainty. Changes in the inputs used to determine the recoverable amount will result in a change to the valuation of the mineral properties and impairment expense. A 15% change in the in-situ values used, would give rise to a 13% change in the mineral properties values.
The result of the impairment better aligns the carrying value of these properties to the Company’s market capitalization value as per the guidance of IFRS 6.20(d).
Section 8: Financial risk summary
As at December 31, 2024, the Company’s financial instruments consist of cash, marketable securities, other investments, accounts receivable, deposits, and accounts payable and accrued liabilities. The fair values of these financial instruments, other than the marketable securities and other investments, approximate their carrying values due to their short term to maturity. The Company’s marketable securities, representing investments held in publicly traded entities, were classified as level 1 of the fair value hierarchy and measured at fair value using their quoted market price at period end. The Company’s other investments, representing investments held in private entities, were classified as level 3 of the fair value hierarchy and measured at fair value based on observable inputs.
The Company’s financial instruments are exposed to certain financial risks, primarily liquidity risk, credit risk and market risk, including price risk. Details of the primary financial risks that the Company is exposed to are available in the notes to the Company’s consolidated financial statements for the year ended December 31, 2024.
Section 9: Related party transactions and balances
| 9.1 | UMS |
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 21 |
The Company owns 25% of the shares of Universal Mineral Services Ltd (“UMS “) with the other 75% owned by three other mineral exploration companies. UMS is the private company through which its shareholders, including Fury Gold, share geological, financial, and transactional advisory services as well as administrative services on a full, cost recovery basis. This allows the Company to maintain a more efficient and cost-effective corporate overhead structure by hiring fewer full-time employees and engaging outside professional advisory firms less frequently. The agreement has an indefinite term and can be terminated by either party upon providing 180 days’ notice.
All transactions with UMS have occurred in the normal course of operations, and all amounts owing to or from UMS are unsecured, non-interest bearing, and have no specific terms of settlement, unless otherwise noted.
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Exploration and evaluation costs | $ | 233 | $ | 872 | $ | 590 | ||||||
| General and administration | 307 | 714 | 841 | |||||||||
| Total transactions for the period | $ | 540 | $ | 1,586 | $ | 1,431 | ||||||
The outstanding balance owing at December 31, 2024, was $90 (December 31, 2023 – $103, December 31, 2022 – $240) which is included in accounts payable.
As part of the UMS arrangement, the Company is contractually obliged to pay certain rental expenses in respect of a ten-year office lease entered into by UMS on July 1, 2021. As at December 31, 2024, the Company expects to incur approximately $91 in respect of its share of future rental expense of UMS.
The Company issues share options to certain UMS employees, including key management personnel of the Company (note 19). The Company recognized a share-based compensation recovery of $3 for the year ended December 31, 2024, in respect of share options issued to UMS employees (December 31, 2023 - $317 expense, December 31, 2022 - $483 expense) which is included within employee benefits and exploration and evaluation costs.
| 9.2 | Key management personnel |
Key management personnel include Fury Gold’s board of directors and certain executive officers of the Company, including the Chief Executive Officer and Chief Financial Officer.
The remuneration of the Company’s key management personnel was as follows:
| Years ended December 31 | ||||||||||||
| 2024 | 2023 | 2022 | ||||||||||
| Short-term benefits provided to executives (1) | $ | 1,306 | $ | 1,109 | $ | 1,719 | ||||||
| Directors’ fees paid to non-executive directors | 161 | 289 | 203 | |||||||||
| Share-based payments | 724 | 1,013 | 1,059 | |||||||||
| Total | $ | 2,191 | $ | 2,411 | $ | 2,981 | ||||||
(1) Short-term employee benefits include salaries, bonuses payable within twelve months of the date of the consolidated statement of financial position, and other annual employee benefits.
Section 10: Critical accounting estimates and judgements
The preparation of financial statements in conformity with IFRS Accounting Standards as issued by the IASB requires management to select accounting policies and make estimates and judgments that may have a significant impact on the consolidated financial statements. Estimates are continuously evaluated and are based on management’s experience and expectations of future events that are believed to be reasonable under the circumstances. Actual outcomes may differ from these estimates.
Critical accounting judgments exercised in applying accounting policies, apart from those involving estimates, which have the most significant effect on the amounts recognized in these consolidated financial statements are as follows:
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 22 |
Critical accounting judgments exercised in applying accounting policies, apart from those involving estimates, which have the most significant effect on the amounts recognized in these consolidated financial statements are as follows:
| (a) | Functional currency |
The functional currency for each of the Company’s subsidiaries is the currency of the primary economic environment in which the entity operates. Determination of functional currency may involve certain judgments to determine the primary economic environment and the Company reconsiders the functional currency of its entities if there is a change in events and conditions that determined the primary economic environment.
| (b) | Economic recoverability and probability of future economic benefits of mineral property interests |
Management has determined that the acquisition of mineral properties and related costs incurred, which have been recognized on the consolidated statements of financial position, are economically recoverable. Management uses several criteria in its assessments of economic recoverability and probability of future economic benefit including geological data, scoping studies, accessible facilities, and existing and future permits.
| (c) | Indications of impairment of assets |
Assessments of impairment indicators are performed at the Cash Generating Unit (“CGU”) level and judgment is involved in assessing whether there is any indication that an asset or a CGU may be impaired. The assessment of the impairment indicators involves the application of a number of significant judgments and estimates to certain variables, including metal price trends, exploration plans for properties, and the results of exploration and evaluation to date.
| (d) | Income taxes |
The provision for income taxes and composition of income tax assets and liabilities requires management’s judgment. The application of income tax legislation also requires judgment in order to interpret legislation and to apply those findings to the Company’s transactions.
Credit on duties refundable for loss and refundable tax credits for resource investment
The Company is entitled to a refundable credit on duties of 12% for eligible losses under the Quebec Mining Duties Act and a refundable resource investment tax credit of 38.75% under the Quebec Income Tax Act. These credits are applicable to qualified exploration expenditures on properties located within the province of Quebec. Application for these credits is subject to verification and, as such, they are recognized only when they are received or when a notice of assessment confirming the amount to be paid is issued. During the year ended December 31, 2024, the Company received a refund of $193 (December 31, 2023 – $307, December 31, 2022 – $187) which was classified as income tax recoveries on the consolidated statements of (earnings) loss and comprehensive (income) loss.
| (e) | Determination of control of subsidiaries and joint arrangements |
Judgement is required to determine when the Company has control of subsidiaries or joint control of joint arrangements. This requires an assessment of the relevant activities of the investee, being those activities that significantly affect the investee’s returns (including operating and capital expenditure decision-making, financing of the investee, and the appointment, remuneration, and termination of key management personnel) and when the decisions in relation to those activities are under the control of the Company or require unanimous consent from the investors.
| (f) | Investments in associates |
The Company conducts a portion of its business through equity interests in associates. An associate is an entity over which the Company has significant influence and is neither a subsidiary nor a joint venture. The Company has significant influence when it has the power to participate in the financial and operating policy decisions of the associate but does not have control or joint control over those policy decisions.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 23 |
| (g) | Financial instruments |
Financial instruments are assessed upon initial recognition to determine whether they meet the definition of a financial asset, financial liability, or equity instrument depending on the substance of the contractual arrangement. Judgement is required in making this determination as the substance of a transaction may differ from its legal form. Once a determination is made, IFRS Accounting Standards as issued by the IASB requires that financial instruments be measured at fair value on initial recognition. For financial instruments that do not have quoted market prices or observable inputs, judgements are made in determining what are appropriate inputs and assumptions to use in calculating the fair value.
Key sources of estimation uncertainty that have significant risk of causing a material adjustment to the carrying amount of assets and liabilities are as follows:
| (h) | Reclamation obligations |
Management assesses its reclamation obligations annually and when circumstances suggest that a material change to the obligations have occurred. Significant estimates and assumptions are made in determining the provision for site reclamation and closure because there are numerous factors that will affect the ultimate liability that becomes payable. These factors include estimates of the extent, the timing, and the cost of reclamation activities, regulatory change, cost increases, and changes in discount rates. Those uncertainties may result in actual expenditures differing from the amounts currently provided. The provision at the reporting date represents management’s best estimate of the present value of the future reclamation costs required. Changes to estimated future costs are recognized in the consolidated statements of financial position by adjusting the reclamation asset and liability.
| (i) | Share-based compensation |
The Company determines the fair value of equity-settled share-based payments using the fair value of the equity instruments at the grant date. For options granted, the Company uses the Black-Scholes option pricing model. This option pricing model requires the development of market-based subjective inputs, including the risk-free interest rate, expected price volatility, and expected life of the option. Changes in these inputs and the underlying assumption used to develop them can materially affect the fair value estimate.
| (j) | Deferred tax assets and liabilities |
Management judgment and estimates are required in assessing whether deferred tax assets and deferred tax liabilities are recognized in the consolidated statements of financial position. Judgments are made as to whether future taxable profits will be available in order to recognize deferred tax assets. Assumptions about the generation of future taxable profits depend on management’s estimates of future cash flows. These depend on estimates of future production and sales volumes, commodity prices, reserves, operating costs, and other capital management transactions. These judgments and assumptions are subject to risk and uncertainty, and changes in circumstances may alter expectations which may impact the amount of deferred tax assets and deferred tax liabilities recognized on the consolidated statements of financial position and the benefit of other tax losses and temporary differences not yet recognized.
Section 11: Application of new and revised accounting standards
The Company has adopted the following amended accounting standards and policies effective January 1, 2024:
Amendments to IAS 1 Presentation of Financial Statements — Classification of Liabilities as Current or Non-current
The amendments to IAS 1 published in January 2020 affect only the presentation of liabilities as current or non- current in the statement of financial position and not the amount or timing of recognition of any asset, liability, income or expenses, or the information disclosed about those items.
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 24 |
The amendments clarify that the classification of liabilities as current or non-current is based on rights that are in existence at the end of the reporting period, specify that classification is unaffected by expectations about whether an entity will exercise its right to defer settlement of a liability, explain that rights are in existence if covenants are complied with at the end of the reporting period, and introduce a definition of ‘settlement’ to make clear that settlement refers to the transfer to the counterparty of cash, equity instruments, other assets or services.
There was no impact to the Company’s financial statements for the year ended December 31, 2024, upon adoption.
Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures — Supplier Finance Arrangements
The amendments add a disclosure objective to IAS 7 stating that an entity is required to disclose information about its supplier finance arrangements that enables users of financial statements to assess the effects of those arrangements on the entity’s liabilities and cash flows. In addition, IFRS 7 was amended to add supplier finance arrangements as an example within the requirements to disclose information about an entity’s exposure to concentration of liquidity risk.
There was no impact to the Company’s financial statements for the year ended December 31, 2024, upon adoption.
Amendment to IFRS 16 Leases — Lease Liability in a Sale and Leaseback
The amendments to IFRS 16 add subsequent measurement requirements for sale and leaseback transactions that satisfy the requirements in IFRS 15 to be accounted for as a sale. The amendments require the seller-lessee to determine ‘lease payments’ or ‘revised lease payments’ such that the seller-lessee does not recognise a gain or loss that relates to the right of use retained by the seller-lessee, after the commencement date.
There was no impact to the Company’s financial statements for the year ended December 31, 2024, upon adoption.
New and amended standards not yet effective:
The following new and amended standards, which are not yet effective, have not been applied by the Company in these financial statements.
Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7)
The IASB has issued 'Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7)' to address matters identified during the post-implementation review of the classification and measurement requirements of IFRS 9 'Financial Instruments'. The amendments include changes to derecognition of a financial liability settled through electronic transfer, classification of financial assets, and disclosures, and are effective for reporting periods beginning on or after January 1, 2026. The Company is currently evaluating the impact of the new standard on its financial statements.
IFRS 18 Presentation and Disclosures in Financial Statements
In April 2024, the IASB issued a new standard which replaces IAS 1. IFRS 18 Presentation and Disclosure in Financial Statements carries forward many requirements in IAS 1 and complements them with new requirements. IFRS 18 includes requirements for all entities applying IFRS Accounting Standards as issued by the IASB for the presentation and disclosure of information in financial statements. The new standard applies to annual reporting period beginning on or after January 1, 2027. The Company is currently evaluating the impact of the new standard on its financial statements.
Section 12: Controls and procedures
Internal control over financial reporting (“ICFR”)
Internal control over financial reporting includes those policies and procedures that:
| o | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; |
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 25 |
| o | provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with IFRS Accounting Standards as issued by the IASB, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and |
| o | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company assets, or incurring liabilities or other obligations that could have a material effect on the consolidated financial statements. |
It is management’s responsibility to establish and maintain adequate ICFR to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with IFRS Accounting Standards as issued by the IASB.
Management evaluated the design and operating effectiveness of the Company’s internal control over financial reporting based on the criteria established in the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on that evaluation, the CEO and CFO concluded that such ICFR were not effective at the reasonable assurance level as of December 31, 2024.
Disclosure controls and procedures
Disclosure controls and procedures (“DC&P”) are designed to provide reasonable assurance that information required to be disclosed in reports filed with, or submitted to, securities regulatory authorities is recorded, processed, summarized and reported within the time periods specified under Canadian and U.S. securities laws. As of December 31, 2024, an evaluation was carried out under the supervision of, and with the participation of, the Company's management, including the CEO and CFO, of the effectiveness of the Company's DC&P, as defined in the applicable Canadian and U.S. securities laws. Based on that evaluation, the CEO and CFO concluded that such DC&P were not effective at the reasonable assurance level as of December 31, 2024, due to the material weakness in our internal control over financial reporting as described below.
Material Weakness in Internal Control Over Financial Reporting
A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.
In the fourth quarter of 2024, management determined that we had a material weakness in our internal control over financial reporting and disclosure controls and procedures related to the review of complex accounting transactions outside of the normal course of the Company’s operations. Specifically, we did not design and maintain controls to timely analyze and account for dilution gains or losses resulting from changes in ownership in associates accounted for using the equity method.
This control deficiency resulted in a misstatement of gain on investments and investments in associates relating to the Company’s investment in Dolly Varden, specifically an understatement of dilution gain on the consolidated statement of (earnings) loss and comprehensive (income) loss, as well as an understatement of our investment in associate balance in the statement of financial position, which management corrected via revision of Section 6.
Remediation Plan for the Material Weakness
We continue to be focused on designing and implementing effective internal controls to improve our internal control over financial reporting and remediate the material weakness. Our efforts include:
| - | We are in the process of designing and implementing controls related to the review of complex accounting transactions outside of the normal course of the Company’s operations. Specifically, design and maintain controls to timely analyze and account for dilution gains or losses resulting from changes in ownership in associates accounted for using the equity method. |
| - | Hiring a third-party specialist to assist with the design of these controls. |
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) | 26 |
The process of designing and maintaining effective internal control over financial reporting is a continuous effort that requires management to anticipate and react to changes in our business, economic and regulatory environments and to expend significant resources. As we continue to evaluate our internal control over financial reporting, we may take additional actions to remediate the material weakness or modify the remediation actions described above.
While we continue to devote significant time and attention to these remediation efforts, the material weakness will not be considered remediated until management completes the design and implementation of the actions described above and the controls operate for a sufficient period of time, and management has concluded, through testing, that these controls are effective.
Changes in Internal Control over Financial Reporting
Other than with respect to the material Weakness and remediation efforts described in “Material Weakness in Internal Control over Financial Reporting” and “Remediation Plan for the Material Weakness” above, there were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) for the year ended December 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Additional disclosures pertaining to the Company’s management information circulars, material change reports, press releases, and other information are available on SEDAR+ at www.sedarplus.com.
On behalf of the Board of Directors,
“Forrester A. Clark”
Forrester A. Clark
Chief Executive Officer
March 31, 2025
Fury Gold Mines Limited Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Year Ended December 31, 2024 (Amounts expressed in thousands of Canadian dollars, unless otherwise noted) |
27 |
Exhibit 99.4
Form 52-109F1
Certification of Annual Filings
Full Certificate
I, Forrester A. Clark, Chief Executive Officer of Fury Gold Mines Limited., certify the following:
| 1. | Review: I have reviewed the AIF, annual financial statements and annual MD&A, including, for greater certainty, all documents and information that are incorporated by reference in the AIF (together, the “annual filings”) of Fury Gold Mines Limited (the “issuer”) for the financial year ended December 31, 2024. |
| 2. | No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the annual 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 annual filings. |
| 3. | Fair presentation: Based on my knowledge, having exercised reasonable diligence, the annual financial statements together with the other financial information included in the annual 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 annual 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 financial year end |
| (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 annual 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 based on Internal Control – Integrated Framework (2013) published by the Committee of Sponsoring Organizations of the Treadway Commission. |
| 5.2 | ICFR – material weakness relating to design: The issuer has disclosed in its annual MD&A for each material weakness relating to design existing at the financial year end |
(a) a description of the material weakness;
(b) the impact of the material weakness on the issuer’s financial reporting and its ICFR; and
(c) the issuer’s current plans, if any, or any actions already undertaken, for remediating the material weakness.
| 1 |
| 5.3 | Limitation on scope of design: N/A |
| 6. | Evaluation: The issuer’s other certifying officer(s) and I have |
| (a) | evaluated, or caused to be evaluated under our supervision, the effectiveness of the issuer’s DC&P at the financial year end and the issuer has disclosed in its annual MD&A our conclusions about the effectiveness of DC&P at the financial year end based on that evaluation; and |
| (b) | evaluated, or caused to be evaluated under our supervision, the effectiveness of the issuer’s ICFR at the financial year end and the issuer has disclosed in its annual MD&A |
| (i) | our conclusions about the effectiveness of ICFR at the financial year end based on that evaluation; and |
| (ii) | for each material weakness relating to operation existing at the financial year end |
(A) a description of the material weakness;
(B) the impact of the material weakness on the issuer’s financial reporting and its ICFR; and
(C) the issuer’s current plans, if any, or any actions already undertaken, for remediating the material weakness.
| 7. | Reporting changes in ICFR: The issuer has disclosed in its annual MD&A any change in the issuer’s ICFR that occurred during the period beginning on January 1, 2024 and ended on December 31, 2024 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR. |
| 8. | Reporting to the issuer’s auditors and board of directors or audit committee: The issuer’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of ICFR, to the issuer’s auditors, and the board of directors or the audit committee of the board of directors any fraud that involves management or other employees who have a significant role in the issuer’s ICFR. |
Date: March 31, 2025
/s/ “Forrester A. Clark”
Forrester A. Clark
Chief Executive Officer
2
Exhibit 99.5
Form 52-109F1
Certification of Annual Filings
Full Certificate
I, Phil van Staden, Chief Financial Officer of Fury Gold Mines Limited., certify the following:
| 1. | Review: I have reviewed the AIF, annual financial statements and annual MD&A, including, for greater certainty, all documents and information that are incorporated by reference in the AIF (together, the “annual filings”) of Fury Gold Mines Limited (the “issuer”) for the financial year ended December 31, 2024. |
| 2. | No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the annual 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 annual filings. |
| 3. | Fair presentation: Based on my knowledge, having exercised reasonable diligence, the annual financial statements together with the other financial information included in the annual 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 annual 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 financial year end |
| (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 annual 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 based on Internal Control – Integrated Framework (2013) published by the Committee of Sponsoring Organizations of the Treadway Commission. |
| 5.2 | ICFR – material weakness relating to design: The issuer has disclosed in its annual MD&A for each material weakness relating to design existing at the financial year end |
(a) a description of the material weakness;
(b) the impact of the material weakness on the issuer’s financial reporting and its ICFR; and
(c) the issuer’s current plans, if any, or any actions already undertaken, for remediating the material weakness.
| 1 |
| 5.3 | Limitation on scope of design: N/A |
| 6. | Evaluation: The issuer’s other certifying officer(s) and I have |
| (a) | evaluated, or caused to be evaluated under our supervision, the effectiveness of the issuer’s DC&P at the financial year end and the issuer has disclosed in its annual MD&A our conclusions about the effectiveness of DC&P at the financial year end based on that evaluation; and |
| (b) | evaluated, or caused to be evaluated under our supervision, the effectiveness of the issuer’s ICFR at the financial year end and the issuer has disclosed in its annual MD&A |
| (i) | our conclusions about the effectiveness of ICFR at the financial year end based on that evaluation; and |
| (ii) | for each material weakness relating to operation existing at the financial year end |
(A) a description of the material weakness;
(B) the impact of the material weakness on the issuer’s financial reporting and its ICFR; and
(C) the issuer’s current plans, if any, or any actions already undertaken, for remediating the material weakness.
| 7. | Reporting changes in ICFR: The issuer has disclosed in its annual MD&A any change in the issuer’s ICFR that occurred during the period beginning on January 1, 2024 and ended on December 31, 2024 that has materially affected, or is reasonably likely to materially affect, the issuer’s ICFR. |
| 8. | Reporting to the issuer’s auditors and board of directors or audit committee: The issuer’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of ICFR, to the issuer’s auditors, and the board of directors or the audit committee of the board of directors any fraud that involves management or other employees who have a significant role in the issuer’s ICFR. |
Date: March 31, 2025
/s/ “Phil van Staden”
Phil van Staden
Chief Financial Officer
2
Exhibit 99.6
FURY GOLD MINES LIMITED
and
QUÉBEC PRECIOUS METALS CORPORATION
AMENDED AND RESTATED ARRANGEMENT AGREEMENT
March 6, 2025
TABLE OF CONTENTS
| ARTICLE 1 INTERPRETATION | 4 |
| 1.1 | Definitions | 4 | |
| 1.2 | Interpretation | 13 | |
| 1.3 | Number, Gender and Persons | 14 | |
| 1.4 | Date for Any Action | 14 | |
| 1.5 | Currency | 14 | |
| 1.6 | Accounting Matters | 14 | |
| 1.7 | Knowledge | 14 | |
| 1.8 | Schedules | 14 |
| ARTICLE 2 THE ARRANGEMENT | 15 |
| 2.1 | Arrangement | 15 | |
| 2.2 | Interim Order | 15 | |
| 2.3 | QPM Meeting | 15 | |
| 2.4 | QPM Circular | 16 | |
| 2.5 | Final Order | 17 | |
| 2.6 | Court Proceedings | 17 | |
| 2.7 | Effective Date | 18 | |
| 2.8 | Payment of Consideration and Issuance of Shares | 18 | |
| 2.9 | Announcement and Shareholder Communications | 18 | |
| 2.10 | Withholding Taxes | 18 | |
| 2.11 | List of Shareholders | 19 | |
| 2.12 | U.S. Securities Law Matters | 19 | |
| 2.13 | Treatment of Convertible Securities of QPM | 20 |
| ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF QPM | 20 |
| 3.1 | Representations and Warranties | 20 | |
| 3.2 | Survival of Representations and Warranties | 29 |
| ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF FURY | 29 |
| 4.1 | Representations and Warranties | 29 | |
| 4.2 | Survival of Representations and Warranties | 34 |
| ARTICLE 5 COVENANTS | 34 |
| 5.1 | Covenants of QPM Regarding the Conduct of Business | 34 | |
| 5.2 | Covenants of QPM Relating to the Arrangement | 38 | |
| 5.3 | Covenants of Fury Relating to the Arrangement | 38 |
| 5.4 | Access to Information; Confidentiality | 39 | |
| 5.5 | Notices of Certain Events | 39 | |
| 5.6 | Fury Capital Contribution to QPM | 40 | |
| 5.7 | Insurance, Indemnification and Employee Payments | 40 |
| ARTICLE 6 CONDITIONS | 41 |
| 6.1 | Mutual Conditions Precedent | 41 | |
| 6.2 | Additional Conditions Precedent to the Obligations of Fury | 41 | |
| 6.3 | Additional Conditions Precedent to the Obligations of QPM | 42 | |
| 6.4 | Satisfaction of Conditions | 43 |
| ARTICLE 7 NON-SOLICITATION COVENANTS | 43 |
| 7.1 | Non-Solicitation | 43 | |
| 7.2 | Notification of Acquisition Proposals | 44 | |
| 7.3 | Responding to an Acquisition Proposal | 44 | |
| 7.4 | Right to Match | 45 |
| ARTICLE 8 TERM, TERMINATION, AMENDMENT AND WAIVER | 46 |
| 8.1 | Term | 46 | |
| 8.2 | Termination | 46 | |
| 8.3 | QPM Termination Fee | 48 | |
| 8.4 | Fury Termination Fee | 49 | |
| 8.5 | Expenses | 50 | |
| 8.6 | Amendment | 50 | |
| 8.7 | Waiver | 50 |
| ARTICLE 9 GENERAL PROVISIONS | 50 |
| 9.1 | Privacy | 50 | |
| 9.2 | Notices | 51 | |
| 9.3 | Governing Law | 52 | |
| 9.4 | Injunctive Relief | 52 | |
| 9.5 | Time of Essence | 52 | |
| 9.6 | Entire Agreement, Binding Effect and Assignment | 52 | |
| 9.7 | No Liability | 52 | |
| 9.8 | Severability | 52 | |
| 9.9 | Counterparts, Execution | 53 | |
| 9.10 | Language | 53 |
| SCHEDULE A - PLAN OF ARRANGEMENT | 1 |
| SCHEDULE B – FORM OF ARRANGEMENT RESOLUTION | 1 |
| SCHEDULE C - KEY REGULATORY APPROVALS AND THIRD PARTY CONSENTS | 1 |
- 4 -
ARRANGEMENT AGREEMENT
THIS ARRANGEMENT AGREEMENT is made originally as of February 26, 2025 (the “Original Arrangement Agreement”), as hereby amended and restated as of March 6, 2025.
AMONG:
FURY GOLD MINES LIMITED, a company incorporated under the laws of the Province of British Columbia (“Fury”)
- and –
QUÉBEC PRECIOUS METALS CORPORATION, a company incorporated under the laws of Canada (“QPM”)
WHEREAS:
| A. | Fury and QPM entered into the Original Arrangement Agreement on February 26, 2025 by which Fury is to acquire all of the issued and outstanding QPM Shares pursuant to the Arrangement; |
| B. | The QPM Board has unanimously determined, after receiving financial and legal advice that the Arrangement is fair to the QPM Shareholders and is in the best interests of QPM, and the QPM Board has decided to recommend that the QPM Shareholders vote in favour of the Arrangement, all subject to the terms and the conditions contained in this Agreement; |
| C. | Fury has entered into the Voting Agreements with the QPM Locked-up Shareholders, pursuant to which, among other things, such QPM Locked-up Shareholders agree, subject to the terms and conditions thereof, to vote the QPM Shares held by them in favour of the Arrangement Resolution; |
| D. | QPM have agreed to additional steps for Fury to recapitalize QPM within the Plan of Arrangement; and |
| E. | Fury and QPM wish to enter into this Agreement to amend and restate the Original Arrangement Agreement and upon execution of this Agreement, the Original Arrangement Agreement shall be amended and restated in its entirety and this Agreement shall constitute the entire agreement between Fury and QPM with respect to the transactions contemplated herein. |
NOW THEREFORE in consideration of the covenants and agreements herein contained and other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the Parties hereby amend and restate the Original Arrangement Agreement and hereto covenant and agree as follows:
ARTICLE 1
INTERPRETATION
| 1.1 | Definitions |
In this Agreement, unless the context otherwise requires:
“Acquisition Proposal” relating to a Party means, other than the transactions contemplated by this Agreement, any offer, proposal or inquiry (written or oral) from any Person or group of Persons other than the other Party (or any affiliate of the other Party or any Person acting jointly or in concert with the other Party or any affiliate of the other Party) after the date of this Agreement relating to: (a) any direct or indirect sale, disposition, alliance or joint venture (or any lease, long-term supply or off-take agreement, hedging arrangement or other transaction having the same economic effect as a sale of such assets), in a single transaction or a series of related transactions, of: (i) the assets of the Party that, individually or in the aggregate, constitute 20% or more of the consolidated assets of such Party, or (ii) 20% or more of the voting, equity or other securities of the Party (or rights or interests therein or thereto); (b) any direct or indirect take- over bid, tender offer, exchange offer, treasury issuance or other transaction of QPM that, if consummated, would result in such Person or Persons beneficially owning 20% or more of any class of voting, equity or other securities or any other equity interests (including securities convertible into or exercisable or exchangeable for securities of equity interests) of the Party; (c) any plan of arrangement, merger, amalgamation, consolidation, share exchange, business combination, reorganization, recapitalization, liquidation, dissolution or winding up involving the Party; or (d) any other similar transaction or series of transactions involving the Party;
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“affiliate” has the meaning ascribed thereto in the National Instrument 45-106 - Prospectus and Registration Exemptions of the Canadian Securities Administrators in effect on the date of this Agreement;
“Agreement” means this arrangement agreement, including all schedules annexed hereto, as the same may be amended, supplemented or otherwise modified from time to time in accordance with the terms hereof;
“Arrangement” means the arrangement of QPM under Section 192 of the CBCA on the terms and subject to the conditions set out in the Plan of Arrangement, subject to any amendments or variations thereto made in accordance with Section 8.4 hereof or the Plan of Arrangement or made at the direction of the Court in the Final Order (provided, however, that any such amendment or variation is acceptable to both QPM and Fury, each acting reasonably);
“Arrangement Resolution” means the special resolution of the QPM Shareholders approving the Plan of Arrangement which is to be considered at the QPM Meeting, substantially in the form and content of Schedule B hereto;
“Articles of Arrangement” means the articles of arrangement of QPM to be filed in accordance with the CBCA evidencing the Arrangement;
“Authorization” means, with respect to any Person, any order, permit, approval, consent, waiver, licence or similar authorization of any Governmental Entity having jurisdiction over the Person;
“Business Day” means any day, other than a Saturday, a Sunday or a statutory or civic holiday in Montreal, Québec or Vancouver, British Columbia;
“CBCA” means the Canada Business Corporations Act and the regulations made thereunder, as now in effect and as they may be promulgated or amended from time to time;
“Certificate of Arrangement” means the certificate giving effect to the Arrangement issued by the Director pursuant to Section 192(7) of the CBCA;
“Confidentiality Agreement” means the confidentiality agreement entered into between QPM and Fury, effective December 19, 2024;
“Consideration” means the consideration to be received by the QPM Shareholders pursuant to the Plan of Arrangement as consideration for their QPM Shares consisting of 0.0741 of a Fury Share for each QPM Share;
“Consideration Shares” means the Fury Shares to be issued pursuant to the Plan of Arrangement;
“Contract” means any contract, agreement, license, franchise, lease, arrangement, commitment, understanding, joint venture, partnership or other right or obligation (written or oral) to which a Party or any of its Subsidiaries is a party or by which it or any of its Subsidiaries is bound or affected or to which any of their respective properties or assets is subject;
“Court” means the Superior Court of Québec;
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“Depositary” means any trust company, bank or other financial institution agreed to in writing by QPM and Fury for the purpose of, among other things, exchanging certificates representing QPM Shares for the Consideration in connection with the Arrangement;
“Director” means the Director appointed pursuant to Section 260 of the CBCA;
“Dissent Rights” means the rights of dissent exercisable by the QPM Shareholders in respect of the Arrangement described in Article 4 of the Plan of Arrangement;
“Effective Date” means the date upon which the Arrangement becomes effective as set out in the Plan of Arrangement which will be the date shown in the Certificate of Arrangement;
“Effective Time” means the time on the Effective Date that the Arrangement becomes effective, as set out in the Plan of Arrangement;
“Environmental Laws” means all Laws, imposing obligations, responsibilities, liabilities or standards of conduct for or relating to: (a) the regulation or control of pollution, contamination, activities, materials, substances or wastes in connection with or for the protection of human health or safety, the environment or natural resources (including climate, air, surface water, groundwater, wetlands, land surface, subsurface strata, wildlife, aquatic species and vegetation); or (b) the use, generation, disposal, treatment, processing, recycling, handling, transport, distribution, destruction, transfer, import, export or sale of Hazardous Substances;
“Environmental Permits” means all Authorizations or program participation requirements with or from any Governmental Entity under any Environmental Laws;
“Estimated Net Realizable Assets Amount” the estimated realizable value of QPM’s assets calculated at the Effective Time being the sum of a) the value of the Consideration Shares; plus b) the dollar amount of the known QPM Closing Liabilities.
“Exchange Ratio” means 0.0741 of a Fury Share for each QPM Share;
“Fairness Opinion” means the opinion of the Financial Advisor to the effect that as of February 25, 2025, the Consideration to be received by the QPM Shareholders is fair, from a financial point of view, to the QPM Shareholders;
“Final Order” means the final order of the Court pursuant to Section 192 of the CBCA, in form and substance acceptable to Fury and QPM, each acting reasonably, after a hearing upon the procedural and substantive fairness of the terms and conditions of the Arrangement, approving the Arrangement, as such order may be amended, modified, supplemented or varied by the Court (with the consent of Fury and QPM, each acting reasonably) at any time prior to the Effective Date or, if appealed, then, unless such appeal is withdrawn or denied, as affirmed or as amended on appeal (provided that any such affirmation, amendment, modification, supplement or variation is acceptable to Fury and QPM, each acting reasonably);
“Financial Advisor” means Evans & Evans, Inc., acting as financial advisor to QPM;
“Fury” has the meaning ascribed thereto in the preamble;
“Fury Balance Sheet” has the meaning ascribed thereto in Subsection 4.1(q);
“Fury Board” means the board of directors of Fury;
“Fury Capital Contribution” means the cash contribution by Fury to QPM’s stated capital at the Effective Time in an amount equal to the QPM Closing Liabilities to be made pursuant to section 5.6.
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“Fury Disclosure Letter” means the disclosure letter executed by Fury and delivered to QPM concurrently with the execution of this Agreement;
“Fury DSUs” means the outstanding deferred stock units granted under the Fury Share Incentive Plan or its predecessor incentive plans;
“Fury Material Adverse Effect” means any change, effect, event, state of facts or occurrence that, individually or together with any other changes, effects, events, states of facts or occurrences, is, or would reasonably be expected to be, material and adverse to the business, operations, results of operations, assets, properties, capitalization, financial condition or liabilities (contingent or otherwise) of Fury and the Fury Material Subsidiaries, taken as a whole, other than any change, effect, event, state of facts or occurrence resulting from: (a) any change in general political, economic or financial conditions in Canada or elsewhere where Fury currently engages in business; (b) any change in the state of securities markets in general, including any reduction in market indices; (c) any change in currency exchange or interest rates; (d) any change affecting the industries in which Fury and the Fury Material Subsidiaries operate in general or the market for gold in general; (e) any change in IFRS or regulatory accounting requirements; (f) any change in applicable Laws (including tax Laws) or any interpretation or enforcement thereof by any Governmental Entity; (g) any natural disaster; (h) the commencement or continuation of war, armed hostilities, including the escalation or worsening thereof, or acts of terrorism; (i) the commencement or continuation of an epidemic, pandemic or other outbreak of illness or public health event, including the escalation or worsening thereof; (j) non-cash impairment charges to mineral properties; or (k) any change in the market price or trading volume of the Fury Shares (it being understood that the causes underlying such change in market price or trading volume may be taken into account in determining whether a Fury Material Adverse Effect has occurred); provided, however, that such change, effect, event, state of facts or occurrence referred to in subsections (a) to (i) above does not disproportionately adversely affect Fury and the Fury Material Subsidiaries, taken as a whole, compared to other companies of similar size operating in the industry in which Fury and the Fury Material Subsidiaries operate and references in this Agreement to dollar amounts are not intended to be and shall be deemed not to be illustrative or interpretative for purposes of determining whether an “Fury Material Adverse Effect” has occurred;
“Fury Material Subsidiaries” means North Country Gold Corp., Eastmain Resources Inc., and Eastmain Mines Inc.;
“Fury Mineral Rights” has the meaning ascribed thereto in Subsection 4.1(r);
“Fury Options” means the outstanding options to purchase Fury Shares granted under the Fury Share Incentive Plan;
“Fury Properties” has the meaning ascribed thereto in Subsection 0;
“Fury Public Documents” means all documents or information filed on SEDAR+ by Fury under applicable Securities Laws since and including January 1, 2023 to and including the date hereof;
“Fury RSUs” means the outstanding restricted stock units granted under the Fury Share Incentive Plan or its predecessor incentive plans;
“Fury Share Incentive Plan” means collectively: (i) Fury’s 2017 incentive option plan and (ii) Fury’s 10% rolling long term incentive plan approved by the shareholders of Fury at a meeting held on June 29, 2023;
“Fury Shareholders” means the holders of the outstanding Fury Shares;
“Fury Shares” means the common shares in the share capital of Fury;
“Fury Superior Proposal” means any unsolicited bona fide written Acquisition Proposal from a Person who is an arm’s length third party made after the date of this Agreement to acquire not less than all of the outstanding Fury Shares or all or substantially all of the assets of Fury on a consolidated basis that: (i) is conditional upon Fury exercising its rights under Section 8.2(a)(iii)(E) of this Agreement to terminate this Agreement; (ii) complies with Securities Laws; (iii) is reasonably capable of being completed without undue delay, taking into account all legal, financial, regulatory and other aspects of such proposal and the Person making such proposal; (iv) is not subject to any requirement to obtain the approval of the shareholders of the Person making such Acquisition Proposal or any of its affiliates; (v) is not subject to any financing condition and in respect of which it has been demonstrated to the satisfaction of the Fury Board, acting in good faith (after receipt of advice from its financial advisers and its outside legal counsel) that adequate arrangements have been made in respect of any financing required to complete such Acquisition Proposal; (vi) is not subject to any due diligence or access condition; (vii) to the extent that such Acquisition Proposal involves the acquisition of outstanding Fury Shares, is made available to all Fury Shareholders, on the same terms and conditions; and (viii) the Fury Board determines, in its good faith judgment, after receiving the advice of its outside legal and financial advisors and after taking into account all the terms and conditions of the Acquisition Proposal, including all legal, financial, regulatory and other aspects of such Acquisition Proposal and the Person making such Acquisition Proposal, would, if consummated in accordance with its terms, but without assuming away the risk of non-completion, result in a transaction which is more favourable, from a financial point of view, to the Fury Shareholders than the Arrangement;
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“Fury Termination Fee Event” has the meaning ascribed thereto in Subsection 8.3(b);
“Governmental Entity” means: (a) any multinational, federal, provincial, territorial, state, regional, municipal, local or other government, governmental department, central bank, court, tribunal, ministry, arbitral body, commission, board, bureau, agency or entity, domestic or foreign; (b) any stock exchange, including the TSX, the NYSE and the TSX-V; (c) any subdivision, agent, commission, board or authority of any of the foregoing; or (d) any quasi-governmental or private body, including any tribunal, commission, regulatory agency or self-regulatory organization, exercising any administrative, regulatory, expropriation or taxing authority under or for the account of any of the foregoing;
“Hazardous Substance” means any pollutant, contaminant or chemical or any toxic, radioactive, ignitable, corrosive, reactive or otherwise hazardous or deleterious substance, waste or material, including cyanide, sulphuric acid, hydrogen sulphide, arsenic, cadmium, copper, lead, mercury, petroleum, polychlorinated biphenyls, asbestos and urea-formaldehyde insulation, and any other material, substance, pollutant or contaminant regulated or defined pursuant to, or that could result in liability under, any Environmental Law;
“IFRS” means generally accepted accounting principles in Canada from time to time including, for the avoidance of doubt, the standards prescribed in Part I of the CPA Canada Handbook - Accounting (International Financial Reporting Standards) as the same may be amended, supplemented or replaced from time to time;
“Interim Order” means the order made after the application to the Court pursuant to subsection 192 of the CBCA in form and substance acceptable to Fury and QPM, each acting reasonably, providing for, among other things, the calling and holding of the QPM Meeting, as the same may be amended, affirmed, modified, supplemented or varied by the Court with the consent of Fury and QPM, each acting reasonably;
“Investment Canada Act” means the Investment Canada Act (Canada);
“Key Regulatory Approvals and Third Party Consents” means those sanctions, rulings, consents, orders, exemptions, permits and other approvals (including the waiver or lapse, without objection, of a prescribed time under a statute or regulation that states that a transaction may be implemented if a prescribed time lapses following the giving of notice without an objection being made) of Governmental Entities set out in Schedule C hereto;
“Law” or “Laws” means, with respect to any Person, any and all applicable law (statutory, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, order, injunction, judgment, decree, ruling or other similar requirement, whether domestic or foreign, enacted, adopted, promulgated or applied by a Governmental Entity that is binding upon or applicable to such Person or its business, undertaking, property or securities, and to the extent that they have the force of law, policies, guidelines, notices and protocols of any Governmental Entity, as amended;
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“Liens” means any mortgage, charge, pledge, hypothec, security interest, prior claim, encroachment, option, right of first refusal or first offer, occupancy right, covenant, assignment, lien (statutory or otherwise), defect of title, or restriction or adverse right or claim, or other third party interest or encumbrance of any kind, in each case, whether contingent or absolute;
“Mailing Deadline” means no later than April 3, 2025 unless otherwise agreed in writing by Fury and QPM;
“Majority of the Minority Approval” has the meaning ascribed thereto in Subsection 2.2(c)(ii);
“Matching Period” has the meaning ascribed thereto in Subsection 7.4(a)(v);
“Material Contract” means, with respect to QPM, any Contract: (a) that if terminated or modified or if ceased to be in effect, would have a QPM Material Adverse Effect; (b) under which it has, directly or indirectly, guaranteed any liabilities or obligations of a third party in excess of $10,000 in the aggregate; (c) relating to indebtedness for borrowed money, whether incurred, assumed, guaranteed by it or secured by any of its assets; (d) providing for the establishment, investment in, organization or formation of any joint venture; (e) under which it is obligated to make or expects to receive payments in excess of $10,000 over the remaining term of such Contract (other than employment Contracts); (f) that limits or restricts it from engaging in any line of business or any geographic area in any material respect or that creates an exclusive dealing arrangement or right of first refusal or first offer; (g) that is a collective bargaining agreement, a labour union contract or any other Contract with a union representing employees; (h) with a Governmental Entity, non- governmental organization or indigenous community or group; (i) that contemplates the completion of any Acquisition Proposal in relation to QPM by or with a third party or which includes a standstill agreement in favour of QPM; or (i) that is otherwise material to QPM;
“material fact” and “material change” have the meanings ascribed thereto in the Securities Act;
“Meeting Deadline” means April 30, 2025;
“MI 61-101” means Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions of the Ontario Securities Commission;
“misrepresentation” has the meaning ascribed thereto in the Securities Act;
“NI 43-101” means National Instrument 43-101 - Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators;
“NYSE” means the NYSE American Stock Exchange;
“ordinary course of business” or any similar reference, means, with respect to an action taken by a Person, that such action is consistent with the past practices of such Person and is taken in the ordinary course of the normal day-to-day business and operations of such Person;
“Outside Date” means May 16, 2025, or such later date as may be agreed to in writing by the Parties;
“Original Arrangement Agreement” means the arrangement agreement entered into between Fury and QPM, dated February 26, 2025.
“Parties” means Fury and QPM, and “Party” means either one of them;
“Person” includes an individual, partnership, association, body corporate, trustee, executor, administrator, legal representative, government (including any Governmental Entity) or any other entity, whether or not having legal status;
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“Plan of Arrangement” means the plan of arrangement of QPM, substantially in the form of Schedule A hereto, and any amendments or variations thereto made in accordance with the Plan of Arrangement or upon the direction of the Court in the Final Order with the consent of QPM and Fury, each acting reasonably;
“QPM” has the meaning ascribed thereto in the preamble;
“QPM Balance Sheet” has the meaning ascribed thereto in Subsection 3.1(m);
“QPM Benefit Plans” means any pension plans or other employee compensation, other than equity-based or security-based compensation arrangements, or benefit plans, agreements, policies, programs, arrangements or practices, whether written or oral, which are maintained by or binding upon QPM or for which QPM could have any liability;
“QPM Board” means the board of directors of QPM as the same is constituted from time to time;
“QPM Board Recommendation” has the meaning ascribed thereto in Subsection 2.4(c)(ii);
“QPM Broker Options” means the outstanding common share purchase options of QPM issued to certain brokers and intermediaries;
“QPM Capital Reduction” means a reduction made at the Effective Time in the dollar value of the stated capital of the QPM Shares in accordance with Section 38(1) of the CBCA so that the stated capital equals the Estimated Net Realizable Assets Amount;
“QPM Change of Recommendation” means any of the following: (1) the QPM Board or any committee of the QPM Board fails to unanimously recommend or withdraws, amends, modifies or qualifies, or publicly proposes or states an intention to withdraw, amend, modify or qualify, the QPM Board Recommendation, (2) the QPM Board or any committee of the QPM Board accepts, approves, endorses or recommends, or publicly proposes to accept, approve, endorse or recommend an Acquisition Proposal or takes no position or remains neutral with respect to a publicly announced, or otherwise publicly disclosed, Acquisition Proposal for more than five Business Days (or beyond the third Business Day prior to the date of the QPM Meeting, if sooner)), (3) the QPM Board or any committee of the QPM Board accepts or enters into (other than a confidentiality agreement permitted by and in accordance with Section 7.3) or publicly proposes to accept or enter into any agreement, understanding or arrangement in respect of an Acquisition Proposal, (4) the QPM Board or any committee of the QPM Board fails to publicly reaffirm the QPM Board Recommendation within five Business Days after having been requested in writing by Fury to do so (or in the event that the QPM Meeting is scheduled to occur within such five Business Day period, prior to the third Business Day prior to the date of the QPM Meeting)
“QPM Circular” means the notice of the QPM Meeting and accompanying management information circular, including all schedules, appendices and exhibits thereto and enclosures therewith and the documents incorporated by reference therein, to be sent to the QPM Shareholders in connection with the QPM Meeting, as amended, supplemented or otherwise modified from time to time;
“QPM Closing Liabilities” means all liabilities of QPM existing at the Effective Time, whether due of not, and whether known or unknown;
“QPM Creditors” has the meaning ascribed thereto in Subsection 3.1(i);
“QPM Debt Settlement Agreements” means the debt settlement agreements to be entered into between QPM and each QPM Creditor regarding the satisfaction of the QPM Settlement Debt through the issuance of QPM Debt Settlement Shares;
“QPM Debt Settlement Shares” means the QPM Shares to be issued to the QPM Creditors immediately prior to the Effective Time in accordance with the QPM Debt Settlement Agreements, as detailed in Section 3.1(i) to the QPM Disclosure Letter;
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“QPM Disclosure Letter” means the disclosure letter executed by QPM and delivered to Fury concurrently with the execution of this Agreement;
“QPM DSU Plan” means the deferred stock unit incentive plan of QPM approved by QPM Shareholders at a meeting held on October 20, 2020, providing for the issuance of QPM DSUs;
“QPM DSUs” means the outstanding deferred stock units granted under the QPM DSU Plan or its predecessor incentive plans;
“QPM Incentive Plans” means collectively, the QPM Option Plan and the QPM DSU Plan;
“QPM Locked-up Shareholders” means, collectively, each of QPM’s executive officers, directors, and certain shareholders mutually agreed to by QPM and Fury;
“QPM Material Adverse Effect” means any change, effect, event, state of facts or occurrence that, individually or together with any other changes, effects, events, states of facts or occurrences, is, or would reasonably be expected to be, material and adverse to the business, operations, results of operations, assets, properties, capitalization, financial condition, liabilities (contingent or otherwise), prospects or privileges (whether contractual or otherwise) of QPM, taken as a whole, other than any change, effect, event, state of facts or occurrence resulting from: (a) any change in general political, economic or financial conditions in Canada; (b) any change in the state of securities markets in general, including any reduction in market indices; (c) any change in currency exchange or interest rates; (d) any change affecting the industries in which QPM operates in general or the market for gold in general; (e) any change in IFRS or regulatory accounting requirements; (f) any change in applicable Laws (including tax Laws) or any interpretation or enforcement thereof by any Governmental Entity; (g) any natural disaster; (h) the commencement or continuation of war, armed hostilities, including the escalation or worsening thereof, or acts of terrorism; (i) the commencement or continuation of an epidemic, pandemic or other outbreak of illness or public health event, including the escalation or worsening thereof; (j) non-cash impairment charges to mineral properties; or (k) any change in the market price or trading volume of the QPM Shares (it being understood that the causes underlying such change in market price or trading volume may be taken into account in determining whether a QPM Material Adverse Effect has occurred); provided, however, that such change, effect, event, state of facts or occurrence referred to in subsections (a) to (i) above does not disproportionately adversely affect QPM, taken as a whole, compared to other companies of similar size operating in the industry in which QPM operates and references in this Agreement to dollar amounts are not intended to be and shall be deemed not to be illustrative or interpretative for purposes of determining whether an “QPM Material Adverse Effect” has occurred;
“QPM Meeting” means the special meeting of QPM Shareholders, including any adjournment or postponement thereof, to be called and held in accordance with the Interim Order to consider the Arrangement Resolution;
“QPM Mineral Rights” has the meaning ascribed thereto in Subsection 3.1(n)(i);
“QPM Optionholders” means the holders of QPM Options;
“QPM Option Plan” means the stock option plan of QPM approved by QPM Shareholders at a meeting held on June 30, 2011, providing for the issuance of QPM Options (as amended on July 14, 2015, June 27, 2017, November 29, 2018 and February 19, 2021);
“QPM Options” means the outstanding options to purchase QPM Shares granted under the QPM Option Plan;
“QPM Properties” has the meaning ascribed thereto in Subsection 3.1(n)(i);
“QPM Public Documents” means all documents or information filed on SEDAR+ by QPM under applicable Securities Laws since and including January 1, 2023 up to and including the date hereof;
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“QPM Securities” means, collectively, QPM Shares, QPM Options, QPM DSUs, QPM Broker Options, and the QPM Warrants;
“QPM Settlement Debt” has the meaning ascribed thereto in Subsection 3.1(i);
“QPM Shareholder Approval” has the meaning ascribed thereto in Subsection 2.2(c);
“QPM Shareholders” means the holders of QPM Shares;
“QPM Shares” means the common shares in the authorized share capital of QPM;
“QPM Termination Fee Event” has the meaning ascribed thereto in Subsection 8.4(b);
“QPM Warrants” means the outstanding common share purchase warrants of QPM;
“Securities Act” means the Securities Act (Québec);
“Securities Laws” means: (i) in relation to Fury, the Securities Act (British Columbia); (ii) in relation to QPM, the Securities Act; and (iii) in relation to both Fury and QPM, all other applicable state, federal and provincial securities Laws, rules and regulations and published policies thereunder, as now in effect and as they may be promulgated or amended from time to time;
“SEDAR+” means the System for Electronic Document Analysis and Retrieval +;
“Subsidiary” has the meaning ascribed thereto in the National Instrument 45-106 – Prospectus and Registration Exemptions of the Canadian Securities Administrators;
“Superior Proposal” means any unsolicited bona fide written Acquisition Proposal from a Person who is an arm’s length third party made after the date of this Agreement to acquire not less than all of the outstanding QPM Shares or all or substantially all of the assets of QPM on a consolidated basis that: (i) complies with Securities Laws and did not result from or involve a breach of Article 7 or any agreement between Person making such Acquisition Proposal and QPM; (ii) is reasonably capable of being completed without undue delay, taking into account all legal, financial, regulatory and other aspects of such proposal and the Person making such proposal; (iii) is not subject to any requirement to obtain the approval of the shareholders of the Person making such Acquisition Proposal or any of its affiliates; (iii) is not subject to any financing condition and in respect of which it has been demonstrated to the satisfaction of the QPM Board, acting in good faith (after receipt of advice from its financial advisers and its outside legal counsel) that adequate arrangements have been made in respect of any financing required to complete such Acquisition Proposal; (iv) is not subject to any due diligence or access condition; (v) to the extent that such Acquisition Proposal involves the acquisition of outstanding QPM Shares, is made available to all QPM Shareholders, on the same terms and conditions; and (vi) the QPM Board determines, in its good faith judgment, after receiving the advice of its outside legal and financial advisors and after taking into account all the terms and conditions of the Acquisition Proposal, including all legal, financial, regulatory and other aspects of such Acquisition Proposal and the Person making such Acquisition Proposal, would, if consummated in accordance with its terms, but without assuming away the risk of non-completion, result in a transaction which is more favourable, from a financial point of view, to the QPM Shareholders than the Arrangement (including any amendments to the terms and conditions of the Arrangement proposed by Fury pursuant to Subsection 7.4(b));
“Superior Proposal Notice” has the meaning ascribed thereto in Subsection 7.4(a)(iii);
“Tax Act” means the Income Tax Act (Canada);
“Taxes” includes any taxes, duties, fees, premiums, assessments, imposts, levies and other charges of any kind whatsoever imposed by any Governmental Entity, including all interest, penalties, fines, additions to tax or other additional amounts imposed by any Governmental Entity in respect thereof, and including those levied on, or measured by, or referred to as, income, gross receipts, profits, windfall, royalty, capital, transfer, land transfer, sales, goods and services, harmonized sales, use, value-added, excise, stamp, withholding, business, franchising, property, development, occupancy, employer health, payroll, employment, health, social services, education and social security taxes, all surtaxes, all customs duties and import and export taxes, countervail and anti-dumping, all licence, franchise and registration fees and all employment insurance, health insurance, workers’ compensation and pension plan premiums or contributions imposed by any Governmental Entity, and any transferee liability in respect of any of the foregoing;
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“Tax Returns” includes all returns, reports, declarations, elections, notices, filings, forms, statements and other documents (whether in tangible, electronic or other form) and including any amendments, schedules, attachments, supplements, appendices and exhibits thereto, made, prepared, filed or required by a Governmental Entity to be made, prepared or filed by Law in respect of Taxes;
“Termination Fee” means an amount equal to $200,000;
“Transaction Personal Information” has the meaning ascribed thereto in Section 9.1;
“TSX” means the Toronto Stock Exchange;
“TSX-V” means the TSX Venture Exchange;
“United States” means the United States of America, its territories and possessions, any State of the United States and the District of Columbia;
“U.S. Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder;
“U.S. Securities Act” means the United States Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder; and
“Voting Agreements” means the voting agreements (including all amendments thereto) between Fury and the QPM Locked-up Shareholders setting forth the terms and conditions upon which they agree, among other things, to vote their QPM Securities in favour of the Arrangement Resolution.
| 1.2 | Interpretation |
For the purposes of this Agreement, except as otherwise expressly provided:
| (a) | “this Agreement” means this Agreement, including the recitals and Appendices hereto, and not any particular Article, Section, Subsection or other subdivision, recital or Schedule hereof, and includes any agreement, document or instrument entered into, made or delivered pursuant to the terms hereof, as the same may, from time to time, be supplemented or amended and in effect; |
| (b) | the words “hereof”, “herein”, “hereto” and “hereunder” and other word of similar import refer to this Agreement as a whole and not to any particular Article, Section, Subsection, or other subdivision, recital or Schedule hereof; |
| (c) | all references in this Agreement to a designated “Article”, “Section”, “Subsection” or other subdivision, recital or “Schedule” hereof are references to the designated Article, Section, Subsection or other subdivision, recital or Schedule to, this Agreement; |
| (d) | the division of this Agreement into Article, Sections, Subsections and other subdivisions, recitals or Schedule, the inclusion of a table of contents and the insertion of headings and captions are for convenience of reference only and are not intended to interpret, define or limit the scope, extent or intent of this Agreement or any provision hereof; |
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| (e) | a reference to a statute in this Agreement includes all regulations, rules, policies or instruments made thereunder, all amendments to the statute, regulations, rules, policies or instruments in force from time to time, and any statutes, regulations, rules, policies or instruments that supplement or supersede such statute, regulations, rules, policies or instruments; |
| (f) | the word “or” is not exclusive; |
| (g) | the words “including”, “include” and “includes” are not limiting, whether or not non-limiting language (such as “without limitation” or “but not limited to” or words of similar import) is used with reference thereto; and |
| (h) | all references to “approval”, “authorization” or “consent” in this Agreement means written approval, authorization or consent. |
| 1.3 | Number, Gender and Persons |
In this Agreement, unless the context otherwise requires, words importing the singular shall include the plural and vice versa, words importing the use of either gender shall include both genders and neuter and the word person and words importing persons shall include a natural person, firm, trust, partnership, association, corporation, joint venture or government (including any governmental agency, political subdivision or instrumentality thereof) and any other entity or group of persons of any kind or nature whatsoever.
| 1.4 | Date for Any Action |
If the date on which any action is required to be taken hereunder by a Party is not a Business Day, such action shall be required to be taken on the next succeeding day which is a Business Day.
| 1.5 | Currency |
Unless otherwise stated, all references in this Agreement to sums of money are expressed in lawful money of Canada and “$” refers to Canadian dollars.
| 1.6 | Accounting Matters |
Unless otherwise stated, all accounting terms used in this Agreement in respect of QPM and Fury shall have the meanings attributable thereto under IFRS and all determinations of an accounting nature in respect of QPM and Fury required to be made shall be made in a manner consistent with IFRS consistently applied.
| 1.7 | Knowledge |
| (a) | In this Agreement, references to “the knowledge of QPM” means the actual knowledge of the Chief Executive Officer of QPM and the Chief Financial Officer of QPM in each case, after making due enquiries regarding the relevant matter. |
| (b) | In this Agreement, references to “the knowledge of Fury” means the actual knowledge of the Chief Executive Officer of Fury and the Chief Financial Officer of Fury in each case, after making due enquiries regarding the relevant matter. |
| 1.8 | Schedules |
The following Schedules are annexed to this Agreement and are incorporated by reference into this Agreement and form a part hereof:
| Schedule A | - | Plan of Arrangement | |
| Schedule B | - | Form of Arrangement Resolution | |
| Schedule C | - | Key Regulatory Approvals and Third Party Consents |
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ARTICLE 2
THE ARRANGEMENT
| 2.1 | Arrangement |
QPM and Fury agree that the Arrangement will be implemented in accordance with and subject to the terms and conditions contained in this Agreement and the Plan of Arrangement.
| 2.2 | Interim Order |
As soon as reasonably practicable following the execution of this Agreement, and in any event in sufficient time to hold the QPM Meeting in accordance with Section 2.3, QPM shall apply to the Court in a manner acceptable to Fury, acting reasonably, pursuant to Section 192 of the CBCA and prepare, file and diligently pursue an application for the Interim Order, which shall provide, among other things:
| (a) | for the class of Persons to whom notice is to be provided in respect of the Arrangement and the QPM Meeting and for the manner in which such notice is to be provided; |
| (b) | for confirmation of the record date for the QPM Meeting referred to in Subsection 2.3(a); |
| (c) | that the requisite approval for the Arrangement Resolution shall be: |
| (i) | the affirmative vote of not less than two-thirds of the votes cast on the Arrangement Resolution by the QPM Shareholders present in person or by proxy at the QPM Meeting, voting together as a single class (the “QPM Shareholder Approval”); and |
| (ii) | if required, a simple majority of the votes attached to the QPM Shares held by QPM Shareholders present in person or by proxy at the QPM Meeting excluding votes attached to QPM Shares held or controlled by any person described in items (a) through (d) of section 8.1(2) of MI 61-101 (the “Majority of the Minority Approval”); |
| (d) | that, in all other respects and subject to the terms of the Interim Order, the terms, conditions and restrictions of the QPM constating documents, including quorum requirements and other matters, shall apply in respect of the QPM Meeting; |
| (e) | for the grant of Dissent Rights to the QPM Shareholders who are registered QPM Shareholders; |
| (f) | for the notice requirements with respect to the presentation of the application to the Court for the Final Order; and |
| (g) | that the QPM Meeting may be adjourned or postponed from time to time by the QPM Board subject to the terms of this Agreement without the need for additional approval of the Court. |
| 2.3 | QPM Meeting |
Subject to the terms of this Agreement, QPM shall:
| (a) | convene and conduct the QPM Meeting in accordance with the Interim Order, QPM’s articles and applicable Law as soon as reasonably practicable, and in any event on or before the Meeting Deadline; |
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| (b) | not, except as required for quorum purposes, as required by Law, or otherwise as permitted under this Agreement, adjourn, postpone or cancel (or propose or permit the adjournment, postponement or cancellation of) the QPM Meeting without Fury’s prior written consent; |
| (c) | subject to the terms of this Agreement, solicit proxies in favour of the approval of the Arrangement Resolution and against any resolution submitted by any Person that is inconsistent with the Arrangement Resolution and the completion of any of the transactions contemplated by this Agreement, including, if so requested by Fury, acting reasonably, using proxy solicitation services firms (with Fury paying the cost of such services) and cooperating with any Persons engaged by Fury to solicit proxies in favour of the approval of the Arrangement Resolution; |
| (d) | provide Fury with copies of or access to information regarding the QPM Meeting generated by any proxy solicitation services firm, as requested from time to time by Fury; |
| (e) | consult with Fury in fixing the date of the QPM Meeting and the record date of the QPM Meeting and give notice to Fury of the QPM Meeting and allow Fury’s representatives and legal counsel to attend and to speak at the QPM Meeting; |
| (f) | promptly advise Fury, at such times as Fury may reasonably request, and at least on a daily basis on each of the last ten (10) Business Days prior to the date of the QPM Meeting, as to the aggregate tally of the proxies received by QPM in respect of the Arrangement Resolution; |
| (g) | promptly advise Fury of any communication (written or oral) from or claims brought by (or threatened to be brought by) any Person in opposition to the Arrangement and/or purported exercise or withdrawal of Dissent Rights by QPM Shareholders. QPM shall not settle or compromise or agree to settle or compromise any such claims without the prior written consent of Fury, not to be unreasonably withheld or delayed; and |
| (h) | not change the record date for the QPM Shareholders entitled to vote at the QPM Meeting in connection with any adjournment or postponement of the QPM Meeting unless required by Law. |
| 2.4 | QPM Circular |
| (a) | As promptly as reasonably practicable following execution of this Agreement and in any event prior to the close of business on the Mailing Deadline, QPM shall: (i) prepare the QPM Circular together with any other documents required by applicable Laws, (ii) file the QPM Circular in all jurisdictions where the same is required to be filed, and (iii) mail the QPM Circular as required under applicable Laws and by the Interim Order. |
| (b) | QPM shall ensure that the QPM Circular complies in all material respects with all applicable Laws, does not contain any misrepresentation (except that QPM shall not be responsible for any information provided by Fury relating to Fury and its affiliates, including the Fury Shares) and contains sufficient detail to permit the QPM Shareholders entitled to vote at the QPM Meeting to form a reasoned judgment concerning the matters to be placed before them at the QPM Meeting. |
| (c) | Without limiting the generality of the foregoing, the QPM Circular must include: |
| (i) | a copy of the Fairness Opinion; |
| (ii) | a statement that the QPM Board has received the Fairness Opinion and that the QPM Board has, after receiving financial and legal advice unanimously determined that the Arrangement is fair to the QPM Shareholders and is in the best interests of QPM, and recommends that the QPM Shareholders vote in favour of the Arrangement Resolution (the “QPM Board Recommendation”); and |
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| (iii) | a statement that each director and officer of QPM has, in accordance with the terms of the Voting Agreements, agreed to vote all of such Person’s QPM Shares in favour of the Arrangement Resolution. |
| (d) | Fury shall provide to QPM all information regarding Fury, its affiliates and the Fury Shares as required by the Interim Order or applicable Laws for inclusion in the QPM Circular or in any amendments or supplements to such QPM Circular. Fury shall also use commercially reasonable efforts to obtain any necessary consents from any of its auditors and any other advisors to the use of any financial, technical or other expert information required to be included in the QPM Circular and to the identification in the QPM Circular of each such advisor. Fury shall ensure that such information does not include any misrepresentation concerning Fury. |
| (e) | Fury and its legal counsel shall be given a reasonable opportunity to review and comment on the QPM Circular and other related documents prior to the QPM Circular and such other documents being printed and filed with any Governmental Entity, and reasonable consideration shall be given to any comments made by Fury and its legal counsel, provided, however, that all information relating solely to Fury, its affiliates and the Consideration Shares included in the QPM Circular shall be in form and content satisfactory to Fury, acting reasonably. QPM shall provide Fury with final copies of the QPM Circular prior to the mailing to the QPM Shareholders. |
| (f) | QPM and Fury shall each promptly notify each other if at any time before the Effective Date either becomes aware that the QPM Circular contains a misrepresentation, or otherwise requires an amendment or supplement and the Parties shall co-operate in the preparation of any amendment or supplement to the QPM Circular as required or appropriate, and QPM shall promptly mail or otherwise publicly disseminate any amendment or supplement to the QPM Circular to QPM Shareholders and, if required by the Court or applicable Laws, file the same with any Governmental Entity and as otherwise required. |
| 2.5 | Final Order |
If the Interim Order is obtained and the Arrangement Resolution is passed at the QPM Meeting as provided for in the Interim Order, QPM shall diligently pursue and take all steps necessary or desirable to have the hearing before the Court of the application for the Final Order pursuant to Section 192 of the CBCA held as soon as reasonably practicable, but in any event not later than three Business Days after the Arrangement Resolution is passed at the QPM Meeting.
| 2.6 | Court Proceedings |
In connection with all Court proceedings relating to obtaining the Interim Order and the Final Order, QPM shall diligently pursue, and cooperate with Fury in diligently pursuing, the Interim Order and the Final Order and QPM will provide Fury and its legal counsel with reasonable opportunity to review and comment upon drafts of all material to be filed with the Court in connection with the Arrangement, including by providing on a timely basis a description of any information required to be supplied by Fury for inclusion in such material, prior to the service and filing of that material, and will accept the reasonable comments of Fury and its legal counsel with respect to any such information required to be supplied by Fury and included in such material and any other matters contained therein. QPM will ensure that all material filed with the Court in connection with the Arrangement is consistent in all material respects with the terms of this Agreement and the Plan of Arrangement. In addition, QPM will not object to legal counsel to Fury making such submissions to the court, including on the application for the Interim Order and the application for the Final Order as such counsel considers appropriate, acting reasonably. QPM will also provide legal counsel to Fury on a timely basis with copies of any notice and evidence served on QPM or its legal counsel in respect of the application for the Final Order or any appeal therefrom, and any notice, written or oral, indicating the intention of any Person to appeal, or oppose the granting of, the Interim Order or Final Order. Subject to Laws, QPM will not file any material with, or make any submissions to, the Court in connection with the Arrangement or serve any such material, and will not agree to modify or amend materials so filed or served, except as contemplated hereby or with Fury’s prior written consent, such consent not to be unreasonably withheld or delayed; provided that, for certainty, nothing herein shall require Fury to agree or consent to any increased purchase price or other consideration or other modification or amendment to such filed or served materials that expands or increases Fury’s obligations, or diminishes or limits Fury’s rights.
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| 2.7 | Effective Date |
The Arrangement shall become effective on the date upon which Fury and QPM agree in writing as the Effective Date or, in the absence of such agreement, on the third Business Day following the satisfaction or waiver of all conditions to completion of the Arrangement set out in Article 6 (excluding any conditions that, by their terms, cannot be satisfied until the Effective Date, but subject to the satisfaction or, where not prohibited, waiver of those conditions as of the Effective Date by the applicable Party or Parties for whose benefit such conditions exist) and the Arrangement (and the Articles of Arrangement) shall be effective at the Effective Time on the Effective Date and will have all of the effects provided by applicable Law. The closing of the Arrangement will take place at the offices of McMillan LLP in Vancouver, British Columbia on the Effective Date at the Effective Time, or at such other time and place as may be agreed to by the Parties.
| 2.8 | Payment of Consideration and Issuance of Shares |
Fury will, following receipt by QPM of the Final Order and no later than the Effective Date, deposit or cause to be deposited in escrow with the Depositary sufficient Fury Shares to satisfy the Consideration payable to the QPM Shareholders (other than payments to QPM Shareholders exercising Dissent Rights and who have not withdrawn their notice of objection) which shares shall be held by the Depositary as agent and nominee for such QPM Shareholders for distribution to such QPM Shareholders in accordance with the provisions of the Plan of Arrangement.
| 2.9 | Announcement and Shareholder Communications |
Fury and QPM shall each publicly announce the transactions contemplated hereby promptly following the execution of this Agreement by Fury and QPM, the text and timing of each Party’s announcement to be approved by the other Party in advance, acting reasonably. Fury and QPM agree to co-operate in the preparation of presentations, if any, to QPM Shareholders regarding the transactions contemplated by this Agreement, and no Party shall: (i) issue any press release or otherwise make public announcements with respect to this Agreement or the Plan of Arrangement without the consent of the other Party (which consent shall not be unreasonably withheld or delayed); or (ii) make any filing with any Governmental Entity with respect thereto without prior consultation with the other Party; provided, however, that the foregoing shall be subject to each Party’s overriding obligation to make any disclosure or filing required under applicable Laws, and the Party making such disclosure shall use all commercially reasonable efforts to give prior written notice to the other Party and reasonable opportunity to review or comment on the disclosure or filing, and if such prior notice is not permitted by applicable securities laws, to give such notice immediately following the making of such disclosure or filing.
| 2.10 | Withholding Taxes |
Fury, QPM and the Depositary shall be entitled to deduct and withhold from any amounts payable or otherwise deliverable to any Person pursuant to the Arrangement or this Agreement (including any amount payable to QPM Shareholders who have validly exercised Dissent Rights) and from all dividends, interest or other amounts payable or allocable to any former QPM Shareholder such amounts as Fury, QPM or the Depositary may be required, or reasonably believe to be required, to deduct or withhold therefrom or with respect thereto under any provision of applicable Laws in respect of Taxes. To the extent that such amounts are so deducted, withheld and remitted, such amounts shall be treated for all purposes under this Agreement as having been paid, delivered or allocated to the Person to whom such amounts would otherwise have been paid, delivered or allocated.
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| 2.11 | List of Shareholders |
At the reasonable request of Fury from time to time, QPM shall provide Fury with a list (in both written and electronic form) of the registered QPM Shareholders, together with their addresses and respective holdings of QPM Shares, with a list of the names and addresses and holdings of all Persons having rights issued by QPM to acquire QPM Shares (including holders of QPM Options) and a list of non-objecting beneficial owners of QPM Shares, together with their addresses and respective holdings of QPM Shares. QPM shall from time to time require that its registrar and transfer agent furnish Fury with such additional information, including updated or additional lists of QPM Shareholders and lists of holdings and other assistance as Fury may reasonably request.
| 2.12 | U.S. Securities Law Matters |
The Parties agree that the Arrangement will be carried out with the intention that all Consideration Shares delivered in the course of and on completion of the Arrangement to the QPM Shareholders will be delivered by Fury in reliance on the exemption from the registration requirements of the U.S. Securities Act provided by Section 3(a)(10) thereof. In order to ensure the availability of the exemption under Section 3(a)(10) of the
U.S. Securities Act, the Parties agree that the Arrangement will be carried out on the following basis:
| (a) | the Arrangement will be subject to the approval of the Court; |
| (b) | the Court will be advised as to the intention of the Parties to rely on the exemption under Section 3(a)(10) of the U.S. Securities Act based on the Court’s approval of the Arrangement, prior to the hearing required to approve the Arrangement; |
| (c) | the Court will be required to satisfy itself as to the procedural and substantive fairness of the terms and conditions of the Arrangement to the QPM Shareholders; |
| (d) | QPM will ensure that each QPM Shareholder entitled to receive Consideration Shares on completion of the Arrangement will be given adequate notice advising them of their right to attend the hearing of the Court to give approval of the Arrangement and providing them with sufficient information necessary for them to exercise that right; |
| (e) | The QPM Shareholders entitled to receive Consideration Shares will be advised that the Consideration Shares issued pursuant to the Arrangement have not been registered under the U.S. Securities Act and will be issued by Fury in reliance on the exemption under Section 3(a)(10) of the U.S. Securities Act; |
| (f) | the Final Order approving the Arrangement that is obtained from the Court will expressly state that the Arrangement is approved by the Court as being procedurally and substantively fair to the QPM Shareholders; |
| (g) | the Interim Order approving the QPM Meeting will specify that each QPM Shareholder will have the right to appear before the Court at the hearing of the Court to give approval of the Arrangement so long as they enter an appearance within the time prescribed by the Interim Order; and |
| (h) | the Final Order shall include a statement to substantially the following effect: |
“This Order will serve as a basis of a claim to an exemption, pursuant to Section 3(a)(10) of the United States Securities Act of 1933, as amended, from the registration requirements otherwise imposed by such act, regarding the distribution of securities of Fury, pursuant to the Plan of Arrangement.”
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| 2.13 | Treatment of Convertible Securities of QPM |
Subject to the terms and conditions of this Agreement and the Plan of Arrangement, pursuant to the Arrangement:
| (a) | following the Effective Time, in accordance with the terms of each of the QPM Warrants, each holder of QPM Warrants shall be entitled to receive (and such holder shall accept) Fury Shares upon the exercise of such holder’s QPM Warrants; |
| (b) | following the Effective Time, in accordance with the terms of each of the QPM Broker Options, each holder of QPM Broker Options shall be entitled to receive (and such holder shall accept) Fury Shares upon the exercise of such holder’s QPM Broker Options; |
| (c) | following the Effective Time, in accordance with the terms of each of the QPM Options, each holder of QPM Options shall be entitled to receive (and such holder shall accept) Fury Shares upon the exercise of such holder’s QPM Options; and |
| (d) | on or immediately prior to the Effective Date, the QPM DSUs shall be deemed vested and convert into 3,552,136 QPM Shares that shall be deemed issued and outstanding as of the Effective Date and shall be exchanged for Consideration Shares, |
all in accordance with and subject to the provisions of the Plan of Arrangement.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF QPM
| 3.1 | Representations and Warranties |
Except as disclosed in the QPM Disclosure Letter (which shall make reference to the applicable section, subsection, paragraph or subparagraph below in respect of which such qualification is being made), QPM hereby represents and warrants to Fury as follows, and acknowledges that Fury is relying upon such representations and warranties in connection with the entering into of this Agreement:
| (a) | Organization and Qualification. QPM is duly incorporated and validly existing under the laws of Canada and has full corporate power and capacity to own its assets and conduct its business as now owned and conducted. QPM is duly qualified to carry on business and is in good standing in each jurisdiction in which the character of its properties or the nature of its activities makes such qualification necessary. True and complete copies of the constating documents of QPM have been delivered or made available to Fury, and QPM has not taken any action to amend or supersede such documents. |
| (b) | Corporate Authority. QPM has the requisite corporate power and authority to enter into this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement by QPM and the consummation by QPM of the transactions contemplated by this Agreement have been duly authorized by the QPM Board and no other corporate proceedings on the part of QPM are necessary to authorize this Agreement other than QPM Shareholder Approval and, if required, Majority of the Minority Approval. This Agreement has been duly executed and delivered by QPM and constitutes valid and binding obligations of QPM, enforceable by Fury against QPM in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency and other applicable Laws affecting the enforcement of creditors’ rights generally and subject to the qualification that equitable remedies may be granted only in the discretion of a court of competent jurisdiction. |
| (c) | No Conflict. The execution and delivery by QPM of this Agreement, the performance by it of its obligations hereunder and the completion of the Arrangement will not violate, conflict with or result in a breach of any provision of its constating documents, and will not: (i) violate, conflict with or result in a breach of: (A) any Material Contract; or (B) any Law to which QPM is subject or by which QPM; (ii) give rise to any right of termination, or the acceleration of any indebtedness, under any Material Contract; or (iii) give rise to any rights of first refusal or rights of first offer, trigger any change in control or influence provisions or any restriction or limitation under any such agreement, contract, indenture, Authorization, deed of trust, mortgage, bond, instrument, licence or permit, or result in the imposition of any Lien upon any of QPM’s assets. |
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| (d) | Government Authorization. The execution, delivery and performance by QPM of its obligations under this Agreement and the consummation of the Arrangement and the other transactions contemplated hereby do not require any Authorization or other action by or in respect of, or filing with, or notification to, any Governmental Entity by QPM other than: (i) the Interim Order and any approvals required by the Interim Order; (ii) the Final Order; (iii) filings with the Director under the CBCA; (iv) the Key Regulatory Approvals and Third Party Consents; and (v) filings pursuant to Securities Laws. |
| (e) | Subsidiaries. Except as disclosed in Section 3.1(e) of the Disclosure Letter, QPM has no Subsidiaries and QPM does not hold any equity interests in any entity. |
| (f) | Compliance with Laws. |
| (i) | The operations of QPM has been for the last 5 years and are now conducted in compliance in all material respects with all Laws of each applicable jurisdiction, the Laws of which have been and are now applicable to the operations of QPM and QPM has not received any notice of any alleged violation of any such Laws. |
| (ii) | Except as disclosed in Section 3.1(f)(ii) of the Disclosure Letter, QPM is not in conflict with, or in breach or default (including cross defaults) under or in violation of (including with or without notice or the lapse of time or both): (a) its notice of articles, articles or by- laws or equivalent organizational documents; or (b) any Material Contract, in any material respect. |
| (g) | QPM Authorizations. QPM has obtained all Authorizations necessary for the ownership, operation, development, maintenance, and use of the QPM Properties or otherwise in connection with the material business or operations of QPM as currently conducted and such Authorizations are in full force and effect. QPM has fully complied in all material respects with and are in compliance in all material respects with all Authorizations. There is no action, investigation or proceeding pending or, to the knowledge of QPM, threatened regarding any of the Authorizations. QPM has not received any notice, whether written or oral, of revocation or non-renewal of any such Authorizations, or of any intention of any Person to revoke or refuse to renew any of such Authorizations, and, to the knowledge of QPM, all such Authorizations continue to be effective in order for QPM to continue to conduct its businesses as it is currently being conducted. |
| (h) | Capitalization and Listing. |
| (i) | The authorized share capital of QPM consists of an unlimited number of QPM Shares. As at the date of this Agreement there are: (A) 103,646,498 QPM Shares, all of which are validly issued and outstanding as fully-paid and non-assessable shares of QPM, (B) 3,552,136 QPM DSUs providing for the issuance of 3,552,136 QPM Shares, (C) 8,054,091 QPM Warrants providing for the issuance of 8,054,091 QPM Shares, (D) 252,000 QPM Broker Options providing for the issuance of 252,000 QPM Shares, and (E) 3,560,000 outstanding QPM Options providing for the issuance of 3,560,000 QPM Shares upon the exercise thereof. Prior to the Effective Time, an additional and up to 5,959,671 QPM Shares will be issuable as QPM Debt Settlement Shares pursuant to the QPM Debt Settlement Agreements. There are no other options, warrants, conversion privileges, calls or other rights, shareholder rights plans, agreements, arrangements, commitments, or obligations of QPM to issue or sell any shares of QPM or securities or obligations of any kind convertible into, exchangeable for or otherwise carrying the right or obligation to acquire any shares of QPM, and there are no outstanding stock appreciation rights, phantom equity or similar rights, agreements, arrangements or commitments of QPM. No Person is entitled to any pre-emptive or other similar right granted by QPM. The QPM Shares are listed on the TSX-V, the Frankfurt Stock Exchange and the OTC BB and are not listed or quoted on any other market. |
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| (ii) | Section 3.1(h)(ii) to the QPM Disclosure Letter sets forth, as of the date hereof, the holders of all outstanding QPM Warrants, QPM Options, and QPM Broker Options and full details with respect to all such securities (including, where applicable, the number, exercise prices and vesting and expiration dates of such securities). All QPM Shares that may be issued pursuant to the exercise or vesting of outstanding QPM Warrants, QPM Options, or QPM Broker Options will, when issued in accordance with the terms thereof, be duly authorized, validly issued, fully-paid and non-assessable and are not and will not be subject to or issued in violation of, any pre-emptive rights. In addition, QPM has provided Fury with copies of the QPM Incentive Plans. |
| (iii) | There are no outstanding contractual obligations of QPM to repurchase, redeem or otherwise acquire any QPM Shares. |
| (iv) | No order ceasing or suspending trading in securities of QPM nor prohibiting the sale of such securities has been issued and is outstanding against QPM or its directors, officers or promoters. |
| (i) | Debt Settlement Agreements. Section 3.1(i) to the QPM Disclosure Letter sets forth, all the outstanding debt and obligations owing by QPM to certain creditors of QPM (the “QPM Creditors”) that are either: (i) presently outstanding, or (ii) will become outstanding as of closing as a direct result of a change in control of QPM or that will be triggered as a result of the execution of this Agreement or the completion of the Arrangement and that are to be settled through the issuance of QPM Debt Settlement Shares pursuant to the QPM Debt Settlement Agreements (the “QPM Settlement Debt”). Section 3.1(i) to the QPM Disclosure Letter sets forth with respect to the QPM Settlement Debt: (i) the name of each QPM Creditor, (ii) the amount owing or to be owing to the QPM Creditor that is to be settled by the issuance of the QPM Debt Settlement Shares, (iii) the number of QPM Debt Settlement Shares to be issued, and (iv) the ultimate number of Fury Shares to be issued to such QPM Creditors on closing of the Arrangement in accordance with the Plan of Arrangement. |
| (j) | Shareholder and Similar Agreements. QPM is not party to any shareholder, pooling, voting trust or other similar agreement relating to the issued and outstanding shares in the capital of QPM. |
| (k) | Public Filings. QPM has filed with all applicable Governmental Entities true and complete copies of the QPM Public Documents that QPM is required to file therewith. QPM Public Documents at the time filed: (a) did not contain any misrepresentation; and (b) complied in all material respects with the requirements of applicable Securities Laws. QPM has not filed any confidential material change report with any Governmental Entity which at the date hereof remains confidential. |
| (l) | Financial Statements. |
| (i) | The audited financial statements for QPM as at and for the fiscal year ended on January 31, 2024, including the notes thereto and the reports by QPM’s auditors thereon have been, and all financial statements of QPM which are publicly disseminated by QPM in respect of any subsequent periods prior to the date hereof, have been prepared in accordance with IFRS applied on a basis consistent with prior periods and all applicable Laws and present fairly, in all material respects, the financial condition and results of operations of QPM as of the respective dates thereof and its results of operations and cash flows for the respective periods covered thereby (except, in the case of the financial statements filed prior to the date hereof, as may be indicated expressly in the notes thereto). |
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| (ii) | Since February 1, 2024, to QPM’s knowledge, no director, officer, employee, auditor, accountant or representative of QPM has received or otherwise had or obtained knowledge of any complaint, allegation, assertion, or claim, whether written or oral, regarding the accounting or auditing practices, procedures, methodologies or methods of QPM or its internal accounting controls, including any complaint, allegation, assertion, or claim that QPM has engaged in questionable accounting or auditing practices, which has not been resolved to the satisfaction of the audit committee of the QPM Board. |
| (m) | Undisclosed Liabilities. QPM has no liabilities or obligations of any nature, whether or not accrued, contingent or otherwise, except for: (a) liabilities and obligations that are specifically presented on the statements of financial position of QPM as of October 31, 2024 (the “QPM Balance Sheet”) or disclosed in the notes thereto; (b) those incurred in the ordinary course of business since the date of the QPM Balance Sheet and those incurred in connection with the execution of this Agreement. There are no outstanding loans made by QPM to any executive officer or director of QPM. |
| (n) | Interest in Properties and QPM Mineral Rights. |
| (i) | All of QPM’s rights, title and interests in and to (collectively, the “QPM Properties”) and all of QPM’s mineral interests and rights (including any claims, concessions, exploration licences, exploitation licences, prospecting permits, mining leases and mining rights, in each case, either existing under contract, by operation of Law or otherwise) (collectively, the “QPM Mineral Rights”), are set out in Section 3.1(n)(i) of the QPM Disclosure Letter. Other than the QPM Properties and the QPM Mineral Rights set out in Section 3.1(n)(i) of the QPM Disclosure Letter, QPM does not own or have any interest in any real property or any mineral interests and rights. |
| (ii) | QPM is the sole beneficial and registered owner of all right, title and interest in and to the QPM Properties and the QPM Mineral Rights, with good and marketable title thereto, free and clear of any Liens. |
| (iii) | All of the QPM Mineral Rights have been properly located and recorded in compliance with applicable Law and are comprised of valid and subsisting mineral claims and have been properly staked and/or map designated in compliance with applicable Law. |
| (iv) | The QPM Properties and the QPM Mineral Rights are in good standing under applicable Law in all material respects and all work required to be performed and filed in respect thereof has been performed and filed, all Taxes, rentals, fees, expenditures and other payments in respect thereof have been paid or incurred and all filings in respect thereof have been made. |
| (v) | There is no material adverse claim against or challenge to the title to or ownership of the QPM Properties or any of the QPM Mineral Rights and, to the knowledge of QPM, there is no threat of such claim nor of any basis for any such claim. |
| (vi) | QPM has the exclusive right to deal with the QPM Properties and all of the QPM Mineral Rights. |
| (vii) | No Person other than QPM has any interest in the QPM Properties or any of the QPM Mineral Rights or the production or profits therefrom or any royalty in respect thereof or any right to acquire any such interest. |
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| (viii) | There are no options, back-in rights, earn-in rights, rights of first refusal or similar provisions or rights which would affect QPM’s interest in the QPM Properties or any of the QPM Mineral Rights. |
| (ix) | QPM has not received any notice, whether written or oral, from any Governmental Entity of any revocation or intention to: (i) revoke any interest of QPM in any of the QPM Properties or any of the QPM Mineral Rights, (ii) require modifications to the terms of existing contractual arrangements with such Governmental Entities in relation to the QPM Mineral Rights, or (iii) not to renew any such interest in accordance with applicable Law. |
| (x) | QPM has all surface rights, including fee simple estates, leases, easements, rights of way and permits or licences for operations from landowners or Governmental Entities permitting the use of land by QPM, and the QPM Mineral Rights permit QPM to conduct the exploration work currently contemplated in QPM Public Documents and no third party or group holds any such rights that would be required by QPM to develop the QPM Properties or any of the QPM Mineral Rights as contemplated in QPM Public Documents on or before the date hereof. |
| (xi) | each technical report filed by QPM on SEDAR+ in respect of the QPM Properties has been prepared and complies in all material respect with the requirements of NI 43-101 as the time of filing of each such technical report and the assumptions contained in each of such technical reports are reasonable in the circumstances. |
| (o) | Operational Matters. |
| (i) | all rentals, royalties, overriding royalty interests, production payments, net profits, interest burdens, payments and obligations due and payable, or performable, as the case may be, on or prior to the date hereof under, with respect to, or on account of, any direct or indirect assets of QPM, and its material joint ventures, are set forth in Section 3.1(p)(i) of the QPM Disclosure Letter and have been: (A) duly paid or accrued; (B) duly performed; or (C) accrued prior to the date hereof; and |
| (ii) | all costs, expenses, and liabilities payable on or prior to the date hereof under the terms of any contracts and agreements to which QPM or material joint ventures is directly or indirectly bound have been properly and timely paid, except for such expenses that are being currently paid prior to delinquency in the ordinary course of business. |
| (p) | Employment Matters. |
| (i) | Other than as disclosed in Section 3.1(p) of the QPM Disclosure Letter, QPM has not entered into any written or oral agreement or understanding providing for severance or termination payments to any director, officer or employee in connection with the termination of their position or their employment as a direct result of a change in control of QPM or that will be triggered as a result of the execution of this Agreement or the completion of the Arrangement. |
| (ii) | QPM: (i) is not a party to any collective bargaining agreement; nor (ii) is subject to any application for certification or, to the knowledge of QPM, threatened or apparent union organizing campaigns for employees not covered under a collective bargaining agreement. To the knowledge of QPM, no fact or event exists that is likely to give rise to a change in the representation in this Section 3.1(p) on or before the Effective Date. |
| (iii) | QPM is not subject to any claim for wrongful dismissal, constructive dismissal or any other tort claim, actual or, to the knowledge of QPM, threatened, or any litigation, actual, or to the knowledge of QPM, threatened, relating to employment or termination of employment of employees or independent contractors. To the knowledge of QPM, no labour strike, lock-out, slowdown or work stoppage is pending or threatened against or directly affecting QPM. |
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| (iv) | QPM has operated in accordance with all applicable Laws with respect to employment and labour, including employment and labour standards, occupational health and safety, employment equity, pay equity, workers’ compensation, human rights, labour relations and privacy and there are no current, pending, or to the knowledge of QPM, threatened proceedings before any board or tribunal with respect to any of the foregoing. |
| (q) | Absence of Certain Changes or Events. |
Since January 1, 2023:
| (i) | QPM has conducted its businesses only in the ordinary course of business; |
| (ii) | there has not been any QPM Material Adverse Effect; |
| (iii) | there has not been any material change in the accounting practices used by QPM; |
| (iv) | there has not been any redemption, repurchase or other acquisition of QPM Shares by QPM, or any declaration, setting aside or payment of any dividend or other distribution (whether in cash, shares or property) with respect to the QPM Shares; |
| (v) | there has not been a material change in the level of accounts receivable or payable, inventories or employees, other than those changes in the ordinary course of business; |
| (vi) | there has not been any entering into, or an amendment of, any Material Contract other than in the ordinary course of business; |
| (vii) | there has not been any satisfaction or settlement of any material claims or material liabilities that were not reflected in QPM’s audited financial statements, other than the settlement of claims or liabilities incurred in the ordinary course of business; and |
| (viii) | except for ordinary course adjustments, there has not been any increase in the salary, bonus, or other remuneration payable to any officers or senior or executive officers of QPM. |
| (r) | Litigation. There is no claim, action, proceeding or investigation pending or, to the knowledge of QPM, threatened against or relating to QPM, the business of QPM, or affecting any of its properties or assets, before or by any Governmental Entity which, if adversely determined, would have, or reasonably would be expected to have, a QPM Material Adverse Effect or prevent or materially delay the consummation of the Arrangement, nor to the knowledge of QPM are there any events or circumstances which could reasonably be expected to give rise to any such claim, action, proceeding or investigation. QPM is not subject to any outstanding order, writ, injunction or decree which has had or reasonably would be expected to have, a QPM Material Adverse Effect or prevent or materially delay the consummation of the Arrangement. |
| (s) | Corporate Social Responsibility. To the knowledge of QPM, no material dispute between QPM and any governmental or non-governmental organization, community, or group of individuals forming part of the community exists or is threatened with respect to the QPM Mineral Rights and QPM Properties. |
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| (t) | Taxes. |
| (i) | QPM has duly and in a timely manner made or prepared all Tax Returns required to be made or prepared by it, and duly and in a timely manner filed all material Tax Returns required to be filed by it with the appropriate Governmental Entity, such Tax Returns were complete and correct in all material respects and QPM has paid all Taxes, including instalments on account of Taxes for the current year required by applicable Law, which are due and payable by it whether or not assessed by the appropriate Governmental Entity. No waiver or extension of time in which to file any Tax Returns is in effect. No Governmental Entity has asserted that QPM is required to file Tax Returns or pay any Taxes in any jurisdiction where it does not do so. |
| (ii) | QPM has provided adequate accruals in accordance with IFRS in the most recently published financial statements of QPM for any Taxes of QPM for the period covered by such financial statements that have not been paid whether or not shown as being due on any material Tax Returns. Since such publication date, no material liability in respect of Taxes not reflected in such statements or otherwise provided for has been assessed, proposed to be assessed, incurred or accrued, other than in the ordinary course of business. |
| (iii) | QPM has duly and timely withheld all material Taxes and other amounts required by Law to be withheld by it (including material Taxes and other amounts required to be withheld by it in respect of any amount paid or credited or deemed to be paid or credited by it to, or for the benefit of, any Person) and has duly and timely remitted to the appropriate Governmental Entity such Taxes or other amounts required by Law to be remitted by it. |
| (iv) | QPM has duly and timely charged and collected all amounts on account of any sales, use or transfer Taxes, including goods and services, Québec Sales Tax, provincial and territorial taxes and state and local taxes, required by Law to be charged and collected by it and has duly and timely remitted to the appropriate Governmental Entity such amounts required by Law to be remitted by it. All input tax credits, refunds, rebates and similar adjustments of Taxes claimed by QPM have been validly claimed and correctly calculated as required by Law to support such claims. Where applicable, QPM has obtained all required information and documentation to support any zero-rating treatment of its supplies, and has been furnished with valid exemption certificates or their equivalent and has retained all such records and supporting documents in the manner required by Law. |
| (v) | QPM has not made, prepared and/or filed any elections, designations or similar filings relating to Taxes or entered into any agreement or other arrangement in respect of Taxes or Tax Returns that has effect for any period ending after the Effective Date. |
| (vi) | There are no proceedings, investigations, audits or claims now pending or threatened against QPM in respect of any Taxes, there are no matters under discussion, audit or appeal with any Governmental Entity relating to Taxes and QPM has not waived or extended any statutory limitation period in respect of Taxes. | |
| (vii) | QPM has not acquired property from a non-arm’s length Person within the meaning of the Tax Act for consideration the value of which is less than fair market value of the property. |
| (viii) | For the purposes of the Tax Act, and any other relevant Tax purposes, QPM is a “taxable Canadian corporation” and is not a non-resident. |
| (ix) | There are no transactions or events that have resulted, and no circumstances existing, which could result in the application to QPM of sections 17, 78, 80, 80.01, 80.02, 80.03, 80.04, 160, 191.3, 237.3 or 237.4 of the Tax Act or any analogous provision of any comparable Law of any province or territory of Canada. |
| (x) | There are no Liens for Taxes upon any properties or assets of QPM (other than Liens relating to Taxes not yet due and payable and for which adequate reserves have been recorded on the QPM Balance Sheet). |
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| (u) | Books and Records. Since January 1, 2023, the corporate records and minute books of QPM have been maintained in accordance with all applicable Laws, and the minute books of QPM, as provided to Fury, are complete and accurate in all material respects. The financial books and records and accounts of QPM in all material respects: (a) have been maintained in accordance with good business practices and in accordance with IFRS and with the accounting principles generally accepted in the country of domicile of each such entity, on a basis consistent with prior years (except in the case of a change in accounting principles for such jurisdiction); and (b) are stated in reasonable detail. |
| (v) | Non-Arm’s Length Transactions. Except for employment or consulting agreements entered into in the ordinary course of business prior to the date hereof and the QPM Debt Settlement Agreements to be entered into prior to the Effective Time, there are no current contracts, commitments, agreements, arrangements or other transactions (including relating to indebtedness by QPM) between QPM on the one hand, and any: (a) officer or director of QPM; (b) any holder of record or, to the knowledge of QPM, beneficial owner of five percent or more of the voting securities of QPM; or (c) any affiliate or associate of any officer, director or beneficial owner, on the other hand. |
| (w) | Benefit Plans. There are no QPM Benefit Plans. |
| (x) | Environmental. |
| (i) | All facilities and operations of QPM have been conducted, and are now, in material compliance with all Environmental Laws. |
| (ii) | QPM is in possession of, and in material compliance with, all Environmental Permits that are required to own, lease and operate the QPM Properties and QPM Mineral Rights and to conduct its business as it is now being conducted. |
| (iii) | No environmental, reclamation or closure obligation, demand, notice, work order or other liabilities presently exist with respect to any portion of any currently or formerly owned, leased, used or otherwise controlled property, interests and rights or relating to the operations and business of QPM and, to the knowledge of QPM, there is no basis for any such obligations, demands, notices, work orders or liabilities to arise in the future as a result of any activity in respect of such property, interests, rights, operations and business. |
| (iv) | QPM is not subject to any proceeding, application, order or directive which relates to environmental, health or safety matters, and which may require any material work, repairs, construction or expenditures. |
| (v) | To the knowledge of QPM, there are no changes in the status, terms or conditions of any Environmental Permits held by QPM, or any renewal, modification, revocation, reassurance, alteration, transfer or amendment of any such environmental approvals, consents, waivers, permits, orders and exemptions, or any review by, or approval of, any Governmental Entity of such environmental approvals, consents, waivers, permits, orders and exemptions that are required in connection with the execution or delivery of this Agreement, the consummation of the transactions contemplated herein or the continuation of the business of QPM following the Effective Date. |
| (vi) | QPM has made available to Fury all material audits, assessments, investigation reports, studies, plans, regulatory correspondence and similar information with respect to environmental matters. |
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| (vii) | To the knowledge of QPM, QPM is not subject to any past or present fact, condition or circumstance that could reasonably be expected to result in liability under any Environmental Laws that would, individually or in the aggregate, constitute a QPM Material Adverse Effect. |
| (y) | Restrictions on Business Activities. There is no agreement, judgment, injunction, order or decree binding upon QPM that has or could reasonably be expected to have the effect of prohibiting, materially restricting or impairing any business practice of QPM, any acquisition of property by QPM or the conduct of business by QPM as currently conducted (including following the transaction contemplated by this Agreement). |
| (z) | Contracts. QPM has performed in all material respects all obligations required to be performed by it to date under any Material Contracts to which any of them is a party. QPM is not in material breach or default under any Material Contract to which it is a party or bound, nor does QPM have knowledge of any condition that with the passage of time or the giving of notice or both would result in such a breach or default. QPM does not know of, nor has received written notice of, any material breach or default under (nor, to the knowledge of QPM, does there exist any condition which with the passage of time or the giving of notice or both would result in such a material breach or default under) any such Material Contract by any other party thereto. Prior to the date hereof, QPM has made available to Fury true and complete copies of all of the Material Contracts. Such Material Contracts are legal, valid, binding and in full force and effect and are enforceable by QPM in accordance with their respective terms (subject to bankruptcy, insolvency and other applicable Laws affecting creditors’ rights generally, and to general principles of equity) and are the product of arms’ length negotiations between the parties thereto. To the knowledge of QPM, there is no outstanding material dispute in relation to, or unremedied material breach of the terms of, the any such Material Contract by the other parties thereto. Section 3.1(z) of the QPM Disclosure Letter is a complete and accurate schedule of all Material Contracts. |
| (aa) | Brokers. Except for the fees to be paid to the Financial Advisor pursuant to its engagement letter with QPM, a true and complete copy of which has been delivered to Fury, none of QPM, or any of its officers, directors or employees has employed any broker or finder or incurred any liability for any brokerage fees, commissions or finder’s fees in connection with the transactions contemplated by this Agreement. | |
| (bb) | Reporting Issuer Status. As of the date hereof, QPM is a reporting issuer not in default (or the equivalent) under the Securities Laws of British Columbia, Alberta and Québec and QPM is not the subject of any unresolved comments letters issued by any securities regulatory authority; | |
| (cc) | Stock Exchange Compliance. QPM is in compliance in all material respects with the applicable listing and corporate governance rules and regulations of the TSX-V. QPM is a “foreign private issuer” within the meaning of Rule 405 under the U.S. Securities Act. QPM is not required to file reports under Section 13 or 15(d) of the U.S. Exchange Act or is required to register as an investment company under the United States Investment Company Act of 1940. | |
| (dd) | No Expropriation. No property or asset of QPM (including any QPM Properties or QPM Mineral Rights) has been taken or expropriated by any Governmental Entity nor has any notice or proceeding in respect thereof been given or commenced nor, to the knowledge of QPM, is there any intent or proposal to give any such notice or to commence any such proceeding. | |
| (ee) | Corrupt Practices Legislation. QPM, nor any of its officers, directors or employees acting on behalf of any of them, has taken, committed to take or been alleged to have taken any action which would cause QPM to be in violation of the Corruption of Foreign Public Officials Act (Canada) (and the regulations promulgated thereunder) or any applicable Law of similar effect of any other jurisdiction, and to the knowledge of QPM no such action has been taken by any of its agents, representatives or other Persons acting on behalf of QPM. |
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| (ff) | NGOs and Community Groups. No material dispute between QPM and any non-governmental organization, community, or community group exists or, to the knowledge of QPM, is threatened or imminent with respect to any of QPM’s properties or exploration activities. | |
| (gg) | Arrangements with Shareholders of Fury. Other than this Agreement, QPM does not have any agreement, arrangement or understanding (whether written or oral) with respect to Fury or any of its securities, businesses or operations with any shareholder of Fury, any interested party of Fury or any related party of any interested party of Fury, or any joint actor with any such persons (and for this purpose, the terms “interested party”, “related party” and “joint actor” shall have the meaning ascribed to such terms in MI 61-101). | |
| (hh) | Fairness Opinion. The QPM Board has received the Fairness Opinion and the Fairness Opinion has not been modified, amended or withdrawn. | |
| (ii) | Board Approval. As of the date hereof, the QPM Board, after consultation with legal and financial advisors, has unanimously: (i) determined that the Arrangement is fair to the QPM Shareholders and is in the best interests of QPM; (ii) approved the Arrangement pursuant to the Plan of Arrangement and the execution and performance of this Agreement; and (iii) resolved to recommend that the QPM Shareholders vote in favour of the Arrangement Resolution. | |
| (jj) | MI 61-101 Matters. Other than pursuant to the QPM Debt Settlement Agreements to be entered into by the Effective Time, to the to the knowledge of QPM, no “related party” of QPM (within the meaning of MI 61-101) together with its associated entities will receive any “collateral benefit” (within the meaning of MI 61-101) or be a party to any “connected transaction” (within the meaning of MI 61-101) as a consequence of the transactions contemplated by this Agreement. | |
| (kk) | Information. All information provided to Fury or its representatives in relation to Fury’s due diligence requests is accurate and complete in all material respects as at its respective date as stated therein. There has been no material change to the information provided to Fury or its representatives since the date provided to Fury or its representatives. |
| 3.2 | Survival of Representations and Warranties |
The representations and warranties of QPM contained in this Agreement shall not survive the completion of the Arrangement and shall expire and be terminated on the earlier of the Effective Time and the date on which this Agreement is terminated in accordance with its terms.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF FURY
| 4.1 | Representations and Warranties |
Fury hereby represents and warrants to QPM as follows, and acknowledge that QPM is relying upon such representations and warranties in connection with the entering into of this Agreement:
| (a) | Organization and Qualification. Fury is duly incorporated and validly existing under the laws of the Province of British Columbia and has full corporate power and capacity to own its assets and conduct its business as now owned and conducted. Fury is duly qualified to carry on business and is in good standing in each jurisdiction in which the character of its properties or the nature of its activities makes such qualification necessary, except where the failure to be so qualified will not, individually or in the aggregate, have a Fury Material Adverse Effect. |
| (b) | Corporate Authority. Fury has the requisite corporate power and authority to enter into this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement by Fury and the consummation by it of the transactions contemplated by this Agreement have been duly authorized by the board of directors of Fury and no other corporate proceedings on the part of Fury are necessary to authorize this Agreement. This Agreement has been duly executed and delivered by Fury and constitutes valid and binding obligations of Fury enforceable by QPM against Fury in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency and other applicable Laws affecting the enforcement of creditors’ rights generally and subject to the qualification that equitable remedies may be granted only in the discretion of a court of competent jurisdiction. |
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| (c) | No Conflict. The execution and delivery by Fury of this Agreement and the performance by it of its obligations hereunder and the completion of the Arrangement will not violate, conflict with or result in a breach of any provision of the constating documents of Fury or those of any of the Fury Material Subsidiaries, and except as would not, individually or in the aggregate, have or reasonably be expected to have a Fury Material Adverse Effect, will not: (i) violate, conflict with or result in a breach of: (A) any agreement, contract, indenture, deed of trust, mortgage, bond, instrument, Authorization, licence or permit to which Fury or any of the Fury Material Subsidiaries is a party or by which Fury or any of the Fury Material Subsidiaries is bound; or (B) any Law to which Fury or any of the Fury Material Subsidiaries is subject or by which Fury or any of the Fury Material Subsidiaries is bound; (ii) give rise to any right of termination, or the acceleration of any indebtedness, under any such agreement, contract, indenture, Authorization, deed of trust, mortgage, bond, instrument, licence or permit; or (iii) give rise to any rights of first refusal or rights of first offer, trigger any change in control or influence provisions or any restriction or limitation under any such agreement, contract, indenture, Authorization, deed of trust, mortgage, bond, instrument, licence or permit, or result in the imposition of any material Lien upon any of the assets of Fury or any of the Fury Material Subsidiaries. |
| (d) | Government Authorization. The execution, delivery and performance by Fury of its obligations under this Agreement and the consummation of the Arrangement and the other transactions contemplated hereby do not require any Authorization or other action by or in respect of, or filing with, or notification to, any Governmental Entity by Fury or by any of the Fury Material Subsidiaries other than: (i) the Interim Order and any approvals required by the Interim Order; (ii) the Final Order; (iii) filings with the Director under the CBCA; (iv) the Key Regulatory Approvals and Third Party Consents; (v) filings pursuant to Securities Laws; and (vi) any Authorizations which, if not obtained, or any other actions by or in respect of, or filings with, or notifications to, any Governmental Entity which, if not taken or made, would not, individually or in the aggregate, materially impede the ability of Fury to consummate the Arrangement and the transactions contemplated hereby. |
| (e) | Subsidiaries. Each Fury Material Subsidiary is duly organized and is validly existing under the Laws of its jurisdiction of incorporation or organization, has full corporate power and authority to own its assets and conduct its business as now owned and conducted by it and is duly qualified to carry on business in each jurisdiction in which the character of its properties or the nature of its activities makes such qualification necessary, except where the failure to be so qualified would not have a Fury Material Adverse Effect. Except as disclosed in the Fury Public Documents, Fury beneficially owns, directly or indirectly, all of the issued and outstanding securities of each of the Fury Material Subsidiaries. All of the outstanding shares in the capital of each of the Fury Material Subsidiaries owned directly or indirectly by Fury that is a corporation are, except as disclosed in the Fury Public Documents: (i) validly issued and fully-paid and all such shares are owned free and clear of all Liens of any kind or nature whatsoever; and (ii) are free of any other restrictions including any restriction on the right to vote, sell or otherwise dispose of shares. Fury does not hold any material equity interests in any entity, other than (A) its interests in the Fury Material Subsidiaries; and (B) as otherwise disclosed in the Fury Public Documents. |
| (f) | Equity Interests. Fury owns, directly or indirectly 51,054,590 common shares of Dolly Varden Silver Corp. (“Dolly Varden”), free and clear of any lien, charge, security interest, encumbrance, right of first refusal or other restriction other than as set forth in the investor rights agreement dated February 25, 2022 between Fury and Dolly Varden, and Dolly Varden has represented to Fury that such shares are validly issued and are fully paid, non-assessable shares in the capital of Dolly Varden and have been issued to Fury in compliance with and free of any pre-emptive and similar rights; |
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| (g) | Compliance with Laws. |
| (i) | The operations of Fury and the Fury Material Subsidiaries have been and are now conducted in compliance with all Laws of each applicable jurisdiction, the Laws of which have been and are now applicable to the operations of Fury and the Fury Material Subsidiaries and none of Fury or any of the Fury Material Subsidiaries has received any notice of any alleged violation of any such Laws, other than non-compliance or violations which, individually or in the aggregate, would not have a Fury Material Adverse Effect. |
| (ii) | None of Fury or any of the Fury Material Subsidiaries is in conflict with, or in default (including cross defaults) under or in violation of: (A) its notice of articles, articles or by- laws or equivalent organizational documents; or (B) any agreement or understanding to which it or by which any of its properties or assets is bound or affected, except for failures which, individually or in the aggregate, would not have a Fury Material Adverse Effect. |
| (h) | Capitalization of Fury and Listing. |
| (i) | The authorized share capital of Fury consists of an unlimited number of Fury Shares. As at the date hereof there are: (A) 151,938,300 Fury Shares validly issued and outstanding as fully-paid and non-assessable shares of Fury; (B) 8,266,172 outstanding Fury Options providing for the issuance of 8,266,172 Fury Shares upon the exercise thereof; (C) 1,857,014 Fury RSUs providing for the issuance of 1,857,014 Fury Shares upon the vesting thereof; and (D) 590,000 Fury DSUs providing for the issuance of 590,000 Fury Shares upon the vesting thereof. Except for the securities referred to in this Subsection 4.1(h)(i) and any agreements, arrangements, commitments, or obligations under the Fury Share Inventive Plan, there are no options, warrants, conversion privileges, calls or other rights, shareholder rights plans, agreements, arrangements, commitments, or obligations of Fury or any of the Fury Material Subsidiaries to issue or sell any shares of Fury or of any of the Fury Material Subsidiaries or securities or obligations of any kind convertible into, exchangeable for or otherwise carrying the right or obligation to acquire any shares of Fury or any of the Fury Material Subsidiaries, there are no outstanding stock appreciation rights, phantom equity or similar rights, agreements, arrangements or commitments of Fury or any of the Fury Material Subsidiaries based upon the book value, income or any other attribute of Fury or any of the Fury Material Subsidiaries, and no Person is entitled to any pre-emptive or other similar right granted by Fury or any of the Fury Material Subsidiaries. The Fury Shares are listed on the TSX and the NYSE and are not listed or quoted on any other market. |
| (ii) | All Fury Shares that may be issued pursuant to the exercise of outstanding Fury Options will, when issued in accordance with the terms of such securities, be duly authorized, validly issued, fully- paid and non-assessable and are not and will not be subject to or issued in violation of, any pre-emptive rights. |
| (iii) | All Fury Shares that may be issued pursuant to the exercise of outstanding Fury RSUs will, when issued in accordance with the terms of such securities, be duly authorized, validly issued, fully- paid and non-assessable and are not and will not be subject to or issued in violation of, any pre-emptive rights. |
| (iv) | All Fury Shares that may be issued pursuant to the exercise of outstanding Fury DSUs will, when issued in accordance with the terms of such securities, be duly authorized, validly issued, fully-paid and non-assessable and are not and will not be subject to or issued in violation of, any pre-emptive rights. |
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| (v) | There are no outstanding contractual obligations of Fury or any of the Fury Material Subsidiaries to repurchase, redeem or otherwise acquire any Fury Shares or any shares of any of the Fury Material Subsidiaries. No Fury Material Subsidiary owns any Fury Shares. |
| (vi) | No order ceasing or suspending trading in securities of Fury nor prohibiting the sale of such securities has been issued and is outstanding against Fury or its directors or officers. |
| (vii) | All Fury Shares will, when issued in accordance with the terms of the Plan of Arrangement be duly authorized, validly issued, fully- paid and non-assessable Fury Shares. |
| (i) | Public Filings. Fury has filed with all applicable Governmental Entities true and complete copies of Fury Public Documents that Fury is required to file therewith. Fury Public Documents at the time filed: (i) did not contain any misrepresentation, and (i) complied in all material respects with the requirements of applicable Securities Laws. Fury has not filed any confidential material change report with any Governmental Entity which at the date hereof remains confidential. |
| (j) | Litigation. There is no claim, action, proceeding or investigation pending or, to the knowledge of Fury, threatened against or relating to Fury or any of the Fury Material Subsidiaries, the business of Fury or any of the Fury Material Subsidiaries or affecting any of their properties, assets, before or by any Governmental Entity which, if adversely determined, would have, or reasonably could be expected to have, a Fury Material Adverse Effect or prevent or materially delay the consummation of the Arrangement, nor to the knowledge of Fury are there any events or circumstances which could reasonably be expected to give rise to any such claim, action, proceeding or investigation (provided, however, that the representation in this Subsection 4.1(j) shall not apply to claims, actions, proceedings, or investigations which may arise after the date of this Agreement which do not have a reasonable prospect of succeeding or, if successful, would not give rise to, nor reasonably be expected to give rise to, a Fury Material Adverse Effect). Neither Fury nor any of the Fury Material Subsidiaries is subject to any outstanding order, writ, injunction or decree which has had or is reasonably likely to have a Fury Material Adverse Effect or which would prevent or materially delay consummation of the transactions contemplated by this Agreement. |
| (k) | Reporting Issuer Status. As of the date hereof, Fury is a reporting issuer not in default (or the equivalent) under the Securities Laws of each of the provinces and territories of Canada. Fury is not the subject of any unresolved comment letters issued by any securities regulatory authority. |
| (l) | Stock Exchange Compliance. Fury is in compliance in all material respects with the applicable listing and corporate governance rules and regulations of the TSX and the NYSE. |
| (m) | QPM Shares. Fury does not have legal or beneficial ownership, control or direction over any QPM Shares. |
| (n) | Investment Canada Act. Fury is not “non-Canadian” for purposes of the Investment Canada Act. |
| (o) | Shareholder and Similar Agreements. Fury is not party to any shareholder, pooling, voting trust or other similar agreement relating to the issued and outstanding shares in the capital of Fury or any of the Fury Material Subsidiaries. |
| (p) | Financial Statements. The audited consolidated financial statements for Fury as at and for the fiscal year ended on December 31, 2023 including the notes thereto and the reports by Fury’s auditors thereon and all financial statements of Fury which are publicly disseminated by Fury in respect of any subsequent periods prior to the Effective Date will be prepared in accordance with IFRS applied on a basis consistent with prior periods (except in the case of a change in accounting principles) and all applicable Laws and present fairly, in all material respects, the consolidated financial condition and results of operations of Fury and the Fury Material Subsidiaries as of the respective dates thereof and its results of operations and cash flows for the respective periods covered thereby (except as may be indicated expressly in the notes thereto). There are no outstanding loans made by Fury or any of the Fury Material Subsidiaries to any executive officer or director of Fury. |
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| (q) | Undisclosed Liabilities. Except as disclosed in the Fury Public Documents, neither Fury nor any of the Fury Material Subsidiaries has any liabilities or obligations of any nature, whether or not accrued, contingent or otherwise, except for: (i) liabilities and obligations that are specifically presented on the unaudited balance sheet of Fury as of September 30, 2024 (the “Fury Balance Sheet”) or disclosed in the notes thereto; or (ii) liabilities and obligations incurred in the ordinary course of business consistent with past practice since September 30, 2024, that are not and would not, individually or in the aggregate with all other liabilities and obligations of Fury and the Fury Material Subsidiaries (other than those disclosed on the Fury Balance Sheet and/or the notes to the Fury financial statements), reasonably be expected to have a Fury Material Adverse Effect or, as a consequence of the consummation of the Arrangement, have a Fury Material Adverse Effect. Without limiting the foregoing, the Fury Balance Sheet reflects reasonable reserves in accordance with IFRS for contingent liabilities relating to pending litigation and other contingent obligations of Fury and the Fury Material Subsidiaries. |
| (r) | Interest in Properties and Fury Mineral Rights. |
Other than as disclosed in the Fury Disclosure Letter:
| (i) | all of Fury’s and the Fury Material Subsidiaries’ material real properties (collectively, the “Fury Properties”) and all of Fury’s and the Fury Material Subsidiaries’ material mineral interests and rights (including any material claims, concessions, exploration licences, exploitation licences, prospecting permits, mining leases and mining rights, in each case, either existing under contract, by operation of Law or otherwise) (collectively, the “Fury Mineral Rights”), are accurately set forth in the Fury Public Documents. Other than the Fury Properties and the Fury Mineral Rights set out in the Fury Public Documents, neither Fury nor the Fury Material Subsidiaries, owns or has any interest in any material real property or any material mineral interests and rights; |
| (ii) | and except as disclosed in the Fury Public Documents, Fury or a Fury Material Subsidiary is the sole legal and beneficial owner of all right, title and interest in and to the Fury Properties and the Fury Mineral Rights, free and clear of any material Liens; |
| (iii) | all of the Fury Mineral Rights have been, in all material respects, properly located and recorded in compliance with applicable Law and are comprised of valid and subsisting mineral claims; |
| (iv) | the Fury Properties and the Fury Mineral Rights are in good standing under applicable Law in all material respects and, in all material respects (i) all work required to be performed and filed in respect thereof has been performed and filed, (ii) all Taxes, rentals, fees, expenditures and other payments in respect thereof have been paid or incurred and (iii) all filings in respect thereof have been made; |
| (v) | there is no material adverse claim against or challenge to the title to or ownership of the Fury Properties or any of the Fury Mineral Rights; |
| (vi) | and except as disclosed in the Fury Public Documents, Fury or a Fury Material Subsidiary has the exclusive right to deal with the Fury Properties and all of the Fury Mineral Rights; |
| (vii) | and except as disclosed in the Fury Public Documents, no Person other than Fury and the Fury Material Subsidiaries has any interest in the Fury Properties or any of the Fury Mineral Rights or the production or profits therefrom or any royalty in respect thereof or any right to acquire any such interest; |
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| (viii) | there are no back-in rights, earn-in rights, rights of first refusal or similar provisions or rights which would affect Fury’s or a Fury Material Subsidiary’s interest in the Fury Properties or any of the Fury Mineral Rights; |
| (ix) | there are no material restrictions on the ability of Fury and the Fury Material Subsidiaries to use, transfer or exploit the Fury Properties or any of the Fury Mineral Rights, except pursuant to the applicable Law; |
| (x) | neither Fury nor any of the Fury Material Subsidiaries has received any notice, whether written or oral, from any Governmental Entity of any revocation or intention to (i) revoke any interest of Fury or a Fury Material Subsidiary in any of the Fury Properties or any of the Fury Mineral Rights, (ii) require modifications to the terms of existing contractual arrangements with such Governmental Entities in relation to the Fury Mineral Rights, or (iii) not to renew any such interest in accordance with applicable Law; |
| (xi) | and except as disclosed in the Fury Public Documents, Fury and the Fury Material Subsidiaries have all surface rights, including fee simple estates, leases, easements, rights of way and permits or licences for operations from landowners or Governmental Entities permitting the use of land by Fury and the Fury Material Subsidiaries, and mineral interests that are required to exploit the development potential of the Fury Properties and the Fury Mineral Rights as contemplated in Fury Public Documents on or before the date hereof and no third party or group holds any such rights that would be required by Fury to develop the Fury Properties or any of the Fury Mineral Rights as contemplated in Fury Public Documents on or before the date hereof; and |
| (xii) | each technical report filed by Fury on SEDAR+ in respect of the Fury Properties has been prepared and complies in all material respect with the requirements of NI 43-101 as the time of filing of each such technical report and the assumptions contained in each of such technical reports are reasonable in the circumstances. |
| (s) | Mineral Reserves and Resources. The mineral resources for the Fury Properties and the Fury Mineral Rights were prepared in all material respects in accordance with sound mining, engineering, geoscience and other applicable industry standards and practices, and in all material respects in accordance with all applicable Laws, including the requirements of NI 43-101. There has been no material reduction in the aggregate amount of estimated mineral resources of Fury from the amounts set forth in Fury Public Documents. All material information regarding the Fury Properties and the Fury Mineral Rights, including all drill results, technical reports and studies, that is required to be disclosed under NI 43-101, have been disclosed in Fury Public Documents on or before the date hereof. |
| 4.2 | Survival of Representations and Warranties |
The representations and warranties of Fury contained in this Agreement shall not survive the completion of the Arrangement and shall expire and be terminated on the earlier of the Effective Time and the date on which this Agreement is terminated in accordance with its terms.
ARTICLE 5
COVENANTS
| 5.1 | Covenants of QPM Regarding the Conduct of Business |
QPM covenants and agrees that prior to the Effective Date, unless Fury otherwise agrees in writing or as otherwise expressly contemplated or permitted by this Agreement:
| (a) | QPM shall conduct its businesses in the ordinary course of business and to use commercially reasonable efforts to (i) maintain and preserve its and their present business organization and goodwill, (ii) preserve the QPM Properties and the QPM Mineral Rights, and (iii) keep available the services of its officers and employees as a group and to maintain satisfactory relationships consistent with past practice with employees and others having business relationships with them; |
| (b) | without limiting the generality of Subsection 5.1(a), QPM shall not, directly or indirectly: |
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| (i) | issue, sell, grant, award, pledge, dispose of, encumber or agree to issue, sell, grant, award, pledge, dispose of or encumber any QPM Securities or any calls, conversion privileges or rights of any kind to acquire any QPM Shares or other securities, other than in accordance with the QPM Incentive Plans, the QPM Debt Settlement Agreements, or pursuant to the terms of existing QPM Securities as at the date hereof; |
| (ii) | other than in the ordinary course of business, sell, pledge, lease, dispose of, mortgage, licence, encumber or agree to sell, pledge, dispose of, mortgage, licence, encumber or otherwise transfer any assets of QPM or any interest in any assets of having a value greater than $10,000 in the aggregate; |
| (iii) | other than in the ordinary course of business, sell, pledge, lease, dispose of, mortgage, licence, encumber or agree to sell, pledge, dispose of, mortgage, licence, encumber or otherwise transfer the QPM Properties or any of the QPM Mineral Rights; |
| (iv) | enter into any long-term sale, forward sale, off-take, royalty, options or hedging agreement with respect to any commodities extracted from the QPM Properties or any QPM Mineral Right; |
| (v) | amend or propose to amend the articles, by-laws or other constating documents or the terms of any securities of QPM; |
| (vi) | split, combine or reclassify any outstanding QPM Shares; |
| (vii) | redeem, purchase or offer to purchase any QPM Shares or other securities of QPM; |
| (viii) | declare, set aside or pay any dividend or other distribution (whether in cash, securities or property or any combination thereof) in respect of any QPM Shares; |
| (ix) | reorganize, amalgamate or merge QPM with any other Person; |
| (x) | reduce the stated capital of the shares of QPM; |
| (xi) | acquire or agree to acquire (by merger, amalgamation, acquisition of shares or assets or otherwise) any Person, or make any investment either by purchase of shares or securities, contributions of capital, property transfer or purchase of any property or assets of any other Person that has a value greater than $10,000 in the aggregate; |
| (xii) | except in the ordinary course of business, incur, create, assume or otherwise become liable for any indebtedness for borrowed money or any other material liability or obligation or issue any debt securities, except for the borrowing of working capital in the ordinary course of business, or guarantee, endorse or otherwise as an accommodation become responsible for, the obligations of any other Person or make any loans or advances; |
| (xiii) | adopt a plan of liquidation or resolutions providing for the liquidation or dissolution of QPM; |
| (xiv) | pay, discharge, settle, satisfy, compromise, waive, assign or release any claims, liabilities or obligations other than the payment, discharge or satisfaction, in the ordinary course of business, of liabilities reflected or reserved against in QPM’s financial statements or incurred in the ordinary course of business not in excess of $10,000 in the aggregate; |
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| (xv) | authorize, recommend or propose any release or relinquishment of any contractual right, except in the ordinary course of business; |
| (xvi) | waive, release, grant, transfer, exercise, modify or amend in any material respect, other than in the ordinary course of business, (i) any existing contractual rights in respect of the QPM Properties or any QPM Mineral Rights, (ii) any material Authorization, lease, concession, contract or other document, or (iii) any other material legal rights or claims; |
| (xvii) | waive, release, grant or transfer any rights of value or modify or change in any material respect any existing licence, lease, contract or other document, other than in the ordinary course of business; |
| (xviii) | take any action or fail to take any action which action or failure to act would result in the material loss, expiration or surrender of, or the loss of any material benefit under, or reasonably be expected to cause any Governmental Entities to institute proceedings for the suspension, revocation or limitation of rights under, any material Authorizations necessary to conduct its businesses as now conducted; or fail to prosecute with commercially reasonable due diligence any pending applications to any Governmental Entities; |
| (xix) | take any action or fail to take any action that is intended to, or would reasonably be expected to, individually or in the aggregate, prevent, materially delay or materially impede the ability of QPM to consummate the Arrangement or the other transactions contemplated by this Agreement; |
| (xx) | increase the benefits payable or to become payable to its directors or officers, enter into or modify any employment, consulting, severance, or similar agreements or arrangements with, or grant any bonuses, salary increases, severance or termination pay to, any officers of QPM or member of the QPM Board other than pursuant to agreements already entered into and which agreements are disclosed in QPM Public Documents; |
| (xxi) | in the case of employees who are not officers of QPM or members of the QPM Board, take any action other than in the ordinary course of business (none of which actions shall be unreasonable or unusual) with respect to the grant of any bonuses, salary increases, severance or termination pay or with respect to any increase of benefits payable in effect on the date hereof; |
| (xxii) | other than pursuant to the Plan of Arrangement, establish, adopt, enter into, amend or waive any performance or vesting criteria or accelerate vesting, exercisability or funding under any bonus, profit sharing, thrift, incentive, compensation, stock option, restricted stock, pension, retirement, deferred compensation, savings, welfare, employment, termination, severance or other employee benefit plan, agreement, trust, fund, policy or arrangement for the benefit or welfare of any directors, officers, current or former employees of QPM; |
| (xxiii) | not enter into or renew any agreement, contract, lease, licence or other binding obligation of QPM: (A) containing (x) any limitation or restriction on the ability of QPM or, following completion of the transactions contemplated hereby, the ability of Fury and the Fury Material Subsidiaries, to engage in any type of activity or business, (y) any limitation or restriction on the manner in which, or the localities in which, all or any portion of the business of QPM or, following consummation of the transactions contemplated hereby, all or any portion of the business of Fury or the Fury Material Subsidiaries, is or would be conducted, or (z) any limit or restriction on the ability of QPM or, following completion of the transactions contemplated hereby, the ability of Fury or the Fury Material Subsidiaries, to solicit customers or employees; or (B) that would reasonably be expected to materially delay or prevent the consummation of the transactions contemplated by this Agreement; |
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| (xxiv) | not enter into or renew any agreement, contract, lease, licence or other binding obligation of QPM that is not terminable within 30 days of the Effective Date without payment by Fury or any of the Fury Material Subsidiaries that involves or would reasonably be expected to involve payments in excess of $10,000 in the aggregate over the term of the contract; |
| (xxv) | not incur any capital expenditures or enter into any agreement obligating QPM to provide for future capital expenditures involving payments in excess of $10,000 in the aggregate; |
| (xxvi) | take any action that would reasonably be expected to interfere with or be inconsistent with the completion of the Arrangement or the transactions contemplated in this Agreement, or which would render, or which reasonably may be expected to render, untrue or inaccurate (without giving effect to, applying or taking into consideration any materiality or QPM Material Adverse Effect qualification already contained within such representation or warranty) in any material respect any of the representations and warranties of QPM set forth in this Agreement; or |
| (xxvii) | authorize, agree, resolve or otherwise commit, whether or not in writing, to do any of the foregoing matters prohibited in this Section 5.1 |
| (c) | QPM shall use all reasonable commercial efforts to cause its current insurance (or re-insurance) policies not to be cancelled or terminated or any of the coverage thereunder to lapse, unless simultaneously with such termination, cancellation or lapse, replacement policies underwritten by insurance and re-insurance companies of internationally recognized standing providing coverage equal to or greater than the coverage under the cancelled, terminated or lapsed policies for substantially similar premiums are in full force and effect; |
| (d) | QPM shall use all reasonably commercial efforts to enter into the QPM Debt Settlement Agreements with the QPM Creditors and obtain any necessary approvals required for the QPM Debt Settlement Agreements, including but not limited to approval from the TSX-V and Majority of the Minority Approval (as applicable), which provide that effective immediately before the Effective Time, QPM will settle the QPM Settlement Debt through the issuance of QPM Debt Settlement Shares; |
| (e) | QPM shall: |
| (i) | duly and timely file all Tax Returns required to be filed by it on or after the date hereof and all such Tax Returns will be true, complete and correct in all material respects; |
| (ii) | fully and timely pay all Taxes shown on such Tax Returns; |
| (iii) | promptly notify Fury in writing of any audits, inquiries or investigations with respect to Tax of QPM; |
| (iv) | timely withhold, collect, remit and pay all Taxes which are to be withheld, collected, remitted or paid by it to the extent due and payable; |
| (v) | not make or rescind any material express or deemed election relating to Taxes; |
| (vi) | not make a new request for a Tax ruling or enter into any agreement with any taxing authorities or consent to any extension or waiver of any limitation period with respect to Taxes; |
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| (vii) | not settle or compromise any claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to Taxes; |
| (viii) | properly reserve (and reflect such reserves in its books and records and financial statements) for all Taxes accruing in respect of QPM which are not due or payable prior to the Effective Date in a manner consistent with past practice and in accordance with the provisions of applicable Laws; and |
| (ix) | not amend any Tax Return or change any of its methods of reporting income, deductions or accounting for income Tax purposes from those employed in the preparation of its income Tax Return for the tax year ended January 31, 2024, except as may be required by applicable Laws; and |
| (f) | QPM shall immediately notify Fury of any opposition, concerns or threats raised or brought by non- governmental organizations, communities or community organizations in respect of QPM’s current or planned operations. |
| 5.2 | Covenants of QPM Relating to the Arrangement |
QPM shall perform all obligations required to be performed by QPM under this Agreement, co-operate with Fury in connection therewith, and do all such other acts and things as may be necessary or desirable in order to consummate and make effective the transactions contemplated in this Agreement and QPM shall:
| (a) | use its commercially reasonable efforts to obtain and assist Fury in obtaining the Key Regulatory Approvals and Third Party Consents. Without limiting the generality of the foregoing, QPM shall use its commercially reasonable efforts to satisfy, as soon as reasonably possible, any requests for information and documentation received by any Governmental Entity. QPM will coordinate and cooperate in exchanging information and supplying assistance that is reasonably requested by Fury in connection with obtaining the Key Regulatory Approvals and Third Party Consents, including providing Fury with copies in advance and reasonable opportunity to comment on all notices, submissions, filings and information supplied to or filed with any Governmental Entity (except for notices and information which QPM, acting reasonably, considers highly confidential and competitively sensitive, which then shall be provided on an outside counsel only basis to external counsel for Fury), and all notices and correspondence received from a Governmental Entity. QPM shall not attend any meetings, whether in person or by telephone, with any Governmental Entity in connection with the transactions contemplated by this Agreement, unless it provides Fury with a reasonable opportunity to attend such meetings; |
| (b) | use its commercially reasonable efforts to obtain or provide, as applicable, as soon as practicable following execution of this Agreement all third party consents, approvals and notices required under any of the Material Contracts; |
| (c) | defend all lawsuits or other legal, regulatory or other proceedings against QPM challenging or affecting this Agreement or the consummation of the transactions contemplated hereby; and |
| (d) | use its commercially reasonable efforts to satisfy all conditions precedent in this Agreement and take all steps set forth in the Interim Order and Final Order. |
| 5.3 | Covenants of Fury Relating to the Arrangement |
Fury shall, and shall cause the Fury Material Subsidiaries to, perform all obligations required to be performed by Fury or any Fury Material Subsidiary under this Agreement, co-operate with QPM in connection therewith, and do all such other acts and things as may be necessary or desirable in order to consummate and make effective, as soon as reasonably practicable, the transactions contemplated in this Agreement and Fury shall:
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| (a) | use its commercially reasonable efforts to obtain and assist QPM in obtaining the Key Regulatory Approvals and Third Party Consents. Fury will coordinate and cooperate in exchanging information and supplying assistance that is reasonably requested by QPM in connection with obtaining the Key Regulatory Approvals and Third Party Consents, including providing QPM with copies in advance and reasonable opportunity to comment on all notices, submissions, filings and information supplied to or filed with any Governmental Entity (except for notices and information which Fury, acting reasonably, considers highly confidential and competitively sensitive, which then shall be provided on an outside counsel only basis to external counsel for QPM), and all notices and correspondence received from a Governmental Entity; |
| (b) | use its commercially reasonable efforts to obtain as soon as practicable following execution of this Agreement all third party consents, approvals and notices required under any of the material contracts; |
| (c) | defend all material lawsuits or other legal, regulatory or other proceedings against Fury challenging or affecting this Agreement or the consummation of the transactions contemplated hereby; |
| (d) | provide such assistance as may be reasonably requested by QPM for the purposes of completing the QPM Meeting; |
| (e) | apply for and use commercially reasonable efforts to obtain conditional approval of the listing and posting for trading on the TSX and the NYSE of the Fury Shares, subject only to satisfaction by Fury of customary listing conditions of the TSX and the NYSE; and |
| (f) | use commercially reasonable efforts to satisfy all conditions precedent in this Agreement. |
| 5.4 | Access to Information; Confidentiality |
Subject to the terms of the Confidentiality Agreement and applicable Laws, upon reasonable notice, QPM shall afford the Fury and/or Fury’s Representatives access, to such properties, books, contracts and records and other documents, information or data relating to QPM which Fury or its Representatives deem necessary or advisable to review in making an examination of QPM and its business (which includes but not limited to the QPM Properties and QPM Mineral Rights), as well as to its management personnel, and, during such period, QPM shall furnish promptly to Fury all information concerning QPM and its properties and personnel as Fury or its Representatives may reasonably request. At the request of Fury, QPM will execute or cause to be executed such consents, authorizations and directions as may be necessary to enable Fury or its Representatives to obtain full access to all files and records relating to QPM or its respective assets maintained by any Governmental Entity.
Subject to the terms of the Confidentiality Agreement and applicable Laws, Fury shall furnish promptly to QPM all information respecting material changes in QPM’s business, properties and personnel as QPM may reasonably request.
| 5.5 | Notices of Certain Events |
| (a) | Each Party will give prompt notice to the other of the occurrence, or failure to occur, at any time from the date hereof until the earlier to occur of the termination of this Agreement pursuant to its terms and the Effective Time of any event or state of facts which occurrence or failure would, or would be likely to: |
| (i) | cause any of the representations or warranties of such Party contained herein to be untrue or inaccurate in any material respect on the date hereof or at the Effective Time (provided, however, that this clause (i) shall not apply in the case of any event or state of facts resulting from the actions or omissions of a Party which are required under this Agreement); or |
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| (ii) | result in the failure to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by such Party hereunder prior to the Effective Time, |
provided, however, that the delivery of any notice pursuant to this Section 5.5 shall not limit or otherwise affect the remedies available hereunder to the Party receiving that notice.
| (b) | No Party may elect not to complete the transactions contemplated hereby pursuant to the conditions set forth herein or any termination right arising therefrom under Subsection 8.2(a)(iii)(C) or Subsection 8.2(a)(iv)(A) and no payments are payable as a result of such termination pursuant to Section 8.3 unless, prior to the Effective Date, the Party intending to rely thereon has delivered a written notice to the other Party specifying in reasonable detail all breaches of covenants, representations and warranties or other matters which the Party delivering such notice is asserting as the basis for the non-fulfilment or the applicable condition or termination right, as the case may be. If any such notice is delivered, provided, however, that a Party is proceeding diligently to cure such matter and such matter is capable of being cured, no Party may terminate this Agreement until the expiration of a period of ten Business Days from such notice. |
| 5.6 | Fury Capital Contribution to QPM |
At the Effective Time, Fury will advance to QPM as a contribution to its stated capital and without receiving any share capital or other consideration in exchange, a cash amount equal to the known QPM Closing Liabilities, and thereafter Fury shall contribute to QPM in the same manner such further amounts as shall be necessary from time to time to discharge any subsequently discovered QPM Closing Liabilities, if any (the “Fury Capital Contribution”).
| 5.7 | Insurance, Indemnification and Employee Payments |
| (a) | Fury agrees that it shall cause QPM to honour all rights to indemnification or exculpation now existing in favour of present and former officers and directors of QPM, to the extent that they are disclosed in Schedule 5.6(a) of the QPM Disclosure Letter, and acknowledges that such rights, to the extent that they are disclosed in Schedule 5.6(a) of the QPM Disclosure Letter, shall survive the completion of the Plan of Arrangement and shall continue in full force and effect for a period of not less than six (6) years from the Effective Date. |
| (b) | Prior to the Effective Time, QPM shall purchase customary “tail” or “run off” policies of directors’ and officers’ liability insurance providing protection for both current and former directors and officers of QPM who have held office within 12 months preceding the date of this Agreement, including directors and officers who retire or whose employment is terminated as a result of the Arrangement, no less favourable in the aggregate than the protection provided by the policies maintained by QPM immediately prior to the Effective Time and providing protection in respect of claims arising from facts or events which occurred on or prior to the Effective Time and Fury will, or will cause QPM to, maintain such tail policies in effect without any reduction in scope or coverage for six (6) years following the Effective Time. |
| (c) | Following the Effective Time, subject to any other provision of this Agreement, Fury shall and shall cause QPM to honour and pay all amounts triggered by the completion of the Arrangement in all employment agreements, consultant agreements, equity or security based compensation arrangements, policies or other similar arrangements or plans of any kind which are disclosed in Schedule 5.6(b) of the QPM Disclosure Letter and copies of which have been made available to Fury by QPM prior to the date hereof. |
| (d) | The provisions of this Section 5.6 are intended for the benefit of, and shall be enforceable by, each insured or indemnified person or party to or participant in each employment agreement, consultant agreement, equity or security based compensation arrangement, policy or other similar arrangement which are described in the QPM Disclosure Letter and which QPM has provided an executed copy thereof to Fury prior to the date hereof, his or her heirs and his or her legal representatives and, for such purpose, QPM hereby confirms that it is acting as agent on their behalf. Furthermore, this Section 5.6 shall survive the termination of this Agreement as a result of the occurrence of the Effective Date for a period of six (6) years. |
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| (e) | Fury and QPM acknowledge and agree that, for Canadian tax purposes, no deduction will be claimed by QPM or any person not dealing at arm’s length with QPM in respect of any amounts payable to QPM Optionholders under the Plan of Arrangement and Fury will cause QPM to elect in prescribed form, and do all such things as required to make the election, under subsection 110(1.1) of the Tax Act, that neither QPM or any person not dealing at arm’s length with QPM will deduct, in computing income for purposes of the Tax Act, any amount in respect of any consideration payable to QPM Optionholders as contemplated by this Agreement and the Plan of Arrangement. Fury will cause QPM to, provide QPM Optionholders with evidence in writing of such election under subsection 110(1.1) of the Tax Act. |
ARTICLE 6
CONDITIONS
| 6.1 | Mutual Conditions Precedent |
The obligations of the Parties to complete the Arrangement are subject to the fulfillment of each of the following conditions precedent on or before the Effective Time, each of which may only be waived with the mutual consent of the Parties:
| (a) | the Arrangement Resolution shall have been approved and adopted at the QPM Meeting in accordance with the Interim Order; |
| (b) | the Interim Order and the Final Order shall each have been obtained on terms consistent with this Agreement, and shall not have been set aside or modified in a manner unacceptable to QPM and Fury, acting reasonably, on appeal or otherwise; |
| (c) | the Key Regulatory Approvals and Third Party Consents shall have been obtained on terms acceptable to the Parties, each acting reasonably; |
| (d) | no Governmental Entity shall have enacted, issued, promulgated, enforced or entered any Law which is then in effect and has the effect of making the Arrangement illegal or otherwise preventing or prohibiting consummation of the Arrangement; and |
| (e) | the Consideration Shares to be issued pursuant to the Arrangement have been conditionally approved or authorized for listing on the TSX and the NYSE (subject only to customary listing conditions). |
| 6.2 | Additional Conditions Precedent to the Obligations of Fury |
The obligation of Fury to complete the Arrangement is subject to the fulfillment of each of the following additional conditions precedent on or before the Effective Time (each of which is for the exclusive benefit of Fury and may be waived by Fury):
| (a) | all representations and warranties of QPM set forth in this Agreement that are qualified by materiality or by the expression QPM Material Adverse Effect were true and correct in all respects as of the date of this Agreement and shall be true and correct in all respects as of the Effective Time, as though made on and as of the Effective Time (except for representations and warranties made as of a specified date, the accuracy of which shall be determined as of that specified date) and all other representations and warranties of QPM were true and correct in all respects as of the date of this Agreement and shall be true and correct in all material respects as of the Effective Time, as though made on and as of the Effective Time (except for representations and warranties made as of a specified date, the accuracy of which shall be determined as of that specified date), and Fury shall have received a certificate of QPM addressed to Fury and dated the Effective Date, signed on behalf of QPM by two executive officers of QPM (on QPM’s behalf and without personal liability), confirming the same as at the Effective Time; |
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| (b) | all covenants of QPM under this Agreement to be performed on or before the Effective Time shall have been duly performed by QPM in all material respects, and Fury shall have received a certificate of QPM addressed to Fury and dated the Effective Date, signed on behalf of QPM by two executive officers of QPM (on QPM’s behalf and without personal liability), confirming the same as at the Effective Time; |
| (c) | the QPM Debt Settlement Agreements will have been entered into prior to the Effective Time and the QPM Settlement Debt shall have been converted immediately prior to the Effective Time through the issuance of up to 5,959,671 QPM Debt Settlement Shares pursuant to the terms and conditions of the QPM Debt Settlement Agreements, and the QPM Creditors shall have delivered to Fury any documents and deeds required to release and discharge all the QPM Creditors’ interests relating to the QPM Settlement Debt. |
| (d) | there shall be no suit, action or proceeding by any Governmental Entity or any other Person that has resulted in an imposition of material limitations on the ability of Fury to acquire or hold, or exercise full rights of ownership of, any QPM Shares, including the right to vote the QPM Shares to be acquired by it on all matters properly presented to the QPM Shareholders. |
| (e) | there shall not have occurred a QPM Material Adverse Effect, and Fury shall have received a certificate signed on behalf of QPM by two executive officers of QPM (on QPM’s behalf and without personal liability) to such effect; |
| (f) | holders of no more than 5% of the QPM Shares shall have exercised Dissent Rights; and |
| (g) | Fury shall have received resignations and releases in such form as is acceptable to Fury, acting reasonably, in favour of QPM from each of the directors and officers of QPM. |
The foregoing conditions will be for the sole benefit of Fury and may be waived by it in whole or in part at any time.
| 6.3 | Additional Conditions Precedent to the Obligations of QPM |
The obligation of QPM to complete the Arrangement is subject to the fulfillment of each of the following additional conditions precedent on or before the Effective Time (each of which is for the exclusive benefit of QPM and may be waived by QPM):
| (a) | all representations and warranties of Fury set forth in this Agreement that are qualified by materiality or by the expression Fury Material Adverse Effect were true and correct in all respects as of the date of this Agreement and shall be true and correct in all respects as of the Effective Time, as though made on and as of the Effective Time (except for representations and warranties made as of a specified date, the accuracy of which shall be determined as of that specified date) and all other representations and warranties of Fury were true and correct in all respects as of the date of this Agreement and shall be true and correct in all material respects as of the Effective Time, as though made on and as of the Effective Time (except for representations and warranties made as of a specified date, the accuracy of which shall be determined as of that specified date), and QPM shall have received a certificate of Fury addressed to QPM and dated the Effective Date, signed on behalf of Fury by two executive officers of Fury (on Fury’s behalf and without personal liability), confirming the same as at the Effective Time; |
| (b) | all covenants of Fury under this Agreement to be performed on or before the Effective Time shall have been duly performed by Fury in all material respects, and QPM shall have received a certificate of Fury addressed to QPM and dated the Effective Date, signed on behalf of Fury by two executive officers of Fury (on Fury’s behalf and without personal liability), confirming the same as at the Effective Time; |
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| (c) | Fury shall have complied with its obligations under Section 2.8 and the Depositary shall have confirmed receipt of the Consideration; and |
| (d) | there shall not have occurred a Fury Material Adverse Effect and QPM shall have received a certificate signed by two executive officers of Fury (on Fury’s behalf and without personal liability) to such effect. |
The foregoing conditions will be for the sole benefit of QPM and may be waived by it in whole or in part at any time.
| 6.4 | Satisfaction of Conditions |
The conditions precedent set out in Section 6.1, Section 6.2 and Section 6.3 shall be conclusively deemed to have been satisfied, waived or released when the Certificate of Arrangement is issued by the Director following filing of the Articles of Arrangement with the consent of the Parties in accordance with the terms of this Agreement.
ARTICLE 7
NON-SOLICITATION COVENANTS
| 7.1 | Non-Solicitation |
| (a) | Except as otherwise expressly provided in this Section 7.1, QPM shall not, directly or indirectly, through any officer, director, employee, representative (including any financial or other adviser) or agent of QPM (collectively, “Representatives”), or otherwise, and shall cause any such Person not to: |
| (i) | solicit, initiate, encourage or otherwise facilitate (including by way of furnishing or providing copies of, access to, or disclosure of, any confidential information, properties, facilities, books or records of QPM or entering into any form of agreement, arrangement or understanding) any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal; |
| (ii) | enter into or otherwise engage or participate in any discussions or negotiations with any Person (other than Fury) regarding any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to, an Acquisition Proposal; |
| (iii) | take any action or fail to take any action that, in either case, constitutes a QPM Change of Recommendation; |
| (iv) | accept, approve, endorse or recommend, or publicly propose to accept, approve, endorse or recommend, or take no position or remain neutral with respect to, any Acquisition Proposal (it being understood that publicly taking no position or a neutral position with respect to a publicly announced, or otherwise publicly disclosed, Acquisition Proposal for a period of no more than five Business Days will not be considered to be in violation of this Section 7.1 provided the QPM Board has rejected such Acquisition Proposal and affirmed the QPM Board Recommendation before the end of such five Business Day period (or in the event that the QPM Meeting is scheduled to occur within such five Business Day period, prior to the third Business Day prior to the date of the QPM Meeting)); or |
| (v) | enter into (other than a confidentiality agreement permitted by and in accordance with Section 7.3) or publicly propose to enter into any agreement, understanding or arrangement in respect of an Acquisition Proposal. |
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| (b) | QPM shall, and shall cause its Representatives to, immediately cease and terminate, and cause to be terminated, any solicitation, encouragement, discussion, negotiation, or other activity commenced prior to the date of this Agreement with any Person (other than Fury) with respect to any inquiry, proposal or offer that constitutes, or may reasonably be expected to constitute or lead to, an Acquisition Proposal, and in connection therewith shall: |
| (i) | immediately discontinue access to and disclosure of all information, including any data room, any confidential information, properties, facilities, books and records of QPM; and |
| (ii) | promptly, and in any event within two Business Days of the date of this Agreement, request, and exercise all rights it has to require (A) the return or destruction of all copies of any confidential information regarding QPM provided to any Person other than Fury, and (B) the destruction of all material including or incorporating or otherwise reflecting such confidential information regarding QPM using its best efforts to ensure that such requests are fully complied with in accordance with the terms of such rights or entitlements. |
| (c) | QPM represents and warrants that QPM has not waived any confidentiality, standstill or similar agreement or restriction to which QPM is a party and covenants and agrees that (i) QPM shall take all necessary action to enforce each confidentiality, standstill or similar agreement or restriction to which the QPM is a party, and (ii) QPM, nor any of its Representatives, have released or will, without the prior written consent of Fury (which may be withheld or delayed in Fury’s sole and absolute discretion), release any Person from, or waive, amend, suspend or otherwise modify such Person’s obligations respecting QPM, under any confidentiality, standstill or similar agreement or restriction to which QPM is a party. |
| 7.2 | Notification of Acquisition Proposals |
If QPM or any of its Representatives, receives or otherwise becomes aware of any inquiry, proposal or offer that constitutes or may reasonably be expected to constitute or lead to an Acquisition Proposal, or any request for copies of, access to, or disclosure of, confidential information relating to QPM, including information, access, or disclosure relating to the properties, facilities, books or records of QPM, QPM shall immediately notify Fury, at first orally, and then promptly and in any event within 24 hours in writing, of such Acquisition Proposal, inquiry, proposal, offer or request, including a description of its material terms and conditions, the identity of all Persons making the Acquisition Proposal, inquiry, proposal, offer or request, and shall provide Fury with copies of all written documents, correspondence or other material received (and, if not in writing or electronic form, a description of the material terms thereof) in respect of, from or on behalf of any such Person. QPM shall keep Fury fully informed on a current basis of the status of developments and negotiations with respect to such Acquisition Proposal, inquiry, proposal, offer or request, including any changes, modifications or other amendments to any such Acquisition Proposal, inquiry, proposal, offer or request.
| 7.3 | Responding to an Acquisition Proposal |
Notwithstanding Section 7.1, if at any time following the date of this Agreement and prior to obtaining the QPM Shareholder Approval, QPM receives an Acquisition Proposal, the QPM Board may engage in or participate in discussions or negotiations with such Person regarding such Acquisition Proposal, and may provide copies of, access to or disclosure of information, properties, facilities, books or records of QPM, if and only if:
| (a) | the QPM Board first determines in good faith, after consultation with its financial advisors and its outside legal counsel, that such Acquisition Proposal constitutes or would reasonably be expected to constitute or lead to a Superior Proposal; |
| (b) | such Person was not restricted from making such Acquisition Proposal pursuant to an existing confidentiality, standstill or similar agreement or restriction to which QPM is a party; |
| (c) | QPM has been, and continues to be, in compliance with its obligations under this Article 7; and |
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| (d) | prior to providing any such copies, access, or disclosure: |
| (i) | QPM enters into a confidentiality and standstill agreement with such Person and substance that is customary of transactions of this nature; |
| (ii) | QPM provides Fury with a true, complete and final executed copy of the confidentiality and standstill agreement referred to in this Section 7.3(d)(i); and |
| (iii) | any such copies, access or disclosure provided to such Person shall have already been (or simultaneously be) provided to Fury. |
| 7.4 | Right to Match |
| (a) | If QPM receives an Acquisition Proposal that constitutes a Superior Proposal prior to the approval of the Arrangement Resolution by the QPM Shareholders, the QPM Board may, subject to compliance with Article 7 and Section 8.3, enter into a definitive agreement with respect to such Acquisition Proposal, if and only if: |
| (i) | the Person making the Superior Proposal was not restricted from making such Superior Proposal pursuant to an existing confidentiality, standstill or similar agreement or restriction; |
| (ii) | QPM has been, and continues to be, in compliance with its obligations under this Article 7; |
| (iii) | QPM has delivered to Fury a written notice of the determination of the QPM Board that such Acquisition Proposal constitutes a Superior Proposal and of the intention of the QPM Board to enter into such definitive agreement with respect to such Superior Proposal, such notice to include a summary of the factors used by the QPM Board to conclude that the Acquisition Proposal constitutes a Superior Proposal and, in the case of a proposal that includes non-cash consideration, the value or range of values attributed by the QPM Board, in good faith, to such non-cash consideration, after consultation with its financial advisers (the “Superior Proposal Notice”); |
| (iv) | QPM has provided Fury with a copy of the proposed definitive agreement for the Superior Proposal and all supporting materials, including any financing documents provided to QPM in connection therewith; |
| (v) | at least five (5) Business Days (the “Matching Period”) have elapsed from the date that is the later of the date on which Fury received the Superior Proposal Notice and the date Fury received all of the materials set forth in Subsection 7.4(a)(iv); |
| (vi) | during any Matching Period, Fury has had the opportunity (but not the obligation), in accordance with Section 7.4(b), to offer to amend this Agreement and the Arrangement in order for such Acquisition Proposal to cease to be a Superior Proposal; |
| (vii) | if Fury has offered to amend this Agreement and the Arrangement under Section 7.4(b), the QPM Board has determined in good faith, after consultation with its outside legal counsel and financial advisers, that such Acquisition Proposal continues to constitute a Superior Proposal compared to the terms of the Arrangement as proposed to be amended by Fury under Section 7.4(b); |
| (viii) | the QPM Board has determined in good faith, after consultation with its outside legal counsel, that the failure by the QPM Board to recommend that QPM enter into a definitive agreement with respect to such Superior Proposal would be inconsistent with its fiduciary duties; and |
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| (ix) | prior to entering into such definitive agreement, QPM terminates this Agreement pursuant to Subsection 8.2(a)(iv)(B) and pays the Termination Fee pursuant to Section 8.3. |
| (b) | During the Matching Period, or such longer period as QPM may approve in writing for such purpose: (i) the QPM Board shall review any offer made by Fury to amend the terms of this Agreement and the Arrangement in good faith in order to determine whether such proposal would, upon acceptance, result in the Acquisition Proposal previously constituting a Superior Proposal ceasing to be a Superior Proposal; and (ii) QPM shall negotiate in good faith with Fury to make such amendments to the terms of this Agreement and the Arrangement as would enable Fury to proceed with the transactions contemplated by this Agreement on such amended terms. If the QPM Board determines that such Acquisition Proposal would cease to be a Superior Proposal, QPM shall promptly so advise Fury and QPM and Fury shall amend this Agreement to reflect such offer made by Fury, and shall take and cause to be taken all such actions as are necessary to give effect to the foregoing. |
| (c) | Each successive amendment or modification to any Acquisition Proposal shall constitute a new Acquisition Proposal for the purposes of this Section 7.3, and Fury shall be afforded a new five (5) Business Day Matching Period from the later of the date on which Fury received the Superior Proposal Notice and the date on which Fury received all of the materials set forth in Section 7.4(a)(iv) with respect to the new Superior Proposal from QPM. |
| (d) | The QPM Board shall promptly reaffirm the QPM Board Recommendation by press release after any Acquisition Proposal which is not determined to be a Superior Proposal is publicly announced or the QPM Board determines that a proposed amendment to the terms of this Agreement as contemplated under Section 7.4(b) would result in an Acquisition Proposal no longer being a Superior Proposal. QPM shall provide Fury and its outside legal counsel with a reasonable opportunity to review the form and content of any such press release and shall make all reasonable amendments to such press release as requested by Fury and its counsel. |
| (e) | If QPM provides a Superior Proposal Notice to Fury on a date that is less than 10 Business Days before the date of the QPM Meeting, QPM shall (i) if requested in writing by Fury, postpone or adjourn the QPM Meeting to a date designated by Fury (which shall not be more than 10 Business Days after the scheduled date of the QPM Meeting or any previous postponement or adjournment thereof) or (ii) if no such request is made, continue to take all steps necessary to hold with the QPM Meeting on its scheduled date and to cause the Arrangement Resolution to be voted on at the QPM Meeting. |
ARTICLE 8
TERM, TERMINATION, AMENDMENT AND WAIVER
| 8.1 | Term |
This Agreement shall be effective from the date hereof until the earlier of the Effective Time and the termination of this Agreement in accordance with its terms.
| 8.2 | Termination |
| (a) | This Agreement may be terminated at any time prior to the Effective Time (notwithstanding any approval of this Agreement or the Arrangement Resolution by the QPM Shareholders and/or by the Court, as applicable): |
| (i) | by mutual written agreement of the Parties; |
| (ii) | by either QPM or Fury, if: |
| (A) | the Effective Time does not occur on or before the Outside Date, except that the right to terminate this Agreement under this Subsection 8.2(a)(ii)(A) is not available to a Party whose failure to fulfill any of its obligations or breach of any of its representations and warranties under this Agreement has been the direct or indirect cause of, or resulted in, the failure of the Effective Time to occur by such Outside Date; |
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| (B) | after the date of this Agreement, any Law is enacted, made, enforced or amended, as applicable, that makes consummation of the Arrangement illegal or otherwise prohibited or enjoins QPM or Fury from consummating the Arrangement and such applicable Law or enjoinment that has become final and non-appealable; or |
| (C) | QPM Shareholder Approval or the Majority of the Minority Approval, if applicable, is not obtained at the QPM Meeting in accordance with the Interim Order; |
| (iii) | by Fury, if: |
| (A) | QPM or the QPM Board takes any action or fails to take any action that, in either case, constitutes a QPM Change of Recommendation or otherwise breaches Article 7 in any material respect; |
| (B) | QPM enters into (other than a confidentiality agreement permitted by Section 7.3) any letter of intent, agreement in principal, agreement, arrangement or understanding in respect of an Acquisition Proposal, other than in circumstances where QPM has terminated this Agreement in accordance with Section 8.2(a)(iv)(B) and paid the Termination Fee in accordance with Section 8.3(a); |
| (C) | a breach of any representation or warranty or failure to perform any covenant or agreement on the part of QPM under this Agreement occurs that would cause any condition in Subsection 6.2(b) or Subsection 6.2(a) not to be satisfied, and such breach or failure is incapable of being cured on or prior to the Outside Date or is not cured in accordance with the terms of Subsection 5.5(b), provided, however, that Fury is not then in breach of this Agreement so as to cause any condition in Subsection 6.3(b) or Subsection 6.3(a) not to be satisfied; |
| (D) | a Material Adverse Effect has occurred in respect of QPM and is continuing; or |
| (E) | an Acquisition Proposal shall have been made to Fury or an Acquisition Proposal with respect to Fury shall have been publicly announced or any Person shall have publicly announced the intention to make an Acquisition Proposal with respect to Fury and Fury has determined that such Acquisition Proposal constitutes a Fury Superior Proposal; |
| (iv) | by QPM, if |
| (A) | a breach of any representation or warranty or failure to perform any covenant or agreement on the part of Fury under this Agreement occurs that would cause any condition in Subsection 6.3(b) or Subsection 6.3(a) not to be satisfied, and such breach or failure is incapable of being cured on or prior to the Outside Date or is not cured in accordance with the terms of Subsection 5.5(b), provided, however, that QPM is not then in breach of this Agreement so as to cause any condition in Subsection 6.2(b) or Subsection 6.2(a) not to be satisfied; |
| (B) | prior to the approval by the QPM Shareholders of the Arrangement Resolution, the QPM Board authorizes QPM to enter into a written agreement with respect to a Superior Proposal, provided QPM is then in compliance with Article 7 and that prior to or concurrent with such termination QPM pays the Termination Fee in accordance with Section 8.3; or |
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| (C) | a Material Adverse Effect has occurred in respect of Fury and is continuing |
| (b) | The Party desiring to terminate this Agreement pursuant to this Section 8.2 (other than pursuant to Subsection 8.2(a)(i)) shall give notice of such termination to the other Parties, specifying in reasonable detail the basis for such Party’s exercise of its termination right. |
| (c) | If this Agreement is terminated pursuant to this Section 8.2, this Agreement shall become void and be of no further force or effect without liability of any Party (or any shareholder, director, officer, employee, agent, consultant or representative of such Party) to any other Party hereto, except that the provisions of this Subsection 8.2(c) and Sections 8.3, 9.3, 9.4, 9.6 and 9.7 and all related definitions set forth in Section 1.1 shall survive any termination hereof pursuant to Subsection 8.2(a). |
| 8.3 | QPM Termination Fee |
| (a) | If a QPM Termination Fee Event occurs, QPM shall pay Fury the Termination Fee in accordance with Subsection 8.3(c). |
| (b) | For the purposes of this Agreement, “QPM Termination Fee Event” means the termination of this Agreement in any of the following circumstances: |
| (i) | by Fury pursuant to Subsection 8.2(a)(iii)(A) (QPM Change of Recommendation or other breach of Section 7 deal protection covenants); |
| (ii) | by Fury pursuant to Section 8.2(a)(iii)(B) (QPM Agreement with respect to Acquisition Proposal); |
| (iii) | by QPM pursuant to Subsection 8.2(a)(iv)(B) (QPM enters into QPM Superior Proposal); or |
| (iv) | this Agreement is terminated: |
| (A) | by either Party pursuant to Section 8.2(a)(ii)(A) (Effective Time not occurring by Outside Date); |
| (B) | by either Party pursuant to Section 8.2(a)(ii)(C) (Failure to obtain QPM Shareholder Approval); or |
| (C) | by Fury pursuant to Subsection 8.2(a)(iii)(C) (QPM Breach of Representations, Warranties or Covenants) |
but only if, in the case of this Section 8.3(b)(iv), prior to the termination of this Agreement, an Acquisition Proposal shall have been made to QPM, or an Acquisition Proposal with respect to QPM is publicly announced or any Person shall have publicly announced the intention to make an Acquisition Proposal with respect to QPM (other than by Fury), and if within twelve months following the date of such termination (i) QPM or one of its subsidiaries enters into a definitive agreement in respect of an Acquisition Proposal, whether or not such Acquisition Proposal is the same Acquisition Proposal referred to in this paragraph; and (ii) such Acquisition Proposal is consummated at any time thereafter (whether or not within twelve months following the date of termination of this Agreement), in which case the Termination Fee shall be payable within two Business Days following the closing of the applicable transaction referred to therein.
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For purposes of this Section 8.3(b)(iv), the term “Acquisition Proposal” shall have the meaning ascribed thereto in Section 1.1 except that the references to “20%” therein shall be deemed to be references to “50%”.
| (c) | If a QPM Termination Fee Event occurs, the Termination Fee shall be paid by QPM to Fury, by wire transfer of immediately available funds to an account designated by Fury within two (2) Business Days of the occurrence of such QPM Termination Fee Event; |
| (d) | QPM acknowledges that the agreements contained in this Section 8.3 are an integral part of the transactions contemplated in this Agreement and that, without those agreements, Fury would not enter into this Agreement. QPM acknowledges that all of the payment amounts set out in this Section 8.3 are payments of liquidated damages which are a genuine pre-estimate of the damages which Fury will suffer or incur as a result of the event giving rise to such payment and the resultant termination of this Agreement and are not penalties. QPM irrevocably waives any right it may have to raise as a defence that any such liquidated damages are excessive or punitive. Fury agrees that the payment of the Termination Fee in the manner provided in this Section 8.3 is the sole and exclusive remedy of Fury in respect of the event giving rise to such payment, provided, however, that this limitation shall not apply in the event of fraud or a wilful breach by QPM of its representations, warranties, covenants or agreements set forth in this Agreement (which breach and liability therefore shall not be affected by termination of this Agreement or any payment of the Termination Fee). For greater certainty, should Fury have reason to terminate this Agreement but elect not to terminate this Agreement, Fury shall be free to pursue any and all remedies against QPM, including injunctive relief, specific performance or other equitable remedy, arising from the facts entitling Fury to otherwise terminate this Agreement. |
| 8.4 | Fury Termination Fee |
| (a) | If a Fury Termination Fee Event occurs, Fury shall pay QPM the Termination Fee in accordance with Subsection 8.4(c). |
| (b) | For the purposes of this Agreement, “Fury Termination Fee Event” means the termination of this Agreement in the following circumstances: |
| (i) | by Fury pursuant to Section 8.2(a)(iii)(E) (Fury Superior Proposal); |
| (ii) | by QPM pursuant to Subsection 8.2(a)(iv)(A) (Fury Breach of Representations, Warranties or Covenants); |
| (iii) | by QPM pursuant to Section 8.2(a)(ii)(A) (Effective Time not occurring by Outside Date) in circumstances where: (i) QPM has fulfilled all of its obligations under this Agreement and (ii) Fury has failed to fulfill any of its obligations or was in breach of any of its representations and warranties under this Agreement and such failure was the direct or indirect cause of, or resulted in, the failure of the Effective Time to occur by such Outside Date. |
| (c) | If the Fury Termination Fee Event occurs, the Termination Fee shall be paid by Fury to QPM, by wire transfer of immediately available funds to an account designated by QPM within two (2) Business Days of the occurrence of such Fury Termination Fee Event; |
| (d) | Fury acknowledges that the agreements contained in this Section 8.4 are an integral part of the transactions contemplated in this Agreement and that, without those agreements, QPM would not enter into this Agreement. Fury acknowledges that all of the payment amounts set out in this Section 8.4 are payments of liquidated damages which are a genuine pre-estimate of the damages which QPM will suffer or incur as a result of the event giving rise to such payment and the resultant termination of this Agreement and are not penalties. Fury irrevocably waives any right it may have to raise as a defence that any such liquidated damages are excessive or punitive. QPM agrees that the payment of the Termination Fee in the manner provided in this Section 8.4 is the sole and exclusive remedy of QPM in respect of the event giving rise to such payment, provided, however, that this limitation shall not apply in the event of fraud or a wilful breach by Fury of its representations, warranties, covenants or agreements set forth in this Agreement (which breach and liability therefore shall not be affected by termination of this Agreement or any payment of the Termination Fee). For greater certainty, should QPM have reason to terminate this Agreement but elect not to terminate this Agreement, QPM shall be free to pursue any and all remedies against Fury, including injunctive relief, specific performance or other equitable remedy, arising from the facts entitling QPM to otherwise terminate this Agreement. |
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| 8.5 | Expenses |
Except as otherwise provided herein, all out-of-pocket third party transaction expenses incurred in connection with this Agreement and the Plan of Arrangement, including all costs, expenses and fees of QPM or Fury incurred prior to or after the Effective Date in connection with, or incidental to, the Plan of Arrangement, shall be paid by the Party incurring such expenses, whether or not the Arrangement is consummated.
| 8.6 | Amendment |
Subject to the provisions of the Interim Order, the Plan of Arrangement and applicable Laws, this Agreement and the Plan of Arrangement may, at any time and from time to time before or after the holding of the QPM Meeting but not later than the Effective Time, be amended by mutual written agreement of the Parties, without further notice to or authorization on the part of the QPM Shareholders, and any such amendment may without limitation:
| (a) | change the time for performance of any of the obligations or acts of the Parties; |
| (b) | waive any inaccuracies or modify any representation or warranty contained herein or in any document delivered pursuant hereto; |
| (c) | waive compliance with or modify any of the covenants herein contained and waive or modify performance of any of the obligations of the Parties; and |
| (d) | waive compliance with or modify any mutual conditions precedent herein contained. |
| 8.7 | Waiver |
Any Party may (a) extend the time for the performance of any of the obligations or acts of the other Party, (b) waive compliance, except as provided herein, with any of the other Party’s agreements or the fulfilment of any conditions to its own obligations contained herein, or (c) waive inaccuracies in any of the other Party’s representations or warranties contained herein or in any document delivered by the other Party; provided, however, that any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such Party and, unless otherwise provided in the written waiver, will be limited to the specific breach or condition waived.
ARTICLE 9
GENERAL PROVISIONS
| 9.1 | Privacy |
Each Party shall comply with applicable privacy Laws in the course of collecting, using and disclosing personal information about identifiable individuals in connection with the transactions contemplated hereby (the “Transaction Personal Information”). Neither Party shall disclose Transaction Personal Information originally collected by the other Party to any Person other than to its advisors who are evaluating and advising on the transactions contemplated by this Agreement. If Fury completes the transactions contemplated by this Agreement, Fury shall not, following the Effective Date, without the consent of the individuals to whom such Transaction Personal Information relates or as permitted or required by applicable Law, use or disclose Transaction Personal Information originally collected by QPM:
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| (a) | for purposes other than those for which such Transaction Personal Information was collected by QPM prior to the Effective Date; and |
| (b) | which does not relate directly to the carrying on of the business of QPM or to the carrying out of the purposes for which the transactions contemplated by this Agreement were implemented. |
The Parties shall protect and safeguard the Transaction Personal Information against unauthorized collection, use or disclosure. Fury shall cause its advisors to observe the terms of this Section 9.1 and to protect and safeguard all Transaction Personal Information in their possession. If this Agreement shall be terminated, each Party shall promptly deliver to the other Party all Transaction Personal Information originally collected by such other Party in its possession or in the possession of any of its advisors, including all copies, reproductions, summaries or extracts thereof, except, unless prohibited by applicable Law, for electronic backup copies made automatically in accordance with the usual backup procedures of the Party returning such Transaction Personal Information.
| 9.2 | Notices |
All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed to have been duly given and received on the day it is delivered, provided, however, that it is delivered on a Business Day prior to 5:00 p.m. local time in the place of delivery or receipt. However, if notice is delivered after 5:00 p.m. local time or if such day is not a Business Day then the notice shall be deemed to have been given and received on the next Business Day. Notice shall be sufficiently given if delivered (either in Person, by courier service or other personal method of delivery), or if transmitted by email to the Parties at the following addresses (or at such other addresses as shall be specified by any Party by notice to the other given in accordance with these provisions):
| (a) | if to Fury: |
Fury Gold Mines Limited 401 Bay Street, 16th Floor Toronto, Ontario
M5H 2Y4
Attention: Tim Clark, CEO
Email: Email address redacted.
with a copy (which shall not constitute notice) to:
McMillan LLP
1000 Sherbrooke West, Suite 2700 Montréal, Québec
H3A 3G4
Attention: Michael Taylor
E-mail: michael.taylor@mcmillan.ca
| (b) | if to QPM: |
Québec Precious Metals Corporation 800 Rue du Square-Victoria
Suite 3500 Montréal, Quebec H3C 0B4
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Attention: Normand Champigny, CEO
Email: Email address redacted.
with a copy (which shall not constitute notice) to: BCF LLP
1100 René-Lévesque Blvd. West
25th Floor Montréal, Quebec H3B 5C9
Attention: Gilles Seguin & Julien Lefebvre
E-mail: gilles.seguin@bcf.ca; julien.lefebvre@bcf.ca
| 9.3 | Governing Law |
This Agreement shall be governed, including as to validity, interpretation and effect, by the Laws of the Province of Québec and the Laws of Canada applicable therein. Each of the Parties hereby irrevocably attorns to the exclusive jurisdiction of the courts of the Province of Québec in respect of all matters arising under and in relation to this Agreement and the Arrangement.
| 9.4 | Injunctive Relief |
The Parties agree that irreparable harm would occur for which money damages would not be an adequate remedy at Law in the event that any of the provisions of this Agreement were not performed by QPM in accordance with their specific terms or were otherwise breached by QPM. It is accordingly agreed that Fury shall be entitled to injunctive and other equitable relief to prevent breaches of this Agreement, and to enforce compliance with the terms of this Agreement against QPM without any requirement for the securing or posting of any bond in connection with the obtaining of any such injunctive or other equitable relief, this being in addition to any other remedy to which Fury may be entitled at law or in equity.
| 9.5 | Time of Essence |
Time shall be of the essence in this Agreement.
| 9.6 | Entire Agreement, Binding Effect and Assignment |
This Agreement (including the exhibits and schedules hereto), together with the Confidentiality Agreement and the QPM Disclosure Letter constitute the entire agreement, and supersede all other prior agreements and understandings, both written and oral, between the Parties, or any of them, with respect to the subject matter hereof and thereof and, except as expressly provided herein, this Agreement is not intended to and shall not confer upon any Person other than the Parties any rights or remedies hereunder. Neither this Agreement nor any of the rights, interests or obligations hereunder may be assigned by either of the Parties without the prior written consent of the other Parties.
| 9.7 | No Liability |
No director or officer of Fury shall have any personal liability whatsoever to QPM under this Agreement, or any other document delivered in connection with the transactions contemplated hereby on behalf of Fury. No director or officer of QPM shall have any personal liability whatsoever to Fury under this Agreement, or any other document delivered in connection with the transactions contemplated hereby on behalf of QPM.
| 9.8 | Severability |
If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule or Law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any Party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the fullest extent possible.
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| 9.9 | Counterparts, Execution |
This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument. The Parties shall be entitled to rely upon delivery of an executed facsimile or similar executed electronic copy of this Agreement, and such facsimile or similar executed electronic copy shall be legally effective to create a valid and binding agreement between the Parties.
| 9.10 | Language |
The Parties confirm having requested that this Agreement and all notices or other communications relating to them be drawn-up in the English language only. Les Parties aux présentes confirment avoir requis que cette convention ainsi que tous les avis et autres communications s’y rapportant soient rédigés en langue anglaise seulement.
[Remainder of page intentionally left blank.]
IN WITNESS WHEREOF Fury and QPM have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.
| FURY GOLD MINES LIMITED | |||
| By: | /s/ "Tim Clark" | ||
| Name: Tim Clark | |||
| Title: Chief Executive Officer | |||
| QUÉBEC PRECIOUS METALS CORPORATION | |||
| By: | /s/ "Normand Champigny | ||
| Name: Normand Champigny | |||
| Title: Chief Executive Officer | |||
SCHEDULE A - PLAN OF ARRANGEMENT
SCHEDULE A - PLAN OF ARRANGEMENT
UNDER SECTION 192 OF THE
CANADA BUSINESS CORPORATIONS ACT
ARTICLE 1
DEFINITIONS AND INTERPRETATION
| 1.1 | Definitions |
In this Plan of Arrangement, unless the context otherwise requires, capitalized terms used but not defined shall have the meanings ascribed to them below:
“affiliate” has the meaning ascribed thereto in the National Instrument 45-106 - Prospectus Exemptions of the Canadian Securities Administrators;
“Arrangement” means the arrangement of QPM under Section 192 of the CBCA on the terms and subject to the conditions set out in this Plan of Arrangement, subject to any amendments or variations thereto made in accordance with Section 8.6 of the Arrangement Agreement or this Plan of Arrangement or made at the direction of the Court in the Final Order;
“Arrangement Agreement” means the amended and restated arrangement agreement dated March 5, 2025, by and between Fury and QPM, as may be amended and restated or supplemented prior to the Effective Date;
“Arrangement Resolution” means the special resolution approving this Plan of Arrangement which is to be considered at the QPM Meeting, substantially in the form and content of Schedule B to the Arrangement Agreement;
“Business Day” means any day, other than a Saturday, a Sunday or a statutory or civic holiday in Montreal, Québec or Vancouver, British Columbia;
“CBCA” means the Canada Business Corporations Act and the regulations made thereunder, as now in effect and as they may be promulgated or amended from time to time;
“Certificate of Arrangement” means the certificate giving effect to the Arrangement issued by the Director pursuant to Section 192(7) of the CBCA;
“Consideration” means the consideration to be received by the QPM Shareholders pursuant to this Plan of Arrangement as consideration for their QPM Shares consisting of 0.0741 of a Fury Share for each QPM Share, subject to adjustment pursuant to Section 3.2;
“Consideration Shares” means the Fury Shares to be issued as Consideration pursuant to this Plan of Arrangement;
“Court” means the Superior Court of Québec;
“Depositary” means any trust company, bank or other financial institution agreed to in writing by QPM and Fury for the purpose of, among other things, exchanging certificates representing QPM Shares for the Consideration in connection with the Arrangement;
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“Dissent Rights” shall have the meaning ascribed thereto in Section 4.1(a);
“Dissenting Shareholder” means a registered holder of QPM Shares who dissents in respect of the Arrangement in strict compliance with the Dissent Rights and who is ultimately entitled to be paid fair value by QPM for such holder’s QPM Shares;
“Dissent Shares” means QPM Shares held by a Dissenting Shareholder who has demanded and perfected Dissent Rights in respect of the QPM Shares in accordance with the Interim Order and who, as of the Effective Time, has not effectively withdrawn or lost such Dissent Rights;
“DRS Statement” means, in relation to Fury Shares or QPM Shares, written evidence of the book entry issuance or holding of such shares issued to the holder by the transfer agent of such shares;
“Effective Date” means the date upon which the Arrangement becomes effective as set out in this Plan of Arrangement which will be the date shown in the Certificate of Arrangement;
“Effective Time” means 12:01 a.m. on the Effective Date; “Exchange Ratio” means 0.0741 Fury Share for each QPM Share;
“Estimated Net Realizable Assets Amount” the estimated realizable value of QPM’s assets calculated at the Effective Time being the sum of a) the value of the Consideration Shares; plus b) the dollar amount of the known QPM Closing Liabilities;
“Final Order” means the final order of the Court pursuant to Section 192 of the CBCA, in form and substance acceptable to Fury and QPM, each acting reasonably, after a hearing upon the procedural and substantive fairness of the terms and conditions of the Arrangement, approving the Arrangement, as such order may be amended, modified, supplemented or varied by the Court (with the consent of Fury and QPM, each acting reasonably) at any time prior to the Effective Date or, if appealed, then, unless such appeal is withdrawn or denied, as affirmed or as amended on appeal (provided that any such affirmation, amendment, modification, supplement or variation is acceptable to Fury and QPM, each acting reasonably);
“final proscription date” shall have the meaning ascribed thereto in Section 5.5;
“Fury” means Fury Gold Mines Limited, a company incorporated under the laws of the Province of British Columbia;
“Fury Capital Contribution” a cash contribution to QPM’s stated capital made by Fury without receiving any share capital or other consideration in exchange, equal to the known QPM Closing Liabilities, and thereafter Fury shall contribute to QPM in the same manner such further amounts as shall be necessary from time to time to discharge any subsequently discovered QPM Closing Liabilities, if any;
“Fury Shares” means the common shares in the capital of Fury;
“Interim Order” means the order made after the application to the Court pursuant to subsection 192 of the CBCA in form and substance acceptable to Fury and QPM, each acting reasonably, providing for, among other things, the calling and holding of the QPM Meeting, as the same may be amended, affirmed, modified, supplemented or varied by the Court with the consent of Fury and QPM, each acting reasonably;
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“Letter of Transmittal” means a letter of transmittal to be forwarded by QPM to QPM Shareholders together with the management information circular to be mailed to QPM Shareholders in connection with the QPM Meeting or such other equivalent form of letter of transmittal acceptable to Fury acting reasonably;
“Liens” means any mortgage, charge, pledge, hypothec, security interest, prior claim, encroachments, option, right of first refusal or first offer, occupancy right, covenant, assignment, lien (statutory or otherwise), defect of title, or restriction or adverse right or claim, or other third party interest or encumbrance of any kind, in each case, whether contingent or absolute;
“QPM” means Québec Precious Metals Corporation, a corporation existing under the laws of Canada;
“QPM Broker Option Holders” means the holders of the QPM Broker Options;
“QPM Broker Options” means the outstanding common share purchase options of QPM issued to certain brokers and intermediaries;
“QPM DSU Holders” means the holders of the QPM DSUs;
“QPM DSU Plan” means the deferred stock unit incentive plan of QPM approved by QPM Shareholders at a meeting held on October 20, 2020, providing for the issuance of QPM DSUs;
“QPM DSUs” means the outstanding deferred stock units granted under the QPM DSU Plan or its predecessor incentive plans;
“QPM Meeting” means the special meeting of QPM Shareholders, including any adjournment or postponement thereof, to be called and held in accordance with the Interim Order to consider the Arrangement Resolution;
“QPM Option Plan” means the stock option plan of QPM approved by QPM Shareholders at a meeting held on June 30, 2011, providing for the issuance of QPM Options (as amended on July 14, 2015, June 27, 2017, November 29, 2018 and February 19, 2021);
“QPM Options” means the outstanding options to purchase QPM Shares granted under the QPM Option Plan;
“QPM Option Holders” means the holders of QPM Options;
“QPM Capital Reduction” means a reduction made at the Effective Time in the dollar value of the stated capital of the QPM Shares in accordance with Section 38(1) of the CBCA so that the stated capital equals the Estimated Net Realizable Assets Amount;
“QPM Securities” means, collectively, QPM Shares, QPM Options, QPM DSUs, QPM Broker Options, and the QPM Warrants;
“QPM Shareholders” means the holders of QPM Shares and, subsequent to any transfer of QPM Shares pursuant to Section 3.1, shall be referred to as “Former QPM Shareholders”;
“QPM Shares” means the common shares in the capital of QPM;
“QPM Warrants” means the outstanding common share purchase warrants of QPM;
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“QPM Warrantholders” means the holders of the QPM Warrants;
“Tax Act” means the Income Tax Act (Canada) and the regulations made thereunder, as now in effect and as they may be promulgated or amended from time to time; and
“U.S. Securities Act” means the United States Securities Act of 1933, as amended.
In addition, words and phrases used herein and defined in the CBCA and not otherwise defined herein shall have the same meaning herein as in the CBCA unless the context otherwise requires.
| 1.2 | Interpretation Not Affected by Headings |
For the purposes of this Plan of Arrangement, except as otherwise expressly provided:
| (a) | “this Plan of Arrangement” means this Plan of Arrangement, including the recitals and Appendices hereto, and not any particular Article, Section, Subsection or other subdivision, recital or Appendix hereof, and includes any agreement, document or instrument entered into, made or delivered pursuant to the terms hereof, as the same may, from time to time, be supplemented or amended and in effect; |
| (b) | the words “hereof”, “herein”, “hereto” and “hereunder” and other word of similar import refer to this Plan of Arrangement as a whole and not to any particular Article, Section, Subsection, or other subdivision, recital or Appendix hereof; |
| (c) | all references in this Plan of Arrangement to a designated “Article”, “Section”, “Subsection” or other subdivision, recital or “Annex” hereof are references to the designated Article, Section, Subsection or other subdivision, recital or Annex to, this Plan of Arrangement; |
| (d) | the division of this Plan of Arrangement into Article, Sections, Subsections and other subdivisions, recitals or Annex, the inclusion of a table of contents and the insertion of headings and captions are for convenience of reference only and are not intended to interpret, define or limit the scope, extent or intent of this Plan of Arrangement or any provision hereof; |
| (e) | a reference to a statute in this Plan of Arrangement includes all regulations, rules, policies or instruments made thereunder, all amendments to the statute, regulations, rules, policies or instruments in force from time to time, and any statutes, regulations, rules, policies or instruments that supplement or supersede such statute, regulations, rules, policies or instruments; |
| (f) | the word “or” is not exclusive; |
| (g) | the word “including” is not limiting, whether or not non-limiting language (such as “without limitation” or “but not limited to” or words of similar import) is used with reference thereto; and |
| (h) | all references to “approval”, “authorization” or “consent” in this Plan of Arrangement means written approval, authorization or consent. |
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| 1.3 | Number, Gender and Persons |
In this Plan of Arrangement, unless the context otherwise requires, words importing the singular shall include the plural and vice versa, words importing the use of either gender shall include both genders and neuter and the word person and words importing persons shall include a natural person, firm, trust, partnership, association, corporation, joint venture or government (including any governmental agency, political subdivision or instrumentality thereof) and any other entity or group of persons of any kind or nature whatsoever.
| 1.4 | Date for any Action |
If the date on which any action is required to be taken hereunder is not a Business Day, such action shall be required to be taken on the next succeeding day which is a Business Day.
| 1.5 | Currency |
Unless otherwise stated, all references in this Agreement to sums of money are expressed in lawful money of the Canada and “$” refers to Canadian dollars.
| 1.6 | Time |
Time shall be of the essence in every matter or action contemplated hereunder. All times expressed herein are local time in Montreal, Québec unless otherwise stipulated herein.
ARTICLE 2
ARRANGEMENT AGREEMENT
| 2.1 | Arrangement Agreement |
This Plan of Arrangement is made pursuant to, and is subject to the provisions of, the Arrangement Agreement, except in respect of the sequence of the steps comprising the Arrangement, which shall occur in the order set forth herein.
| 2.2 | Binding Effect |
At the Effective Time, this Plan of Arrangement shall be binding on:
| (a) | QPM; |
| (b) | the QPM Shareholders; |
| (c) | the QPM DSU Holders; |
| (d) | the QPM Option Holders; |
| (e) | the QPM Warrantholders; |
| (f) | the QPM Broker Option Holders; and |
| (g) | all other Persons served with notice of the final application to approve this Plan of Arrangement. |
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ARTICLE 3
ARRANGEMENT
| 3.1 | Arrangement |
Commencing at the Effective Time, except as otherwise noted herein, the following shall occur and shall be deemed to occur sequentially, in the following order, without any further act or formality required on the part of any person:
| (a) | the stated capital of QPM shall be deemed to be reduced by an amount equal to the QPM Capital Reduction; |
| (b) | each QPM DSU outstanding immediately prior to the Effective Time shall immediately and unconditionally vest in accordance with the terms of the QPM DSU Plan and shall, without any further action by or on behalf of the QPM DSU Holder thereof, be deemed to have been settled by the issuance of one QPM Share to such QPM DSU Holder for each QPM DSU held and the following shall apply: |
| (i) | each QPM DSU Holder shall cease to be a holder of such QPM DSUs, |
| (ii) | each such holder’s name shall be removed from each applicable register maintained by QPM and shall be added to the central securities register of QPM as a holder of QPM Shares, |
| (iii) | the QPM DSU Plan and all agreements relating to the QPM DSUs shall be terminated and shall be of no further force and effect; and |
| (iv) | each QPM DSU Holder will thereafter have only the right to receive the consideration to which they are entitled pursuant to Section 3.1(c); |
| (c) | each QPM Share held by a Dissenting Shareholder shall, without any further action by or on behalf of the Dissenting Shareholder, be deemed to have been surrendered to QPM, free and clear of all Liens, for cancellation and such Dissenting Shareholder shall cease to be the holder of such QPM Shares and to have any rights as holders of such QPM Shares other than the right to be paid the fair value for such QPM Shares in accordance with the provisions of Article 4; |
| (d) | each QPM Share, including such QPM Shares issued to the holders of the QPM DSUs, (other than any QPM Shares held by Dissenting Shareholders) shall be directly transferred and assigned by the QPM Shareholders to Fury (free and clear of any Liens) in exchange for the Consideration, provided, however, that if the foregoing would otherwise result in a QPM Shareholder receiving, in the aggregate, a fraction of a Fury Share, the aggregate number of Fury Shares received by such QPM Shareholder shall be rounded down to the next whole Fury Share, and the following shall apply with respect to each QPM Share surrendered or transferred and assigned to Fury, as applicable, in accordance with Section 3.1(b) or this Section 3.1(c): |
| (i) | the registered holder of such QPM Share shall cease to be the registered holder thereof and the name of such registered holder shall be removed from register maintained by or on behalf of QPM in respect of the QPM Shares as of the Effective Time; |
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| (ii) | the registered holder thereof shall be deemed to have executed and delivered all consents, releases, assignments and waivers, statutory or otherwise, required to surrender or transfer and assign, as the case may be, such QPM Share in accordance with Section 3.1(b) or this Section 3.1(c), as applicable; and |
| (iii) | Fury will be the holder of all of the outstanding QPM Shares and the register of QPM Shareholders shall be revised accordingly; |
| (e) | with respect to the QPM Options outstanding immediately prior to the Effective Time: |
| (i) | in accordance with the QPM Option Plan, each QPM Option Holder shall be entitled to receive (and such holder shall accept) upon the exercise of such holder’s QPM Options, in lieu of QPM Shares to which such holder was theretofore entitled upon such exercise, and for the same aggregate consideration payable therefor, the number of Fury Shares which the holder would have been entitled to receive as a result of the transactions contemplated by this Arrangement if, immediately prior to the Effective Date, such holder had been the registered holder of the number of QPM Shares to which such holder would have been entitled if such holder had exercised such holder’s QPM Options immediately prior to the Effective Time; |
| (ii) | other than expressly provided above in subparagraph (i) above, the remaining terms and conditions of the QPM Options, including the term to expiry, vesting and other conditions to and manner of exercise, will continue in force without amendment; |
| (iii) | any document previously evidencing the QPM Option will thereafter evidence and be deemed to evidence the right to purchase Fury Shares on the terms set out in subparagraphs (i) and (ii) above; and |
| (iv) | the QPM Option Plan will continue in full, force and affect, without amendment, provided that no new stock options may be granted under the QPM Option Plan following the Effective Time; |
| (f) | with respect to the QPM Warrants outstanding immediately prior to the Effective Time: |
| (i) | in accordance with the terms of each of the QPM Warrants, each QPM Warrantholder shall be entitled to receive (and such holder shall accept) upon the exercise of such holder’s QPM Warrants, in lieu of QPM Shares to which such holder was theretofore entitled upon such exercise, and for the same aggregate consideration payable therefor, the number of Fury Shares which the holder would have been entitled to receive as a result of the transactions contemplated by this Arrangement if, immediately prior to the Effective Date, such holder had been the registered holder of the number of QPM Shares to which such holder would have been entitled if such holder had exercised such holder’s QPM Warrants immediately prior to the Effective Time; and |
| (ii) | other than expressly provided above in subparagraph (i), each QPM Warrant shall continue to be governed by and be subject to the terms of the applicable warrant certificate, subject to any supplemental exercise documents issued by Fury to holders of QPM Warrants to facilitate the exercise of the QPM Warrants and the payment of the corresponding portion of the exercise price with each them; |
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| (g) | with respect to the QPM Broker Options outstanding immediately prior to the Effective Time: |
| (i) | in accordance with the terms of each of the QPM Broker Options, each QPM Broker Option Holder shall be entitled to receive (and such holder shall accept) upon the exercise of such holder’s QPM Broker Options, in lieu of QPM Shares to which such holder was theretofore entitled upon such exercise, and for the same aggregate consideration payable therefor, the number of Fury Shares which the holder would have been entitled to receive as a result of the transactions contemplated by this Arrangement if, immediately prior to the Effective Date, such holder had been the registered holder of the number of QPM Shares to which such holder would have been entitled if such holder had exercised such holder’s QPM Broker Options immediately prior to the Effective Time; |
| (ii) | other than expressly provided above in subparagraph (i), each QPM Broker Options shall continue to be governed by and be subject to the terms of the applicable option certificate, subject to any supplemental exercise documents issued by Fury to holders of QPM Broker Options to facilitate the exercise of the QPM Broker Options and the payment of the corresponding portion of the exercise price with each of them; and |
| (h) | Fury shall transfer cash to QPM as an increase to its stated capital, in an amount equal to the initial Fury Capital Contribution. |
| 3.2 | Adjustments to Consideration |
Notwithstanding anything to the contrary contained in this Plan of Arrangement, if between the date of the Agreement and the Effective Time, the issued and outstanding QPM Shares shall have been changed into a different number of shares or a different class by reason of any stock split, reverse stock split, dividend of QPM, reclassification, redenomination or the like, then the Consideration and any other dependent items, including the Exchange Ratio, shall be appropriately adjusted to provide to QPM and Fury and their respective shareholders the same economic effect as contemplated by the Agreement and this Plan of Arrangement prior to such action and as so adjusted shall, from and after the date of such event, be the Consideration to be paid per QPM Share, the Exchange Ratio or other dependent item, subject to further adjustment in accordance with this sentence.
| 3.3 | U.S. Securities Laws Matters |
Notwithstanding any provision herein to the contrary, Fury acknowledges and agrees that this Plan of Arrangement will be carried out with the intention that all Consideration Shares issued on completion of this Plan of Arrangement will be issued by Fury in reliance on the exemption from the registration requirements of the U.S. Securities Act, as provided by Section 3(a)(10) thereof, and pursuant to exemptions from registration under any other applicable U.S. state securities laws.
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ARTICLE 4
DISSENT RIGHTS
| 4.1 | Rights of Dissent |
| (a) | In connection with the Arrangement, each registered QPM Shareholder may exercise rights of dissent (“Dissent Rights”) with respect to the QPM Shares held by such QPM Shareholder pursuant to section 190 of the CBCA, as modified by the Interim Order, the Final Order and this Section 4.1(a); provided that, notwithstanding Part XV of the CBCA, the written notice of intent to exercise the right to demand the purchase of QPM Shares contemplated by section 190(7) of the CBCA must be received by QPM not later than 4:00 p.m. two (2) Business Days immediately preceding the date of the QPM Meeting, and provided that such notice of intent must otherwise comply with the requirements of the CBCA. Dissenting Shareholders who are: |
| (i) | ultimately entitled to be paid by QPM the fair value for their Dissent Shares (A) shall be deemed to not to have participated in the transactions in Article 3 (other than Section 3.1(b)); (B) shall be deemed to have transferred and assigned such Dissent Shares (free and clear of any Liens) to QPM in accordance with Section 3.1(b); (C) will be entitled to be paid the fair value of such Dissent Shares by QPM, which fair value, notwithstanding anything to the contrary contained in the CBCA, shall be determined as of the close of business on the day before the Arrangement Resolution was adopted at the QPM Meeting; and (D) will not be entitled to any other payment or consideration, including any payment that would be payable under the Arrangement had such holders not exercised their Dissent Rights in respect of such QPM Shares; or |
| (ii) | ultimately not entitled, for any reason, to be paid by QPM the fair value for their Dissent Shares, shall be deemed to have participated in the Arrangement in respect of those QPM Shares on the same basis as a non-dissenting QPM Shareholder and shall be entitled to receive only the Consideration contemplated by Section 3.1(c) that such Dissenting Shareholder would have received pursuant to the Arrangement if such Dissenting Shareholder had not exercised their Dissent Rights. |
| (b) | In no circumstances shall Fury, QPM or any other Person be required to recognize a Person exercising Dissent Rights unless such Person is the registered holder of QPM Shares in respect of which Dissent Rights are purported to be exercised. |
| (c) | In no circumstances shall Fury, QPM or any other Person be required to recognize a Dissenting Shareholder as a registered or beneficial owner of QPM Shares or any interest therein (other than the rights set out in this Section 4.1) at or after the Effective Time, and as at the Effective Time the names of such Dissenting Shareholders shall be deleted from the central securities register of QPM. |
| (d) | For greater certainty, in addition to any other restrictions in the Interim Order and under section 190 of the CBCA, none of the following shall be entitled to exercise Dissent Rights: (i) QPM Shareholders who vote or have instructed a proxyholder to vote such QPM Shares in favour of the Arrangement Resolution (but only in respect of such QPM Shares) and any other Person who is not a registered holder of QPM Shares as of the record date for the QPM Meeting. |
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ARTICLE 5
DELIVERY OF CONSIDERATION
| 5.1 | Delivery of the Consideration Shares |
| (a) | Upon return of a properly completed Letter of Transmittal by a registered Former QPM Shareholder together with certificates or DRS Statements representing QPM Shares and such other documents as the Depositary may require, Former QPM Shareholders shall be entitled to receive delivery of the DRS Statements representing the Fury Shares to which they are entitled pursuant to Section 3.1(g). |
| (b) | After the Effective Time and until surrendered for cancellation as contemplated by Section 5.1(a) hereof, each certificate or DRS Statement that immediately prior to the Effective Time represented one or more QPM Shares shall be deemed at all times to represent only the right to receive in exchange therefor the Consideration that the holder of such certificate is entitled to receive in accordance with Section 3.1 hereof. |
| 5.2 | Lost Certificates |
If any certificate, that immediately prior to the Effective Time represented one or more outstanding QPM Shares shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the holder claiming such certificate to be lost, stolen or destroyed, the Depositary shall deliver in exchange for such lost, stolen or destroyed certificate, the Consideration that such holder is entitled to receive in accordance with Section 3.1 hereof. When authorizing such delivery of Consideration that such holder is entitled to receive in exchange for such lost, stolen or destroyed certificate, the holder to whom such Consideration is to be delivered shall, as a condition precedent to the delivery of such Consideration, give a bond satisfactory to Fury and the Depositary in such amount as Fury and the Depositary may direct, or otherwise indemnify Fury and the Depositary in a manner satisfactory to Fury and the Depositary, against any claim that may be made against Fury or the Depositary with respect to the certificate alleged to have been lost, stolen or destroyed and shall otherwise take such actions as may be required by the articles and notice of articles of QPM.
| 5.3 | Distributions with Respect to Unsurrendered Certificates |
No dividend or other distribution declared or made after the Effective Time with respect to Fury Shares with a record date after the Effective Time shall be delivered to the holder of any unsurrendered certificate that, immediately prior to the Effective Time, represented outstanding QPM Shares unless and until the holder of such certificate shall have complied with the provisions of Section 5.1 or Section 5.2 hereof. Subject to applicable Law and to Section 5.4 hereof, at the time of such compliance, there shall, in addition to the delivery of Consideration to which such holder is thereby entitled, be delivered to such holder, without interest, the amount of the dividend or other distribution with a record date after the Effective Time theretofore paid with respect to such Fury Shares.
| 5.4 | Withholding Rights |
Fury, QPM and the Depository shall be entitled to deduct or withhold from any amounts payable or otherwise deliverable pursuant to the Arrangement or the Arrangement Agreement and from all dividends, interest or other distributions or payments otherwise payable or allocable to any Former QPM Shareholder or other person (each of the foregoing, an “Affected Person”) such amounts as Fury, QPM or the Depository is required, or reasonably believe to be required, to deduct or withhold with respect to such payment, delivery or allocation under the Tax Act or any provision of any applicable federal, provincial, state, local or foreign tax law or treaty, in each case, as amended (“Withholding Obligations”). To the extent that amounts are so deducted or withheld, such deducted or withheld amounts shall be treated for all purposes hereof as having been paid, delivered or allocated to the Affected Person in respect of which such deduction or withholding was made, provided that such deducted or withheld amounts are remitted to the appropriate taxing authority. Fury, QPM and the Depository shall also have the right to:
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| (a) | withhold and sell, on their own account or through a broker (the “Broker”), and on behalf of any Affected Person; or |
| (b) | require the Affected Person to irrevocably direct the sale through a Broker and irrevocably direct the Broker to pay the proceeds of such sale to QPM, the Depositary or Fury as appropriate (and, in the absence of such irrevocable direction, the Affected Person shall be deemed to have provided such irrevocable direction), |
the Consideration, delivered or deliverable to such Affected Person pursuant to the Arrangement Agreement as is necessary to produce sale proceeds (after deducting commissions payable to the Broker and other costs and expenses) sufficient to fund any Withholding Obligations. Any such sale of Fury Shares shall be affected on a public market and as soon as practicable following the Effective Date. None of Fury, QPM, the Depository or the Broker will be liable for any loss arising out of any sale of such Fury Shares, including any loss relating to the manner or timing of such sales, the prices at which the Fury Shares are sold or otherwise.
| 5.5 | Limitation and Proscription |
To the extent that a Former QPM Shareholder shall not have complied with the provisions of Section 5.1 or Section 5.2 hereof on or before the date that is six (6) years after the Effective Date (the “final proscription date”), then the Consideration that such Former QPM Shareholder was entitled to receive shall be automatically cancelled without any repayment of capital in respect thereof and the Consideration to which such Former QPM Shareholder was entitled, shall be delivered to Fury by the Depositary and the Fury Shares forming part of the Consideration shall be deemed to be cancelled, and the interest of the Former QPM Shareholder in such Fury Shares (and any dividend or other distribution referred to in Section 5.3 hereof) to which it was entitled shall be terminated as of such final proscription date.
| 5.6 | No Liens |
Any exchange or transfer of securities pursuant to this Plan of Arrangement shall be free and clear of any Liens of any kind.
| 5.7 | Paramountcy |
From and after the Effective Time: (i) this Plan of Arrangement shall take precedence and priority over any and all QPM Securities issued prior to the Effective Time or pursuant to this Plan of Arrangement; (ii) the rights and obligations of the registered holders of QPM Securities and QPM, Fury, the Depository and any transfer agent or other depositary in relation thereto, shall be solely as provided for in this Plan of Arrangement; and (iii) all actions, causes of action, claims or proceedings (actual or contingent and whether or not previously asserted) based on or in any way relating to any QPM Securities shall be deemed to have been settled, compromised, released and determined without liability except as set forth herein.
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ARTICLE 6
AMENDMENTS
| 6.1 | Amendments to Plan of Arrangement |
| (a) | QPM reserves the right to amend, modify or supplement this Plan of Arrangement at any time and from time to time, provided, however, that each such amendment, modification or supplement must be: (i) set out in writing; (ii) agreed to in writing by Fury and QPM; (iii) filed with the Court and, if made following the QPM Meeting, approved by the Court; and (iv) communicated to holders or former holders of QPM Securities if and as required by the Court. |
| (b) | Any amendment, modification or supplement to this Plan of Arrangement may be proposed by QPM at any time prior to the QPM Meeting; provided, however, that Fury shall have consented thereto in writing, with or without any other prior notice or communication, and, if so proposed and accepted by the persons voting at the QPM Meeting (other than as may be required under the Interim Order), shall become part of this Plan of Arrangement for all purposes. |
| (c) | Any amendment, modification or supplement to this Plan of Arrangement that is approved by the Court following the QPM Meeting shall be effective only if: (i) it is consented to in writing by each of Fury and QPM; (ii) it is filed with the Court (other than amendments contemplated in Section 6.1(d), which shall not require such filing) and (iii) if required by the Court, it is consented to by persons voting at the QPM Meeting in the manner directed by the Court. |
| (d) | This Plan of Arrangement may be withdrawn prior to the Effective Time in accordance with the terms of the Arrangement Agreement. |
ARTICLE 7
FURTHER ASSURANCES
| 7.1 | Further Assurances |
Notwithstanding that the transactions and events set out herein shall occur and be deemed to occur in the order set out in this Plan of Arrangement without any further act or formality, each of the parties to the Arrangement Agreement shall make, do and execute, or cause to be made, done and executed, all such further acts, deeds, agreements, transfers, assurances, instruments or documents as may reasonably be required by any of them in order to further document or evidence any of the transactions or events set out therein.
SCHEDULE B – FORM OF ARRANGEMENT RESOLUTION
BE IT RESOLVED THAT:
| 1. | The arrangement (the “Arrangement”) under Section 192 of the Canada Business Corporations Act (the “CBCA”) involving Québec Precious Metals Corporation (“QPM”), pursuant to the amended and restated arrangement agreement between QPM and Fury dated March 6, 2025, as it may be modified, supplemented or amended from time to time in accordance with its terms (the “Arrangement Agreement”), as more particularly described and set forth in the management information circular of QPM dated [●], 2025 (the “Circular”), and all transactions contemplated thereby, are hereby authorized, approved and adopted. |
| 2. | The reduction to the stated capital of the common shares of QPM, as a special resolution pursuant to Section 38(1) of the Canada Business Corporations Act to an amount equal to the Estimated Net Realizable Assets of QPM, is here by authorized, approved and adopted. |
| 3. | The plan of arrangement of QPM, as it has been or may be modified, supplemented or amended in accordance with the Arrangement Agreement and its terms (the “Plan of Arrangement”), the full text of which is set out as Schedule “A” to the Circular, is hereby authorized, approved and adopted. |
| 4. | The: (a) Arrangement Agreement and all the transactions contemplated therein, (b) actions of the directors of QPM in approving the Arrangement and the Arrangement Agreement, and (c) actions of the directors and officers of QPM in executing and delivering the Arrangement Agreement and any modifications, supplements or amendments thereto, and causing the performance by QPM of its obligations thereunder, are hereby ratified and approved. |
| 5. | QPM is hereby authorized to apply for a final order from the Superior Court of Québec (the “Court”) to approve the Arrangement on the terms set forth in the Arrangement Agreement and the Plan of Arrangement (as they may be, or may have been, modified, supplemented or amended). |
| 6. | Notwithstanding that this resolution has been passed (and the Arrangement adopted) by the holders of common shares of QPM (the “QPM Shareholders”) entitled to vote thereon or that the Arrangement has been approved by the Court, the directors of QPM are hereby authorized and empowered, without further notice to or approval of the QPM Shareholders: (a) to amend, modify or supplement the Arrangement Agreement or the Plan of Arrangement to the extent permitted by their terms, and (b) subject to the terms of the Arrangement Agreement, not to proceed with the Arrangement and any related transactions. |
| 7. | Any officer or director of QPM is hereby authorized and directed, for and on behalf of QPM, to execute or cause to be executed and to deliver or cause to be delivered, whether under the corporate seal of QPM or otherwise, for filing with the Director under the CBCA, articles of arrangement and all such other documents and instruments and to perform or cause to be performed all such other acts and things as, in such person’s opinion, may be necessary or desirable to give full force and effect to the foregoing resolutions and the matters authorized thereby, such determination to be conclusively evidenced by the execution and delivery of any such other document or instrument or the doing of any such other act or thing. |
SCHEDULE C- KEY REGULATORY APPROVALS AND THIRD PARTY CONSENTS
1. Conditional listing approval of the TSX and the NYSE in respect of the Fury Shares to be issued in accordance with the Plan of Arrangement.
2. Approval of the TSX-V to QPM to complete the Arrangement pursuant to Policy 5.3 of the TSX-V Corporate Finance Manual.
Exhibit 99.7
AMENDMENT AGREEMENT
THIS AMENDMENT AGREEMENT (this “Amending Agreement”) is made effective March 24, 2025.
AMONG:
FURY GOLD MINES LIMITED, a company incorporated under the laws of the Province of British Columbia (“Fury”)
- and -
QUÉBEC PRECIOUS METALS CORPORATION, a company incorporated under the laws of Canada (“QPM”)
WHEREAS:
| A. | Fury and QPM entered into an Arrangement Agreement on February 26, 2025 (“Original Arrangement Agreement”) pursuant to which Fury is, inter alia, to acquire all of the issued and outstanding QPM Shares pursuant to the Arrangement, of which the parties agreed to amend and restate the Original Arrangement Agreement as of March 6, 2025 (the “Amended and Restated Arrangement Agreement”); and |
| B. | Fury and QPM wish to enter into this Amending Agreement to amend the Amended and restated Arrangement Agreement in respect to the timing of the recapitalization of QPM. |
NOW THEREFORE in consideration of the covenants and agreements herein contained and other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the Parties hereby covenant and agree as follows:
| 1) | Section 5.6 of the Amended and Restated Agreement is hereby deleted and deemed replaced with the following section: |
| 5.6 | Fury Capital Contribution to QPM |
Immediately prior to the time of the hearing for the Final Order, the following will take place:
| (i) | Fury will advance to QPM as a contingent contribution to its contributed surplus account, a cash amount equal to the known QPM Closing Liabilities but not less than $750,000 in any event. From and after the Effective Date, Fury shall contribute to QPM in the same manner such further amounts as shall be necessary from time to time to discharge any subsequently discovered QPM Closing Liabilities, if any (the “Fury Capital Contribution”). If for any reason the Effective Date does not occur within 10 days of the date of the hearing for the Final Order then on the date that is determined by Fury that is between five and three days prior to the Outside Date, QPM shall allot and issue to Fury equity Units in the capital, each Unit consisting of one common share and one share purchase warrant exercisable a two-year period at $0.05, for a Unit price of $0.05 in a number as is equal to the aggregate Fury Capital Contribution divided by $0.05 and the contingent contribution to Contributed surplus will be concurrently transferred to to the stated share capital account; and |
| (ii) | Immediately following the Fury Capital Contribution, QPM will effect the QPM Capital Reduction |
| 2) | Section 3.1(a) and Section 3.1(h) of the Plan of Arrangement are hereby deemed deleted. |
| 3) | Capitalized terms used but not otherwise defined shall have the meaning ascribed thereto in the Amended and Restated Arrangement Agreement. |
| 4) | The Amended and Restated Arrangement Agreement and this Amending Agreement shall together constitute and be read as one and the same written instrument. The Amended and Restated Arrangement Agreement, as amended by this Amending Agreement, is hereby ratified and confirmed. All references to the Amended and Restated Arrangement Agreement shall refer to the Amended and Restated Arrangement Agreement as amended by this Amending Agreement. Except as amended by this Amending Agreement, the Amended and Restated Arrangement Agreement is unchanged and continues in full force and effect. |
| 5) | This Amending Agreement may be executed in any number of counterparts, each of which will be considered the original and all of which, together, will constitute one and the same instrument. This Amending Agreement may also be executed in original or by signature sent and received by facsimile or other electronic transmission and the reproduction of such signature sent and received by way of facsimile or other electronic transmission will be deemed as though such reproduction was an executed original thereof. |
IN WITNESS WHEREOF Fury and QPM have caused this Amending Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.
| FURY GOLD MINES LIMITED | ||
| By: | /s/ "Tim Clark" | |
|
Name: Tim Clark | ||
| Title: Chief Executive Officer | ||
| QUÉBEC PRECIOUS METALS CORPORATION | ||
| By: | /s/ "Normand Champigny" | |
|
Name: Normand Champigny | ||
| Title: Chief Executive Officer | ||