Our unaudited condensed financial statements for the three
month period ended November 30, 2018 form part of this quarterly report. They
are stated in United States Dollars (US$) and are prepared in accordance with
United States generally accepted accounting principles.
ENERTOPIA CORP.
|
UNAUDITED CONDENSED INTERIM BALANCE SHEETS
|
(Expressed in U.S. Dollars)
|
|
|
November 30
|
|
|
August 31
|
|
|
|
2018
|
|
|
2018
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current
|
|
|
|
|
|
|
Cash and
cash equivalents
|
$
|
137,915
|
|
$
|
176,409
|
|
Accounts receivable
|
|
9,147
|
|
|
7,504
|
|
Prepaid
expenses and deposit
|
|
83,569
|
|
|
87,777
|
|
Total current assets
|
|
230,631
|
|
|
271,690
|
|
Total Assets
|
$
|
230,631
|
|
$
|
271,690
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
Current
|
|
|
|
|
|
|
Accounts
payable
|
$
|
285,025
|
|
$
|
278,036
|
|
Due to related parties
(Note 6)
|
|
171,010
|
|
|
171,234
|
|
Total Current
Liabilities
|
|
456,035
|
|
|
449,270
|
|
|
|
|
|
|
|
|
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital
|
|
|
|
|
|
|
Authorized:
200,000,000 common shares with a par value of $0.001 per
share
Issued and outstanding:
121,964,931 common shares at November 30, 2018 and August 31,2018:
119,739,931
|
|
121,966
|
|
|
119,741
|
|
Additional paid-in capital
(Note 7)
|
|
13,639,247
|
|
|
13,594,497
|
|
Deficit accumulated during the exploration
stage
|
|
(13,986,617
|
)
|
|
(13,891,818
|
)
|
Total Stockholders'
Equity
|
|
(225,404
|
)
|
|
(177,580
|
)
|
Total Liabilities and Stockholders'
Equity
|
$
|
230,631
|
|
$
|
271,690
|
|
The accompanying notes are an integral part of these unaudited
condensed interim financial statements
F-1
ENERTOPIA CORP.
|
CONDENSED INTERIM STATEMENTS OF STOCKHOLDERS' EQUITY
(UNAUDITED)
|
(Expressed in U.S. Dollars)
|
|
|
COMMON STOCK
|
|
|
ADDITIONAL
|
|
|
|
|
|
TOTAL
|
|
|
|
|
|
|
|
|
|
PAID-IN
|
|
|
DEFICIT
|
|
|
STOCKHOLDERS'
|
|
|
|
SHARES
|
|
|
AMOUNT
|
|
|
CAPITAL
|
|
|
ACCUMULATED
|
|
|
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, August 31, 2017
|
|
102,298,031
|
|
$
|
102,299
|
|
$
|
12,901,936
|
|
$
|
(13,241,763
|
)
|
$
|
(237,528
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Based Compensation
|
|
-
|
|
|
-
|
|
|
89,596
|
|
|
-
|
|
|
89,596
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued for Private
Placement on November 1
|
|
2,600,000
|
|
|
2,600
|
|
|
98,598
|
|
|
-
|
|
|
101,198
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued for Private
Placement on December 8
|
|
3,954,000
|
|
|
3,954
|
|
|
140,505
|
|
|
-
|
|
|
144,459
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option conversion on December
8
|
|
240,000
|
|
|
240
|
|
|
11,760
|
|
|
-
|
|
|
12,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued for Private
Placement on January 12
|
|
1,611,000
|
|
|
1,611
|
|
|
59,657
|
|
|
-
|
|
|
61,268
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Warrant conversion on
February 2
|
|
50,000
|
|
|
50
|
|
|
3,450
|
|
|
-
|
|
|
3,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option conversion on May 11
|
|
200,000
|
|
|
200
|
|
|
11,800
|
|
|
-
|
|
|
12,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued for Private
Placement on May 11
|
|
1,746,900
|
|
|
1,747
|
|
|
72,982
|
|
|
-
|
|
|
74,729
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued for Private
Placement on May 25
|
|
2,470,000
|
|
|
2,470
|
|
|
107,864
|
|
|
-
|
|
|
110,334
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued for Private
Placement on August 31
|
|
4,400,000
|
|
|
4,400
|
|
|
87,519
|
|
|
-
|
|
|
91,919
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option conversion on August
31
|
|
170,000
|
|
|
170
|
|
|
8,830
|
|
|
-
|
|
|
9,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss)
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(650,055
|
)
|
|
(650,055
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, August 31, 2018
|
|
119,739,931
|
|
|
119,741
|
|
|
13,594,497
|
|
|
(13,891,818
|
)
|
|
(177,580
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued for Private
Placement on September 21
|
|
2,225,000
|
|
|
2,225
|
|
|
44,750
|
|
|
-
|
|
|
46,975
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income (loss)
|
|
-
|
|
|
-
|
|
|
-
|
|
|
(94,799
|
)
|
|
(94,799
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, November 30, 2018
|
|
121,964,931
|
|
|
121,966
|
|
|
13,639,247
|
|
|
(13,986,617
|
)
|
|
(225,404
|
)
|
The accompanying notes are an integral part of these unaudited
condensed interim financial statements
ENERTOPIA CORP.
|
CONDENSED INTERIM STATEMENTS OF OPERATIONS
(UNAUDITED)
|
(Expressed in U.S. Dollars)
|
|
|
THREE
MONTHS ENDED
|
|
|
|
November 30
|
|
|
November 30
|
|
|
|
2018
|
|
|
2017
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
Accounting and audit
|
$
|
11,122
|
|
$
|
6,118
|
|
Bank
charges and interest expense
|
|
209
|
|
|
357
|
|
Consulting (Note 6)
|
|
12,450
|
|
|
10,700
|
|
Mineral
exploration costs
|
|
9,172
|
|
|
-
|
|
Fees and dues
|
|
14,158
|
|
|
11,804
|
|
Insurance
|
|
2,902
|
|
|
3,002
|
|
Investor relations
|
|
36,209
|
|
|
12,651
|
|
Legal and
professional
|
|
1,922
|
|
|
3,748
|
|
Office and miscellaneous
|
|
1,552
|
|
|
1,775
|
|
Research
and Development
|
|
-
|
|
|
108,748
|
|
Rent
|
|
1,321
|
|
|
1,362
|
|
Stock
based compensation
|
|
-
|
|
|
31,237
|
|
Telephone
|
|
-
|
|
|
(203
|
)
|
Travel
|
|
3,047
|
|
|
2,631
|
|
|
|
|
|
|
|
|
Total expenses
|
|
94,064
|
|
|
193,930
|
|
|
|
|
|
|
|
|
Loss for the period before
other items
|
|
(94,064
|
)
|
|
(193,930
|
)
|
|
|
|
|
|
|
|
Other income (expense)
|
|
|
|
|
|
|
Foreign exchange gain
|
|
(735
|
)
|
|
589
|
|
|
|
|
|
|
|
|
Net loss and comprehensive loss for the
period
|
$
|
(94,799
|
)
|
$
|
(193,341
|
)
|
|
|
|
|
|
|
|
Basic and diluted loss per share
|
$
|
(0.00
|
)
|
$
|
(0.00
|
)
|
Weighted average number of
common shares
outstanding - basic and diluted
|
|
120,081,488
|
|
|
102,504,606
|
|
The accompanying notes are an integral part of these unaudited
condensed interim financial statements
F-3
ENERTOPIA CORP.
|
CONDENSED INTERIM STATEMENTS OF CASH FLOWS
(UNAUDITED)
|
(Expressed in U.S. Dollars)
|
|
|
THREE
MONTHS ENDED
|
|
|
|
November 30
|
|
|
November 30
|
|
|
|
2018
|
|
|
2017
|
|
Cash flows used in
operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (loss)
|
$
|
(94,799
|
)
|
$
|
(193,341
|
)
|
Changes
to reconcile net loss to net cash used in operating
activities
|
|
|
|
|
|
|
Stock based
compensation
|
|
-
|
|
|
31,237
|
|
Change
in non-cash working capital items:
|
|
|
|
|
|
|
Accounts
receivable
|
|
(1,643
|
)
|
|
(5,149
|
)
|
Prepaid expenses and
deposit
|
|
4,208
|
|
|
(41,752
|
)
|
Accounts
payable and accrued liabilities
|
|
6,989
|
|
|
1,485
|
|
Due to related parties
|
|
(224
|
)
|
|
7,350
|
|
Net cash (used in)
operating activities
|
|
(85,469
|
)
|
|
(200,170
|
)
|
|
|
|
|
|
|
|
Cash flows from financing
activities
|
|
|
|
|
|
|
Net
proceeds from subscriptions received
|
|
46,975
|
|
|
100,893
|
|
Net cash from financing
activities
|
|
46,975
|
|
|
100,893
|
|
Increase (Decrease) in cash and cash
equivalents
|
|
(38,494
|
)
|
|
(99,277
|
)
|
Cash
and cash equivalents, beginning of period
|
|
176,409
|
|
|
150,870
|
|
Cash and cash equivalents, end of
period
|
$
|
137,915
|
|
$
|
51,593
|
|
|
|
|
|
|
|
|
Supplemental information of cash flows
|
|
|
|
|
|
|
Interest paid in cash
|
$
|
-
|
|
$
|
-
|
|
Income
taxes paid in cash
|
$
|
-
|
|
$
|
-
|
|
The accompanying notes are an integral part of these unaudited
condensed interim financial statements
F-4
ENERTOPIA CORP.
|
NOTES TO CONDENSED INTERIM FINANCIAL STATEMENTS
(UNAUDITED)
|
November 30, 2018
|
(Expressed in U.S. Dollars)
|
|
The unaudited condensed interim
financial statements for the period ended November 30, 2018 included herein have
been prepared pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures normally
included in annual financial statements prepared in accordance with United
States generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included. These unaudited condensed interim
financial statements should be read in conjunction with the August 31, 2018
audited annual financial statements and notes thereto.
The Company was formed on November 24,
2004 under the laws of the State of Nevada and commenced operations on November
24, 2004. The Company was an independent natural resource company engaged in the
exploration, development and acquisition of natural resources in the United
States and Canada. In the fiscal year 2010, the Company shifted its strategic
plan from its non-renewal energy operations to its planned renewal energy
operations and natural resource acquisition and development. In late summer of
2013, the Company had another business sector in alternative health and
wellness. During spring of 2016, the Company shifted its strategic plan to
natural resource acquisitions and Lithium brine extraction technology. The
Company office is located in Kelowna, B.C., Canada.
2.
|
GOING CONCERN UNCERTAINTY
|
The accompanying unaudited condensed
interim financial statements have been prepared on a going concern basis which
contemplates the realization of assets and the satisfaction of liabilities and
commitments in the normal course of business for the foreseeable future. The
Company had a working capital deficit of $225,404 for the three months ended
November 30, 2018 (deficit of $177,580 for the year ended August 31, 2018). The
Company incurred a net loss of $94,799 for the three months ended November 30,
2018 (net loss of $193,341 for the three months ended November 30, 2017) and as
at November 30, 2018 has incurred cumulative losses of $13,986,617 that raises
substantial doubt about its ability to continue as a going concern. Management
has been able, thus far, to finance the operations through equity financing and
cash on hand. There is no assurance that the Company will be able to continue to
finance the Company on this basis.
In view of these conditions, the
ability of the Company to continue as a going concern is in substantial doubt
and dependent upon its ability to generate sufficient cash flow to meet its
obligations on a timely basis, to obtain additional financing as may be
required, to receive the continued support of the Companys shareholders, and
ultimately to obtain successful operations. There are no assurances that we will
be able to obtain further funds required for our continued operations. As noted
herein, we are pursuing various financing alternatives to meet our immediate and
long-term financial requirements. There can be no assurance that additional
financing will be available to us when needed or, if available, that it can be
obtained on commercially reasonable terms. If we are not able to obtain the
additional financing on a timely basis, we will be unable to conduct our
operations as planned, and we will not be able to meet our other obligations as
they become due. In such event, we will be forced to scale down or perhaps even
cease our operations. There is significant uncertainty as to whether we can
obtain additional financing. These unaudited condensed interim financial
statements do not give effect to any adjustments which would be necessary should
the Company be unable to continue as a going concern and therefore be required
to realize its assets and discharge its liabilities in other than the normal
course of business and at amounts different from those reflected in the
accompanying unaudited condensed interim financial statements.
3.
|
SIGNIFICANT ACCOUNTING
POLICIES
|
The accompanying unaudited condensed
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 the instructions to Securities and Exchange Commission
(SEC) Form 10-Q and Article 10 of SEC Regulation S-X. They do not include all
of the information and footnotes required by U.S. GAAP for complete financial
statements. Therefore, these financial statements should be read in conjunction
with our audited financial statements and notes thereto for the year ended
August 31, 2018.
The preparation of financial
statements in conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of expenses during
the reporting period. On an ongoing basis, we evaluate our estimates, judgments,
and assumptions, including those related to revenue recognition, inventory
valuation, and stock based compensation (expense and liability). Our estimates,
judgments, and assumptions are based on historical experience, future
expectations, and other factors which we believe to be reasonable. Actual
results could differ from those estimates and assumptions.
|
c)
|
Recently Adopted Accounting
Pronouncements
|
On November 22, 2017, the FASB issued
ASU 2017-14 Income StatementReporting Comprehensive Income (Topic 220),
Revenue Recognition (Topic 605), and Revenue from Contracts with Customers
(Topic 606). This update amends SEC paragraphs pursuant to the SEC Staff
Accounting Bulletin No. 116 and SEC Release No. 33-10403, which bring existing
guidance into conformity with Topic 606, Revenue from Contracts with Customers.
This update is effective in fiscal years, including interim periods, beginning
after December 15, 2017. The adoption of this standard had no impact on the
Companys balance sheets or statements of operations or cash flows.
In August 2016, the FASB issued ASU
No. 2016-15 related to the statement of cash flows. This new guidance addresses
eight specific cash flow issues with the objective of reducing the existing
diversity in practice in how certain cash receipts and cash payments are
presented and classified in the statement of cash flows. This update is
effective in fiscal years, including interim periods, beginning after December
15, 2017, and early adoption is permitted. The adoption of this standard had no
impact on the Companys balance sheets or statements of operations or cash
flows.
In May 2014, the FASB issued ASU No.
2014-09, Revenue from Contracts with Customers. The new standard provides a
five-step approach to be applied to all contracts with customers and also
requires expanded disclosures about revenue recognition. The ASU is effective
for annual reporting periods beginning after December 15, 2017, including
interim periods and is to be retrospectively applied. The adoption of this
standard had no impact on the Companys balance sheets or statements of
operations or cash flows.
|
d)
|
New Accounting
Pronouncements
|
In June 2018, the FASB issued ASU
2018-07, which simplifies the accounting for nonemployee share-based payment
transactions. The amendments specify that Topic 718 applies to all share-based
payment transactions in which a grantor acquires goods or services to be used or
consumed in a grantors own operations by issuing share-based payment awards.
The standard will be effective for us in the first quarter of our fiscal year
2020, although early adoption is permitted (but no sooner than the adoption of
Topic 606). We do not expect that the adoption of this ASU will have a
significant impact on our consolidated financial statements.
In February 2016, Topic 842, Leases
was issued to replace the leases requirements in Topic 840, Leases. The main
difference between previous GAAP and Topic 842 is the recognition of lease
assets and lease liabilities by lessees for those leases classified as operating
leases under previous GAAP. A lessee should recognize in the balance sheet a
liability to make lease payments (the lease liability) and a right-of-use asset
representing its right to use the underlying asset for the lease term. For
leases with a term of 12 months or less, a lessee is permitted to make an
accounting policy election by class of underlying asset not to recognize lease
assets and lease liabilities. If a lessee makes this election, it should
recognize lease expense for such leases generally on a straight-line basis over
the lease term. The accounting applied by a lessor is largely unchanged from
that applied under previous GAAP. Topic 842 will be effective for annual
reporting periods beginning after December 15, 2018, including interim periods
within those annual periods and is to be retrospectively applied. Earlier
application is permitted. The adoption of this standard is not expected to have
a significant impact on the Companys results of operations, financial
condition, cash flows, and financial statement disclosures.
During the year ended August 30, 2017
the Company staked lode and placer claims on BLM lands in Esmerelda county
Nevada covering approximately 160 Acres subject to adjustment. The Company has a
100% interest in the lands and is only responsible for the yearly maintenance
fees to keep its 100% interest. The claims are in good standing until August 31,
2019.
On August 15, 2016, a binding Letter of
Intent (LOI) was signed by Enertopia and Genesis Water Technologies, Inc.
("GWT") with regard to the acquisition by Enertopia of the exclusive worldwide
licensing rights (the "Licensing Rights") by Enertopia of all of the technology
used in the process of recovering and extraction of battery grade lithium
carbonate powder Li2CO3 grading 99.5% or higher purity from brine solutions.
Upon the execution of this LOI,
Enertopia issued 250,000 common shares valued at $12,500 to GWT.
On December 6, 2016, and amended on
October 9, 2017, Enertopia and GWT signed a Definitive Commercial Agreement with
regard to the acquisition by Enertopia of the exclusive licensing rights in the
United States of America, Argentina, Bolivia and Chile of all of the technology
used in the process of recovering and extraction of battery grade lithium
carbonate powder Li2CO3 grading 99.5% or higher purity from brine solutions.
On July 4, 2018, the Company provided
GWT with a formal notice of termination of the commercialization agreement.
Following termination, the Company has no further obligations with respect to
the commercialization agreement. As a result, for the year ended August 31,
2018, the Company wrote off capitalized costs of $12,500.
6.
|
RELATED PARTIES
TRANSACTION
|
For the three month period ended
November 30, 2018, the Company was party to the following related party
transactions:
|
|
Incurred $10,500 (November 30, 2017: $10,500)
to the President of the Company in consulting fees.
|
|
|
$171,010 (August 31, 2018: $171,234) was
payable to the President of the Company.
|
|
|
Incurred share based compensation expenses of
$Nil in relation to stock options issued to a director of the Company
(November 30, 2017: $19,523).
|
The related party transactions are
recorded at the exchange amount established and agreed to between the related
parties.
On November 1, 2017, the Company closed
the first tranche of a private placement of 2,600,000 units at a price of
CAD$0.05 per unit for gross proceeds of CAD$130,000 (equivalent of $101,198).
Each unit consists of one common share of the Company and one non-transferable
share purchase warrant, each full warrant entitling the holder to purchase one
additional common share of the Company for a period of 24 months from the date
of issuance, at a purchase price of $0.06.
On December 8, 2017, the Company closed
the second tranche of a private placement of 3,954,000 units at a price of
CAD$0.05 per unit for gross proceeds of CAD$197,700 (equivalent of $154,397).
Each unit consists of one common share of the Company and one non-transferable
share purchase warrant, each full warrant entitling the holder to purchase one
additional common share of the Company for a period of 24 months from the date
of issuance, at a purchase price of $0.06. A cash finders fee of CAD$12,770 and
230,400 broker warrants was paid to a third party. The broker warrants have the
same terms as the warrants issued as part of the unit offering.
On December 8, 2017, the Company issued
240,000 shares for gross proceeds of $12,000 from the exercise of stock options
at $0.05.
On January 12, 2018, the Company closed
the final tranche of a private placement of 1,611,000 units at a price of
CAD$0.05 per unit for gross proceeds of CAD$80,550 (equivalent of $64,371). Each
unit consists of one common share of the Company and one non-transferable share
purchase warrant, each full warrant entitling the holder to purchase one
additional common share of the Company for a period of 24 months from the date
of issuance, at a purchase price of $0.06. A cash finders fee of CAD$3,880 and
77,600 broker warrants was paid to a third party. The broker warrants have the
same terms as the warrants issued as part of the unit offering.
On February 2, 2018, the Company issued
50,000 shares for gross proceeds of $3,500 from the exercise of warrants from a
previous financing at $0.07.
On May 11, 2018, the Company issued
200,000 shares for gross proceeds of $12,000 from the exercise of stock options
at $0.06.
On May 11, 2018, the Company closed the
first tranche of a private placement of 1,746,900 units at a price of CAD$0.06
per unit for gross proceeds of CAD$104,814 (equivalent of $81,987). Each unit
consists of one common share of the Company and one non-transferable share
purchase warrant, each full warrant entitling the holder to purchase one
additional common share of the Company for a period of 24 months from the date
of issuance, at a purchase price of $0.075. A cash finders fee of CAD$9,281 and
144,690 full broker warrants that expire May 11, 2020 was paid to third parties.
The broker warrants have the same terms as the warrants issued as part of the
unit offering.
On May 25, 2018, the Company closed the
final tranche of a private placement of 2,470,000 units at a price of CAD$0.06
per unit for gross proceeds of CAD$148,200 (equivalent of $114,822). Each unit
consists of one common share of the Company and one non-transferable share
purchase warrant, each full warrant entitling the holder to purchase one
additional common share of the Company for a period of 24 months from the date
of issuance, at a purchase price of $0.075. A cash finders fee of CAD$5,820 and
70,000 full broker warrants that expire May 25, 2020 was paid to third parties.
The broker warrants have the same terms as the warrants issued as part of the
unit offering.
On August 31, 2018, the Company closed
the first tranche of a private placement of 4,400,000 units at a price of
CAD$0.03 per unit for gross proceeds of CAD$132,000 (equivalent of $101,111).
Each unit consists of one common share of the Company and one non-transferable
share purchase warrant, each full warrant entitling the holder to purchase one
additional common share of the Company for a period of 36 months from the date of issuance, at a purchase
price of $0.05. A cash finders fee of CAD$12,000 (equivalent of $9,192) and
400,000 full broker warrants that expire August 31, 2021 was paid to third
parties. The broker warrants have the same terms as the warrants issued as part
of the unit offering.
On August 31, 2018, the Company issued
170,000 shares for gross proceeds of $9,000 from the exercise of 50,000 stock
options at $0.06 and 120,000 stock options at $0.05 respectively.
On September 21, 2018, the Company
closed the final tranche of a private placement of 2,225,000 units at a price of
CAD$0.03 per unit for gross proceeds of CAD$66,750 (equivalent of $51,678). Each
unit consists of one common share of the Company and one non-transferable share
purchase warrant, each full warrant entitling the holder to purchase one
additional common share of the Company for a period of 36 months from the date
of issuance, at a purchase price of $0.05. A cash finders fee of CAD$6,075 and
202,500 full broker warrants that expire September 21, 2021 was paid to third
parties. The broker warrants have the same terms as the warrants issued as part
of the unit offering.
As at November 30, 2018 the Company had
121,964,931 shares issued and outstanding and as at August 31, 2018, the Company
had 119,739,931 shares issued and outstanding.
8.
|
STOCK OPTIONS AND WARRANTS
|
Stock Options
On July 15, 2014, the shareholders
approved and adopted at the Annual General Meeting the Companys 2014 Stock
Option Plan. On April 14, 2011, the shareholders approved and adopted at the
Annual General Meeting to consolidate the Companys 2007 Equity compensation
plan and the Companys 2010 Equity Compensation Plan into a new Company 2011
Stock Option Plan. The purpose of these Plans is to advance the interests of the
Corporation, through the grant of Options, by providing an incentive mechanism
to foster the interest of eligible persons in the success of the Corporation and
its affiliates; encouraging eligible persons to remain with the Corporation or
its affiliates; and attracting new Directors, Officers, Employees and
Consultants.
On November 1, 2017, the Company
granted 800,000 stock options to a director and consultant of the Company with
an exercise price of $0.05, expiring November 2, 2022.
On May 11, 2018, the Company granted
535,000 stock options to a director and consultant of the Company with an
exercise price of $0.06, expiring May 11, 2023.
On May 22, 2018, the Company granted
550,000 stock options to consultants of the Company with an exercise price of
$0.07, expiring May 22, 2023.
For the three month period ended
November 30, 2018, the Company recorded $Nil (November 30, 2017 $31,237) stock
based compensation expenses.
A summary of the changes in stock
options for the three months ended November 30, 2018 is presented below:
|
|
|
Options Outstanding
|
|
|
|
|
|
|
|
Weighted Average
|
|
|
|
|
Number of Shares
|
|
|
Exercise Price
|
|
|
Balance, August 31, 2017
|
|
7,295,000
|
|
$
|
0.07
|
|
|
Granted
|
|
1,885,000
|
|
|
0.06
|
|
|
Exercised
|
|
(610,000
|
)
|
|
0.05
|
|
|
Balance, August 31, 2018
|
|
8,570,000
|
|
$
|
0.07
|
|
|
Granted
|
|
-
|
|
|
-
|
|
|
Expired
|
|
(250,000
|
)
|
|
0.06
|
|
|
Balance, November 30, 2018
|
|
8,320,000
|
|
$
|
0.07
|
|
The fair value of options granted has
been estimated as of the date of the grant by using the Black-Scholes option
pricing model with the following assumptions:
|
|
|
November 30, 2018
|
|
|
November 30, 2017
|
|
|
Expected volatility
|
|
-
|
|
|
204%
|
|
|
Risk-free interest rate
|
|
-
|
|
|
2.03%
|
|
|
Expected life
|
|
-
|
|
|
5.00 years
|
|
|
Dividend yield
|
|
-
|
|
|
0.00%
|
|
|
Estimated fair value per option
|
|
-
|
|
$
|
0.04
|
|
The Company has the following options
outstanding and exercisable.
November 30, 2018
|
|
|
Options
outstanding and
|
|
|
|
|
exercisable
|
|
|
|
|
Number
|
|
|
Remaining
|
|
|
Exercise prices
|
|
of shares
|
|
|
contractual
|
|
|
|
|
|
|
|
life
|
|
|
$0.07
|
|
550,000
|
|
|
4.48 years
|
|
|
$0.06
|
|
535,000
|
|
|
4.45 years
|
|
|
$0.05
|
|
800,000
|
|
|
3.91 years
|
|
|
$0.10
|
|
500,000
|
|
|
3.42 years
|
|
|
$0.07
|
|
1,500,000
|
|
|
3.17 years
|
|
|
$0.07
|
|
1,535,000
|
|
|
3.14 years
|
|
|
$0.07
|
|
800,000
|
|
|
2.81 years
|
|
|
$0.05
|
|
1,100,000
|
|
|
1.90 years
|
|
|
$0.10
|
|
1,000,000
|
|
|
0.93 years
|
|
|
|
|
|
|
|
|
|
|
|
|
8,320,000
|
|
|
3.08 years
|
|
August 31, 2018
|
|
|
Options
outstanding and
|
|
|
|
|
exercisable
|
|
|
|
|
Number
|
|
|
Remaining
|
|
|
Exercise prices
|
|
of shares
|
|
|
contractual
|
|
|
|
|
|
|
|
life
|
|
|
$0.07
|
|
550,000
|
|
|
4.73 years
|
|
|
$0.06
|
|
535,000
|
|
|
4.70 years
|
|
|
$0.05
|
|
800,000
|
|
|
4.16 years
|
|
|
$0.10
|
|
500,000
|
|
|
3.67 years
|
|
|
$0.07
|
|
1,500,000
|
|
|
3.42 years
|
|
|
$0.07
|
|
1,535,000
|
|
|
3.39 years
|
|
|
$0.07
|
|
800,000
|
|
|
3.05 years
|
|
|
$0.05
|
|
1,100,000
|
|
|
2.15 years
|
|
|
$0.10
|
|
1,000,000
|
|
|
1.18 years
|
|
|
$0.06
|
|
250,000
|
|
|
0.18 years
1
|
|
|
|
|
|
|
|
|
|
|
|
|
8,570,000
|
|
|
2.88 years
|
|
*The aggregate intrinsic value for
options outstanding and exercisable as at November 30, 2018 was $Nil.
Warrants
During the year ended August 31, 2018,
the Company issued 16,781,900 warrants attached to units in private placements
and 922,690 broker warrants in connection with the private placements, see Note
7 for disclosure of the terms of the warrants. The fair value of the brokers
warrants was $27,791, recorded as share issuance costs off-setting the gross
proceeds of private placements in additional-paid-in-capital, and was calculated
using the Black Scholes option pricing model, with the following weighted
average assumptions: expected volatility 152%, risk-free interest rate: 2.10%,
expected life: 2.43 years, dividend yield: 0.00% .
During the three month period ended
November 30, 2018, the Company issued 2,225,000 warrants attached to units in
private placements and 202,500 broker warrants in connection with the private
placements, see Note 9 for disclosure of the terms of the warrants. The fair
value of the brokers warrants was $4,620, recorded as share issuance costs
off-setting the gross proceeds of private placements in
additional-paid-in-capital, and was calculated using the Black Scholes option
pricing model, with the following weighted average assumptions: expected
volatility 150%, risk-free interest rate: 2.89%, expected life: 3 years,
dividend yield: 0.00% .
A summary of warrants as at November
30, 2018 and August 31, 2018 is as follows:
|
|
|
Warrants Outstanding
|
|
|
|
|
|
|
|
Weighted Average
|
|
|
|
|
Number of warrants
|
|
|
Exercise Price
|
|
|
Balance, August 31, 2017
|
|
39,191,810
|
|
$
|
0.09
|
|
|
Expired
|
|
(16,107,340
|
)
|
|
0.12
|
|
|
Issued
|
|
17,704,590
|
|
|
0.06
|
|
|
Exercised
|
|
(50,000
|
)
|
|
0.07
|
|
|
Balance, August 31, 2018
|
|
40,739,060
|
|
$
|
0.06
|
|
|
Expired
|
|
(3,946,571
|
)
|
|
0.07
|
|
|
Issued
|
|
2,427,500
|
|
|
0.05
|
|
|
Balance, November 30, 2018
|
|
39,219,989
|
|
$
|
0.06
|
|
|
Number
|
|
Exercise
|
|
|
Expiry
|
|
|
Outstanding
1
|
|
Price
|
|
|
Date
|
|
|
2,427,500
|
$
|
0.050
|
|
|
September 21,
2021
|
|
|
4,800,000
|
$
|
0.050
|
|
|
August 31, 2021
|
|
|
2,540,000
|
$
|
0.075
|
|
|
May 25, 2020
|
|
|
1,891,590
|
$
|
0.075
|
|
|
May 11, 2020
|
|
|
1,688,600
|
$
|
0.060
|
|
|
January 12, 2020
|
|
|
4,184,400
|
$
|
0.060
|
|
|
December 8, 2019
|
|
|
2,600,000
|
$
|
0.060
|
|
|
November 1, 2019
|
|
|
3,253,333
|
$
|
0.050 and $0.10 after 18 months
|
|
|
June 8, 2019
|
|
|
6,882,666
|
$
|
0.050 and $0.10
after 18 months
|
|
|
May 20, 2019
|
|
|
3,454,400
|
$
|
0.120
|
|
|
April 29, 2019
|
|
|
4,477,500
|
$
|
0.060
|
|
|
February 28, 2019
|
|
|
1,020,000
|
$
|
0.060
|
|
|
January 20, 2019
|
|
|
39,219,989
|
|
|
|
|
|
|
|
1.
|
Each warrant entitles a holder to purchase one common
share.
|
|
(a)
|
The Company has a consulting agreement with the President
of the Company for corporate administration and consulting services for
$3,500 per month plus goods and services tax (GST) on a continuing
basis.
|
10.
|
SEGMENTED INFORMATION
|
As at November 30, 2018 and August 31,
2018, the Company is operating its business in one reportable segment: natural
resource acquisitions. All of the Companys material long-lived assets are
located in the United States.
(a)
Item 2.
Managements Discussion and Analysis of Financial Condition and Results of
Operations
Forward-Looking Statements
This quarterly report contains forward-looking statements as
that term is defined in the Private Securities Litigation Reform Act of 1995.
These statements relate to future events or our future financial performance. In
some cases, you can identify forward-looking statements by terminology such as
"may", "should", "expects", "plans", "anticipates", "believes", "estimates",
"predicts", "potential" or "continue" or the negative of these terms or other
comparable terminology. These statements are only predictions and involve known
and unknown risks, uncertainties and other factors, including the risks in the
section entitled "Risk Factors", that may cause our or our industry's actual
results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. Although
we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements. Except as required by applicable law, including the securities
laws of the United States, we do not intend to update any of the forward-looking
statements to conform these statements to actual results.
Our unaudited condensed financial statements are stated in
United States Dollars (US$) and are prepared in accordance with United States
Generally Accepted Accounting Principles. The following discussion should be
read in conjunction with our unaudited condensed financial statements and the
related notes that appear elsewhere in this quarterly report. The following
discussion contains forward-looking statements that reflect our plans, estimates
and beliefs. Our actual results could differ materially from those discussed in
the forward looking statements. Factors that could cause or contribute to such
differences include, but are not limited to, those discussed below and elsewhere
in this quarterly report, particularly in the section entitled "Risk Factors" of
this quarterly report.
In this quarterly report, unless otherwise specified, all
dollar amounts are expressed in United States dollars. All references to "CDN$"
refer to Canadian dollars and all references to "common shares" refer to the
common shares in our capital stock.
As used in this quarterly report, the terms "we", "us", "our"
and "Company" mean Company and/or our subsidiaries, unless otherwise indicated.
Overview
Enertopia Corp. was formed on November 24, 2004 under the laws
of the State of Nevada and commenced operations on November 24, 2004.
From inception until April 2010, we were primarily engaged in
the acquisition and exploration of natural resource properties. Beginning in
April 2010, we began our entry into the renewable energy sector by purchasing an
interest in a solar thermal design and installation company. In late summer
2013, we began our entry into medicinal marijuana business. During our 2014
fiscal year end our activities in the clean energy sector were discontinued.
During fiscal 2015 our activities in the Medicinal Marijuana sector were
discontinued. During fiscal 2016 our activities in the Womens personal
healthcare sector were discontinued.
The Company is actively pursuing business opportunities in the
resource sector, whereby we signed a definitive agreement for a Lithium Brine
Project in May 2016. In May 2017 the Company dropped the Lithium Brine Project
and subsequently acquired the Clayton Valley, NV Lithium Project announced in
August 2017. The Companys main focus is in natural resource sector.
The address of our principal executive office is 156 Valleyview
RD, Kelowna, British Columbia V1X 3M4. Our telephone number is (250) 765-6412.
Our current location provide adequate office space for our purposes at this
stage of our development.
Due to the implementation of British Columbia Instrument 51-509
on September 30, 2008 by the British Columbia Securities Commission, we have
been deemed to be a British Columbia based reporting issuer. As such, we are
required to file certain information and documents at
www.sedar.com
.
Summary of Recent Business
On September 21, 2018, the Company closed the final tranche of
a private placement of 2,225,000 units at a price of CAD$0.03 per unit for gross
proceeds of CAD$66,750. Each unit consists of one common share of the Company
and one non-transferable share purchase warrant, each full warrant entitling the
holder to purchase one additional common share of the Company for a period of 36
months from the date of issuance, at a purchase price of $0.05. A cash finders
fee of CAD$6,075 and 202,500 full broker warrants that expire September 21, 2021
was paid to third parties. The broker warrants have the same terms as the
warrants issued as part of the unit offering.
Chronological Overview of our Business over the Last Five
Years
On September 17, 2013 we entered into an AMI Participation
Agreement with Downhole Energy LLC to participate in 100% gross interest and 75%
net revenue interest for drilling, completion and production of up to 100 oil
wells on certain oil and gas leases covering 2,924 in the historic field located
in Forest and Venango counties, Pennsylvania. On execution of this agreement we
issued 100,000 of our common shares to Downhole Energy LLC. The Company decided
not to continue with the agreement and wrote off the asset.
On October 4, 2013 we entered into a consulting agreement with
Olibri Acquisitions and issued 750,000 of our common shares to Olibri.
On November 1, 2013 we entered into a Letter of Intent
Agreement (LOI) with 0786521 BC Ltd. (also known as World of Marijuana
Productions Ltd. or WOM) to acquire 51% of the issued and outstanding capital
stock of WOM. WOM was the owner and operator of a Medical Marihuana operation
located in Mission, British Columbia, Canada. The LOI was not comprehensive and
subject to the negotiation of a definitive agreement. Upon execution of the LOI,
we issued 10,000,000 of our common shares to WOM. The LOI was superseded by our
joint venture agreement with WOM dated January 16, 2014, described below.
On November 5, 2013 we granted 675,000 stock options to
directors, officers, and consultant of our Company with an exercise price of
$0.06 vested immediately, expiring November 5, 2018.
On November 18, 2013, we granted 25,000 stock options to a
consultant with an exercise price of $0.09 vested immediately, expiring November
18, 2018.
On November 18, 2013, we entered into an investor relations
contract with Coal Harbour Communications Inc. The initial term of this
agreement began on the date of execution of the agreement and continue for
two months
. Thereafter the agreement continues on a month-by-month basis
subject to cancelation by 30 days written notice. In consideration for the
services the Company paid the designees of Coal Harbour Communications a
one-time payment of two hundred thousand shares (200,000) of our restricted
common stock. We also agree to pay to Coal Harbour Communications a monthly fee
of $5,000 payable on the 1st day of each monthly period starting 60 days from
the signing of the agreement and $500 per month to cover expenses incurred on
our Companys behalf. Any expenses above $500 per month must be pre-approved.
On November 26, 2013, our Company closed the first tranche of a
private placement of 2,720,000 units at a price of CAD$0.05 per unit for gross
proceeds of CAD$136,000 ($136,000). Each warrant is exercisable into one further
share at a price of US$0.10 per warrant share for a period of thirty-six month
following the close.
On November 29, 2013, our wholly-owned subsidiary, Target
Energy, Inc. was discontinued and dissolved.
On December 23, 2013, we closed the final tranche of a private
placement of 2,528,000 units at a price of CAD$0.05 per unit for gross proceeds
of CAD$126,400 ($126,400). Each warrant is exercisable into one further share at
a price of $0.10 per warrant share for a period of thirty-six months following
closing. We also paid a cash finders fee of $10,140 and 202,800 broker warrants
to Canaccord Genuity and Wolverton Securities that are exercisable into one
common share per warrant at a price of $0.10 that expire on December 23, 2016.
On January 1, 2014, we entered into a Social Media/Web
Marketing Agreement with Stuart Gray. The initial term of the agreement began on
the date of execution and continued for three
months. In consideration
for the services we paid Stuart Gray a monthly fee of $5,000. As additional
compensation we issued 200,000 stock options to Mr. Gray. The exercise price of
the stock options is $0.075, with 100,000 stock options vested immediately,
50,000 stock options vested 30 days after the grant, and 50,000 stock options
vested 60 days after the grant, expiring January 1, 2019.
On January 13, 2014, we entered into a corporate development
agreement with Don Shaxon for an initial term of twelve months. Thereafter the
agreement continued on a month-by-month basis subject to cancelation by 30 days
written notice. In consideration for the services we paid to Mr. Shaxon a
signing stock bonus of 250,000 of our common shares, a one-time cash bonus of
$40,000, and a monthly fee of $3,500 plus $500 in monthly expenses. Upon
execution of the Agreement we also granted 250,000 stock options to Mr. Shaxon
with an exercise price of $0.16, vesting immediately and expiring January 13,
2019.
On January 16, 2014 we entered into a Joint Venture Agreement
with WOM to acquire up to a 51% ownership interest in a prospective medical
marijuana production facility to be located at WOMs establishment in Mission,
British Columbia. WOM was to hold a 49% interest in the joint venture and was
responsible to acquire a medical marijuana production licence from Health
Canada. The Joint Venture Agreement superseded the Letter of Intent between our
company and WOM dated November 1, 2013 (the "LOI"). As at March 11, 2014 our
Company had earned a 31% interest in the World of Marijuana Joint Venture by
paying and advancing $375,000 and issuing 16,000,000 million shares of our
common stock. The $375,000 was intended to fund the joint venture through
completion of facility upgrades and completion of the licensing process.
Pursuant to the terms of the Joint Venture Agreement, our company could purchase
up to a 51% interest in the joint venture in consideration of an additional
4,000,000 shares and $1,000,000 in the aggregate. On January 31, 2014, we
accepted and received gross proceeds of CAD$40,500 (US$37,500), for the exercise
of 350,000 stock options; 100,000 at $0.075 each, 150,000 stock options at $0.10
each, and 100,000 stock options at $0.15 each; into 350,000 common shares of our
Company.
On January 31, 2014, we closed the first tranche of a private
placement of 4,292,000 units at a price of US$0.10 per unit for gross proceeds
of US$429,200. Each Unit consists of one share of our common stock and one half
(1/2) of one non-transferable common share purchase warrant Each whole warrant
is exercisable to purchase one common share at a price of US$0.15 per share for
a period of twenty-four (24) months following closing. A cash finders fee
consisting of $29,616 and 296,160 full broker warrants that expire on January
31, 2016 with an exercise price of $0.15 was paid to Canaccord Genuity, Leede
Financial and Wolverton Securities.
On February 5, 2014, Ryan Foster joined our Company as an
advisor. We granted 50,000 stock options to Mr. Foster with an exercise price of
$0.35 per common share expiring February 5, 2019. 25,000 of the stock options
vested immediately and 25,000 vested on July 1, 2014.
On February 13, 2014, we closed the final tranche of a private
placement by issuing 12,938,000 units at a price of US$0.10 per unit for gross
proceeds of US$1,293,800. Each unit consists of one common share and one half
(1/2) of one non-transferable share purchase warrant with each whole warrant
exercisable into one common share at a price of US$0.15 per share for a period
of twenty-four (24) months following closing. One director and one officer of
our Company participated in the final tranche for $30,000. A cash finders fee
consisting of $98,784; 8,000 common shares in lieu of $800 and 995,840 full
broker warrants that expire on February 13, 2016 with an exercise price of $0.15
was paid to Canaccord Genuity, Global Market Development LLC and Wolverton
Securities.
On February 13, 2014, 50,000 stock options were exercised at a
price of $0.06 by a Director and 50,000 stock options were exercised at a price
of $0.075 by a Consultant for net proceeds to our Company of CAD$7,050
(US$6,750) into 100,000 common shares of the Company.
On February 13, 2014, 541,500 warrants from previous private
placements were exercised into 541,500 common shares of our Company for net
proceeds of $101,100.
On February 27, 2014, 585,000 warrants from previous private
placements were exercised into 585,000 common shares of our Company for net
proceeds of $115,000.
On February 27, 2014, we signed a $50,000 12 month marketing
agreement with Agoracom payable in shares of our common stock. The first quarter
payment of $12,500 was paid with the issuance of 54,347 common shares of our
Company at a market price of $0.23 per share.
On February 28, 2014, we entered into a Joint Venture Agreement
with The Green Canvas Ltd.
("
GCL
") pursuant to which we could
acquire up to a 75% interest in the business of GCL, being the business of
legally producing, manufacturing, propagating, importing/exporting, testing,
researching and developing, and selling marijuana for medical purposes. We paid
$100,000 to the GCL upon execution of the agreement. Subsequently, we issued to
GCL an aggregate of 10,000,000 of our common shares at a price of $0.235 per
share; and paid to GCL the aggregate sum of $500,000, to earn a 49% interest in
GCLs business by February 28, 2015. With the exception of $113,400 payable to
Wolverton Securities, the full amount of the $500,000 was to be used by GCL to
upgrade the GCLs existing medical marijuana production facility to meet the
standards introduced by the Marihuana for Medical Purposes Regulations (MMPR)
administered by Health Canada.
On March 5, 2014, our Company and our CEO and Director, Robert
McAllister, entered into a Joint Venture Agreement with Lexaria Corp. to jointly
source and develop business opportunities in the medical marijuana industry.
Pursuant to the terms of the agreement, Lexaria Corp. issued to our Company 1
million restricted common shares and issued 500,000 common shares to Mr.
McAllister for his participation as a key representative for the joint venture.
Additionally, Lexaria agreed to issue to Mr. McAllister options to purchase
500,000 common shares of Lexaria in consideration for Mr. McAllisters
participation on the Lexaria Advisory Board.
On March 10, 2014, our Companys Board appointed Mathew
Chadwick as Senior Vice President of Marijuana Operations and entered into a
Management Agreement with Mr. Chadwick for his services. The initial term of the
agreement began on the date of execution of this agreement and continued for six
months. Thereafter the agreement continued on a month-by-month basis until it
was terminated on October 16, 2014 pursuant to a termination and settlement
agreement, dated effective October 14, 2014, with World of Marijuana Productions
Ltd. and Mr. Chadwick. We paid in total $125,000 to Mr. Chadwick pursuant to the
Management Agreement. Mr. Chadwick resigned as a director and officer of our
Company on October 16, 2014.
On March 11, 2014, Robert Chadwick and Clayton Newbury joined
the Company as advisors and were each paid a $1,000 honorarium. Robert Chadwick
was issued a one-time 100,000 common shares of our Company. On March 11, 2014,
we granted 100,000 stock options to Robert Chadwick with an exercise price of
$0.68 per share expiring March 11, 2019. 50,000 of the stock options vested
immediately, and 50,000 vested on September 11, 2014. We also granted 100,000
options to Clayton Newbury on the same terms. Robert Chadwick and Clayton
Newbury stepped down as advisors on October 17, 2014.
On March 14, 2014, we signed a six month contract for $21,735
with The Money Channel to provide services for national television, internet and
radio media campaign.
On March 14, 2014, 815,310 warrants from previous private
placements were exercised into 815,310 common shares of our Company for net
proceeds of $163,062.
On March 14, 2014, we accepted and received gross proceeds from
a director of our Company of CAD$8,250 (US$7,500), for the exercise of 50,000
stock options at an exercise price of $0.15, into 50,000 common shares of our
Company.
On March 17, 2014, 1,548,000 warrants from previous private
placements were exercised into 1,548,000 common shares of our Company for net
proceeds of US$289,475.
On March 25, 2014, we accepted and received gross proceeds of
$67,750, for the exercise of 325,000 stock options at $0.06 to $0.25 each, into
325,000 common shares of our Company.
On March 25, 2014, 1,095,000 warrants from previous private
placements were exercised into 1,095,000 common shares of our Company for net
proceeds of US$114,250.
On March 26, 2014, our Board appointed Dr. Robert Melamede as
an Advisor to the Board of Directors. We paid to Dr. Melamede, an honorarium of
$2,500 for the first year of participation on our Advisory Board and issued
250,000 shares of our common stock. On March 26, 2014 we granted to Dr. Melamede
500,000 stock options with an exercise price of $0.70 and expiring March 26,
2019. 250,000 of the stock options vested immediately and the remaining 250,000
stock options vested on September 26, 2014, Dr. Melamede stepped down as an
advisor on June 16, 2015.
On April 1, 2014, we entered into a one year consulting
agreement with Kristian Dagsaan to provide controller services for CAD$3,000
(plus goods and services tax) per month. We also granted 100,000 fully vested
stock options with an exercise price of $0.86, expiring April 1, 2019. The
agreement was cancelled effective August 31, 2014.
On April 1, 2014, we entered into a 90 day investor relations
contract for CAD $9,000 with Ken Faulkner. We also granted 100,000 fully vested
stock options to Mr. Faulkner with an exercise price of $0.86, expiring April 1,
2019.
On April 3, 2014, we entered into another 3 month Social
Media/Web Marketing Agreement with Stuart Gray. In consideration for the
services the Company we agreed to pay Mr. Gray a monthly fee of $5,000. Upon
execution of the Agreement, we issued 100,000 stock options to Mr. Gray with an
exercise price of $0.72, expiring on April 3, 2019. The agreement was terminated
on July 31, 2014.
On April 3, 2014, 1,293,500 warrants from previous private
placements were exercised into 1,293,500 common shares of our Company for net
proceeds of US$177,950.
On April 3, 2014, we accepted and received gross proceeds from
past consultant of our Company of US$1,500 for the exercise of 25,000 stock
options at an exercise price of $0.06, into 25,000 common shares of our Company.
On April 8, 2014, we granted 50,000 fully vested stock options
to a consultant of our Company, Taven White. The stock options are exercisable
at $0.50 per share and expire on April 8, 2019.
On April 10, 2014, we entered into a Letter of Intent ("LOI")
with Lexaria Corp regarding the establishment of a joint venture to establish a
medical marijuana production facility in Burlington, Ontario under the MMPR
regulations. Pursuant to the LOI Lexaria issued 500,000 of its common shares to
our company to be held in escrow subject to receipt of an MMPR production
license by our joint venture. Lexaria also contributed $55,000 to acquire a 49%
interest in the joint venture and the responsibility to pay 55% of all joint
venture expenses. We contributed $45,000 for a 51% interest and the
responsibility to pay 45% of all expenses. We were to be responsible for
management of the joint venture for as long as we maintained majority ownership.
Also, effective April 10, 2014 the Burlington Joint Venture
entered into a letter of intent with Mr. Jeff Paikin on behalf of 1475714
ONTARIO INC. to secured a future lease for a 30,000 ft² medical marijuana
production space in Burlington, Ontario. We also acquired a right of first
refusal for another 45,000 ft² to accommodate future growth. We issued 38,297
common shares to Mr. Paikin at a deemed price of $0.47 to secure our interest in
the lease. The production target for the facility based on 30,000 ft² (with
approximately 50% devoted to production space) was approximately 10,000
kilograms per year production.
On April 14, 2014, the Company appointed Mr. Jeff Paikin to its
Advisory Board for a period of not less than one year, but to be determined by
certain performance thresholds described in the letter. Upon signing of the
letter of acceptance the Company issued 90,000 common shares at a deemed price
of $0.34. Based on the milestones listed in the letter, Mr. Paikin can be
eligible to receive up to a total of 472,500 common shares of the Company.
Consulting agreement amended on June 18, 2014, Mr. Paikin can be eligible to
receive up to a total of 1,350,000 common shares of the Company. Based on the
milestones listed in the amended contract, the Company issued Mr. Paikin 135,000
common shares at a deemed price of $0.14 on July 14, 2014.
On April 17, 2014, our Company accepted and received gross
proceeds from a director of CAD$8,475 (US$7,500), for the exercise of 50,000
stock options at $0.15 into 50,000 common shares of our Company.
On April 17, 2014, 651,045 warrants from previous private
placements were exercised into 651,045 common shares of our Company for net
proceeds of $110,209.
On April 24, 2014 our Company entered into a one year
consulting contract with Clark Kent as Media Coordinator for a monthly fee of
CAD$2,250 plus GST. We issued 90,000 common shares to the consultant at a deemed
price of $0.34. Based on the milestones listed in the contract, Mr. Kent can be
eligible to receive up to a total of 472,500 common shares of our Company. On
June 18, 2014, the consulting agreement was amended so that Mr. Kent can be
eligible to receive up to a total of 1,350,000 common shares of our Company.
Based on achievement of the milestones listed in the amended contract, we issued to Mr. Kent 135,000
common shares at a deemed price of $0.14 on July 14, 2014. This agreement was
terminated on February 4, 2015.
On April 24, 2014 we entered into a one year consulting
contract with Don Shaxon as Ontario Operations Manager for a monthly fee of
CAD$3,375 plus GST. Upon signing of the contract we issued to Mr. Shaxon 90,000
common shares at a deemed price of $0.34. Based on the milestones listed in the
contract, Mr. Shaxon can be eligible to receive up to a total of 472,500 common
shares of our Company. We amended the consulting agreement on June 18, 2014,
following which Mr. Shaxon became eligible to receive up to a total of 1,350,000
common shares of our Company. Based on achievement of the milestones listed in
the amended contract, we issued to Mr. Shaxon 135,000 common shares at a deemed
price of $0.14 on July 14, 2014. The agreement was terminated on June 16, 2015.
On April 24, 2014 we entered into a one year consulting
contract with 490072 Ontario Ltd. operating as HEC Group, for the services of
Greg Boone as Human Resources Manager. Upon signing of the contract we issued
90,000 common shares at a deemed price of $0.34. Based on the milestones listed
in the contract, Mr. Boone or his company can be eligible to receive up to a
total of 472,500 common shares of our Company. We amended the agreement on June
18, 2014, further to which Mr. Boone became eligible to receive up to a total of
1,350,000 common shares of our Company. Based on achievement of the milestones
listed in the amended contract, the Company issued Mr. Boone 135,000 common
shares at a deemed price of $0.14 on July 14, 2014. This agreement was
terminated on February 4, 2015.
On April 24, 2014 we entered into a one year consulting
contract with Jason Springett as Master Grower for Ontario Operations for a
monthly fee of $3,375 plus GST. Upon signing of the contract we issued 90,000
common shares at a deemed price of $0.34. Based on the milestones listed in the
contract, Mr. Springett was eligible to receive up to a total of 472,500 common
shares of the Company. We amended the agreement on June 18, 2014 further to
which Mr. Springett became eligible to receive up to a total of 1,350,000 common
shares of our Company. Based on achievement of the milestones listed in the
amended contract, we issued Mr. Springett 135,000 common shares at a deemed
price of $0.14 on July 14, 2014. This agreement was terminated on June 16, 2015.
On April 24, 2014 we entered into a one year consulting
contract with 2342878 Ontario Inc. for the services of Chris Hornung as
Assistant Operations Manager. Upon signing of the contract we issued 90,000
common shares to the consultant at a deemed price of $0.34. Subject to
achievement of the milestones listed in the contract, Mr. Hornung or his company
were eligible to receive up to a total of 472,500 common shares of our Company.
Mr. Hornung resigned on July 14, 2014 prior to the accrual of additional
compensation. The 90,000 common shares of the Company that were issued have been
returned back to treasury on September 24, 2014.
On April 30, 2014, 200,000 warrants from previous private
placements were exercised into 200,000 common shares of our Company for net
proceeds of $40,000.
On May 3, 2014 we entered into a one year consulting contract
with B. Mullan and Associates for the services of Brian Mullan as Security
Consultant. Upon signing of the contract we issued to the consultant 45,000
common shares at a deemed price of $0.28. Subject to achievement of the
milestones listed in the contract, Mr. Mullan or his company are be eligible to
receive up to a total of 225,000 common shares of our Company. Subsequently, we
issued an additional 45,000 common shares to the consultant at a deemed price of
$0.14 on July 14, 2014. This agreement was terminated on February 4, 2015.
On May 28, 2014, our LOI with Lexaria was replaced by a
definitive joint venture agreement (the Burlington Joint Venture) to establish
a medical marijuana production facility under the MMPR at our planned
Burlington, Ontario location. We received municipal zoning approval for the
proposed site in July, 2014. Design and construction of the proposed facility
was anticipated to cost approximately $3,000,000, and we would be responsible
for $1,350,000 of this cost. Unable to estimate when a production license might
be granted by Health Canada, the joint venture sought assurances from Health
Canada prior to commencement of construction. In the event that Health Canada
did not grant a production license by May 27, 2015, the Burlington Joint Venture
was to terminate.
On May 29, 2014, we accepted and received gross proceeds of
$20,000 for the exercise of 200,000 warrants at $0.10 each into 200,000 common
shares of our Company.
On June 2, 2014, we signed a 30 day contract for $10,000 with
TDM Financial to provide services for original video production, original
coverage, network placement of video and article, article and video syndication,
email distribution, and reporting.
On June 9. 2014, Pursuant to our 12 month marketing agreement
with Agoracom dated February 27, 2014, we made a second quarter payment to
Agoracom of $12,500 plus GST paid by the issuance of 72,917 common shares of the
Company at a market price of $0.18 per share.
On July 1, 2014, we entered into a one year services agreement
with TDM Financial for $120,000 payable in common shares of our Company. TDM
Financial will provide marketing solutions and strategies to our Company. Upon
the signing of the contract with TDM Financial, we issued 750,000 common stock
of our Company at a deemed price of $0.16.
On July 23, 2014, 252,000 warrants from previous private
placements were exercised into 252,000 common shares of our Company for net
proceeds of $25,200.
On August 1, 2014 we entered into a three month Investor
Relations and Marketing Agreement with Neil Blake with a monthly fee of
CAD$2,500.
On August 1, 2014, through our wholly owned subsidiary Thor
Pharma Corp. we signed an extension to the letter of intent with 1475714 ONTARIO
INC. and Lexaria Canpharm Corp. (a subsidiary of Lexaria) to secure a 5 year
lease on the Burlington, Ontario facility for our Burlington Joint Venture. In
consideration of the extension, on August 5, 2014, we issued 118,416 of our
common shares of to the lessor at a deemed price of $0.19 per share.
On September 16, 2014, our joint venture with the Green Canvas
Ltd. made an application to Health Canada under the Marihuana for Medical
Purposes Regulations (MMPR) to obtain a medical marijuana production license for
a proposed facility located near Regina, Saskatchewan. Pursuant to the joint
venture agreement, if a Heath Canada production license was not received by the
first anniversary date of the agreement (February 28, 2015) our company would
have no further obligations under the joint venture. If a license was obtained
by February 28, 2015, we would be responsible to pay to the GCL $250,000 and
3,000,000 common shares in consideration of an additional 2% interest in the
joint venture.
On September 18, 2014 we announced that we had provided notice
to WOM alleging default under the terms of the joint venture agreement for,
among other things, WOMs failure to provide an accounting and financial
information for the use of proceeds paid into the joint venture. On October 16,
2014 we entered into a termination and settlement agreement, dated effective
October 14, 2014, with WOM and Mathew Chadwick (WOMs representative and our
former director), pursuant to which we relinquished our 31% interest in the
joint venture and exchanged mutual releases with WOM and Mr. Chadwick. Mr.
Chadwick resigned from our board of directors and as an officer of our company,
and WOM returned for cancellation 15,127,287 of our common shares that had been
issued to it. Given the foregoing, all relationships between the parties,
including but not limited to the joint venture, have been terminated. No
production license under the MMPR had been awarded or was forthcoming at the
time of termination.
On October 16, 2014, we entered into a termination and
settlement agreement, dated effective October 14, 2014, with World of Marihuana
Productions Ltd. (WOM) and Mathew Chadwick (WOMs representative and our
former director), pursuant to which we relinquished our 31% interest in the
joint venture and exchanged mutual releases with WOM and Mr. Chadwick. Mr.
Chadwick resigned from our board of directors and as an officer of our company,
and WOM returned for cancellation 15,127,287 of our common shares that had been
issued to it. Given the foregoing, all relationships between the parties,
including but not limited to the joint venture, have been terminated. No
production license under the MMPR had been awarded or was forthcoming at the
time of termination.
On November 3, 2014, the Company granted 2,100,000 stock
options to directors, officers and consultants of the Company, vesting
immediately with an exercise price of $0.10, expiring November 3, 2019.
On November 18, 2014, the Company granted 100,000 stock options
to a consultant of the Company, vesting immediately with an exercise price of
$0.10, expiring November 18, 2019.
On January 30, 2015, we closed the first tranche of a private
placement of 1,665,000 units at a price of CAD$0.06 per unit for gross proceeds
of US$79,920, CAD$99,900. Each Unit consists of one common share of the Company
and full non-transferable Share purchase warrant. Each Warrant will
be exercisable into one further Share at a price of US$0.10 per Warrant Share at
any time until the close of business on the day which is 24 months from the date
of issue of the Warrant, and thereafter at a price of US$0.15 per Warrant Share
at any time until the close of business on the day which is 36 months from the
date of issue of the Warrant.
On February 6, 2015, the Companys Board has appointed Bal
Bhullar as a Director of the Company. Ms. Bhullar has been and continues to be
the Chief Financial Officer of the Company since October 9, 2009.
February 6, 2015, the Board of Directors accepted the
resignation of John Thomas as Director of the Company.
On February 9, 2015, Enertopia announced the launch of a new
product line V-Love
TM
for womens sexual pleasure. V-Love
TM
is a brand new water based, silky smooth fragrance free personal
lubricant and intimate gel especially designed for women.
On March 12, 2015, the Company closed its final tranche of a
private placement of 590,000 units at a price of CAD$0.06 per unit for gross
proceeds of CAD$35,400. Each unit consists
of one common share of the
Company and one non-transferable share purchase warrant, each full warrant
entitling the holder to purchase one additional common share of the Company for
a period of 36 months from the date of issuance, at a purchase price of US$0.10
during the first 24 months and at US$0.15 after 24 months. A cash finders fee
of CAD$2,832 and 47,200 full broker warrants that expire on March 12, 2018 was
paid to Canaccord Genuity.
In May, 2015, V-Love
TM
was available to the retail
market for purchase in stores and at various events.
On June 11, 2015, we entered into a mutual Termination
Agreement with The Green Canvas Ltd. pursuant to which we terminated our
relationship and relinquished our 49% interest in the joint venture to establish
a medical marijuana production facility near Regina, Saskatchewan. In
consideration of the termination, The Green Canvas returned for cancellation
6,400,000 shares of our common stock previously issued to GCL.
On June 11, 2015, we entered into a Letter of Intent dated June
10, 2015 with Shaxon Enterprises Ltd. to sell our 51% interest in our Burlington
Joint Venture with Lexaria Corp., including our interest in MMPR application
number 10QMM0610 for the proposed Burlington, Ontario production facility. The
sale would be completed by the sale of our wholly owned subsidiary, Thor Pharma
Corp.
Subsequent to the LOI with Shaxon Enterprises Ltd., the
Burlington Joint Venture between Enertopia and Lexaria which was entered into on
May 28, 2014 was terminated due to the pending sale of the project. As a result
of the termination, 500,000 restricted and escrowed common shares of Lexaria
issued to our Company at a deemed price of $0.40 will be returned to treasury
and cancelled. The Enertopia and Lexaria Master Joint Venture Agreement entered
into on March 5, 2014 is still effective and governs the relationship between
the parties.
On June 26, 2015, we signed a Definitive agreement to sell our
wholly owned subsidiary, Thor Pharma Corp along with the MMPR application number
10MMPR0610. The Burlington MMPR license application will continue in the
application process under new ownership. Pursuant to the agreement, we received
a non-refundable $10,000 deposit and are entitled to receive up to $1,500,000 in
milestone payments upon the Burlington facility becoming licensed under the
MMPR. These monies would be split equally with Lexaria Corp. Notwithstanding the
foregoing, we can neither guarantee nor provide a meaningful time estimate
regarding the potential grant of a production license for the Burlington
facility.
On June 29, 2015, we that announced V-Love
TM
became
available at London Drugs Limited stores. V-Love
TM
is currently
available at London Drugs stores across Western Canada in the provinces of
British Columbia, Alberta, Saskatchewan and Manitoba.
On July 7, 2015 we announced that V-Love
TM
became
available for purchase online in Canada at Amazon.ca.
On July 30, 2015 we announced the launch of V-Love.co, our
product website for V-Love
TM
. As at August 31, 2016, with the
Companys strategic direction mostly being focused on natural resources and
technology relating to the resource sector, the health and wellness portion of
the business is discontinued.
On October 23, 2015, the Companys Board has appointed Kevin
Brown as a Director of the Company and Victor Lebouthillier as an advisor to the
Board of Directors.
On October 23, 2015, the Board of Directors accepted the
resignation of Donald Findlay as Director of the Company.
On October 23, 2015, we granted 1,850,000 stock options to
Directors, Executives and Consultants of the Company. The exercise price of the
stock options is $0.05, vested immediately, expiring October 23, 2020.
On December 16, 2015, extended two classes of warrants by two
years with all other terms and conditions remaining the same. We approved the
expiry extension from January 31, 2016 till January 31, 2018 on 2,167,160
warrants that remain outstanding from the non-brokered private placement that
closed on January 31, 2014. The Company approved the expiry extension from
February 13, 2016 till February 13, 2018 on 7,227,340 warrants that remain
outstanding from the non-brokered private placement that closed on February 13,
2014.
On February 4, 2016, the Companys Board has appointed Olivier
Vincent as an Advisor the Board of Directors and a consultant for a term of one
year and granted 100,000 stock options to Olivier Vincent. The exercise price of
the stock options is $0.05, vested immediately, expiring February 4, 2021. We
issued 100,000 common shares at a price of $0.05 per share on exercise of these
options.
On March 9, 2016, we closed a binding Letter of Intent to
acquire 100% of an established profitable private nutritional vitamin/supplement
company. The private nutritional vitamin/supplement company has been in business
for over 5 years showing good positive cash flows. All products are manufactured
by a GMP, NSF, FDA approved manufacturer in the United States. Enertopia has
agreed subject to further due diligence, review of financials and financing to a
total amount of $350,000 for the acquisition, with $300,000 due on the signing
of the Definitive Purchase Agreement. The Definitive Purchase Agreement is
expected to be completed before the end of April. The Company did not further
pursue this.
On April 21, 2016, Enertopia has signed a binding letter of
intent with a to enter into negotiations to effect the optional acquisition of
certain placer mining claims (the Claims) in Nevada covering approximately
2,560 acres from S P W Inc. S P W Inc. holds the Claims directly (Underlying
Owner). Upon the closing date of the transaction (the Effective Date) S P W
Inc. will have the right to transfer, option, sell or assign the Claims to
Enertopia. The Placer mining claims and any underlying agreements will be
acquired by Enertopia through a mineral property option agreement, an assignment
agreement or an asset acquisition (the Transaction).
On May 12, 2016 Enertopia has signed the Definitive Agreement
with the Vendor respecting the option to purchase a 100% interest in
approximately 2,560 acres of placer mining claims in Churchill, Lander and Nye
Counties Nevada, USA. These placer mining claims are subject to a 1.5% NSR from
commercial production with the Company able to buy back the NSR at the rate of
$500,000 per 0.5% NSR.
On May 20, 2016, Enertopia closed the first tranche of a
private placement of 6,413,333 units at a price of CAD$0.015 per unit for gross
proceeds of US$74,074 (CAD$96,200). Each Unit consists of one common share of
the Company and full non-transferable Share purchase warrant (each whole
warrant, a Warrant). Each Warrant will be exercisable into one further Share
(a Warrant Share) at a price of US$0.05 per Warrant Share at any time until
the close of business on the day which is 18
months
from the date of
issue of the Warrant, and thereafter at a price of US$0.10 per Warrant Share at
any time until the close of business on the day which is 36
months
from
the date of issue of the Warrant.
On June 8, 2016, Enertopia closed its final tranche of a
private placement of 3,016,667 units a price of CAD$0.015 per unit for gross
proceeds of US$34,390 (CAD$45,250). Each Unit consists of one common share of
the Company and full non-transferable Share purchase warrant (each whole
warrant, a Warrant). Each Warrant will be exercisable into one further Share
(a Warrant Share) at a price of US$0.05 per Warrant Share at any time until
the close of business on the day which is 18
months
from the date of
issue of the Warrant, and thereafter at a price of US$0.10 per Warrant Share at
any time until the close of business on the day which is 36
months
from
the date of issue of the Warrant. A cash finders fee of CAD$3,300 and 286,666
full broker warrants that expire June 8, 2019 was paid to Canaccord Genuity,
Leede Jones Gable, PI Financial and Mackie Research.
On August 9, 2016, we closed the first tranche of a private
placement of 4,500,000 units at a price of CAD$0.035 per unit for gross proceeds
of CAD$157,500. Each unit consists
of one common share of our Company and
one non-transferable share purchase warrant, each full warrant entitling the
holder to purchase one additional common share of our Company for a period of 24
months from the date of issuance, at a purchase price of US$0.07.
On August 10, 2016, we retained a private consulting firm to
assist with mergers, acquisitions and market awareness for a 12 month contract.
The consulting firm operates a resource holding company that has been active in
acquiring out of favor mining assets over the past several years. It also
provides breaking news, commentary and analysis on listed companies. We engaged
and paid the consulting firm USD$75,000.
On August 15, 2016 binding Letter of Intent was signed by us
and Genesis Water Technologies, Inc. ("GWT") with regard to the acquisition by
Enertopia (the "Acquisition") of the exclusive worldwide licensing rights (the
"Licensing Rights") of all of the technology used in the process of recovering
and extraction of battery grade lithium carbonate powder Li2CO3 grading 99.5% or
higher purity from brine solutions (the "Technology") and covered under patent
pending process #XXXXXX (the "Pending Patent"). On August 15, 2016, we issued
250,000 common shares at an exercise price of $0.05 per share as per the binding
LOI signed with Genesis Water Technologies Inc.
On August 31, 2016, with the Companys strategic direction
mostly being focused on natural resources and technology relating to the
resource sector, the health and wellness portion of the business is
discontinued.
On September 19, 2016, we entered into a one year Investor
Relations Consulting agreement with Duncan McKay. Based on the terms of the
agreement, Mr. McKay can earn up to a maximum of 10% commissions on capital
raised. We issued 800,000 stock options with an exercise price of $0.07.
On September 23, 2016, we closed the final tranche of a private
placement of 3,858,571 units at a price of CAD$0.035 per unit for gross proceeds
of CAD$135,050. Each unit consists of one common share of our Company and one
non-transferable share purchase warrant, each full warrant entitling the holder
to purchase one additional common share of our Company for a period of 24 months
from the date of issuance, at a purchase price of US$0.07. A cash finders fee
of CAD$3,300 and 286,666 full broker warrants that expire June 8, 2019 was paid
to Canaccord Genuity and Leede Jones Gable.
On October 7, 2016, we issued 175,000 common shares of our
Company and paid $5,000 to comply with the Definitive Agreement signed May 12,
2016.
On December 6, 2016, we signed a Definitive Commercial
Agreement with Genesis Water Technologies with regard to the acquisition of
exclusive licensing rights of the technology as outlined in the agreement.
On January 20, 2017, the Company closed the first tranche of a
private placement of 1,000,000 units at a price of CAD$0.04 per unit for gross
proceeds of CAD $40,000. Each unit consists of one common share of the Company
and one-nontransferable share purchase warrant, each full warrant entitling the
holder to purchase one additional common share of the Company for a period of 24
months from the date of issuance, at a purchase price of $0.06. A cash finders
fee of CAD$800 and 20,000 full broker warrants that expire January 20, 2019 was
paid to Leede Jones Gable Inc.
On January 20, 2017, the Company granted 1,535,000 stock
options to directors, officers and consultant of the Company with an exercise
price of $0.07 which vested immediately, expiring January 20, 2022.
On January 31, 2017, the Company granted 1,500,000 stock
options to consultant of the Company with an exercise price of $0.07 vested
immediately, expiring January 31, 2022.
On February 28, 2017, the Company closed the first tranche of a
private placement of 4,250,000 units at a price of CAD$0.04 per unit for gross
proceeds of CAD $170,000. Each unit consists of one common share of the Company
and one-nontransferable share purchase warrant, each full warrant entitling the
holder to purchase one additional common share of the Company for a period of 24
months from the date of issuance, at a purchase price of $0.06. A cash finders
fee of CAD$11,100 and 227,500 full broker warrants that expire February 28, 2019
was paid to Leede Jones Gable Inc., Canaccord Genuity and Duncan McKay.
On February 28, 2017, the Company signed a Letter of Engagement
with Adam Mogil and issued 1,000,000 warrant options to convert to 1,000,000
common shares to Adam Mogil to provide corporate services. The warrants have an
exercise price of $0.09 and expire August 28, 2017. These warrant options
expired without being exercised.
On April 21, 2017, the Company issued 95,500 shares for gross
proceeds of $5,685 from the exercise of warrants of previous financings at $0.05
and $0.07.
On April 30, 2017 the Company issued 166,500 shares for gross
proceeds of $11,655 from the exercise of warrants from a previous financing at
$0.07.
On April 30, 2017, the Company closed the first and final
tranche of a private placement of 3,224,000 units at a price of CAD$0.09 per
unit for gross proceeds of CAD $290,160. Each unit consists of one common share
of the Company and one-nontransferable share purchase warrant, each full warrant
entitling the holder to purchase one additional common share of the Company for
a period of 24 months from the date of issuance, at a purchase price of $0.12. A
cash finders fee of CAD$20,736 and 230,400 full broker warrants that expire
April 28, 2019 was paid to Leede Jones Gable and Canaccord Genuity.
On May 5, 2017, the Company granted 500,000 stock options to
consultant of the Company with an exercise price of $0.10 vested immediately,
expiring May 5, 2022.
On May 5, 2017, the Company terminated the Definitive Agreement
dated May 12, 2016 with the Vendor on the Nevada Lithium brine properties.
On July 31, 2017, the Company announced the resignation of CFO
and Director Bal Bhullar, the appointment of Kristian Ross as director and
president Robert McAllister assuming the interim duties of CFO.
On August 14, 2017 the Company announced the appointment of
Davidson and Company, LLP, Chartered Professional Accountants as its new
independent registered auditing firm which replaced MNP LLP independent
registered auditing firm.
On August 30, 2017 the Company announced the Staking of lode
and placer claims covering approximately 160 acres for Lithium in Clayton
Valley, NV.
On October 27, 2017 we entered into a one year Investor
Relations Consulting agreement with FronTier Merchant Capital Group. Terms of
the agreement, FronTier Capital Group has been retained for a 12-month period at
$87,000 (plus applicable sales tax) per annum plus direct expenses. The company
will also grant 300,000 stock options to FronTier at an exercise price of 0.05
per share expiring 5 years from the date of grant.
On November 1, 2017, we closed the first tranche of a private
placement of 2,600,000 units at a price of CAD$0.05 per unit for gross proceeds
of CAD$130,000. Each unit consists of one common share of our Company and one
non-transferable share purchase warrant, each full warrant entitling the holder
to purchase one additional common share of our Company for a period of 24 months
from the date of issuance, at a purchase price of $0.06.
On November 1, 2017, we granted 500,000 stock options to a
director of the company at an exercise price of 0.05 per share expiring 5 years
from the date of grant.
On December 8, 2017, we closed the second tranche of a private
placement of 3,954,000 units at a price of CAD$0.05 per unit for gross proceeds
of CAD $197,700. Each unit consists of one common share of our Company and one
non-transferable share purchase warrant, each full warrant entitling the holder
to purchase one additional common share of our Company for a period of 24 months
from the date of issuance, at a purchase price of $0.06. A cash finders fee for
CAD $12,770 and 230,400 full broker warrants was paid to third parties. Each
full broker warrant entitling the holder to purchase one additional common share
of our Company for a period of 24 months from the date of issuance, at a
purchase price of $0.06.
On December 8, 2017 we issued 240,000 common shares of our
Company on the exercise of 240,000 stock options that were exercised by a
director of the Company at $0.05 for $12,000 for net proceeds to the company.
On December 15, 2017 we paid Genesis Water Technologies (GWT)
$96,465 for the second and final payment for the Second phase of the second
bench test and $8,998 for the bill of materials for the bench test.
On January 12, 2018, we closed the final tranche of a private
placement of 1,611,000 units at a price of CAD$0.05 per unit for gross proceeds
of CAD$80,550. Each unit consists of one common share of the Company and one
non-transferable share purchase warrant, each full warrant entitling the holder
to purchase one additional common share of the Company for a period of 24 months from the date of
issuance, at a purchase price of $0.06. A cash finders fee of CAD$3,880 and
77,600 broker warrants was paid to a third party. The broker warrants have the
same terms as the warrants issued as part of the unit offering.
On February 2, 2018 we issued 50,000 common shares of our
Company on the exercise of 50,000 warrants that were exercised at $0.07 for
$3,500 for net proceeds to the company.
On May 11, 2018, we issued 200,000 shares for gross proceeds of
$12,000 from the exercise of stock options at $0.06.
On May 11, 2018, we closed the first tranche of a private
placement of 1,746,900 units at a price of CAD$0.06 per unit for gross proceeds
of CAD$104,814. Each unit consists of one common share of the Company and one
non-transferable share purchase warrant, each full warrant entitling the holder
to purchase one additional common share of the Company for a period of 24 months
from the date of issuance, at a purchase price of $0.075. A cash finders fee of
CAD$9,281 and 144,690 full broker warrants that expire May 11, 2020 was paid to
third parties. The broker warrants have the same terms as the warrants issued as
part of the unit offering.
On May 22, 2018, we entered into an Investor Relations
Consulting agreement with FronTier Flex Marketing. Terms of the agreement,
FronTier Flex Marketing has been retained for a 9-month period at $66,000 (plus
applicable sales taxes) plus direct expenses. The Company will also grant
300,000 stock options at an exercise price of $0.07 per share expiring 5 years
from the date of grant.
On May 25, 2018, we closed the final tranche of a private
placement of 2,470,000 units at a price of CAD$0.06 per unit for gross proceeds
of CAD$148,200. Each unit consists of one common share of the Company and one
non-transferable share purchase warrant, each full warrant entitling the holder
to purchase one additional common share of the Company for a period of 24 months
from the date of issuance, at a purchase price of $0.075. A cash finders fee of
CAD$5,820 and 70,000 full broker warrants that expire May 25, 2020 was paid to
third parties. The broker warrants have the same terms as the warrants issued as
part of the unit offering.
On July 4, 2018, the Company, after receiving 3rd party lab
results that reported impurities above allowable limits for battery-grade
Li2CO3, provided formal notice of termination to GWT of the commercialization
agreement dated December 6, 2016 and as amended on October 9, 2017.
On August 31, 2018, we closed the first tranche of a private
placement of 4,400,000 units at a price of CAD$0.03 per unit for gross proceeds
of CAD$132,000. Each unit consists of one common share of the Company and one
non-transferable share purchase warrant, each full warrant entitling the holder
to purchase one additional common share of the Company for a period of 36 months
from the date of issuance, at a purchase price of $0.05. A cash finders fee of
CAD$12,000 and 400,000 full broker warrants that expire August 31, 2021 was paid
to third parties. The broker warrants have the same terms as the warrants issued
as part of the unit offering.
On August 31, 2018, we issued 170,000 shares for gross proceeds
of $9,000 from the exercise of 50,000 stock options at $0.06 and 120,000 stock
options at $0.05 respectively.
Our Current Business
We are a development stage company pursuing business
opportunities in diverse sectors natural resource and technology used in the
resource sector currently specific to the extraction, recovery and concentration
of Lithium.
Mineral Property
On
August 30, 2017
, the Company announced the staking of
Lode and Placer claims of BLM lands in Esmeralda county Nevada covering
approximately 160 Acres subject to adjustment. The Company has an 100% interest
in the lands and is only responsible for the yearly maintenance fees to the BLM
(estimated to be $2,635) and County (estimated to be $212) due November 1, 2018
to keep its 100% interest. During the year ending August 31, 2018, the Company
paid $2,859 in maintenance fees. The claims are in good standing until August
31, 2019. As at November 30, 2018, the Company has incurred BLM and county costs
of $Nil and associated surface sampling, assaying and 3
rd
party lab
testing of $9,172.
Access to the property can be achieved by paved Hwy 265 to
Silver Springs, NV or paved Hwy from north of Goldfields, NV. Access is then by
graded gravel road. The last 1.8 miles to the property is by trail road using
4x4 vehicle. The property is covered with extensive outcroppings of the
Esmeralda Formation. Power transmission line is within ½ mile of the northern
property boundary. Water would have to be trucked in or by pipe line if a
processing facility was built onsite. Of particular interest is a section of
green, volcanoclastic, evaporate-rich mudstone strata known as the Frontera
Verde zone that host lithium of potential economic significance. The Frontera
Verde Zone is exposed over approximately 100 acres of the northern two thirds of
the property, and underlies the rest of the property at shallow depths. Third
party drilling adjacent to the west and eastern boundaries of the property
supports this analysis. The property is without known reserves and the current
work programs are exploratory in nature.
Current exploration is at the grass roots stage with surface
sampling and two small 250 pound bulk samples being taken in 2017. The Company
completed additional laboratory testing of synthetic brines. The Company
continues to evaluate off the shelf technology to determine the preferred
methods for potentially producing commercial products from the processing of
synthetic brines.
On November 5, 2018, the Company received an Area of
Disturbance permit from the Bureau of Land Management, Nevada, allowing the
Company access for a series of diamond drill holes. The diamond drill program
will consist of 5 diamond drill holes totaling approximately 2,000 feet. Four
drill holes will allow the Company to provide an inaugural 43-101 project wide
lithium resource. A fifth diamond drill hole drilled to an estimated depth of
400 feet with the recovered lithium enriched material being used for
metallurgical and pH solution testing. The Company will undertake systematic and
through solution testing of the drilled lithium enriched horizons. This will
enable the Company to map the subsurface horizons as per oxide and reduced
horizons and further differentiate the grade of Lithium in solution that can be
potentially recovered in a low CAPEX and low-cost extraction methods.
Property Map
Esmeralda County Lode and Placer Claims:
Claim Name
|
Claim Type
|
BLM Serial #
|
STEVE 1
|
PLACER
|
NMC 1148769
|
STEVE 2
|
PLACER
|
NMC 1148770
|
STEVE 3
|
PLACER
|
NMC 1148771
|
STEVE 4
|
PLACER
|
NMC 1148772
|
STEVE 5
|
PLACER
|
NMC 1148773
|
STEVE 6
|
PLACER
|
NMC 1148774
|
STEVE 7
|
PLACER
|
NMC 1148775
|
STEVE 8
|
PLACER
|
NMC 1148776
|
DAN 1
|
LODE
|
NMC 1148760
|
DAN 2
|
LODE
|
NMC 1148761
|
DAN 3
|
LODE
|
NMC 1148762
|
DAN 4
|
LODE
|
NMC 1148763
|
DAN 5
|
LODE
|
NMC 1148764
|
DAN 6
|
LODE
|
NMC 1148765
|
DAN 7
|
LODE
|
NMC 1148766
|
DAN 8
|
LODE
|
NMC 1148767
|
DAN 9
|
LODE
|
NMC 1148768
|
LITHIUM TECHNOLOGY
On August 15, 2016, a binding Letter of Intent (LOI) was
signed by Enertopia and Genesis Water Technologies, Inc. ("GWT") with regard to
the acquisition by Enertopia of the exclusive worldwide licensing rights (the
"Licensing Rights") by Enertopia of all of the technology used in the process of
recovering and extraction of battery grade lithium carbonate powder Li2CO3
grading 99.5% or higher purity from brine solutions.
Upon the execution of this LOI, Enertopia issued 250,000 common
shares valued at $12,500 to GWT.
On December 6, 2016, and amended on October 9, 2017, Enertopia
and GWT signed a Definitive Commercial Agreement with regard to the acquisition
by Enertopia of the exclusive licensing rights in the United States of America,
Argentina, Bolivia and Chile of all of the technology used in the process of
recovering and extraction of battery grade lithium carbonate powder Li2CO3
grading 99.5% or higher purity from brine solutions.
On July 4, 2018, the Company provided GWT with a formal notice
of termination of the commercialization agreement. Following termination, the
Company has no further obligations with respect to the commercialization
agreement. As a result, for the year ended August 31, 2018, the Company wrote
off capitalized costs of $12,500.
Summary
The continuation of our business is dependent upon obtaining
further financing, a successful program of development, and, finally, achieving
a profitable level of operations. The issuance of additional equity securities
by us could result in a significant dilution in the equity interests of our
current stockholders. Obtaining commercial loans, assuming those loans would be
available, will increase our liabilities and future cash commitments.
There are no assurances that we will be able to obtain further
funds required for our continued operations. As noted herein, we are pursuing
various financing alternatives to meet our immediate and long-term financial
requirements. There can be no assurance that additional financing will be
available to us when needed or, if available, that it can be obtained on
commercially reasonable terms. If we are not able to obtain the additional
financing on a timely basis, we will be unable to conduct our operations as
planned, and we will not be able to meet our other obligations as they become
due. In such event, we will be forced to scale down or perhaps even cease our
operations. There is significant uncertainty as to whether we can obtain
additional financing.
Competition
There is strong competition relating to all aspects of the
resource sector. We actively compete for capital, skilled personnel, market
share, and in all other aspects of our operations with a substantial number of
other organizations. These organizations include small development stage
companies like our own, and large, established companies, many of which have
greater technical and financial resources than our company.
Compliance with Government Regulation
The exploration and development of mineral properties is
subject to various United States federal, state and local and foreign
governmental regulations. We may from time to time, be required to obtain
licenses and permits from various governmental authorities in regards to the
exploration of our property interests.
Purchase of Significant Acquisition
Not applicable
Corporate Offices
The address of our principal executive office is 156 Valleyview
Rd, Kelowna, British Columbia V1X 3M4. Our telephone number is (250) 765-6412.
Our current location provides adequate office space for our purposes at this
stage of our development.
Employees
We primarily used the services of sub-contractors and
consultants for our intended business operations. Our technical consultant is
Mr. McAllister, our president and a director.
We entered into a consulting agreement with Mr. Robert
McAllister on December 1, 2007. During the term of this agreement, Mr.
McAllister is to provide corporate administration and consulting services, such
duties and responsibilities to include provision of oil and gas industry
consulting services, strategic corporate and financial planning, management of
the overall business operations of the Company, and supervising office staff and
exploration and oil & gas consultants. Mr. McAllister is reimbursed at the
rate of $2,000 per month. On December 1, 2008, the consulting fee was increased
to $5,000 per month. We may terminate this agreement without prior notice based
on a number of conditions. Mr. McAllister may terminate the agreement at any
time by giving 30 days written notice of his intention to do so. Effective March
1, 2014, the Company entered into a new Management Consulting Agreement
replacing the original agreement with a consulting fee of $6,500 plus GST per
month. Effective July 1, 2017, the Company entered into a new Management
Consulting Agreement replacing the March 1, 2014 agreement with a consulting fee
of $3,500 plus GST per month. On July 31, 2017 Mr. McAllister agreed to be
intern CFO until such time as a replacement could be sourced.
We do not expect any material changes in the number of
employees over the next 12 month period. We do and will continue to outsource
contract employment as needed.
Off-Balance Sheet Arrangements
We have no significant off-balance sheet arrangements that have
or are reasonably likely to have a current or future effect on our financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources that are
material to stockholders.
Critical Accounting Policies
Our financial statements and accompanying notes are prepared in
accordance with generally accepted accounting principles used in the United
States of America. Preparing financial statements requires management to make
estimates and assumptions that affect the reported amounts of assets,
liabilities, revenue, and expenses. These estimates and assumptions are affected
by management's application of accounting policies. We believe that
understanding the basis and nature of the estimates and assumptions involved
with the following aspects of our financial statements is critical to an
understanding of our financials.
Mineral Properties
Acquisition costs of mineral rights are initially capitalized
as incurred while exploration and pre-extraction expenditures are expensed as
incurred until such time proven or probable reserves are established for that
project. Acquisition costs include cash consideration and the fair market value
of shares issued on the acquisition of mineral properties.
Expenditures relating to exploration activities are expensed as
incurred and expenditures relating to pre-extraction activities are expensed as
incurred until such time proven or probable reserves are established for that
project, after which subsequent expenditures relating to development activities
for that particular project are capitalized as incurred.
Where proven and probable reserves have been established, the
projects capitalized expenditures are depleted over proven and probable
reserves using the units-of-production method upon commencement of production.
Where proven and probable reserves have not been established, the projects
capitalized expenditures are depleted over the estimated extraction life using
the straight-line method upon commencement of extraction. The Company has not
established proven or probable reserves for any of its projects.
The carrying values of the mineral rights are assessed for
impairment by management on a quarterly basis and as required whenever
indicators of impairment exist. An impairment loss is recognized if it is
determined that the carrying value is not recoverable and exceeds fair
value.
Long-Lived Assets Impairment
In accordance with ASC 360, Accounting for Impairment or
Disposal of Long Lived Assets, the carrying value of long lived assets are
tested for recoverability whenever events or changes in circumstances indicate
that its carrying amount may not be recoverable. The Company recognizes
impairment when the sum of the expected undiscounted future cash flows is less
than the carrying amount of the asset. Impairment losses, if any, are measured
as the excess of the carrying amount of the asset over its estimated fair value.
Revenue Recognition
The Company recognizes revenue from product sales when
persuasive evidence of an arrangement exists, title to product and associated
risk of loss has passed to the customer, the price is fixed or determinable,
collection from the customer is reasonably assured, the Company has no further
performance obligation, and returns can be reasonably estimated.
Going Concern
We have suffered recurring losses from operations. The
continuation of our Company as a going concern is dependent upon our Company
attaining and maintaining profitable operations and/or raising additional
capital. The financial statements do not include any adjustment relating to the
recovery and classification of recorded asset amounts or the amount and
classification of liabilities that might be necessary should our Company
discontinue operations.
The continuation of our business is dependent upon
us raising additional financial support and/or attaining and maintaining
profitable levels of internally generated revenue. The issuance of additional
equity securities by us could result in a significant dilution in the equity
interests of our current stockholders. Obtaining commercial loans, assuming
those loans would be available, will increase our liabilities and future cash
commitments.
Recently Issued Accounting Standards
In June 2018, the FASB issued ASU 2018-07, which simplifies the
accounting for nonemployee share-based payment transactions. The amendments
specify that Topic 718 applies to all share-based payment transactions in which
a grantor acquires goods or services to be used or consumed in a grantors own
operations by issuing share-based payment awards. The standard will be effective
for us in the first quarter of our fiscal year 2020, although early adoption is
permitted (but no sooner than the adoption of Topic 606). We do not expect that
the adoption of this ASU will have a significant impact on our consolidated
financial statements.
In February 2016, Topic 842, Leases was issued to replace the
leases requirements in Topic 840, Leases. The main difference between previous
GAAP and Topic 842 is the recognition of lease assets and lease liabilities by
lessees for those leases classified as operating leases under previous
GAAP. A lessee should recognize in the balance sheet a liability to make lease
payments (the lease liability) and a right-of-use asset representing its right
to use the underlying asset for the lease term. For leases with a term of 12
months or less, a lessee is permitted to make an accounting policy election by
class of underlying asset not to recognize lease assets and lease liabilities.
If a lessee makes this election, it should recognize lease expense for such
leases generally on a straight-line basis over the lease term. The accounting
applied by a lessor is largely unchanged from that applied under previous GAAP.
Topic 842 will be effective for annual reporting periods beginning after
December 15, 2018, including interim periods within those annual periods and is
to be retrospectively applied. Earlier application is permitted. The adoption of
this standard is not expected to have a significant impact on the Companys
results of operations, financial condition, cash flows, and financial statement
disclosures.
Other accounting standards that have been issued or proposed by
the FASB or other standards-setting bodies that do not require adoption until a
future date are not expected to have a material impact on the Companys
financial statements upon adoption.
Results of Operations Three Months Ended November 30, 2018
and November 30, 2017
The following summary of our results of operations should be
read in conjunction with our financial statements for the quarter ended November
30, 2018, which are included herein.
Our operating results for the three months ended November 30,
2018, for the three months ended November 30, 2017 and the changes between those
periods for the respective items are summarized as follows:
|
|
|
|
|
|
|
|
Change Between
|
|
|
|
Three Months
|
|
|
Three Months
|
|
|
Three Month Period
|
|
|
|
Ended
|
|
|
Ended
|
|
|
Ended
|
|
|
|
November 30,
|
|
|
November 30,
|
|
|
November 30, 2018 and
|
|
|
|
2018
|
|
|
2017
|
|
|
November 30, 2017
|
|
Revenue (cost recovery)
|
$
|
Nil
|
|
$
|
Nil
|
|
$
|
Nil
|
|
Cost of product sales
|
|
Nil
|
|
|
Nil
|
|
|
Nil
|
|
Other expenses (income)
|
|
735
|
|
|
(589
|
)
|
|
1,324
|
|
General and administrative
|
|
94,064
|
|
|
193,930
|
|
|
(99,866
|
)
|
Bank charges and interest expense
|
|
209
|
|
|
357
|
|
|
(148
|
)
|
Consulting fees
|
|
12,450
|
|
|
10,700
|
|
|
1,750
|
|
Stock based compensation
|
|
-
|
|
|
31,237
|
|
|
(31,237
|
)
|
Exploration expenses
|
|
9,172
|
|
|
Nil
|
|
|
9,172
|
|
Research and development
|
|
-
|
|
|
108,748
|
|
|
(108,748
|
)
|
Professional fees
|
|
13,044
|
|
|
3,748
|
|
|
9,296
|
|
Net loss
|
|
94,799
|
|
|
193,341
|
|
|
(98,542
|
)
|
Our accumulated losses increased to $13,986,617 at November 30,
2018. Our financial statements report revenue of $Nil for the three months ended
November 30, 2018 and November 30, 2017. Our financial statements report a net
loss of $94,799 for the three-month period ended November 30, 2018, compared to
a net loss of $193,341 for the three-month period ended November 30, 2017. Our
net losses have decreased by $98,542 for the three month period ended November
30, 2018. Our general and administrative expenses were lower by $99,866 for
November 30, 2018 compared to November 30, 2017. The decrease was largely due to
decreased research and development expenditures, and stock based compensation
which were offset by increases to exploration expenses and professional fees for
the three month period ended November 30, 2018 compared to November 30,
2017.
As at November 30, 2018, we had $456,035 in current
liabilities, which is comparable to current liabilities as at August 31, 2017.
Our net cash used in operating activities for the three months ended November
30, 2018 was $85,469 compared to $200,170 used in the three months ended
November 30, 2017.
Our total liabilities as of November 30, 2018 were $456,035 as
compared to total liabilities of $449,270 as of August 31, 2018.
Liquidity and Financial Condition
Working Capital
|
|
At
|
|
|
At
|
|
|
|
November 30,
|
|
|
August 31,
|
|
|
|
2018
|
|
|
2018
|
|
Current assets
|
$
|
230,631
|
|
$
|
271,690
|
|
Current liabilities
|
|
456,035
|
|
|
449,270
|
|
|
|
|
|
|
|
|
Working capital surplus/(deficit)
|
$
|
(225,404
|
)
|
$
|
(177,580
|
)
|
Cash Flows
|
|
At
|
|
|
At
|
|
|
|
November 30,
|
|
|
November 30,
|
|
|
|
2018
|
|
|
2017
|
|
Cash flows (used in)
operating activities
|
$
|
(85,469
|
)
|
$
|
(200,170
|
)
|
Cash flows from investing activities
|
|
-
|
|
|
-
|
|
Cash flows from financing
activities
|
|
46,975
|
|
|
100,893
|
|
Net increase (decrease) in cash during year
|
$
|
(38,494
|
)
|
$
|
(99,277
|
)
|
Operating Activities
Net cash used in operating activities was $85,469 in the three
months ended November 30, 2018 compared with net cash used in operating
activities of $200,170 in the same period in 2017. The decrease in cash used is
the result of a decrease in stock-based compensation expense, a non-cash item,
and non-cash working capital items, primarily increased prepaid expenses.
Financing Activities
Net cash provided by financing activities was $46,975 in the
three months ended November 30, 2018 compared to $100,893 in the same period in
2017. The cash provided was from private placements, option exercises and
warrant exercises.
Investing Activities
Net cash provided in investing activities was $Nil in the three
months ended November 30, 2018 compared to $Nil in the same period in 2017.