General Information and Nature of Operations (Note
1)
Commitments (Note 8)
The accompanying notes are an integral part of
these condensed consolidated interim financial statements.
INTERNATIONAL TOWER HILL MINES LTD.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS
For the Three Months Ended March 31, 2021 and 2020
(Expressed in US Dollars - Unaudited)
|
|
|
|
Three Months Ended
|
|
|
|
Note
|
|
March 31,
2021
|
|
|
March 31,
2020
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
Consulting fees
|
|
6
|
|
$
|
60,001
|
|
|
$
|
40,419
|
|
Depreciation
|
|
|
|
|
27
|
|
|
|
443
|
|
Insurance
|
|
|
|
|
40,910
|
|
|
|
31,224
|
|
Investor relations
|
|
6
|
|
|
12,193
|
|
|
|
10,490
|
|
Mineral property exploration
|
|
4
|
|
|
539,754
|
|
|
|
115,420
|
|
Office
|
|
|
|
|
4,585
|
|
|
|
7,620
|
|
Other
|
|
|
|
|
3,258
|
|
|
|
3,892
|
|
Professional fees
|
|
|
|
|
46,641
|
|
|
|
52,120
|
|
Regulatory
|
|
|
|
|
100,023
|
|
|
|
61,173
|
|
Rent
|
|
|
|
|
33,956
|
|
|
|
33,933
|
|
Travel
|
|
|
|
|
2,508
|
|
|
|
2,162
|
|
Wages and benefits
|
|
6
|
|
|
163,250
|
|
|
|
154,530
|
|
Total operating expenses
|
|
|
|
|
(1,007,106
|
)
|
|
|
(513,426
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expenses)
|
|
|
|
|
|
|
|
|
|
|
Gain/(loss) on foreign exchange
|
|
|
|
|
(140,687
|
)
|
|
|
541,186
|
|
Interest income
|
|
|
|
|
9,921
|
|
|
|
37,325
|
|
Total other income (expenses)
|
|
|
|
|
(130,766
|
)
|
|
|
578,511
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) for the period
|
|
|
|
|
(1,137,872
|
)
|
|
|
65,085
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|
Exchange difference on translating foreign operations
|
|
|
|
|
143,392
|
|
|
|
(553,334
|
)
|
Total other comprehensive income (loss) for the period
|
|
|
|
|
143,392
|
|
|
|
(553,334
|
)
|
Comprehensive loss for the period
|
|
|
|
$
|
(994,480
|
)
|
|
$
|
(488,249
|
)
|
Basic and diluted loss per share
|
|
|
|
$
|
(0.01
|
)
|
|
$
|
(0.00
|
)
|
Weighted average number of shares outstanding – basic and diluted
|
|
|
|
|
194,908,184
|
|
|
|
187,573,671
|
|
The accompanying notes are an integral part of
these condensed consolidated interim financial statements.
INTERNATIONAL TOWER HILL MINES LTD.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES
IN SHAREHOLDERS’ EQUITY
For the Three Months Ended March 31, 2021 and 2020
(Expressed in US Dollars - Unaudited)
|
|
|
Three-Month
Period Ended March 31, 2021
|
|
|
|
Number of
shares
|
|
|
Share
capital
|
|
|
Contributed
surplus
|
|
|
Accumulated
other
comprehensive
income
|
|
|
Deficit
|
|
|
Total
|
|
Balance, December 31, 2020
|
|
|
194,908,184
|
|
|
$
|
288,032,132
|
|
|
$
|
35,454,805
|
|
|
$
|
1,759,228
|
|
|
$
|
(257,144,828
|
)
|
|
$
|
68,101,337
|
|
Stock-based compensation-options
|
|
|
-
|
|
|
|
-
|
|
|
|
18,971
|
|
|
|
-
|
|
|
|
-
|
|
|
|
18,971
|
|
Exchange difference on translating
foreign operations
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
143,392
|
|
|
|
-
|
|
|
|
143,392
|
|
Net loss
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(1,137,872
|
)
|
|
|
(1,137,872
|
)
|
Balance, March 31, 2021
|
|
|
194,908,184
|
|
|
$
|
288,032,132
|
|
|
$
|
35,473,776
|
|
|
$
|
1,902,620
|
|
|
$
|
(258,282,700
|
)
|
|
$
|
67,125,828
|
|
|
|
Three-Month
Period Ended March 31, 2020
|
|
|
|
Number of
shares
|
|
|
Share
capital
|
|
|
Contributed
surplus
|
|
|
|
Accumulated
other
comprehensive
income
|
|
|
Deficit
|
|
|
Total
|
|
Balance, December 31, 2019
|
|
|
187,573,671
|
|
|
$
|
278,213,801
|
|
|
$
|
35,069,274
|
|
|
$
|
1,574,011
|
|
|
$
|
(252,626,110
|
)
|
|
$
|
62,230,976
|
|
Exchange difference on translating foreign operations
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(553,334
|
)
|
|
|
-
|
|
|
|
(553,334
|
)
|
Net income
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
65,085
|
|
|
|
65,085
|
|
Balance, March 31, 2020
|
|
|
187,573,671
|
|
|
$
|
278,213,801
|
|
|
$
|
35,069,274
|
|
|
$
|
1,020,677
|
|
|
$
|
(252,561,025
|
)
|
|
$
|
61,742,727
|
|
The accompanying notes are an integral part of
these condensed consolidated interim financial statements.
INTERNATIONAL TOWER HILL MINES LTD.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
For the Three Months Ended March 31, 2021 and 2020
(Expressed in US Dollars - Unaudited)
|
|
Three Months Ended
|
|
|
|
March 31,
2021
|
|
|
March 31,
2020
|
|
Operating Activities
|
|
|
|
|
|
|
|
|
Income (Loss) for the period
|
|
$
|
(1,137,872
|
)
|
|
$
|
65,085
|
|
Add items not affecting cash:
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
27
|
|
|
|
443
|
|
Stock-based compensation-options
|
|
|
18,971
|
|
|
|
-
|
|
Changes in non-cash items:
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
24,155
|
|
|
|
108,287
|
|
Prepaid expenses and other
|
|
|
(27,846
|
)
|
|
|
(12,049
|
)
|
Accounts payable and accrued liabilities
|
|
|
(72,012
|
)
|
|
|
(92,726
|
)
|
Cash (used in) provided by operating activities
|
|
|
(1,194,577
|
)
|
|
|
69,040
|
|
|
|
|
|
|
|
|
|
|
Effect of foreign exchange on cash
|
|
|
143,322
|
|
|
|
(540,996
|
)
|
Change in cash and cash equivalents
|
|
|
(1,051,255
|
)
|
|
|
(471,956
|
)
|
Cash and cash equivalents, beginning of the period
|
|
|
13,049,293
|
|
|
|
6,937,621
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of the period
|
|
$
|
11,998,038
|
|
|
$
|
6,465,665
|
|
The accompanying notes are an integral part of
these condensed consolidated interim financial statements.
INTERNATIONAL TOWER HILL MINES LTD.
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Three Months Ended March 31, 2021 and 2020
(Expressed in US Dollars - Unaudited)
|
1.
|
GENERAL INFORMATION AND NATURE OF OPERATIONS
|
International Tower Hill Mines Ltd.
(“ITH” or the “Company”) is incorporated under the laws of British Columbia, Canada. The Company’s head
office address is 2710 – 200 Granville Street, Vancouver, British Columbia, Canada.
International Tower Hill Mines Ltd.
consists of ITH and its wholly-owned subsidiaries Tower Hill Mines, Inc. (“TH Alaska”) (an Alaska corporation), Tower Hill
Mines (US) LLC (“TH US”) (a Colorado limited liability company), and Livengood Placers, Inc. (“LPI”) (a Nevada
corporation). The Company is in the business of acquiring, exploring and evaluating mineral properties, and either joint venturing or
developing these properties further or disposing of them when the evaluation is completed. At March 31, 2021, the Company has a 100% interest
in its Livengood Gold Project, an exploration-stage project in Alaska, U.S.A.
These unaudited condensed consolidated
interim financial statements have been prepared on a going-concern basis, which presumes the realization of assets and discharge of liabilities
in the normal course of business for the foreseeable future.
As at March 31, 2021, the Company had
cash and cash equivalents of $11,998,038 compared to $13,049,293 at December 31, 2020. The Company has no revenue generating operations
from which it can internally generate funds.
The Company will require significant
additional financing to continue its operations (including general and administrative expenses) in connection with advancing activities
at the Livengood Gold Project and the development of any mine that may be determined to be built at the Livengood Gold Project. There
is no assurance that the Company will make a decision to build a mine at the Livengood Gold Project and, if so, that it will be able to
obtain the additional financing required on acceptable terms, if at all. In addition, any significant delays in the issuance of required
permits for the ongoing work at the Livengood Gold Project, or unexpected results in connection with the ongoing work, could result in
the Company being required to raise additional funds to advance permitting efforts. The Company’s review of its financing options
includes pursuing a future strategic alliance to assist in further development, permitting and future construction costs, although there
can be no assurance that any such strategic alliance will, in fact, be realized.
Despite the Company’s success
to date in raising significant equity financing to fund its operations, there is significant uncertainty that the Company will be able
to secure any additional financing in the current or future equity markets. The amount of funds to be raised and the terms of any proposed
equity financing that may be undertaken will be negotiated by management as opportunities to raise funds arise. Specific plans related
to the use of proceeds will be devised once financing has been completed and management knows what funds will be available for these purposes.
COVID-19 Pandemic
In March 2020, the World Health Organization
declared the novel coronavirus 2019 (“COVID-19”) a global pandemic. This contagious disease outbreak, which has continued
to spread, and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally,
potentially leading to an economic downturn. While it is not possible for the Company to predict the duration or magnitude of the adverse
results of the outbreak and its ultimate effects on the Company’s business, results of operations or ability to raise funds at this
time, as of the date of this Quarterly Report on Form 10-Q, the COVID-19 pandemic has not had any material adverse effects on the Company.
These
unaudited condensed consolidated interim financial statements have been prepared in accordance with accounting principles generally
accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions to
Form 10-Q and Article 8 of Regulation S-X under the Securities Exchange Act of 1934, as amended. Accordingly, they do not
include all of the information and footnotes required by U.S. GAAP for annual financial statements. These unaudited condensed
consolidated interim financial statements should be read in conjunction with the audited consolidated financial statements for the
year ended December 31, 2020 as filed in our Annual Report on Form 10-K. In the opinion of the Company’s management, these
financial statements reflect all adjustments, consisting of normal recurring adjustments, necessary to present fairly the
Company’s financial position at March 31, 2021 and the results of its operations for the three months then ended. Operating
results for the three months ended March 31, 2021 are not necessarily indicative of the results that may be expected for the year
ending December 31, 2021.
INTERNATIONAL TOWER HILL MINES LTD.
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Three Months Ended March 31, 2021 and 2020
(Expressed in US Dollars - Unaudited)
The preparation of financial statements
in conformity with U.S. GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts
of revenues and expenses during the period. These judgments, estimates and assumptions are continuously evaluated and are based on management’s
experience and knowledge of the relevant facts and circumstances. While management believes the estimates to be reasonable, actual results
could differ from those estimates and could impact future results of operations and cash flows.
On May 6, 2021, the Board of Directors
of the Company (the “Board”) approved these condensed consolidated interim financial statements.
Basis of consolidation
These condensed consolidated interim
financial statements include the accounts of ITH and its wholly-owned subsidiaries TH Alaska, TH US, and LPI. All intercompany transactions
and balances have been eliminated.
|
3.
|
FAIR VALUE OF FINANCIAL INSTRUMENTS
|
The carrying values of cash and cash
equivalents, accounts receivable and accounts payable and accrued liabilities approximate their fair values due to the short-term nature
of these financial instruments.
Financial instruments measured at
fair value are classified into one of three levels in the fair value hierarchy according to the significance of the inputs used in making
the measurement. The three levels of the fair value hierarchy are as follows:
|
·
|
Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities;
|
|
·
|
Level 2 – Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and
|
|
·
|
Level 3 – Inputs that are not based on observable market data.
|
There were no financial instruments
measured at fair value.
The Company had the following activity related to the mineral
property:
Capitalized acquisition costs
|
|
Amount
|
|
Balance, December 31, 2020
|
|
$
|
55,375,124
|
|
Acquisition costs
|
|
|
-
|
|
Balance, March 31, 2021
|
|
$
|
55,375,124
|
|
INTERNATIONAL TOWER HILL MINES LTD.
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Three Months Ended March 31, 2021 and 2020
(Expressed in US Dollars - Unaudited)
The following table presents costs incurred for exploration
and evaluation activities for the three months ended March 31, 2021 and 2020:
|
|
March 31,2021
|
|
|
March 31,2020
|
|
Exploration costs:
|
|
|
|
|
|
|
|
|
Environmental
|
|
$
|
55,690
|
|
|
$
|
36,584
|
|
Equipment rental
|
|
|
15,372
|
|
|
|
11,639
|
|
Field costs
|
|
|
43,413
|
|
|
|
39,272
|
|
Geological/geophysical
|
|
|
372,724
|
|
|
|
6,286
|
|
Land maintenance and tenure
|
|
|
30,130
|
|
|
|
30,210
|
|
Legal
|
|
|
22,425
|
|
|
|
(8,571
|
)
|
Total expenditures for the period
|
|
$
|
539,754
|
|
|
$
|
115,420
|
|
Livengood Gold Project
Property
The Livengood property is located in
the Tintina gold belt approximately 70 miles (113 kilometers) northwest of Fairbanks, Alaska. The property consists of land leased from
the Alaska Mental Health Trust, a number of smaller private mineral leases, Alaska state mining claims purchased or located by the Company
and patented ground held by the Company.
Details of the leases are as follows:
|
a)
|
A lease of the Alaska Mental Health Trust mineral rights having a term beginning July 1, 2004 and extending
19 years until June 30, 2023, subject to further extensions beyond June 30, 2023 by either commercial production or payment of an advance
minimum royalty equal to 125% of the amount paid in year 19 and diligent pursuit of development. The lease requires minimum work expenditures
and advance minimum royalties (all of which minimum royalties are recoverable from production royalties) which escalate annually with
inflation. A net smelter return (“NSR”) production royalty of between 2.5% and 5.0% (depending upon the price of gold) is
payable to the lessor with respect to the lands subject to this lease. In addition, an NSR production royalty of l% is payable to the
lessor with respect to the unpatented federal mining claims subject to the lease described in b) below and an NSR production royalty of
between 0.5% and 1.0% (depending upon the price of gold) is payable to the lessor with respect to the lands acquired by the Company as
a result of the purchase of Livengood Placers, Inc. in December 2011. During the three months ended March 31, 2021 and from the inception
of this lease, the Company has paid $Nil and $3,651,168, respectively.
|
|
b)
|
A lease of federal unpatented lode mining claims having an initial term of ten years commencing on April
21, 2003 and continuing for so long thereafter as advance minimum royalties are paid and mining related activities, including exploration,
continue on the property or on adjacent properties controlled by the Company. The lease requires an advance minimum royalty of $50,000
on or before each anniversary date for the duration of the lease (all of which minimum royalties are recoverable from production royalties).
An NSR production royalty of between 2% and 3% (depending on the price of gold) is payable to the lessors. The Company may purchase 1%
of the royalty for $1,000,000. During the three months ended March 31, 2021 and from the inception of this lease, the Company has paid
$Nil and $830,000, respectively.
|
|
c)
|
A lease of patented lode mining claims having an initial term of ten years commencing January 18, 2007,
and continuing for so long thereafter as advance minimum royalties are paid. The lease requires an advance minimum royalty of $20,000
on or before each anniversary date through January 18, 2017 and $25,000 on or before each subsequent anniversary (all of which minimum
royalties are recoverable from production royalties). An NSR production royalty of 3% is payable to the lessors. The Company may purchase
all interests of the lessors in the leased property (including the production royalty) for $1,000,000 (less all minimum and production
royalties paid to the date of purchase), of which $500,000 is payable in cash over four years following the closing of the purchase and
the balance is payable by way of the 3% NSR production royalty. The Company paid $15,000 of royalties during the three months ended March
31, 2021, for a total of $265,000 from the inception of this lease. The Company has acquired a 40% interest in the mining claims subject
to the lease, providing the Company with a 40% interest in the lease.
|
NTERNATIONAL TOWER HILL MINES LTD.
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
Three Months Ended March 31, 2021 and 2020
(Expressed in US Dollars - Unaudited)
|
d)
|
A lease of unpatented federal lode mining and federal unpatented placer claims having an initial term
of ten years commencing on March 28, 2007, and
continuing for so long thereafter as advance minimum royalties are paid and mining related activities, including exploration, continue
on the property or on adjacent properties controlled by the Company. The lease requires an advance minimum royalty of $15,000 on or before
each anniversary date for the duration of the lease (all of which minimum royalties are recoverable from production royalties). The Company
is required to pay the lessor the additional sum of $250,000 upon making a positive production decision, of which $125,000 is payable
within 120 days of the decision and $125,000 is payable within a year of the decision (all of which are recoverable from production royalties).
An NSR production royalty of 2% is payable to the lessor. The Company may purchase all of the interest of the lessor in the leased property
(including the production royalty) for $1,000,000. The Company paid $15,000 of royalties during the three months ended March 31, 2021,
for a total of $188,000 from the inception of this lease.
|
Title to mineral properties
The acquisition of title to mineral
properties is a detailed and time-consuming process. The Company has taken steps to verify title to mineral properties in which it has
an interest. Although the Company has taken every reasonable precaution to ensure that legal title to its properties is properly recorded
in the name of the Company, there can be no assurance that such title will ultimately be secured.
The following table presents the accrued
liabilities balances at March 31, 2021 and December 31, 2020.
|
|
March
31,2021
|
|
|
December 31,2020
|
|
Accrued liabilities
|
|
$
|
171,783
|
|
|
$
|
227,459
|
|
Accrued salaries and benefits
|
|
|
21,278
|
|
|
|
66,506
|
|
Total accrued liabilities
|
|
$
|
193,061
|
|
|
$
|
293,965
|
|
Accrued liabilities at March 31, 2021
include accruals for general corporate costs and project costs of $52,837 and $118,946, respectively. Accrued liabilities at December
31, 2020 include accruals for general corporate costs and project costs of $51,151 and $176,308, respectively.
Authorized
The Company’s authorized share
capital consists of 500,000,000 common shares without par value. At December 31, 2020 and March 31, 2021, there were 194,908,184 shares
issued and outstanding.
Share issuances
There were no share issuances during
the three months ended March 31, 2021.
Stock options
The Company adopted an incentive
stock option plan in 2006, as amended September 19, 2012 and reapproved by the Company’s shareholders on May 28, 2015 and May
30, 2018 (the “Stock Option Plan”). The essential elements of the Stock Option Plan provide that the aggregate number of
common shares of the Company that may be issued pursuant to options granted under the Stock Option Plan and any other share-based
compensation arrangements may not exceed 10% of the number of issued shares of the Company at the time of the granting of the
options. Options granted under the Stock Option Plan will have a maximum term of ten years. The exercise price of options granted
under the Stock Option Plan shall be fixed in compliance with the applicable provisions of the Toronto Stock Exchange
(“TSX”) Company Manual in force at the time of grant and, in any event, shall not be less than the closing price of the
Company’s common shares on the TSX on the trading day immediately preceding the day on which the option is granted, or such
other price as may be agreed to by the Company and accepted by the TSX. Options granted under the Stock Option Plan vest
immediately, unless otherwise determined by the directors at the date of grant.
INTERNATIONAL
TOWER HILL MINES LTD.
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
Three Months Ended March 31, 2021
and 2020
(Expressed
in US dollars – Unaudited)
A summary of the options granted under
the Stock Option Plan as of March 31, 2021 and December 31, 2020 is presented below:
|
|
Three Months Ended
|
Year Ended
|
|
|
|
March 31, 2021
|
December 31, 2020
|
|
|
|
Number of
Options
|
|
|
Weighted Average Exercise Price (C$)
|
|
|
Aggregate Intrinsic Value (C$)
|
Number of
Options
|
|
|
Weighted Average Exercise Price (C$)
|
|
|
Aggregate Intrinsic Value (C$)
|
|
Balance, beginning of the period
|
|
|
2,707,049
|
|
|
$
|
0.94
|
|
|
|
|
|
2,452,049
|
|
|
$
|
0.94
|
|
|
|
|
|
Granted
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
255,000
|
|
|
|
0.92
|
|
|
|
|
|
Balance, end of the period
|
|
|
2,707,049
|
|
|
$
|
0.94
|
|
|
$
|
1,123,231
|
|
2,707,049
|
|
|
$
|
0.94
|
|
|
$
|
2,287,262
|
|
The weighted average remaining life
of options outstanding at March 31, 2021 was 2.4 years.
Stock options outstanding
are as follows:
|
|
March 31, 2021
|
|
December 31, 2020
|
|
Expiry Date
|
|
Exercise
Price (C$)
|
|
|
Number of Options
|
|
|
Exercisable
|
|
Exercise
Price (C$)
|
|
|
Number of Options
|
|
|
Exercisable
|
|
February 25, 2022
|
|
$
|
1.11
|
|
|
|
510,000
|
|
|
|
510,000
|
|
$
|
1.11
|
|
|
|
510,000
|
|
|
|
510,000
|
|
February 25, 2022
|
|
$
|
0.73
|
|
|
|
270,000
|
|
|
|
270,000
|
|
$
|
0.73
|
|
|
|
270,000
|
|
|
|
270,000
|
|
March 10, 2022
|
|
$
|
1.11
|
|
|
|
120,000
|
|
|
|
120,000
|
|
$
|
1.11
|
|
|
|
120,000
|
|
|
|
120,000
|
|
March 16, 2023
|
|
$
|
1.00
|
|
|
|
580,000
|
|
|
|
580,000
|
|
$
|
1.00
|
|
|
|
580,000
|
|
|
|
580,000
|
|
March 16, 2023
|
|
$
|
0.50
|
|
|
|
130,000
|
|
|
|
130,000
|
|
$
|
0.50
|
|
|
|
130,000
|
|
|
|
130,000
|
|
June 9, 2023
|
|
$
|
1.00
|
|
|
|
30,000
|
|
|
|
30,000
|
|
$
|
1.00
|
|
|
|
30,000
|
|
|
|
30,000
|
|
March 21, 2024
|
|
$
|
0.61
|
|
|
|
374,817
|
|
|
|
374,817
|
|
$
|
0.61
|
|
|
|
374,817
|
|
|
|
374,817
|
|
February 1, 2025
|
|
$
|
1.35
|
|
|
|
250,000
|
|
|
|
250,000
|
|
$
|
1.35
|
|
|
|
250,000
|
|
|
|
250,000
|
|
August 8, 2025
|
|
$
|
0.85
|
|
|
|
187,232
|
|
|
|
187,232
|
|
$
|
0.85
|
|
|
|
187,232
|
|
|
|
187,232
|
|
May 27, 2026
|
|
$
|
0.92
|
|
|
|
255,000
|
|
|
|
85,000
|
|
$
|
0.92
|
|
|
|
255,000
|
|
|
|
85,000
|
|
|
|
|
|
|
|
|
2,707,049
|
|
|
|
2,537,049
|
|
|
|
|
|
|
2,707,049
|
|
|
|
2,537,049
|
|
A summary of the non-vested options
as of March 31, 2021 and changes during the three months ended March 31, 2021 is as follows:
Non-vested options:
|
|
Number of
options
|
|
|
Weighted average
grant-date fair value
(C$)
|
|
Outstanding at December 31, 2020
|
|
|
170,000
|
|
|
$
|
0.76
|
|
Outstanding at March 31, 2021
|
|
|
170,000
|
|
|
$
|
0.76
|
|
At March 31, 2021, there was unrecognized
compensation expense of C$47,412 related to non-vested options outstanding. The cost is expected to be recognized over a weighted-average
remaining period of approximately 0.9 years.
INTERNATIONAL TOWER HILL MINES LTD.
NOTES TO THE CONDENSED CONSOLIDATED
INTERIM FINANCIAL STATEMENTS
Three Months Ended March 31, 2021 and
2020
(Expressed
in US dollars – Unaudited)
Deferred Share Unit Incentive Plan
On April 4, 2017, the Company adopted
a Deferred Share Unit Plan (the “DSU Plan”). The DSU Plan was approved by the Company’s shareholders on May 24, 2017
and reapproved by the Company’s shareholders on May 27, 2020. The maximum aggregate number of common shares that may be issued under
the DSU Plan and the Stock Option Plan is 10% of the number of issued and outstanding common shares (on a non-diluted basis).
During the year ended December 31, 2020,
the Company granted each of the members of the Board (other than those directors nominated for election by Paulson & Co. Inc., the
Company’s largest shareholder) 90,217 deferred share units (“DSUs”) with a grant date fair value (defined as the weighted
average of the prices at which the common shares traded on the exchange with the most volume for the five days immediately preceding the
grant) of C$0.92 per DSU, representing C$83,000 per director or C$415,000 in the aggregate. The DSUs entitle the holders to receive common
shares of the Company without the payment of any consideration. The DSUs vested immediately upon being granted but the common shares underlying
the DSUs are not deliverable to the holder until the holder is no longer serving on the Board.
DSUs outstanding are as follows:
|
|
Three Months Ended
|
|
|
Year Ended
|
|
|
|
March 31, 2021
|
|
|
December 31, 2020
|
|
|
|
Number of
Units
|
|
|
Weighted Average
Exercise Price
(C$)
|
|
|
Number of
Units
|
|
|
Weighted Average
Exercise Price
(C$)
|
|
Balance, beginning of the period
|
|
|
1,834,481
|
|
|
$
|
0.81
|
|
|
|
1,383,396
|
|
|
$
|
0.77
|
|
Issued
|
|
|
-
|
|
|
|
-
|
|
|
|
451,085
|
|
|
$
|
0.92
|
|
Balance, end of the period
|
|
|
1,834,481
|
|
|
$
|
0.81
|
|
|
|
1,834,481
|
|
|
$
|
0.81
|
|
Share-based payments
During the three-month period
ended March 31, 2021, there were no stock options granted under the Stock Option Plan and no DSUs granted for common shares of the
Company under the DSU Plan. Share-based payment compensation for the three months ended March 31, 2021 totaled $18,971 ($18,971
related to stock options and $Nil related to DSUs). Of the total expense for the period ended March 31, 2021, $2,232 was included in
consulting fees, $1,116 was included in investor relations, and $15,623 was included in wages and benefits in the statement of
operations and comprehensive loss.
During the three-month period ended
March 31, 2020, there were no stock options granted under the Stock Option Plan and no DSUs granted for common shares of the Company under
the DSU Plan. Share-based payment compensation for the three months ended March 31, 2020 totaled $Nil.
INTERNATIONAL TOWER HILL MINES LTD.
NOTES TO THE CONDENSED CONSOLIDATED
INTERIM FINANCIAL STATEMENTS
Three Months Ended March 31, 2021 and
2020
(Expressed in US dollars – Unaudited)
|
7.
|
SEGMENT AND GEOGRAPHIC INFORMATION
|
The Company operates in a single reportable segment, being
the exploration and development of mineral properties. The following tables present selected financial information by geographic location:
|
|
Canada
|
|
|
United States
|
|
|
Total
|
|
March 31, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
Capitalized acquisition costs
|
|
$
|
-
|
|
|
$
|
55,375,124
|
|
|
$
|
55,375,124
|
|
Property and equipment
|
|
|
7,805
|
|
|
|
-
|
|
|
|
7,805
|
|
Current assets
|
|
|
11,673,206
|
|
|
|
492,031
|
|
|
|
12,165,237
|
|
Total assets
|
|
$
|
11,681,011
|
|
|
$
|
55,867,155
|
|
|
$
|
67,548,166
|
|
December 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
Capitalized acquisition costs
|
|
$
|
-
|
|
|
$
|
55,375,124
|
|
|
$
|
55,375,124
|
|
Property and equipment
|
|
|
7,832
|
|
|
|
-
|
|
|
|
7,832
|
|
Current assets
|
|
|
12,862,068
|
|
|
|
349,304
|
|
|
|
13,211,372
|
|
Total assets
|
|
$
|
12,869,900
|
|
|
$
|
55,724,428
|
|
|
$
|
68,594,328
|
|
Three months ended
|
|
March 31, 2021
|
|
|
March 31, 2020
|
|
Net income (loss) for the period – Canada
|
|
$
|
(366,948
|
)
|
|
$
|
413,537
|
|
Net loss for the period – United States
|
|
|
(770,924
|
)
|
|
|
(348,452
|
)
|
Net income (loss) for the period
|
|
$
|
(1,137,872
|
)
|
|
$
|
65,085
|
|
The following table discloses the Company’s
contractual obligations as of March 31, 2021, including anticipated mineral property payments. Under the terms of the Company’s
mineral property purchase agreements, mineral leases and unpatented mineral claims, the Company is required to make certain scheduled
acquisition payments, incur certain levels of expenditures, make lease or advance royalty payments, make payments to government authorities
and incur assessment work expenditures (as summarized in the table below) in order to maintain and preserve the Company’s interests
in the related mineral properties. If the Company is unable or unwilling to make any such payments or incur any such expenditure, it is
likely that the Company would lose or forfeit its rights to acquire or hold the related mineral properties. The following table assumes
that the Company retains the rights to all of its current mineral properties, but does not exercise any lease purchase or royalty buyout
options:
|
|
Payments Due by Year
|
|
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
2025
|
|
2026 and beyond
|
|
Total
|
|
Mineral Property Leases(1)
|
|
$
|
392,688
|
|
$
|
426,972
|
|
$
|
513,715
|
|
$
|
519,136
|
|
$
|
524,625
|
|
$
|
530,183
|
|
$
|
2,907,319
|
|
Mining
Claim Government Fees
|
|
|
132,460
|
|
|
132,460
|
|
|
132,460
|
|
|
132,460
|
|
|
132,460
|
|
|
132,460
|
|
|
794,760
|
|
Total
|
|
$
|
525,148
|
|
$
|
559,432
|
|
$
|
646,175
|
|
$
|
651,596
|
|
$
|
657,085
|
|
$
|
662,643
|
|
$
|
3,702,079
|
|
|
|
|
|
1.
|
Does not include required work expenditures, as it is assumed that the required expenditure level is significantly below the level of work that will actually be carried out by the Company. Does not include potential royalties that may be payable (other than annual minimum royalty payments). See Note 4.
|