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What changed in Ivanhoe Electric Inc.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Ivanhoe Electric Inc.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+748 added−769 removedSource: 10-K (2024-02-26) vs 10-K (2023-03-14)

Top changes in Ivanhoe Electric Inc.'s 2023 10-K

748 paragraphs added · 769 removed · 367 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

205 edited+259 added−306 removed86 unchanged
Biggest changeTyphoon™ in Resource Exploration We believe the following specifications differentiate Typhoon™ from conventional geophysical systems: • high current that is adjustable according to the depth and scale of the exploration target; • high voltages that are also adjustable to overcome near-surface resistance; • the ability to transmit both electromagnetic and direct current signals; 19 Table of Contents • extremely clean signal, which yields a high signal to noise ratio in recorded data; • the ability to synchronize with multiple types of data receivers, so that the user can choose the receiver system most appropriate for the exploration environment; and • three deployment configurations, from a large containerized system to a smaller lightweight system that is helicopter portable.
Biggest changeType Short title Country Grant Date Grant Number Expiration Date Patent Current signal generator and method of implementing such a generator France 16/02/2018 FR2980653 22/09/2031 Australia 05/01/2017 AU2012311429 21/09/2032 Brazil 19/01/2021 BR112014006276 21/09/2032 Canada 22/05/2018 CA2849558 21/09/2032 Indonesia Pending Turkey 21/04/2015 TR201403350B 21/09/2032 USA 28/02/2017 US9584037 18/09/2033 Patent Current generator and method for generating current pulses France 04/04/2014 FR2988933 30/03/2032 Australia 02/02/2017 AU2013241675 29/03/2033 Canada 08/09/2020 CA2869170 29/03/2033 Chile 30/10/2018 CL56649 29/03/2033 Peru 20/05/2019 PE9489 29/03/2033 USA 28/06/2016 US9379636 03/06/2033 Patent Switch and system to inject current France 28/01/2022 FR3105446 19/12/2039 We believe the following specifications differentiate Typhoon™ from conventional geophysical systems: • high current that is adjustable according to the depth and scale of the exploration target; • high voltages that are also adjustable to overcome near-surface resistance; • the ability to transmit both electromagnetic and direct current signals; • extremely clean signal, which yields a high signal to noise ratio in recorded data; • the ability to synchronize with multiple types of data receivers, so that the user can choose the receiver system most appropriate for the exploration environment; and • three deployment configurations, from a large containerized system to a smaller lightweight system that is helicopter portable. 67 Table of Contents Figure: Schematic of Typhoon™ at work.
Technical information to support an APP application is extensive and requires that facility design be advanced to the point that the potential for impacts groundwater quality can be adequately assessed. Arizona Administrative Code R18-1-525 limits the time for a complex Individual APP with public hearing to 329 business days.
Technical information to support an APP application is extensive and requires that facility design be advanced to the point that the potential for impacts to groundwater quality can be adequately assessed. Arizona Administrative Code R18-1-525 limits the time for a complex Individual APP with public hearing to 329 business days.
The Ivory Coast Project consists of three exploration permits owned by Sama Nickel, a subsidiary of Sama, which is the joint venture vehicle in which we are partnering with Sama to advance the Ivory Coast Project, which cover a total of 517 km 2 , as well as two additional exploration permits held in a joint venture with Société pour le Développement Minier de la Côte d’Ivoire (“SODEMI”), a parastatal organization established by the Ivory Coast and which together cover 318 km 2 .
The Ivory Coast Project consists of three exploration permits owned by Sama Nickel, a subsidiary of Sama, which is the joint venture vehicle in which we are partnering with Sama to advance the Ivory Coast Project, which cover a total of 517 km 2 , as well as two additional exploration permits held in a joint venture with Société pour le Développement Minier de la Côte d’Ivoire, a parastatal organization established by the Ivory Coast and which together cover 318 km 2 .
Inversion modelling by CGI showed two of the EM conductors extend from 200 m below surface to depths >700 m and are potentially tens of meters in thickness. Inversion modelling was not possible on the remaining EM conductors due to the proximity to cultural interference by cast iron water pipes and power lines located along most North Carolina County roads.
Inversion modelling by CGI showed two of the EM conductors extend from 200 meters below surface to depths >700 meters and are potentially tens of meters in thickness. Inversion modelling was not possible on the remaining EM conductors due to the proximity to cultural interference by cast iron water pipes and power lines located along most North Carolina County roads.
In addition, VRB’s proprietary electrolyte formula contains no heavy metals and the liquid electrolyte is non-toxic, non-flammable and 100% reusable, making VRB-ESS® fundamentally superior to lithium-ion batteries for grid scale energy storage. Vanadium pentoxide (“V 2 O 5 ”) is a key input factor and cost driver of VRB-ESS®.
In addition, VRB’s proprietary electrolyte formula contains no heavy metals and the liquid electrolyte is non-toxic, non-flammable and 100% reusable, making VRB-ESS® superior to lithium-ion batteries for grid scale energy storage. Vanadium pentoxide (“V 2 O 5 ”) is a key input factor and cost driver of VRB-ESS®.
Item 1. Business Overview We are a United States domiciled minerals exploration and development company with a focus on developing mines from mineral deposits principally located in the United States. We seek to support American supply chain independence by finding and delivering the critical metals necessary for electrification of the economy, with a focus on copper.
Item 1. Business Overview We are a United States domiciled minerals exploration company with a focus on developing mines from mineral deposits principally located in the United States. We seek to support American supply chain independence by finding and delivering the critical metals necessary for electrification of the economy, with a focus on copper.
In addition, six other NSR royalties in favor of several individuals encumber specified parcels of the project area with NSR royalty rates of 2.25%, 2%, 1%, 0.5%, 0.075%, 0.015% and 0.0125%. No royalty encumbers the entire known mineral resources at the Santa Cruz Project, other than the ASARCO Santa Cruz, Inc. and Freeport Copper Company royalty.
In addition, six other NSR royalties in favor of several individuals encumber specified parcels of the project area with NSR royalty rates of 2%, 1%, 0.5%, 0.075%, 0.015% and 0.0125%. No royalty encumbers the entire known mineral resources at the Santa Cruz Project, other than the ASARCO Santa Cruz, Inc. and Freeport Copper Company royalty.
A separate dust control permit will be submitted for the commencement of mining operations. As the project is anticipated to have the potential to create emissions of regulated air pollutants above a minimum threshold during the mining phase for the processing plants, a permit from PCAQCD must be obtained before construction begins.
A separate dust control permit will be submitted for the commencement of mining operations. As the project is anticipated to have the potential to create emissions of regulated air pollutants above a minimum threshold during the mining phase for the processing plants, a final permit from PCAQCD must be obtained before construction begins.
Brixton Metals Corporation (“Brixton”) owns the Hog Heaven Project through its subsidiary Brixton USA, covering an area of 24.32 km 2 through the following interests: 2.59 km 2 of deeded fee simple land both surface and minerals and 14.06 km2 of fee simple mineral rights held by Brixton USA.
Brixton Metals Corporation (“Brixton”) owns the Hog Heaven Project through its subsidiary Brixton USA, covering an area of 24.32 km 2 through the following interests: 2.59 km 2 of deeded fee simple land both surface and minerals and 14.06 km 2 of fee simple mineral rights held by Brixton USA.
CGI’s services apply its geophysical data inversion codes on a geophysical data (included that of Typhoon™) collected by third party data acquirers as well as other sources such as public or private libraries, in order to construct and refine 3D subsurface images.
CGI’s services apply its geophysical data inversion codes on geophysical data (included that of Typhoon™) collected by third party data acquirers as well as other sources such as public or private libraries, in order to construct and refine 3D subsurface images.
Dust Control and Air Quality Permits. Emissions of fugitive dust caused by activities that disturb the soil, such as earthmoving, vehicular/equipment traffic on unpaved surfaces, project activities disturbing unpaved services and wind require a dust control permit from the Pinal County Air Quality Control District (“PCAQCD”).
Emissions of fugitive dust caused by activities that disturb the soil, such as earthmoving, vehicular/equipment traffic on unpaved surfaces, project activities disturbing unpaved services and wind require a dust control permit from the Pinal County Air Quality Control District (“PCAQCD”).
These additional permits may include: • Hazardous materials permits • Solid or hazardous waste permits • City/County zoning changes • City/County building permits, utility permits, road access permits • City/County Special Use permit or Development Plan approval • Floodplain use permit • Stormwater permit • Septic or sewage treatment permit • Onsite landfill permit • Potable water system permit • Threatened or endangered species consultation • Cultural resources consultation Numerous large mine operations have been permitted in Arizona, and specifically in Pinal County where the Santa Cruz Project is located.
These additional permits may include: • Hazardous materials permits • Solid or hazardous waste permits • City/County building permits, utility permits, road access permits • City/County Special Use permit or Development Plan approval • Floodplain use permit • Stormwater permit • Septic or sewage treatment permit • Onsite landfill permit • Potable water system permit • Threatened or endangered species consultation • Cultural resources consultation Numerous large mine operations have been permitted in Arizona, and specifically in Pinal County where the Santa Cruz Project is located.
Royalties. If a party’s interest in Brixton JVC is diluted below 10%, then the interest of such party in Brixton JVC will be cancelled and its shareholding interest converted into a 2.0% NSR.
If a party’s interest in Brixton JVC is diluted below 10%, then the interest of such party in Brixton JVC will be cancelled and its shareholding interest converted into a 2.0% NSR.
Forty-seven holes have collar locations recorded in undocumented or unknown mine-grid datums and will be added to the database when their locations can be deduced. 193 drillholes are collared on the Applied Minerals “Dragon” halloysite mine property (12,635 m total), and consist primarily of geotechnical, geological, and mineral data pertinent to the clay and iron-oxide mining operations there.
Forty-seven holes have collar locations recorded in undocumented or unknown mine-grid datums and will be added to the database when their locations can be deduced. 193 drill holes are collared on the Applied Minerals “Dragon” halloysite mine property (12,635 m total), and consist primarily of geotechnical, geological, and mineral data pertinent to the clay and iron-oxide mining operations there.
We anticipate the permit could be obtained within 12 months of application submittal but will be dependent on the category of permit needed and the agency backlog at the time of submittal. Aquifer Protection Permit.
We anticipate the permit could be obtained within 12 months of application submittal but will be dependent on the category of permit needed and the agency backlog at the time of submittal. Aquifer Protection Permit (“APP”).
Water for the Tintic Project can be sourced from the city of Eureka’s maintenance yard at a cost of $0.01 per gallon (~3.8 litres). The exploration area also contains several small ephemeral springs that are productive in the early spring but does not contain any streams or rivers owing to the arid nature of the climate.
Water for the Tintic Project can be sourced from the city of Eureka’s maintenance yard at a cost of $0.01 per gallon (~3.8 liters). The exploration area also contains several small ephemeral springs that are productive in the early spring but does not contain any streams or rivers owing to the arid nature of the climate.
VRB has over 500 MWh of energy storage capacity installed or in development, and has completed over one million hours of testing and operation. Ongoing research and development and project experience have allowed VRB to produce larger, more cost-effective and efficient systems in each successive battery generation. VRB intends to produce VRB-ESS® using vanadium recycled from petroleum waste.
VRB has over 500 MWh of energy storage capacity installed or in development and has completed over one million hours of testing and operation. Ongoing research and development and project experience have allowed VRB to produce larger, more cost-effective and efficient systems in each successive battery generation. VRB intends to produce VRB-ESS® using vanadium recycled from industrial waste.
The East Tintic Mountains are underlain by a basement sequence of more than 800 m of phyllic slate, quartzite and dolomite from the Neoproterozoic Big Cottonwood Formation, outcropping along the axis of the North Tintic anticline. A sequence of more than 3,700 m of Paleozoic (ranging from Cambrian to Mississippian periods) carbonate and clastic sedimentary strata lies unconformably on top.
The East Tintic Mountains are underlain by a basement sequence of more than 800 meters of phyllic slate, quartzite and dolomite from the Neoproterozoic Big Cottonwood Formation, outcropping along the axis of the North Tintic anticline. A sequence of more than 3,700 meters of Paleozoic (ranging from Cambrian to Mississippian periods) carbonate and clastic sedimentary strata lies unconformably on top.
Once the joint venture agreement has been executed, we will have the obligation to spend up to $1,000,000 over two years to acquire private mineral rights and surface access with the rights to drill test a series of electromagnetic (EM) conductors defined by CMC’s VTEM survey flown in 2021.
Once the joint venture agreement has been executed, we will have the obligation to spend up to $1,000,000 over two years to acquire private mineral rights and surface access with the rights to drill test a series of electromagnetic (“EM”) conductors defined by CMC’s VTEM survey flown in 2021.
This mineralization style resides 30 Table of Contents immediately above supergene sulfide mineralization near the paleo water table. Superimposed in-situ within the copper oxide zone is atacamite (copper chloride) and copper sulfates (e.g., antlerite, chalcanthite). Atacamite accounts for much of the copper grades within the oxide zone and requires formation of a brine to precipitate. Exploration and Drillin g.
This mineralization style resides immediately above supergene sulfide mineralization near the paleo water table. Superimposed in-situ within the copper oxide zone is atacamite (copper chloride) and copper sulfates (e.g., antlerite, chalcanthite). Atacamite accounts for much of the copper grades within the oxide zone and requires formation of a brine to precipitate. Exploration and Drillin g.
In 2021, CMC flew a Geotech VTEM survey over a 16 km by 19 km area to explore for additional massive sulfide mineralization in the Ordovician volcanic-sedimentary rocks of the Carolina Slate Belt. This resulted in defining seven EM conductors ranging in strike length from 300 m to 1300 m.
In 2021, CMC flew a Geotech VTEM survey over a 16 km by 19 km area to explore for additional massive sulfide mineralization in the Ordovician volcanic-sedimentary rocks of the Carolina Slate Belt. This resulted in defining seven EM conductors ranging in strike length from 300 meters to 1300 meters.
The I-Pulse Convertible PIK Notes are also convertible at the option of the holder at any time prior to maturity into shares of I-Pulse common stock. The I-Pulse Convertible PIK Notes mature on July 31, 2023. Series 2 Convertible Notes. On April 5, 2022, we issued and sold an aggregate principal amount of $86,200,000 of our Series 2 Convertible Notes.
The I-Pulse Convertible PIK Notes are also convertible at the option of the holder at any time prior to maturity into shares of I-Pulse common stock. The I-Pulse Convertible PIK Notes matured on July 31, 2023. Series 2 Convertible Notes On April 5, 2022, we issued and sold an aggregate principal amount of $86,200,000 of our Series 2 Convertible Notes.
N/A Special Flood Hazar Area Permit – Exploration Drilling City of Casa Grande In Review TBD TBD N/A Temporary Use Permit – Non-SFHA City of Casa Grande In Prep TBD TBD N/A Floodplain Use Permit Pinal County In Prep TBD TBD N/A The Migratory Bird Treaty Act prohibits “Take” without prior authorization by the U.S. Fish and Wildlife Service (“USFWS”).
N/A Special Flood Hazard Area Permit – Exploration Drilling City of Casa Grande In Review TBD TBD N/A Temporary Use Permit – Non-SFHA City of Casa Grande In Prep TBD TBD N/A Floodplain Use Permit Pinal County In Prep TBD TBD N/A The Migratory Bird Treaty Act prohibits “Take” without prior authorization by the U.S. Fish and Wildlife Service (“USFWS”).
This time could be extended if the application review identifies additional information that is required to be submitted or if agency backlog is high at the time of submittal. We anticipate being able to obtain this information within 18 months of developing the permit application. AZPDES Industrial Stormwater Mining Multi-Sector General Permit (“MSGP”).
This time could be extended if the application review identifies additional information that is required to be submitted or if agency backlog is high at the time of submittal. We anticipate being able to obtain this information within 24 months of developing the permit application. AZPDES Industrial Stormwater Mining Multi-Sector General Permit (“MSGP”).
The historic mining area straddles the Tintic Mountains divide between the Utah and Juab Counties. The county line occurs at the watershed divide. Infrastructure. The Tintic Project is managed out of the city of Eureka (population approximately 700), which is approximately 2 km north of the northeastern Tintic Project property boundary. Eureka offers limited services.
The historic mining area straddles the Tintic Mountains divide between the Utah and Juab Counties. The county line occurs at the watershed divide. Infrastructure. The Tintic Project is managed out of the city of Eureka (population approximately 660), which is approximately 2 km north of the northeastern Tintic Project property boundary. Eureka offers limited services.
The permits listed are not meant to be all-inclusive and cover only the major permits required for the mine and processing plant that are known at the current time. 56 Table of Contents Major Permits or Approvals Issuing Agency Underground Injection Control Permit U.S.
The permits listed are not meant to be all-inclusive and cover only the major permits required for the mine and processing plant that are known at the current time. 60 Table of Contents Major Permits or Approvals Issuing Agency Underground Injection Control Permit U.S.
Permit Name Agency Status Renewal Date Requirements Violations Dust Control Permit DUSTW-22-0292 Pinal County Air Quality Control District Approved 03/01/2023 Bi-weekly inspections; limit vehicle access to work areas; reduce vehicle speeds; water disturbed areas; apply stabilizers as needed; concurrent reclamation; install track-out devices as needed No Violations NOI AZPDES Stormwater General Construction Permit AZCN96111 Arizona Dept. of Environmental Quality Approved 06/30/2025 Stormwater Pollution Prevention Plan in place; monthly inspections No Violations Temporary Use Permit DSA-22-00200 City of Casa Grande Approved 11/08/2025 Submit SFHA Permit and Non-SFHA Temporary Use Permit No Violations Floodplain Use Permit FUP2206-165 Pinal County Approved N/A Existing grades within the area of disturbance shall be restored per the reclamation plan.
Permit Name Agency Status Renewal Date Requirements Violations Dust Control Permit DUSTW-22-0292 Pinal County Air Quality Control District Approved 05/11/2024 Bi-weekly inspections; limit vehicle access to work areas; reduce vehicle speeds; water disturbed areas; apply stabilizers as needed; concurrent reclamation; install track-out devices as needed No Violations NOI AZPDES Stormwater General Construction Permit AZCN96111 Arizona Dept. of Environmental Quality Approved 06/30/2025 Stormwater Pollution Prevention Plan in place; monthly inspections No Violations Temporary Use Permit DSA-22-00200 City of Casa Grande Approved 11/08/2025 Submit SFHA Permit and Non-SFHA Temporary Use Permit No Violations Floodplain Use Permit FUP2206-165 Pinal County Approved N/A Existing grades within the area of disturbance shall be restored per the reclamation plan.
Mineral extraction focused on high-grade Ag-Pb-Zn oxide carbonate replacement deposits (“CRD”) hosted in Paleozoic limestone both at surface and underground, with lesser production from steeply dipping Au-Ag-Pb-Zn-Cu fissure veins. The Tintic precious and polymetallic mining district saw nearly continuous mining operations from 1871 through to 2002 with variations in the level of activity and commodity extracted.
Mineral extraction focused on high-grade Ag-Pb-Zn oxide carbonate replacement deposits (“CRD”) hosted in Paleozoic limestone both at 40 Table of Contents surface and underground, with lesser production from steeply dipping Au-Ag-Pb-Zn-Cu fissure veins. The Tintic precious and polymetallic mining district saw nearly continuous mining operations from 1871 through to 2002 with variations in the level of activity and commodity extracted.
As of December 31, 2022, Ivanhoe Electric and its subsidiaries had 244 full time employees. We consider our relationship with our employees to be strong. None of our employees are represented by a labor union or party to a collective bargaining agreement.
As of December 31, 2023, Ivanhoe Electric and its subsidiaries had 244 full time employees. We consider our relationship with our employees to be strong. None of our employees are represented by a labor union or party to a collective bargaining agreement.
These include the Silver Valley mine, a VMS deposit discovered in 1880 with limited zinc, lead, silver, and gold production due to the difficulty of Smelting and recovering precious metals from zinc-rich ores and Conrad Hill, a deposit mined in the early 1830s that produced high grade gold (>1 oz/t) from a series of orogenic quartz veins carrying significant copper values.
These include the Silver Valley mine, a volcanogenic massive sulfide (VMS) deposit discovered in 1880 with limited zinc, lead, silver, and gold production due to the difficulty of Smelting and recovering precious metals from zinc-rich ores and Conrad Hill, a deposit mined in the early 1830s that produced high grade gold (>1 oz/t) from a series of orogenic quartz veins carrying significant copper values.
History, 2021 Reorganization and Financing On April 30, 2021, HPX completed a restructuring whereby HPX contributed (i) all of the issued and outstanding shares of HPX’s subsidiaries, other than those holding direct or indirect interests in its Nimba Iron Ore Project; (ii) certain property, plant and equipment; and (iii) certain financial assets, in exchange for shares of our common stock.
On April 30, 2021, HPX completed a restructuring whereby HPX contributed (i) all of the issued and outstanding shares of HPX’s subsidiaries, other than those holding direct or indirect interests in its Nimba Iron Ore Project; (ii) certain property, plant and equipment; and (iii) certain financial assets, in exchange for shares of our common stock.
Pursuant to the terms of the Sama Earn-In and JV Agreement, we have the ability to earn a 30% shareholding interest in the Ivory Coast Project by incurring expenditures of C$15,000,000 over a maximum of six years.
Pursuant to the terms of the Sama Earn-In and JV Agreement, we have the ability to earn a 30% shareholding interest in the Ivory Coast Project by incurring expenditures of Cdn$15,000,000 over a maximum of six years.
The permit application would identify emission sources, emission controls and other relevant information. Development of a dispersion model to estimate effects to background air quality from project emission may be required. The permitting process includes a 30-day public comment period, and the time needed by PCAQCD to complete the technical review depends on the complexity of the project.
The permit application would identify emission sources, emission controls and other relevant information. Development of a dispersion model to estimate impacts to background ambient air quality from project emission may be required. The permitting process includes a 30-day public comment period, and the time needed by PCAQCD to complete the technical review depends on the complexity of the project.
(“Exiro ”) on February 22, 2023 which give us the right to earn an 80% interest in the White Hill Project by incurring $10.0 million of expenditures and making payments to Exiro totaling $4.95 million ($3.55 million in cash and $1.4 million in our common stock) within six years of signing the agreement.
(“Exiro”) on February 22, 2023 which give us the right to earn an 80% interest in the White Hill Project by incurring $10.0 million of expenditures and making payments to Exiro totaling $4.95 million ($3.55 million in cash and $1.4 million in our common stock) within six years of signing the agreement.
Starting in late September 2022, a 3-week program of ground Typhoon™ EM was carried out over three of the VTEM anomalies to better define their geometry and depth extent. CGI 3D inversion modeling was completed in January 2023 over one of the EM grids that will provide targeting detail for drill testing in 2023.
Starting in late September 2022, a 3-week program of ground Typhoon™ EM was carried out over three of the VTEM anomalies to better define their geometry and depth extent. CGI 3D inversion modeling was completed in January 2023 over one of the EM grids that provided targeting detail for drill testing in 2023.
Dust caused by vehicles traveling on unpaved roads, construction and wind events create a type of air pollution called particulate matter. Rules and regulations have been adopted to limit the amount of particulate matter produced by certain types of activities. A permit application is being submitted through the online portal to cover the exploration activities.
Dust caused by vehicles traveling on unpaved roads, construction and wind events create a type of air pollution called particulate matter. Rules and regulations have been adopted to limit the amount of particulate matter produced by certain types of activities. A permit is submitted annually through the online portal to cover the exploration activities.
In addition, the costs for a third-party to complete the reclamation must be estimated. The reclamation plan and reclamation cost estimate must be provided to the Arizona Mine Inspector for approval, a process expected to take 120 days.
In addition, a reclamation bond, the costs for a third-party to complete the reclamation, must be estimated. The reclamation plan and reclamation cost estimate must be provided to the Arizona State Mine Inspector for approval, a process expected to take 120 days.
We believe the United States is significantly underexplored and has the potential to yield major new discoveries of these metals. We are committed to the sustainable development of our projects by embedding Environmental, Social and Governance (“ESG”) criteria in our decision-making framework from the earliest stages of project exploration and development.
We believe the United States is significantly under explored and has the potential to yield major new discoveries of these metals. We are committed to the sustainable development of our projects by embedding Environmental, Social and Governance (“ESG”) criteria in our decision-making framework from the earliest stages of project exploration and development.
Option payments of $2,000,000 on the fifth anniversary of the agreement and $2,250,000 on the sixth anniversary are required to complete the acquisition of the claims. No exploration work had been conducted at the project area since the 1980s until we optioned the property in 2018 and we expanded the claim holdings.
Option payments of $250,000 on the fifth anniversary, $1,500,000 on the sixth anniversary of the agreement and $2,250,000 on the seventh anniversary are required to complete the acquisition of the claims. No exploration work had been conducted at the project area since the 1980s until we optioned the property in 2018 and we expanded the claim holdings.
The thrust faults that underly this folding have been identified in mines in the East Tintic District and locally at surface when not covered by later volcanic rocks.
The thrust faults that underlay this folding have been identified in mines in the East Tintic District and locally at surface when not covered by later volcanic rocks.
Total historic production from deposits located within our acquired property, predominantly in the Tintic mining districts, totals approximately 1.9 Moz Au, 136 Moz Ag, 105 kt Cu, 416 kt Pb and 6 kt Zn. The main precious and base metal bearing minerals in the Tintic District are enargite, tetrahedrite, galena, sphalerite, pyrite, marcasite, and native gold, silver, and copper.
Total historic production from deposits located within our acquired property, predominantly in the Tintic mining districts, totals approximately 1.89 Moz Au, 136 Moz Ag, 104 kt Cu, 416 kt Pb and 6 kt Zn. The main precious and base metal bearing minerals in the Tintic District are enargite, tetrahedrite, galena, sphalerite, pyrite, marcasite, and native gold, silver, and copper.
While the authors of the Tintic Technical Report note that drillhole positions should be treated with caution when utilized for geological modelling, due to the varied level of accuracy, they note that they can be utilized for regional scale geological modelling, which we have completed in Leapfrog Geo™.
While the authors of the Tintic Technical Report note that drill hole positions should be treated with caution when utilized for geological modelling, due to the varied level of accuracy, they note that they can be utilized for regional scale geological modelling, which we have completed in Leapfrog Geo™.
In order to complete stage 1, in addition to incurring $15,000,000 in exploration expenditures, we are required to make $500,000 in cash payments each year for four years, and $1,000,000 in 38 Table of Contents cash payments on or before each of the fifth and sixth anniversaries of the date of the earn-in agreement.
In order to complete stage 1, in addition to incurring $15,000,000 in exploration expenditures, we are required to make $500,000 in cash payments each year for four years, and $1,000,000 in cash payments on or before each of the fifth and sixth anniversaries of the date of the earn-in agreement.
These range from comprehensive 43 element ICP-MS data from analyses performed on drillhole core from the Big Hill diamond drillhole program conducted from 2008 to 2014 in the East Tintic sub-district, to Cu-Au only results from RC drilling in the Treasure Hill area.
These range from comprehensive 43 element ICP-MS data from analyses performed on drill hole core from the Big Hill diamond drill hole program conducted from 2008 to 2014 in the East Tintic sub-district, to Cu-Au only results from RC drilling in the Treasure Hill area.
Pursuant to the 55 Table of Contents current Sevier River Basin policy, the basin is closed to new surface and groundwater appropriations, so to meet the water requirements for the Tintic Project, we will rely on lease agreements or acquisitions of existing water rights within the area of the Tintic Project.
Pursuant to the current Sevier River Basin policy, the basin is closed to new surface and groundwater appropriations, so to meet the water requirements for the Tintic Project, we will rely on lease agreements or acquisitions of existing water rights within the area of the Tintic Project.
Three major folds deform the Neoproterozoic and Paleozoic sequence in the Tintic district. Our interests in the Tintic District are focused on the southern portion of the Main District where Paleozoic sedimentary rocks and late Eocene — Oligocene volcanic rocks are intruded by the Silver City intrusive complex.
Three major folds deform the Neoproterozoic and Paleozoic sequence in the Tintic district. 41 Table of Contents Our interests in the Tintic District are focused on the southern portion of the Main District where Paleozoic sedimentary rocks and late Eocene — Oligocene volcanic rocks are intruded by the Silver City intrusive complex.
Hypogene mineralization appears to be the most concentrated within the Southwest Exploration Area, Texaco Ridge Exploration Area, and Texaco Deposit areas based on IE drill holes. • Secondary supergene sulfide mineralization: dominantly chalcocite which rims primary hypogene sulfides and completely replaces hypogene mineralization.
Hypogene mineralization appears to be the most concentrated within the Southwest Exploration Area, Texaco Ridge Exploration Area, and Texaco Deposit areas based on Ivanhoe Electric drill holes. • Secondary supergene sulfide mineralization: dominantly chalcocite which rims primary hypogene sulfides and completely replaces hypogene mineralization.
The JV SHA will provide that (1) the CMH board will comprise four individuals, of which two directors will be nominated by Cordoba and the other two directors will be nominated by JCHX; and for so long as the shareholdings in CMH remain 50%-50%, a Cordoba representative will serve as the Chairperson of the CMH board, and will possess a casting vote on all matters subject to a list of reserved matters; (2) Cordoba will be appointed as the operator and manager of the Alacran Project pursuant to a management services agreement and will be responsible for setting the annual programs and budgets for the CMH board’s approval; (3) JCHX (or its affiliate) has right of first offer to bid on the Engineering, Procurement and Construction and Detailed Design Agreement contracts, provided that Cordoba has the right to open the process out to competitive tender; with JCHX having the right to match any competitive bid; and (4) JCHX (or its affiliate) shall be entitled to up to 100% of the offtake from the production under the current Feasibility Study of the Alacran Project, provided that they are paying fair market value and they are the most competitive offer (including a matching right for other third-party proposals).
The JV SHA provides that (1) the CMH board comprises four individuals, of which two directors nominated by Cordoba and the other two directors nominated by JCHX; and for so long as the shareholdings in CMH remain 50%-50%, a Cordoba representative serves as the Chairperson of the CMH board, and possesses a casting vote on all matters subject to a list of reserved matters; (2) Cordoba is appointed as the operator and manager of the Alacran Project pursuant to a management services agreement and is responsible for setting the annual programs and budgets for the CMH board’s approval; (3) JCHX (or its affiliate) has right of first offer to bid on the Engineering, Procurement and Construction and Detailed Design Agreement contracts, provided that Cordoba has the right to open the process out to competitive tender; with JCHX having the right to match any competitive bid; and (4) JCHX (or its affiliate) shall be entitled to up to 100% of the offtake from the production under the current Feasibility Study of the Alacran Project, provided that they are paying fair market value and they are the most competitive offer (including a matching right for other third-party proposals).
LCE holds a right of first refusal on the sale of GCSM’s royalty. The Lincoln Project area encompasses numerous historic small underground workings with little record of production. Almost no modern exploration has occurred on the Lincoln Project.
LCE holds a right of first refusal on the sale of GCSM’s royalty. 47 Table of Contents The Lincoln Project area encompasses numerous historic small underground workings with little record of production. Almost no modern exploration has occurred on the Lincoln Project.
During the earn-in period, we have the exclusive right to operate, control and direct all exploration and mineral development activities at the White Hill Project. There are no minimum expenditures required in any given year, and we have the right to cease making payments at any time, resulting in us earning no interest in the project.
During the earn-in period, we have the exclusive right to operate, control and direct all 48 Table of Contents exploration and mineral development activities at the White Hill Project. There are no minimum expenditures required in any given year, and we have the right to cease making payments at any time, resulting in us earning no interest in the project.
Key considerations that will influence our decision making include, but are not limited to, using clean and renewable energy in our future mining operations, optimizing and minimizing our water resource utilization, minimizing our environmental footprint, ensuring workforce diversity and hiring from local communities, following best practices to meet the highest health, safety and environmental standards as well as protecting local cultural heritage and biodiversity.
Key considerations that will influence our decision making include, but are not limited to, using clean and renewable energy in our future mining operations, following best practices to meet health, safety and environmental standards, optimizing our water resources, protecting local cultural heritage and biodiversity, minimizing our environmental footprint, as well as ensuring workforce diversity and hiring from local communities.
Should we earn into 80% of the project, the joint venture will form, and we will then be obligated to fund the next $30 million of development expenditures to advance the project. After that expenditure, each joint venture partner will contribute pro rata to the joint venture or be subject to standard dilution provisions related to its project interest.
Should we earn into 80% of the project, the joint venture will form, and we will then be responsible for the next $30 million of development expenditures to advance the project. After that expenditure, each joint venture partner will contribute pro rata to the joint venture or be subject to standard dilution provisions related to its project interest.
CGI’s technology consists of sophisticated software codes and artificial intelligence (“AI”) that is used to process geophysical data (including that generated by Typhoon™) in order to build accurate 3D subsurface images that indicate the presence of various metals and minerals, as well as water and oil. Services.
CGI’s technology consists of sophisticated software codes and artificial intelligence tools (“AI”) that are used to process geophysical data (including that generated by Typhoon™) in order to build accurate 3D subsurface images that indicate the presence of various metals and minerals, as well as water and oil.
We own 3% of the outstanding shares of Brixton, which we acquired from Newstar Advantage Ltd., an entity affiliated with Mr. Friedland (“Newstar”) on October 1, 2021 for C$2.0 million. Newstar acquired shares and warrants of Brixton in a private placement for a purchase price of C$2.0 million.
We own 1.8% of the outstanding shares of Brixton, which we acquired from Newstar Advantage Ltd., an entity affiliated with Mr. Friedland (“Newstar”) on October 1, 2021 for Cdn$2.0 million. Newstar acquired shares and warrants of Brixton in a private placement for a purchase price of Cdn$2.0 million.
In the opinion of the authors of the Tintic Technical Reports, historical drillhole analytical results should be treated with caution and only utilized for indicative purposes until twin drilling is completed to verify position, orientation and grade, as no supporting QA/QC information is available for the respective drillholes. Sampling, Analysis and Data Verification.
In the opinion of the authors of the Tintic Technical Reports, historical drill hole analytical results should be treated with caution and only utilized for indicative purposes until twin drilling is completed to verify position, orientation and grade, as no supporting QA/QC information is available for the respective drill holes. Sampling, Analysis, and Data Verification.
Environmental Protection Agency 54 Table of Contents (“EPA”) and other federal agencies have delegated primary enforcement responsibility for mining and environmental law oversight to the state of Utah. Mining operations must obtain proper permits and approvals and submit proper reclamation surety prior to mine start-up per state and federal statutory and regulatory requirements. The BLM, as agent for the U.S.
With primacy, the U.S. Environmental Protection Agency (“EPA”) and other federal agencies have delegated primary enforcement responsibility for mining and environmental law oversight to the state of Utah. Mining operations must obtain proper permits and approvals and submit proper reclamation surety prior to mine start-up per state and federal statutory and regulatory requirements. The BLM, as agent for the U.S.
Assay results have been compiled from 221 drillholes across the Tintic Project district. Records of analytical methods for assay data are limited and the assay database consists of variable element analyses.
Assay results have been compiled from 221 drill holes across the Tintic Project district. Records of analytical methods for assay data are limited and the assay database consists of variable element analyses.
Carolina Mining, North Carolina, USA ( the “Carolina Joint Venture”). We entered into a binding letter of intent in November 2021 to form a joint venture with the Carolina Mining Company (“CMC”), a private company based in Charlotte, North Carolina.
We entered into a binding letter of intent in November 2021 to form a joint venture with the Carolina Mining Company (“CMC”), a private company based in Charlotte, North Carolina.
We completed a twin hole program in 2021 to validate the historical drill data and produce an initial Mineral Resource Estimate in 2021 (December 8, 2021) and accompanying Technical Report Summary (June 7, 2022). Our exploration in 2021 – 2022 included: a.
We completed a twin hole program in 2021 to validate the historical drill data and produce an initial Mineral Resource Estimate in 2021 (December 8, 2021) and accompanying Technical Report Summary (June 7, 2022). Our exploration in 2021 – 2022 included: 20 Table of Contents a.
We have also compiled a drillhole database from over 125 years of exploration and development operations in the Tintic Project district by dozens of historical owners and operators. A total of 489 drillholes were completed historically on the Tintic Project by several prior owners and operators. However not all of the details are available.
We have also compiled a drill hole database from over 125 years of exploration and development operations in the Tintic Project district by dozens of historical owners and operators. A total of 489 drill holes were completed historically on the Tintic Project by several prior owners and operators. However not all of the details are available.
The agreement with DRHE provides that we (by way of assignment from CAR) have the right, but not the obligation, to acquire 100% of the mineral title in the fee simple mineral estate, 39 Federal unpatented mining claims, and three small, approximately 10 acre surface parcels, by paying $27,870,500 in cash or in shares of our common stock at the election of DRHE over the course of three years.
The agreement with DRHE provides that we (by way of assignment from CAR) have the right, but not the obligation, to acquire 100% of the mineral title in the fee simple mineral estate, 39 Federal unpatented mining claims, and three small, approximately 10 acre surface parcels, by paying $27,870,500 in cash or in shares of our common stock at the election of the owner by August 16, 2024.
As of December 31, 2022, we had incurred $3.1 million in exploration expenditures and made $1,000,000 in cash payments. In order to complete stage 2, which is at our sole discretion, we would be required to incur an additional $25,000,000 in expenditures of which we must incur $10,000,000 by February 26, 2030 and $15,000,000 by February 26, 2032.
As of December 31, 2023, we had incurred $11.0 million in exploration expenditures and made $1,500,000 in cash payments. In order to complete stage 2, which is at our sole discretion, we would be required to incur an additional $25,000,000 in expenditures of which we must incur $10,000,000 by February 26, 2030 and $15,000,000 by February 26, 2032.
Company Deposit Effective Date Category Tonnes Total Cu (%) Ni (%) Au (g/t) Ag (g/t) Contained Cu (tonnes) Contained Ni (tonnes) Contained Au (oz) Contained Ag (oz) Geographic Area Resource Category 100% Project Basis Ivanhoe Electric Santa Cruz 12/31/2022 Indicated 226,715,000 1.24 — — — 2,807,000 — — — Arizona,U.S.
Company Deposit Category Tonnes Total Cu (%) Ni (%) Au (g/t) Ag (g/t) Contained Cu (tonnes) Contained Ni (tonnes) Contained Au (oz) Contained Ag (oz) Geographic Area Resource Category 100% Project Basis Ivanhoe Electric 1 Santa Cruz Indicated 226,715,000 1.24 — — — 2,807,000 — — — Arizona,U.S.
A SWPPP must be prepared as outlined in the mining sector MSGP prior to receiving permit coverage. The drainage control plan developed as part of the mining and reclamation plan will be used to develop the SWPPP. The SWPPP must be fully developed and permit coverage granted prior to breaking ground at the site.
A Storm Water Pollution Prevention Plan (“SWPPP”) must be prepared as outlined in the mining sector MSGP prior to receiving permit coverage. The drainage control plan developed as part of the mining and reclamation plan will be used to develop the SWPPP. The SWPPP must be fully developed and permit coverage granted prior to breaking ground at the site.
All such reports are also available free of charge via EDGAR through the SEC website at www.sec.gov .
All such reports are also available free of charge via EDGAR through the SEC website at www.sec.gov . 72 Table of Contents
Known deposits predominantly occur as CRDs and epithermal veins with a few small porphyry deposits including the SWT 36 Table of Contents porphyry in the Southwest District and the Big Hill porphyry in the East District.
Known deposits predominantly occur as CRDs and epithermal veins with a few small porphyry deposits including the SWT porphyry in the Southwest District and the Big Hill porphyry in the East District.
Between August 3, 2021 and November 17, 2021, we and I-Pulse, issued and sold “bundles” of securities comprised of (i) an aggregate of 4,015,990 shares of our common stock at $2.49 per share, (ii) $49,999,200 aggregate principal amount of promissory notes convertible into shares of our common stock (“Convertible Notes ”) , and (iii) $19,999,680 aggregate principal amount of promissory notes issued by I-Pulse convertible into shares of our common stock held by I-Pulse (“I-Pulse Convertible PIK Notes”).
Stapled Offering of Equity and Series 1 Convertible Notes Between August 3, 2021 and November 17, 2021, we and I-Pulse, issued and sold “bundles” of securities comprised of (i) an aggregate of 4,015,990 shares of our common stock at $2.49 per share, (ii) $49,999,200 aggregate principal amount of promissory notes convertible into shares of our common stock (“Convertible Notes”), and (iii) $19,999,680 aggregate principal amount of promissory notes issued by I-Pulse convertible into shares of our common stock held by I-Pulse (“I- 71 Table of Contents Pulse Convertible PIK Notes”).
By incurring additional expenditures of C$10,000,000 within the same time period, including the financing of a bankable Feasibility Study and the acquisition of an exploitation permit on part of the Ivory Coast Project, we will be entitled to earn an additional 30% shareholding interest in the Ivory Coast Project, such that our aggregate shareholding interest therein shall be 60%.
By incurring additional expenditures of Cdn$10,000,000 within the same time period, including the financing of a PEA and the acquisition of an exploitation permit on part of the Ivory Coast Project, we will be titled to earn an additional 30% shareholding interest in the Ivory Coast Project, such that our aggregate shareholding interest therein shall be 60%.
Company Deposit Effective Date % Ownership Category Attributable Tonnes Total Cu (%) Ni (%) Au (g/t) Ag (g/t) Attributable Contained Cu (tonnes) Attributable Contained Ni (tonnes) Attributable Contained Au (oz) Attributable Contained Ag (oz) Geographic Area Resource Category Ivanhoe Electric Santa Cruz 12/31/2022 100.0 % Indicated 226,715,000 1.24 — — — 2,807,000 — — — Arizona,U.S.
Company Deposit Attributable Ownership of Deposit Category Attributable Tonnes Total Cu (%) Ni (%) Au (g/t) Ag (g/t) Attributable Contained Cu (tonnes) Attributable Contained Ni (tonnes) Attributable Contained Au (oz) Attributable Contained Ag (oz) Geographic Area Resource Category Attributable Basis Ivanhoe Electric 1 Santa Cruz 100.0 % Indicated 226,715,000 1.24 — — — 2,807,000 — — — Arizona,U.S.
The cut-off grade reflects total operating costs to define reasonable prospects for eventual economic extracted by conventional underground mining methods with a maximum production rate of 15,000 tonnes/day. All material within mineable shape-optimized wireframes has been included in the Mineral Resource.
The CoG reflects total operating costs to define reasonable prospects for eventual economic extracted by conventional underground mining methods with a maximum production rate of 15,000 t/d. All material within mineable shape-optimized wireframes has been included in the mineral resource.
We will contribute $66.4 million of the proceeds from the sale of the Shares to fund Saudi JVCo and the Joint Venture, and will provide Saudi JVCo with a royalty-free license to use Typhoon™ within the Kingdom of Saudi Arabia for the purpose of mineral exploration.
We contributed $66.4 million of the proceeds from the sale of our common shares to Ma’aden to fund Saudi JVCo and the Joint Venture, and provide Saudi JVCo with a royalty-free license to use Typhoon™ within Saudi Arabia for the purpose of mineral exploration.
Exploration prospects identified by us on the Tintic Project include CRDs in the Paleozoic stratigraphy, areas with porphyry exploration potential in the Silver City intrusive complex and at depth below the CRDs, and skarns at intrusive contacts in the carbonate rocks. Exploration and Drilling. Exploration by us on the Tintic Project commenced in late 2017 with an airborne geophysical survey.
Exploration prospects identified by us on the Tintic Project include CRDs in the Paleozoic stratigraphy, areas with porphyry exploration potential in the Silver City intrusive complex and at depth below the CRDs, and skarns at intrusive contacts in the carbonate rocks. Exploration and Drilling.
CGI has entered into a non-exclusive licensing agreement with a major oilfield service provider for the worldwide royalty-free license of the LWD code plus support and maintenance. With respect to the identification of underground water resources, CGI’s technology can also be deployed to predict prospective areas or delineate known water aquifers. Intellectual Property. CGI does not patent its software codes.
CGI has entered into a non-exclusive licensing agreement with a major oilfield service provider for the worldwide license of the LWD code. With respect to the identification of underground water resources, CGI’s technology can also be deployed to predict prospective areas or delineate known water aquifers. 68 Table of Contents CGI does not patent its software codes.
No mining activity has ever taken place on the land constituting the Santa Cruz Project. There is no mine in production at the project. There is currently no significant equipment, infrastructure or facilities at the Santa Cruz Project, and no mine development or operating equipment at the project site. Permitting and encumbrances.
There is no mine in production at the Tintic Project and no mining activity by us has ever taken place on the land constituting the Tintic Project. There is currently no significant equipment, infrastructure or facilities at the Tintic Project, and no mine development or operating equipment at the project site.
Limited supplies and personnel are available from Eureka; however, the main source is the Salt-Lake City-Ogden- Provo metropolitan area, a corridor of contiguous urban and suburban development stretched along a 190 km segment of the Wasatch Front with a population of 2.7 million. Title.
Limited supplies and personnel are available from Eureka; however, the main source is the Salt-Lake City-Ogden- Provo metropolitan area, a corridor of contiguous urban and suburban development stretched along a 190 km segment of the Wasatch Front with a population of 2.7 million. 35 Table of Contents Figure: Location of the Tintic Project within the state of Utah. Title.
Additional permits or authorizations will be required. However, additional permit requirements and approvals are not anticipated to require extensive technical detail or review and lengthy issuance timelines.
However, additional permit requirements and approvals are not anticipated to require extensive technical detail or review and lengthy issuance timelines.
Our Board of Directors oversees our policies and implementation programs that govern our approach to management of our human capital, with the Nominating and Compensation Committee having oversight of human capital 58 Table of Contents matters, including those relating to executive recruitment, retention and development, pay equity, and inclusion and diversity.
Our Board of Directors oversees our policies and implementation programs that govern our approach to management of our human capital, with the HS&E and Compensation and Nominating Committees having oversight of human capital matters, including those relating to health and safety, executive recruitment, retention and development, pay equity, and inclusion and diversity.
We have been proactive in maintaining good communication with the local community. To date, county officials as well as local landowners have expressed strong support for the Tintic Project. With this level of support for the Tintic Project, the CUP should be issued by Juab County without significant challenges.
To date, county officials as well as local landowners have expressed strong support for the Tintic Project. With this level of support for the Tintic Project, the CUP should be issued by Juab County without significant challenges.
However, many more mineral species are present, including exotic tellurium-bearing species. There are clear metalliferous domain changes across the Tintic District with Cu-Au dominance in the Main Tintic District transitioning northwards into Pb-Ag and finally into Pb-Zn in the northern portion of the district.
However, many more mineral species are present, including exotic tellurium-bearing species. There are clear metalliferous domain changes from the Southwest to the Main Tintic Districts. Cu-Au dominance transitions into Pb-Ag, then into Pb-Au and finally into Pb-Zn in the northern portion of the Main Tintic District.
Diamond drill hole samples were analyzed for total Cu and acid soluble Cu using Atomic Absorption Spectroscopy ("AAS"). A decade after initial drilling, ASARCO re-analyzed select samples for cyanide soluble Cu (AAS) and molybdenum (multi-element ICP). The Company currently analyzes all samples for total Cu, acid soluble Cu, cyanide soluble Cu, and molybdenum.
All drill holes were completed from 1964 to 2022. Diamond drill hole samples were analyzed for total Cu and acid soluble Cu using Atomic Absorption Spectroscopy ("AAS"). A decade after initial drilling, ASARCO re-analyzed select samples for cyanide soluble Cu (AAS) and molybdenum (multi-element ICP).

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAccordingly, government actions in the future, including any decision not to continue to support recent economic reforms could have a significant effect on economic conditions in the PRC or particular regions thereof and could require us to divest ourselves of any interest we then hold in Chinese properties or joint ventures. 73 Table of Contents Additionally, the PRC’s Foreign Investment Law came into effect on January 1, 2020 and embodies an expected PRC regulatory trend of rationalizing the foreign investment regulatory regime in line with prevailing international practice and the legislative efforts to unify the corporate legal requirements for both foreign and domestic investments.
Biggest changeAccordingly, government actions in the future, including any decision not to continue to support recent economic reforms could have a significant effect on economic conditions in the PRC or particular regions thereof and could require us to divest ourselves of any interest we then hold in Chinese properties or joint ventures.
Our ongoing and future success depends on developing and maintaining productive relationships with the communities surrounding our mineral projects, including local indigenous people who may have rights or may assert rights to certain of our properties, and other stakeholders in our operating locations.
Our success depends on developing and maintaining relationships with local communities and stakeholders. Our ongoing and future success depends on developing and maintaining productive relationships with the communities surrounding our mineral projects, including local indigenous people who may have rights or may assert rights to certain of our properties, and other stakeholders in our operating locations.
Illegal mining activities may negatively impact our ability to explore, develop and operate some mineral projects. Artisanal and illegal miners are present at the San Matias Project in Colombia (owned directly by Cordoba) and the Pinaya Project in Peru (owned directly by our subsidiary, Kaizen).
Illegal mining activities may negatively impact our ability to explore, develop and operate some mineral projects. Artisanal and illegal miners are present at the San Matias Project in Colombia (owned directly by Cordoba) and the Pinaya Project in Peru (owned by our subsidiary Kaizen).
Certain provisions in our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that may make the acquisition of our company more difficult, including the following: • amendments to certain provisions of our amended and restated certificate of incorporation or amendments to our amended and restated bylaws generally require the approval of at least 66 and 2∕3% of the voting power of our outstanding capital stock; • our stockholders are only able to take action at a meeting of stockholders and are not able to take action by written consent for any matter; • our amended and restated certificate of incorporation do not provide for cumulative voting; • vacancies on our Board of Directors are able to be filled only by our Board of Directors and not by stockholders; • a special meeting of our stockholders may only be called by the chairperson of our Board of Directors or our Chief Executive Officer, as applicable, or a majority of our Board of Directors; 83 Table of Contents • restrict the forum for certain litigation against us to Delaware or the federal courts of the United States, as applicable; • our amended and restated certificate of incorporation authorizes undesignated preferred stock, the terms of which may be established and shares of which may be issued without further action by our stockholders; and • advance notice procedures apply for stockholders to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders.
Certain provisions in our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that may make the acquisition of our company more difficult, including the following: • amendments to certain provisions of our amended and restated certificate of incorporation or amendments to our amended and restated bylaws generally require the approval of at least 66 and 2∕3% of the voting power of our outstanding capital stock; • our stockholders are only able to take action at a meeting of stockholders and are not able to take action by written consent for any matter; • our amended and restated certificate of incorporation do not provide for cumulative voting; • vacancies on our Board of Directors are able to be filled only by our Board of Directors and not by stockholders; • a special meeting of our stockholders may only be called by the chairperson of our Board of Directors or our Chief Executive Officer, as applicable, or a majority of our Board of Directors; • restrict the forum for certain litigation against us to Delaware or the federal courts of the United States, as applicable; 96 Table of Contents • our amended and restated certificate of incorporation authorizes undesignated preferred stock, the terms of which may be established and shares of which may be issued without further action by our stockholders; and • advance notice procedures apply for stockholders to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders.
Accordingly, we could face risks such as: • greater difficulty in obtaining effective legal redress in the courts of such jurisdictions, whether in respect of a breach of law or regulation, or in an ownership dispute; • a higher degree of discretion on the part of governmental authorities, which leads to greater uncertainty; • the lack of judicial or administrative guidance on interpreting applicable rules and regulations; • inconsistencies or conflicts between and within various laws, regulations, decrees, orders and resolutions; or • relative inexperience of the judiciary and courts in such matters. 80 Table of Contents Enforcement of laws in some of the jurisdictions in which we operate may depend on and be subject to the interpretation of such laws by the relevant governmental authorities, and such authority may adopt an interpretation of an aspect of local law that differs from the advice that has been given to us by local lawyers or even by the relevant local authority itself on a prior occasion.
Accordingly, we could face risks such as: • greater difficulty in obtaining effective legal redress in the courts of such jurisdictions, whether in respect of a breach of law or regulation, or in an ownership dispute; • a higher degree of discretion on the part of governmental authorities, which leads to greater uncertainty; • the lack of judicial or administrative guidance on interpreting applicable rules and regulations; • inconsistencies or conflicts between and within various laws, regulations, decrees, orders and resolutions; or • relative inexperience of the judiciary and courts in such matters. 93 Table of Contents Enforcement of laws in some of the jurisdictions in which we operate may depend on and be subject to the interpretation of such laws by the relevant governmental authorities, and such authority may adopt an interpretation of an aspect of local law that differs from the advice that has been given to us by local lawyers or even by the relevant local authority itself on a prior occasion.
These risks include: • the possible unilateral cancellation or forced re-negotiation of contracts and licenses; 79 Table of Contents • unfavorable or arbitrary changes in laws and regulations; • arbitrary royalty and tax increases; • claims by governmental entities or indigenous communities; • expropriation or nationalization of property; • political instability (including civil strife, insurrection and potentially civil war); • significant fluctuations in currency exchange rates; • social and labor unrest, organized crime, hostage taking, terrorism and violent crime; • uncertainty regarding the enforceability of contractual rights and judgments; and • other risks arising out of foreign governmental sovereignty over areas in which our mineral properties are located.
These risks include: • the possible unilateral cancellation or forced re-negotiation of contracts and licenses; 92 Table of Contents • unfavorable or arbitrary changes in laws and regulations; • arbitrary royalty and tax increases; • claims by governmental entities or indigenous communities; • expropriation or nationalization of property; • political instability (including civil strife, insurrection and potentially civil war); • significant fluctuations in currency exchange rates; • social and labor unrest, organized crime, hostage taking, terrorism and violent crime; • uncertainty regarding the enforceability of contractual rights and judgments; and • other risks arising out of foreign governmental sovereignty over areas in which our mineral properties are located.
Any of the following events, among the other uncertainties and risks described in this Annual Report, could affect the ultimate accuracy of such estimates: • unanticipated changes in grade and tonnage of Ore to be mined and processed; • incorrect data on which engineering assumptions are made; • delays in construction schedules; • delays in the ramp-up of the rate of operations; • unanticipated transportation costs; • the accuracy of major equipment and construction cost estimates; • labor negotiations and labor availability; • changes in government regulation, including regulations regarding greenhouse gas emissions; • changes in the cost of consumables; • changes in royalty, duty, and tax rates; • permitting costs and requirements; and • general demand for skilled labor, steel, industrial equipment and other components required for mining, any of which could cause material and adverse changes to our future capital and operating costs.
Any of the following events, among the other uncertainties and risks described in this Annual Report, could affect the ultimate accuracy of such estimates: 78 Table of Contents • unanticipated changes in grade and tonnage of Ore to be mined and processed; • incorrect data on which engineering assumptions are made; • delays in construction schedules; • delays in the ramp-up of the rate of operations; • unanticipated transportation costs; • the accuracy of major equipment and construction cost estimates; • labor negotiations and labor availability; • changes in government regulation, including regulations regarding greenhouse gas emissions; • changes in the cost of consumables; • changes in royalty, duty, and tax rates; • permitting costs and requirements; and • general demand for skilled labor, steel, industrial equipment and other components required for mining, any of which could cause material and adverse changes to our future capital and operating costs.
Our activities and business could be adversely affected by the effects of health epidemics, including the ongoing COVID-19 pandemic, in regions where we conduct our business operations. Our business and exploration activities could be adversely affected by health epidemics or pandemics.
Our activities and business could be adversely affected by the effects of health epidemics, including the COVID-19 pandemic, in regions where we conduct our business operations. Our business and exploration activities could be adversely affected by health epidemics or pandemics.
However, the PRC may change its foreign ownership regulations to govern battery manufacturers, or may change such regulations in other ways that govern VRB, which could adversely affect our results of operations and financial condition. The PRC government exerts substantial influence over the manner in which we must conduct our business activities.
However, we recognize that PRC may change its foreign ownership regulations to governing battery manufacturers, or may change such regulations in other ways that govern VRB, which could adversely affect our results of operations and financial condition. The PRC government exerts substantial influence over the manner in which we must conduct our business activities.
Those reviews could result in adverse tax consequences and unexpected financial costs and exposure. 81 Table of Contents RISKS RELATED TO OUR COMMON STOCK Future sales and issuances of our common stock or rights to purchase common stock, including pursuant to our equity incentive plans, could result in additional dilution of the percentage ownership of our stockholders and could cause the price of our common stock to decline .
Those reviews could result in adverse tax consequences and unexpected financial costs and exposure. 94 Table of Contents RISKS RELATED TO OUR COMMON STOCK Future sales and issuances of our common stock or rights to purchase common stock, including pursuant to our equity incentive plans, could result in additional dilution of the percentage ownership of our stockholders and could cause the price of our common stock to decline .
We may not be able to attract and retain personnel to sufficiently staff our development and operating teams. 76 Table of Contents Our directors and officers may have conflicts of interest as a result of their relationships with other mining companies that are not affiliated with us.
We may not be able to attract and retain personnel to sufficiently staff our development and operating teams. 89 Table of Contents Our directors and officers may have conflicts of interest as a result of their relationships with other mining companies that are not affiliated with us.
Capital and operating cost estimates are typically set 65 Table of Contents out in Feasibility Studies and are based on the interpretation of geological data, cost of consumables, cost of capital, labor costs, transportation costs, mining and processing costs, anticipated climatic conditions, the costs of taxes, duties and royalties, permitting and restrictions or production quotas on exportation of minerals) and title claims, and other factors which may be considered at the time the estimates are made and will be based on information prevailing at that time.
Capital and operating cost estimates are typically set out in Feasibility Studies and are based on the interpretation of geological data, cost of consumables, cost of capital, labor costs, transportation costs, mining and processing costs, anticipated climatic conditions, the costs of taxes, duties and royalties, permitting and restrictions or production quotas on exportation of minerals) and title claims, and other factors which may be considered at the time the estimates are made and will be based on information prevailing at that time.
Any such developments may materially and adversely affect our financial position and results of operations. 77 Table of Contents If future acquisitions are significant, they could change the scale of our business and expose us to new geographic, political, operating and financial risks.
Any such developments may materially and adversely affect our financial position and results of operations. 90 Table of Contents If future acquisitions are significant, they could change the scale of our business and expose us to new geographic, political, operating and financial risks.
The market price for our common stock may be influenced by many factors, including: the failure to identify mineral resources or reserves at our properties; the failure to achieve production at any of our mineral properties; the lack of mineral exploration success; the actual or anticipated changes in the price of commodities we are seeking to discover and mine, namely copper, nickel, vanadium, cobalt, platinum group elements, gold and silver; changes in market valuations of similar companies; changes in technology and demand for minerals; the success or failure of competitor mining companies; changes in our capital structure, such as future issuances of securities or the incurrence of debt; sales of common stock by us, our executive officers, directors or principal stockholders, or others; changes in regulatory requirements and the political climate in the United States, and other jurisdictions where we have activities, including Canada, Australia, Colombia, Peru, Ivory Coast, Papua New Guinea and the PRC; litigation involving us, our general industry or both; the recruitment or departure of key personnel; our ability to control our costs; accidents at mining projects, whether owned by us or otherwise; cyber-attacks or cyber-breaches; natural disasters, terrorist attacks, and acts of war, including the large-scale invasion of Ukraine by Russia; general economic, industry and market conditions, such as the impact of the COVID-19 pandemic, on our industry and market conditions, or the occurrence of other epidemics or pandemics; and the other factors described in this “Risk Factors” section.
The market price for our common stock may be influenced by many factors, including: the failure to identify mineral resources or reserves at our properties; the failure to achieve production at any of our mineral properties; the lack of mineral exploration success; the actual or anticipated changes in the price of commodities we are seeking to discover and mine, namely copper, nickel, vanadium, cobalt, platinum group elements, gold and silver; changes in market valuations of similar companies; changes in technology and demand for minerals; the success or failure of competitor mining companies; changes in our capital structure, such as future issuances of securities or the incurrence of debt; sales of common stock by us, our executive officers, directors or principal stockholders, or others; changes in regulatory requirements and the political climate in the United States, and other jurisdictions where we have activities, including Canada, Australia, Colombia, Peru, Ivory Coast, Saudi Arabia and the PRC; litigation involving us, our general industry or both; the recruitment or departure of key personnel; our ability to control our costs; accidents at mining projects, whether owned by us or otherwise; cyber-attacks or cyber-breaches; natural disasters, terrorist attacks, and acts of war, including the large-scale invasion of Ukraine by Russia; general economic, industry and market conditions, such as 95 Table of Contents the impact of the COVID-19 pandemic, on our industry and market conditions, or the occurrence of other epidemics or pandemics; and the other factors described in this “Risk Factors” section.
If we are unable to assert that our internal control over financial reporting is effective, or when required in the future, if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may 86 Table of Contents lose confidence in the accuracy and completeness of our financial reports and the valuation of our common stock could be adversely affected.
If we are unable to assert that our internal control over financial reporting is effective, or when required in the future, if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and the valuation of our common stock could be adversely affected.
If a significant amount of our shares of common stock are sold, or it is perceived that they will be sold, in the public market, the market price of our common stock could decline. Sales of a substantial number of shares of our common stock in the public market could occur at any time.
If a substantial number of our shares of common stock are sold, or it is perceived that they will be sold, in the public market, the market price of our common stock could decline. Sales of a substantial number of shares of our common stock in the public market could occur at any time.
Item 1A. Risk Factors The following risks and uncertainties may have a material and adverse effect on our business, financial condition, results of operations, or stock price. You should consider these risks and uncertainties carefully, together with all of the other information contained in this Annual Report, including our consolidated and combined carve-out financial statements and related notes.
Item 1A. Risk Factors The following risks and uncertainties may have a material and adverse effect on our business, financial condition, results of operations, or stock price. You should consider these risks and uncertainties carefully, together with all of the other information contained in this Annual Report, including our consolidated financial statements and related notes.
Accordingly, such elected boards of directors may determine to take an action that they consider in the best interests of all shareholders, even if it is not the preferred course of action for us. As well, transactions between us and such companies are highly regulated by related party transaction rules in Canada, as well as those of the TSX.
Accordingly, such elected directors may determine to take an action that they consider in the best interests of all shareholders, even if it is not the preferred course of action for us. As well, transactions between us and such company are highly regulated by related party transaction rules in Canada, as well as those of the TSX.
The extent to which our mineral resources may ultimately be reclassified as mineral reserves depends on the demonstration of their profitable recovery and economic mineability. 61 Table of Contents In addition, mineral resource estimates have been determined and valued based on assumed future metal prices, cut-off grades, and operating costs that may prove to be inaccurate.
The extent to which our mineral resources may ultimately be reclassified as mineral reserves depends on the demonstration of their profitable recovery and economic mineability. In addition, mineral resource estimates have been determined and valued based on assumed future metal prices, cut-off grades, and operating costs that may prove to be inaccurate.
In the second proceeding, Cordoba (along with the National Mining Agency, Ministry of Mines and Energy, the local environmental authority, the Municipality of Puerto Libertador and the State of Cordoba) were served with a class action claim by individuals purporting to represent the Alacran Community — “Asociación de Mineros de El Alacrán” (“Alacran Community”).
In the second proceeding, Cordoba (along with the National Mining Agency, Ministry of Mines and Energy, the local environmental authority, the Municipality of Puerto Libertador and the State of Cordoba) were served with a class action claim by individuals purporting to represent the Alacran Community — “Asociación de Mineros de El 82 Table of Contents Alacrán” (“Alacran Community”).
Any intellectual property litigation or proceeding could have a material adverse effect on our business, results of operation and financial condition. 75 Table of Contents RISKS RELATED TO OUR BUSINESSES GENERALLY We will require substantial capital investment in the future and we may be unable to raise additional capital on favorable terms or at all.
Any intellectual property litigation or proceeding could have a material adverse effect on our business, results of operation and financial condition. RISKS RELATED TO OUR BUSINESSES GENERALLY We will require substantial capital investment in the future and we may be unable to raise additional capital on favorable terms or at all.
In addition, you may not be able to enforce certain civil liabilities predicated upon U.S. federal or state securities laws in Canada against us, our directors and executive officers and certain of the experts named in this Annual Report or the assets of such persons. Item 1B. Unresolved Staff Comments Not applicable
In addition, you may not be able to enforce certain civil liabilities predicated upon U.S. federal or state securities laws in non-US jurisdictions against us, our directors and executive officers and certain of the experts named in this Annual Report or the assets of such persons. Item 1B. Unresolved Staff Comments Not applicable
We may not be able to substantially increase our manufacturing output in order to fulfill orders from our customers. We intend to expand our battery manufacturing capacity to meet the expected demand for our products.
VRB may not be able to substantially increase its manufacturing output in order to fulfill orders from its customers. We intend to expand our battery manufacturing capacity to meet the expected demand for our products.
Most exploration projects do not result in the discovery of commercially mineable Ore deposits, and anticipated levels of recovery of mineral resources and mineral 60 Table of Contents reserves, if any, may not be realized, nor may any identified mineral deposit ever be a commercially mineable (or viable) Ore Body which can be legally and economically exploited.
Most exploration projects do not result in the discovery of commercially mineable Ore deposits, and anticipated levels of recovery of mineral resources and mineral reserves, if any, may not be realized, nor may any identified mineral deposit ever be a commercially mineable (or viable) Ore Body which can be legally and economically exploited.
If current exploration programs do not result in the discovery of commercially mineable, Ore Bodies, we may need to write-off part or all of our investment in our existing exploration stage properties, and may need to acquire additional properties. We have no history of mineral production and may never engage in mineral production.
If current exploration programs do not result in the discovery of commercially mineable, Ore Bodies, we may need to write-off part or all of our investment in our existing exploration stage properties, and may need to acquire additional properties. 73 Table of Contents We have no history of mineral production and may never engage in mineral production.
Such amounts may be significant and could have a material adverse effect on our financial performance, financial position and results of operations and may cause us to alter our operations. We also may be required to maintain financial assurances, such as letters of credit, to secure reclamation obligations under certain laws and regulations.
Such amounts may be significant and could have a material adverse effect on our financial performance, financial position and results of operations and may cause us to alter our operations. 77 Table of Contents We also may be required to maintain financial assurances, such as letters of credit, to secure reclamation obligations under certain laws and regulations.
If we fail to secure a sufficient supply of key raw materials and components and we are unable to produce them 70 Table of Contents in-house in a timely fashion, it would result in a significant delay in our manufacturing and shipments, which may cause us to breach our sales contracts with our customers.
If we fail to secure a sufficient supply of key raw materials and components and we are unable to produce them in-house in a timely fashion, it would result in a significant delay in our manufacturing and shipments, which may cause us to breach our sales contracts with our customers.
If during the evaluation and testing process, we identify one or more material weaknesses in the design or effectiveness of our internal control over financial reporting or determine that existing material weaknesses have not been remediated, our management will be unable to assert that our internal control over financial reporting is effective.
If during the evaluation and testing process, we identify one or more material weaknesses in the design or effectiveness of our internal control over financial reporting or determine that existing material weaknesses have not been remediated, 98 Table of Contents our management will be unable to assert that our internal control over financial reporting is effective.
The permitting process can vary by jurisdiction in terms of its complexity and likely outcomes. The applicable laws and regulations, and the related judicial interpretations and enforcement policies change frequently, which can make it difficult for us to obtain and renew permits and to comply with applicable requirements.
The permitting process can vary by jurisdiction in terms of its complexity and likely outcomes. The 76 Table of Contents applicable laws and regulations, and the related judicial interpretations and enforcement policies change frequently, which can make it difficult for us to obtain and renew permits and to comply with applicable requirements.
These systems remain vulnerable to disruption, damage or failure from a variety of sources, including, but not limited to, errors by employees or contractors, computer viruses, cyberattacks, including phishing, ransomware, and similar malware, misappropriation of data by outside parties, and various other threats.
These systems remain vulnerable to disruption, damage or failure from a variety of sources, including, but not limited to, errors by employees or contractors, computer viruses, cyber-attacks, including phishing, ransomware, and similar malware, misappropriation of data by outside parties, and various other threats.
In addition, the central or local governments of the jurisdictions in which we operate may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part to ensure our compliance with such regulations or interpretations.
In addition, the central or local governments of the jurisdictions in which we operate may impose new, stricter regulations or interpretations of existing regulations that 86 Table of Contents would require additional expenditures and efforts on our part to ensure our compliance with such regulations or interpretations.
The actual costs of reclamation and exploration restoration requirements are uncertain and planned expenditures may differ from the actual expenditures required. Therefore, the amount that we are required to spend could 64 Table of Contents be materially higher than any current or future estimates.
The actual costs of reclamation and exploration restoration requirements are uncertain and planned expenditures may differ from the actual expenditures required. Therefore, the amount that we are required to spend could be materially higher than any current or future estimates.
We may incur material losses relating to cyberattacks or other information security breaches in the future. Our risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats.
We may incur material losses relating to cyber-attacks or other information security breaches in the future. Our risk and exposure to these matters cannot be fully mitigated because of, among other things, the evolving nature of these threats.
Many of our permits are subject to renewal from time to time, and applications for renewal may be denied or the renewed permits may contain more restrictive conditions than our existing permits, including those governing impacts on 63 Table of Contents the environment.
Many of our permits are subject to renewal from time to time, and applications for renewal may be denied or the renewed permits may contain more restrictive conditions than our existing permits, including those governing impacts on the environment.
If one or more of the analysts who cover us downgrade our common stock or publish inaccurate or unfavorable research about us, the price of our common stock 82 Table of Contents would likely decline. In addition, if our results of operations fail to meet the forecasts of analysts, the price of our common stock would likely decline.
If one or more of the analysts who cover us downgrade our common stock or publish inaccurate or unfavorable research about us, the price of our common stock would likely decline. In addition, if our results of operations fail to meet the forecasts of analysts, the price of our common stock would likely decline.
In addition, it may not be possible to economically mine or process any of our mineral resources. Material changes in mineral resources, if any, grades, stripping ratios or Recovery Rates may affect the economic viability of any project.
In addition, it may not be possible to economically mine or process any of our mineral resources. 74 Table of Contents Material changes in mineral resources, if any, grades, stripping ratios or Recovery Rates may affect the economic viability of any project.
Accordingly, transactions that we may consider to be in our best interest and in the best interest of our investee companies may not proceed if they are subject to minority shareholder approval requirements, and minority shareholders do not provide the necessary approvals.
Accordingly, transactions that we may consider to be in our best interest and in the best interest of Cordoba may not proceed if they are subject to minority shareholder approval requirements, and minority shareholders do not provide the necessary approvals.
If any such transactions are not approved, we may be unable to advance our business interests through our equity investee companies and/or may not be able to engage in transactions with them which we consider beneficial, any of which could have an adverse material impact on our prospects, business, results of operations and financial condition.
If any such transactions are not approved, we may be unable to advance our business interests through Cordoba and/or may not be able to engage in transactions with them which we consider beneficial, any of which could have an adverse material impact on our prospects, business, results of operations and financial condition.
We believe that our common stock currently is regularly traded on an established securities market. However, no assurance can be given that our common stock will remain regularly traded in the future. Non-U.S. holders should consult their tax advisors concerning the consequences of disposing of shares of our common stock.
We believe that our common stock currently is regularly traded on an established securities market. However, no assurance can be given in this regard and no assurance can be given that our common stock will remain regularly traded in the future. Non-U.S. holders should consult their own tax advisors concerning the consequences of disposing of shares of our common stock.
If we were to discover that our products violate third-party proprietary rights, we may be unable to continue offering our products on commercially reasonable terms, or at all, to redesign our technology to avoid infringement or to avoid or settle litigation regarding alleged infringement without substantial expense and damage awards.
If we were to discover that our products violate third-party proprietary rights, we may be unable to continue offering our products on commercially reasonable terms, or at all, to redesign our technology to avoid infringement or to avoid or settle litigation regarding alleged infringement without substantial expense and damage 88 Table of Contents awards.
In addition, while the Delaware Supreme Court ruled in March 2020 that federal forum selection provisions purporting to require claims 84 Table of Contents under the Securities Act be brought in federal court are “facially valid” under Delaware law, there is uncertainty as to whether other courts will enforce our Federal Forum Provision.
In addition, while the Delaware Supreme Court ruled in March 2020 that federal forum selection provisions purporting to require claims under the Securities Act be brought in federal court are “facially valid” under Delaware law, there is uncertainty as to whether other courts will enforce our Federal Forum Provision.
Although Ivanhoe Electric is incorporated under the DGCL, a significant number of the members of our Board of Directors and executive officers and certain of the experts named in this Annual Report are non-U.S. residents, and certain assets of such persons are located outside the United States. Our corporate headquarters is currently located in Canada.
Although Ivanhoe Electric is incorporated under the DGCL, a significant number of the members of our Board of Directors and executive officers and certain of the experts named in this Annual Report are non-U.S. residents, and certain assets of such persons are located outside the United States.
We currently own no water rights and we have not yet obtained the water rights to support some of our potential development activities and our inability to obtain those rights could prevent us from pursuing those activities.
We currently 81 Table of Contents own no water rights and we have not yet obtained the water rights to support some of our potential development activities and our inability to obtain those rights could prevent us from pursuing those activities.
For example, the ongoing global COVID-19 pandemic has negatively affected the global economy, disrupted financial markets and international trade, resulted in increased unemployment levels and significantly affected global supply chains, all of which have and are expected to continue to affect our future exploration activities and business.
For example, the global COVID-19 pandemic has negatively affected the global economy, disrupted financial markets and international trade, resulted in increased unemployment levels and significantly affected global supply chains, all of which have and may continue to affect our future exploration activities and business.
Under the new Negative List regime, any industry that is not on the Negative List is free from foreign ownership restrictions. The most updated version of the Negative List is the Negative List (2020 Version), which contains no foreign ownership restrictions over the manufacturing of power batteries.
Under the new Negative List regime, any industry that is not on the Negative List is free from foreign ownership restrictions. The most updated version of the Negative List (2021 version) contains no foreign ownership restrictions over the manufacturing of power batteries.
Our information technology systems may be vulnerable to disruption, which could place our systems at risk for data loss, operational failure or compromise of confidential information. We rely on various information technology systems.
Our information technology systems may be vulnerable to cyber-attack or other disruption, which could place our systems at risk for data loss, operational failure or compromise of confidential information. We rely on various information technology systems.
Similarly, if we are subject to governmental investigations or proceedings, we may incur significant penalties and fines, and enforcement actions against 66 Table of Contents us could result in our being required to stop exploration and development activities or to close future mining operations.
Similarly, if we are subject to governmental investigations or proceedings, we may incur significant penalties and fines, and enforcement actions against us could result in our being required to stop exploration and development activities or to close future mining operations.
At the Santa Cruz Project, the majority of subsurface mineral rights are owned by one company, and the surface rights are predominantly owned by a different company. At the Tintic Project, five vendors continue to hold title to the majority of subsurface and surface rights, pending us making all required payments within the time required.
At the Santa Cruz Project, the majority of subsurface mineral rights are owned by one company. At the Tintic Project, five vendors continue to hold title to the remaining subsurface and surface rights, pending us making all required payments within the time required.
If the Federal Forum Provision is found to be unenforceable, we may incur additional costs associated with resolving such matters. The Federal Forum Provision may also impose additional litigation costs on stockholders who assert that the provision is not enforceable or invalid.
If the Federal Forum Provision is found to be 97 Table of Contents unenforceable, we may incur additional costs associated with resolving such matters. The Federal Forum Provision may also impose additional litigation costs on stockholders who assert that the provision is not enforceable or invalid.
Our subsidiary VRB relies on patents to establish and protect its intellectual property rights in the PRC, the United States and other jurisdictions. As a result, VRB may be required to spend significant resources to monitor and protect its intellectual property rights.
Our subsidiary VRB relies on patents to establish and protect its intellectual 87 Table of Contents property rights in the PRC, the United States and other jurisdictions. As a result, VRB may be required to spend significant resources to monitor and protect its intellectual property rights.
Accordingly, many transactions that we could undertake with our listed company investee companies may be subject to independent formal valuation requirements and/or minority shareholder approval requirements, at which our votes will be disregarded.
Accordingly, many transactions that we could undertake with Cordoba may be subject to independent formal valuation requirements and/or minority shareholder approval requirements, at which our votes will be disregarded.
RISKS RELATED TO GOVERNMENT REGULATIONS AND INTERNATIONAL OPERATIONS We have mineral projects or investments in mineral projects in the United States, Canada, Australia, Colombia, Peru, Ivory Coast, and Papua New Guinea where the governments extensively regulate mineral exploration and mining operations, imposing significant actual and potential costs on us.
RISKS RELATED TO GOVERNMENT REGULATIONS AND INTERNATIONAL OPERATIONS We have subsidiaries, mineral projects, investments in mineral projects or exploration activities in the United States, Canada, Australia, Colombia, Peru, Ivory Coast and Saudi Arabia where the governments extensively regulate mineral exploration and mining operations, imposing significant actual and potential costs on us.
At our Santa Cruz Project in Arizona and our Tintic Project in Utah, we only own a small portion of the subsurface mineral and surface rights. The majority of such rights are held under option agreements or purchase agreements in respect of which title has not yet transferred to us.
At our Santa Cruz Project in Arizona and our Tintic Project in Utah, we only own some of the subsurface mineral rights, and at Tintic we only own some of the surface rights. The rights we do not own are held under option agreements or purchase agreements in respect of which title has not yet transferred to us.
There is no guarantee that we will not experience significant disruptions to our activities in the future as a result of the COVID-19 pandemic or any similar health epidemics. 78 Table of Contents While our equity ownership in certain of our listed company portfolio may be significant, we may not be able to exert control or direction over those companies or their business.
There is no guarantee that we will not experience significant disruptions to our activities in the future as a result of the COVID-19 pandemic or any similar health epidemics. 91 Table of Contents While our equity ownership in our listed company Cordoba may be significant, we may not be able to exert control or direction over the company or its business.
The stock market in general has experienced extreme volatility that has often been unrelated to the operating performance of particular companies.
Our stock price is volatile. The stock market in general has experienced extreme volatility that has often been unrelated to the operating performance of particular companies.
Colombia is home to South America’s largest and longest running insurgency. The situation may become unstable and may deteriorate in the future into violence, including kidnapping, gang warfare, homicide and/or terrorist activity. Any such actions may generally disrupt supply chains and business activities in Colombia, and discourage qualified individuals from being involved with Cordoba’s operations.
The situation may become unstable and may deteriorate in the future into violence, including kidnapping, gang warfare, homicide and/or terrorist activity. Any such actions may generally disrupt supply chains and business activities in Colombia, and discourage qualified individuals from being involved with Cordoba’s operations.
As a public company, we incur significant legal, accounting, insurance, and other expenses, including expenses related to our ESG strategy. Compliance with these rules and regulations will continue to increase our legal and financial compliance costs and make some activities more time-consuming and costly, particularly after we are no longer an “emerging growth company” or a “smaller reporting company”.
As a public company, we incur significant legal, accounting, insurance, and other expenses, including expenses related to our ESG strategy. Compliance with these rules and regulations will continue to increase our legal and financial compliance costs and make some activities more time-consuming and costly, particularly after we are no longer eligible to report under smaller reporting company standards.
The litigation process is uncertain and it is possible that the second proceeding is resolved against Cordoba, which could have a material adverse effect on its business, results of operations, financial condition and prospects. 69 Table of Contents Our subsidiary Cordoba operates in a jurisdiction, Colombia, which has heightened security risks.
The litigation process is uncertain and it is possible that the second proceeding is resolved against Cordoba, which could have a material adverse effect on its business, results of operations, financial condition and prospects. Our subsidiary Cordoba operates in a jurisdiction, Colombia, which has heightened security risks. Colombia is home to South America’s largest and longest running insurgency.
Acts of civil disobedience are not uncommon in Colombia, Peru, Ivory Coast and Papua New Guinea. Mining companies have been targets of actions to restrict their legally-entitled access to mining concessions or property. Such acts of civil disobedience often occur with no warning and can result in significant direct and indirect costs.
Acts of civil disobedience are not uncommon in some of these countries. Mining companies have been targets of actions to restrict their legally-entitled access to mining concessions or property. Such acts of civil disobedience often occur with no warning and can result in significant direct and indirect costs.
We have also registered all shares of common stock that we may issue under our equity compensation plans or that are issuable upon exercise of outstanding options or other equity awards. Therefore, these shares can be freely sold in the public market upon issuance and, once vested, subject to volume limitations applicable to our affiliates.
We have also registered all shares of common stock that we may issue under our equity compensation plans or that are issuable upon exercise of outstanding options or other equity awards. Therefore, these shares can be freely sold in the public market.
Any challenge to our title could result in litigation, insurance claims and potential losses, hinder our access to capital, delay the exploration and development of a property and ultimately result in the loss of some or all of our interest in the mineral project.
We rely on title information and/or representations and warranties provided by the grantors. Any challenge to our title could result in litigation, insurance claims and potential losses, hinder our access to capital, delay the exploration and development of a property and ultimately result in the loss of some or all of our interest in the mineral project.
The mining industry is subject to increasingly strict regulation by federal, state and local authorities in the jurisdictions in which we have mineral projects, including the United States, Canada, Australia, Colombia, Peru, Ivory Coast, and Papua New Guinea.
The mining industry is subject to increasingly strict regulation by federal, state and local authorities in the jurisdictions in which we have mineral projects, investments in mineral projects or exploration activities, including the United States, Canada, Australia, Colombia, Peru, Ivory Coast and Saudi Arabia.
For the years ended December 31, 2022 and 2021, we had a net loss of $160.2 million and $68.5 million respectively, and negative cash flows from operating activities of $115.7 million and $47.8 million respectively.
For the years ended December 31, 2023 and 2022, we had a net loss of $216.1 million and $160.2 million respectively, and negative cash flows from operating activities of $150.5 million and $115.7 million respectively.
We may not be able to obtain secure and sufficient supplies of power and water at reasonable costs at any of our mineral projects and the failure to do so could have a material adverse effect on our ability to develop and operate a mine, and on our financial condition and results of operations. 68 Table of Contents Our success depends on developing and maintaining relationships with local communities and stakeholders.
We may not be able to obtain secure and sufficient supplies of power and water at reasonable costs at any of our mineral projects and the failure to do so could have a material adverse effect on our ability to develop and operate a mine, and on our financial condition and results of operations.
We may incur significant additional costs and expenses, including costs and expenses associated with obligations relating to being a public company, which will require significant resources and management attention and may divert focus from our business operations, particularly after we are no longer an “emerging growth company” or a “smaller reporting company”.
We may incur significant additional costs and expenses, including costs and expenses associated with obligations relating to being a public company, which will require significant resources and management attention and may divert focus from our business operations, particularly after we are no longer eligible to report under smaller reporting company standards.
The FCPA also requires companies to maintain accurate books and records and internal controls. As we have certain mineral projects and investments in Colombia, Peru, Ivory Coast and Papua New Guinea, there is a risk of potential FCPA violations.
The FCPA also requires companies to maintain accurate books and records and internal controls. As we have certain subsidiaries, mineral projects and investments in other countries, including Colombia, Peru, Ivory Coast, Saudi Arabia and the PRC, there is a risk of potential FCPA violations.
Our ability to increase our manufacturing output is subject to significant constraints and uncertainties, including: • delays by our suppliers and equipment vendors and cost overruns as a result of a number of factors, many of which may be beyond our control, such as increases in raw material prices and problems with equipment vendors; • delays in government approval processes or denial of required approvals by relevant government authorities; • diversion of significant management attention and other resources; and • failure to execute our expansion plan effectively.
Our ability to increase our manufacturing output is subject to significant constraints and uncertainties, including: • delays by our suppliers and equipment vendors and cost overruns as a result of a number of factors, many of which may be beyond our control, such as increases in raw material prices and problems with equipment vendors; • delays in government approval processes or denial of required approvals by relevant government authorities; • diversion of significant management attention and other resources; and • failure to execute our expansion plan effectively. 85 Table of Contents If we are unable to increase our manufacturing output because of any of the risks described above, we may be unable to fulfill customer orders or achieve the growth we expect.
These sales, or the perception in the market that the holders of a large number of shares of common stock intend to sell shares, could reduce the market price of our common stock. As of March 14, 2023, we had 92,971,865 shares of common stock outstanding.
These sales, or the perception in the market that the holders of a large number of shares of common stock intend to sell shares, could reduce the market price of our common stock.
If we fail to manage these additional costs or increase our revenue, we may incur losses in the future. We are an “emerging growth company” and a “smaller reporting company,” and the reduced disclosure requirements applicable to emerging growth companies and smaller reporting companies may make our common stock less attractive to investors.
If we fail to manage these additional costs or increase our revenue, we may incur losses in the future. This Annual Report was prepared pursuant to the standards applicable to a smaller reporting company, and the reduced disclosure requirements applicable to smaller reporting companies may make our common stock less attractive to investors.
If any viable substitute products emerge and gain market acceptance because they have more enhanced features, more power, more attractive pricing, or better reliability, the market demand for VRB’s products may decrease, and accordingly, our business, financial condition and results of operations would be materially and adversely affected.
If any viable substitute products emerge and gain market acceptance because they have more enhanced features, more power, more attractive pricing, or better reliability, the market demand for VRB’s products may decrease, and accordingly, our business, financial condition and results of operations would be materially and adversely affected. 84 Table of Contents Furthermore, the battery market is characterized by rapid technological changes and evolving industry standards, which are difficult to predict.
If we do not make all the option or purchase agreement payments when due, or fail to pay the total amount to the owners, we will lose our right to acquire the subsurface mineral or surface rights at these projects.
If we do not make all the option or purchase agreement payments when due, or fail to pay the total amount to the owners, we will lose our right to acquire the subsurface mineral or surface rights at these projects. 75 Table of Contents At times, the owners of subsurface mineral and surface rights may be unable or unwilling to fulfill their contractual obligations to us.
We have mineral projects, or investments in mineral projects, in Colombia, Peru, Ivory Coast and Papua New Guinea. These countries are less developed economically and politically than the United States, and have historically been more politically or socially unstable than the United States, including with respect to civil unrest and significant civil strife (including violent insurrections).
Some of these countries are less developed economically and politically than the United States, and have historically been more politically or socially unstable than the United States, including with respect to civil unrest and significant civil strife (including violent insurrections).
A significant portion of any future revenue from our operations is expected to come from a small number of mines, such that any adverse developments at these mines could have a more significant or lasting impact on our results of operations than if our business was less concentrated.
If claims and lawsuits or governmental investigations or proceedings are ultimately resolved against us, it could have a material adverse effect on our business, financial position and results of operations. 79 Table of Contents A significant portion of any future revenue from our operations is expected to come from a small number of mines, such that any adverse developments at these mines could have a more significant or lasting impact on our results of operations than if our business was less concentrated.
The Typhoon TM technology we utilize in our exploration activities is based on patents owned by our subsidiary Geo27. In addition, we are also the exclusive worldwide licensee of certain legacy technology from I-Pulse and its affiliates, related to mineral exploration.
In addition, we are also the exclusive worldwide licensee of certain legacy technology from I-Pulse and its affiliates, related to mineral exploration.
If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
We cannot predict whether investors will find our common stock less attractive if we rely on certain or all of these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
At times, the owners of subsurface mineral and surface rights may be unable or unwilling to fulfill their contractual obligations to us. In addition, our option agreements and purchase agreements are often complex and may be subject to interpretation or uncertainties.
In addition, our option agreements and purchase agreements are often complex and may be subject to interpretation or uncertainties. The owners of subsurface mineral and surface rights and other counterparties may interpret our interests in a manner adverse to us.
These arrangements typically require us to commit to 67 Table of Contents meet certain expenditure requirements on the mineral project and/or to pay certain fees to the mineral project owner, each within specified time frames.
We have interests in, or rights to acquire interests in, a number of mineral projects through earn-in arrangements, options and similar agreements with the owner of the mineral project. These arrangements typically require us to commit to meet certain expenditure requirements on the mineral project and/or to pay certain fees to the mineral project owner, each within specified time frames.
If we are unable to manufacture products in commercial quantities on a timely and cost-effective basis, we could lose our customers and be unable to attract future customers. Changes in the policies of the government of the PRC, and its laws, may materially affect VRB. The business of VRB is primarily conducted in the PRC.
We depend on the performance of our manufacturing operations to manufacture and deliver our products to our customers. If we are unable to manufacture products in commercial quantities on a timely and cost-effective basis, we could lose our customers and be unable to attract future customers.
Furthermore, the battery market is characterized by rapid technological changes and evolving industry standards, which are difficult to predict. This, coupled with the frequent introduction of new products and models, has shortened product life cycles and may render our products obsolete or less marketable.
This, coupled with the frequent introduction of new products and models, has shortened product life cycles and may render our products obsolete or less marketable.
The combination of the foregoing could adversely affect our business, financial condition and results of operations. 72 Table of Contents Our failure to cost-effectively manufacture our batteries in quantities which satisfy our customers’ demands and product specifications and their expectations for product quality and reliable delivery could damage our customer relationships and result in significant lost business opportunities for us.
Our failure to cost-effectively manufacture our batteries in quantities which satisfy our customers’ demands and product specifications and their expectations for product quality and reliable delivery could damage our customer relationships and result in significant lost business opportunities for us. VRB manufactures its products rather than relying upon third-party outsourcing.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties See Item 1. Business-Santa Cruz Project, Arizona, USA and Tintic Project, Utah, USA for information about our material properties. Global Mining Management Corp. provides us with office space for our corporate headquarters in Vancouver, Canada, pursuant to a Cost Sharing Agreement. See Note 20 to our Consolidated and Combined Carve-Out Financial Statements.
Biggest changeItem 2. Properties See Item 1. Business for information about our mineral properties. In March 2023, we entered into a five-year lease for office space in Tempe, Arizona, which now serves as our headquarters. Global Mining Management Corp. provides us with office space for our office in Vancouver, Canada, pursuant to a Cost Sharing Agreement.
Added
See Note 19 to our Consolidated Financial Statements.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeCordoba is currently waiting for the Court to issue a decision on the injunction and to schedule a date and time for the initial hearing. While the court matters proceed, Cordoba will incur additional costs that will negatively impact its financial position.
Biggest changeThe Court now should: (i) issue a decision on the injunction; and (ii) schedule date and time for the initial hearing. While the court matters proceed, Cordoba will incur additional costs that will negatively impact its financial position.
As well, the litigation process is uncertain and it is possible that the second proceeding is resolved against Cordoba, which could have a material adverse effect on its business, results of operations, financial condition (including our cash position) and prospects. Item 4. Mine Safety Disclosures Not applicable. 88 Table of Contents Part II
As well, the litigation process is uncertain and it is possible that the second proceeding is resolved against Cordoba, which could have a material adverse effect on its business, results of operations, financial condition and prospects. Item 4. Mine Safety Disclosures Not applicable. 100 Table of Contents Part II
The Administrative Court of Montería admitted the commencement of the class action in September 2021. The decision was challenged by Cordoba and other defendants and confirmed by the Court. Cordoba timely filed its response to the lawsuit and statement of defense as well as its opposition to the injunction requested by the plaintiffs.
The Administrative Court of Montería admitted the commencement of the class action on September 2021. The decision was challenged by Cordoba and other defendants and confirmed by the Court. Cordoba timely filed its: (i) response to the lawsuit and statement of defense; and (ii) opposition to the injunction requested by plaintiffs.
The first is a criminal lawsuit filed by Cordoba in late 2018 and in January 2019 with the Colombian prosecutors against nine members of former Colombian management alleging breach of fiduciary obligations, abuse of trust, theft and fraud. This proceeding is ongoing.
Our subsidiary Cordoba is currently involved in two legal proceedings. The first is a criminal lawsuit filed by Cordoba in late 2018 and in January 2019 with the Colombian prosecutors against nine members of former Colombian management alleging breach of fiduciary obligations, abuse of trust, theft and fraud. This proceeding is ongoing.
Removed
Our subsidiary Kaizen is currently involved in litigation in British Columbia, Canada which commenced in 2017. The proceedings relate to a claim by AM Gold Inc. (“AMG”) against Kaizen in respect of its acquisition of the Pinaya Project.
Removed
On September 2, 2022, the Supreme Court of Canada dismissed the application of AMG seeking leave to appeal the January 21, 2022 decision of the British Columbia Court of Appeal. The British Columbia Court of Appeal decision upheld the March 23, 2021 decision of the trial judge which dismissed all of AMG’s claims against Kaizen.
Removed
There is no further avenue of appeal or review available to AMG from the Supreme Court of Canada’s judgment. AMG and its principal John Fiorino are required to pay Kaizen’s costs in connection with the trial, the appeal and the Supreme Court of Canada proceeding on a party and party basis under the applicable court tariffs.
Removed
Kaizen is in the process of pursuing those 87 Table of Contents recoveries. Kaizen will have to pay AMG’s costs with respect to a successful appeal by AMG regarding the trial judge’s initial substantial indemnity costs award. In addition, our subsidiary, Cordoba, is currently involved in two legal proceedings.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 88 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 89 Item 6. Selected Financial Data 89 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 90 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 100 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 100 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 101 Item 6. Selected Financial Data 105 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 106 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 116 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe issuances of the above securities were exempt either pursuant to Rule 701 under the Securities Act, as transactions pursuant to compensatory benefit plans, or pursuant to Section 4(a)(2) of the Securities Act, as transactions by an issuer not involving a public offering.
Biggest changeThe issuance of the above securities was exempt pursuant to Section 4(a)(2) of the Securities Act, as transactions by an issuer not involving a public offering. Purchases of Equity Securities We made no purchases of our equity securities during the fourth quarter of the year ended December 31, 2023.
Holders of Record As of March 14, 2023, we had approximately 150 holders of record of our common stock. This number does not include beneficial owners whose shares were held in street name.
Holders of Record As of February 22, 2024, we had approximately 94 holders of record of our common stock. This number does not include beneficial owners whose shares were held in street name.
Purchases of Equity Securities We made no purchases of our equity securities during the fourth quarter of the year ended December 31, 2022. Use of Proceeds On June 27, 2022, our Registration Statement on Form S-1 (File No. 333-265175) (the “Final Prospectus”) relating to our IPO of our common stock was declared effective by the SEC.
Use of Proceeds On June 27, 2022, our Registration Statement on Form S-1 (File No. 333-265175) (the “Final Prospectus”) relating to our IPO of our common stock was declared effective by the SEC.
Removed
Securities Authorized for Issuance Under Equity Compensation Plans Recent Sales of Unregistered Securities The following list sets forth information regarding all unregistered securities sold by us from January 1, 2022 through March 14, 2023: ● On June 30, 2022, we issued 5,419,923 shares of our common stock upon the automatic conversion of our outstanding Series 1 convertible notes at a conversion price of $9.39 per share. ● On June 30, 2022, we issued 8,209,035 shares of our common stock upon the automatic conversion of our outstanding Series 2 convertible notes at a conversion price of $10.58 per share. ● On June 30, 2022, we issued 945,626 shares of our common stock at a price of $10.58 per share to Central Arizona Resources Ltd. as partial consideration for the assignment to one of our wholly-owned subsidiaries of certain rights associated with one of the Company’s projects. ● On March 3, 2023, we issued 10,182 shares of our common stock at a price of $14.59 per share to Exiro Minerals USA Corp. as partial consideration for the right to earn in on the White Hill Copper Project.
Added
Securities Authorized for Issuance Under Equity Compensation Plans See Item 12. Recent Sales of Unregistered Securities During the year ended December 31, 2023, we did not sell any unregistered equity securities except as previously reported on Form 10-Q or Form 8-K.
Removed
There has been no material change in our planned use of the net proceeds from our IPO described in the Final Prospectus.
Added
Subsequent to year end, we sold the following unregistered securities: • On February 6, 2024, we issued 116,413 shares of our common stock pursuant to the Plan or Arrangement (the “Arrangement”) between the Company and Kaizen. We issued the shares without registration in reliance upon Section 3(a)(10) of the Securities Act.
Added
Immediately prior to the closing of the Arrangement, the Company beneficially owned 54,428,971 common shares of Kaizen, representing 82.54% of the issued and outstanding common shares on a non-diluted basis. Following the closing of the Arrangement, the Company owns 69,229,659 common shares of Kaizen, representing 100% of the issued and outstanding common shares on a fully diluted basis.
Added
Effective February 6, 2024, Kaizen is now a wholly-owned subsidiary of the Company.
Added
The Company acquired the common shares of Kaizen in consideration for the issuance of one share of common stock of the Company for every 127 common shares of Kaizen issued and outstanding immediately prior to the closing of the Arrangement. • On February 21, 2024, we issued 12,765 shares of our common stock at a price of $11.75 per share to Exiro Minerals USA Corp. as partial consideration for the right to earn in on the White Hill Copper Project.
Added
We have exhausted the net proceeds from our IPO with the use as described in the Final Prospectus. Certain United States Federal Income Tax and Estate Tax Consequences to Non-U.S.
Added
Holders The following is a summary of certain material United States federal income tax and estate tax consequences to a non-U.S. holder (as defined below) relating to the ownership and disposition of our common stock, but does not purport to be a 101 Table of Contents complete analysis of all the potential tax considerations relating thereto.
Added
This summary is based upon the provisions of the Internal Revenue Code of 1986, as amended (the “Code”), Treasury regulations promulgated thereunder (“Treasury Regulations”), administrative rulings and judicial decisions, all as in effect on the date hereof.
Added
These authorities may be changed, possibly retroactively, so as to result in United States federal income or estate tax consequences different from those set forth below. This summary does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation that, if enacted, could be applied on a retroactive basis.
Added
We have not sought any ruling from the IRS with respect to the statements made and the conclusions reached in the following summary, and there can be no assurance that the IRS will agree with such statements and conclusions.
Added
This summary also does not address the tax considerations arising under the laws of any non-U.S., state or local jurisdiction, or under United States federal gift and estate tax laws, except to the limited extent below.
Added
This summary also does not address all aspects of U.S. federal income taxation, such as the U.S. alternative minimum income tax and the additional tax on net investment income. Except as provided below, this summary does not address tax reporting requirements.
Added
In addition, this discussion does not address tax considerations applicable to a non-U.S. holder’s particular circumstances or to non-U.S. holders that may be subject to special tax rules, including, without limitation: • banks, insurance companies or other financial institutions; • persons subject to special tax accounting rules; • persons subject to the alternative minimum tax; • tax-exempt organizations, tax-qualified retirement plans, and pension plans; • controlled foreign corporations, passive foreign investment companies and corporations that accumulate earnings to avoid United States federal income tax and, in each case, shareholders thereof; • partnerships or other entities treated as pass-through entities for United States federal income tax purposes; • dealers in securities or currencies; • traders in securities that elect to use a mark-to-market method of accounting for their securities holdings; • persons who acquire our common stock pursuant to the exercise of employee stock options or otherwise as compensation for their services; • persons that own, or are deemed to own, more than five percent (by voting power or value) of our common stock, except to the extent specifically set forth below; • real estate investment trusts or regulated investment companies; • certain U.S. expatriates, former citizens or long-term residents of the United States; • persons who hold our common stock as part of a straddle, hedge, conversion, constructive sale, or other integrated security transaction; • corporations organized outside the United States, any state thereof, or the District of Columbia that are nonetheless treated as U.S. persons for U.S. federal income tax purposes; or • persons who do not hold our common stock as a capital asset (within the meaning of Section 1221 of the Code).
Added
In addition, if a partnership, including any entity or arrangement classified as a partnership for United States federal income tax purposes, holds our common stock, the United States federal income tax treatment of a partner in the partnership generally will depend on the status of the partner, the activities of the partnership, and certain determinations made at the partner level.
Added
Accordingly, partnerships that hold our common stock, and partners in such partnerships, should consult their own tax advisors regarding the United States federal income tax consequences to them of the acquisition, ownership, and disposition of our common stock.
Added
Prospective investors are urged to consult their own tax advisors with respect to the application of the United States federal income tax laws to their particular situation, as well as any tax consequences of the purchase, ownership and disposition of our common stock arising under the United States federal estate or gift tax rules or under the laws of any state, local, non-U.S. or other taxing jurisdiction or under any applicable tax treaty. 102 Table of Contents Non-U.S.
Added
Holder Defined For purposes of this discussion, a non-U.S. holder is a beneficial owner of shares of our common stock that is not, for United States federal income tax purposes: • an individual citizen or resident of the United States; • a corporation (or other entity treated as a corporation for United States federal income tax purposes) created or organized in or under the laws of the United States, any state or political subdivision thereof, or the District of Columbia; • a partnership (or other entity treated as a partnership for United States federal income tax purposes); • an estate whose income is subject to United States federal income tax regardless of its source; or • a trust (x) whose administration is subject to the primary supervision of a United States court and which has one or more United States persons who have the authority to control all substantial decisions of the trust or (y) which has made an election to be treated as a United States person.
Added
Distributions We have not paid and we do not anticipate declaring or paying dividends in the foreseeable future to holders of our common stock.
Added
However, if we make a distribution of cash or other property (other than certain pro rata distributions of our common stock) in respect of our common stock, the distribution will be treated as a dividend for United States federal income tax purposes to the extent it is paid from our current or accumulated earnings and profits (as determined under United States federal income tax principles).
Added
If the amount of a distribution exceeds our current and accumulated earnings and profits, the excess will be treated first as a tax-free return of capital that reduces a non-U.S. holder’s adjusted basis in such holder’s common stock, but not below zero.
Added
Any excess will be treated as gain realized on the sale or other disposition of our common stock and will be treated as described under “- Sale, Exchange or Other Disposition of Our Common Stock,” below.
Added
Subject to the discussion below regarding effectively connected income, backup withholding and FATCA (as defined below), distributions treated as dividends on our common stock held by a non-U.S. holder generally will be subject to United States federal withholding tax at a rate of 30%, or at a lower rate if provided by an applicable income tax treaty and the non-U.S. holder has provided the documentation required to claim benefits under such treaty.
Added
Generally, to claim the benefits of an income tax treaty, a non-U.S. holder will be required to provide a properly executed IRS Form W-8BEN, IRS Form W-8BEN-E or other applicable IRS Forms. In the case of any constructive distribution, it is possible that this tax would be withheld from any amount owed to the non-U.S.
Added
Holder, including, but not limited to, distributions of cash, common stock or sales proceeds subsequently paid or credited to that holder.
Added
If we are unable to determine, at the time of payment of a distribution, whether the distribution will constitute a dividend, we may nonetheless choose to withhold any U.S. federal income tax on the distribution as permitted by Treasury Regulations.
Added
If we are a USRPHC (as defined below) and we do not qualify for the Regularly Traded Exception (as defined below), distributions which constitute a return of capital will be subject to withholding tax unless an application for a withholding certificate is filed to reduce or eliminate such withholding.
Added
If a non-U.S. holder holds our common stock in connection with the non-U.S. holder’s conduct of a trade or business within the United States, and dividends paid on our common stock are effectively connected with such non-U.S. holder’s United States trade or business (and, if an applicable tax treaty so provides, are attributable to a permanent establishment or fixed base maintained by the non-U.S. holder in the United States), the dividends will not be subject to the 30% United States federal withholding tax (provided the non-U.S. holder has provided the appropriate documentation, generally an IRS Form W-8ECI, to the withholding agent), but the non-U.S. holder generally will be subject to United States federal income tax in respect of the dividend on a net income basis, and at graduated rates, in substantially the same manner as United States persons.
Added
Dividends received by a non-U.S. holder that is a corporation for United States federal income tax purposes and which are effectively connected with the conduct of a United States trade or business may also be subject to a branch profits tax at the rate of 30% (or a lower rate if provided by an applicable tax treaty).
Added
A non-U.S. holder that is eligible for a reduced rate of United States federal withholding tax under an income tax treaty may obtain a refund or credit of any excess amounts withheld by timely filing an appropriate claim for a refund together with the required information with the IRS. 103 Table of Contents Sale, Exchange or Other Disposition of Our Common Stock Subject to the discussion below regarding backup withholding and FATCA (as defined below), a non-U.S. holder generally will not be subject to United States federal income or withholding tax on any gain realized on the sale or other disposition of our common stock unless: • such non-U.S. holder is an individual who is present in the United States for 183 days or more in the taxable year of such sale or disposition, and certain other conditions are met; • such gain is effectively connected with the conduct by the non-U.S. holder of a trade or business in the United States (and, if an applicable tax treaty so provides, is attributable to a permanent establishment or a fixed base maintained by the non-U.S. holder in the United States); or • our common stock constitutes a United States real property interest (“USRPI”) by reason of our status as a “United States real property holding corporation” (“USRPHC”) at any time within the shorter of the five-year period preceding the disposition or the non-U.S. holder’s holding period for our common stock.
Added
A non-U.S. holder described in the first bullet point above generally will be subject to tax at a gross rate of 30% on the amount by which such non-U.S. holder’s taxable capital gains allocable to United States sources, including gain from the sale or other disposition of our common stock, exceed capital losses allocable to United States sources, except as otherwise provided in an applicable income tax treaty.
Added
If the gain is described in the second bullet point above, gain realized by the non-U.S. holder generally will be subject to United States federal income tax on a net income basis, and at graduated rates, in substantially the same manner as a United States person (except as provided by an applicable tax treaty).
Added
In addition, if such non-U.S. holder is a corporation for United States federal income tax purposes, it may also be subject to a branch profits tax at the rate of 30% (or a lower rate if provided by an applicable tax treaty) on such effectively connected gain, as adjusted for certain items.
Added
With respect to the third bullet point above, because we hold significant real property interests in the United States, we believe we are a USRPHC for United States federal income tax purposes.
Added
Because the determination of whether we are a USRPHC depends on the fair market value of our United States real property interests relative to the fair market value of our worldwide real property interests and our other assets used or held for use in a trade or business, it is possible we may (or may not) remain a USRPHC in the future.
Added
As a USRPHC, if our common stock is “regularly traded” on an “established securities market” (in each case, as defined by applicable Treasury Regulations) (the “Regularly Traded Exception”) during the calendar year in which a non-U.S. holder disposes of our stock, the non-U.S. holder would not be subject to taxation on the gain on the disposition of our common stock under this rule unless the non-U.S. holder has, actually or constructively, owned more than 5% of our outstanding common stock at any time during the shorter of the five-year period ending on the date of the disposition of such common stock or the non-U.S. holder’s holding period for such common stock.
Added
We believe that our common stock currently is regularly traded on an established securities market. However, no assurance can be given in this regard and no assurance can be given that our common stock will remain regularly traded in the future.
Added
If gain on the sale or other taxable disposition of shares of our common stock by a non-U.S. holder is subject to United States federal income taxation by reason of such stock being treated as a USRPI, such non-U.S. holder generally would be subject to regular United States federal income tax with respect to such gain in the same manner as a taxable U.S. holder and would be required to file a United States federal income tax return for the taxable year in which such gain was recognized.
Added
In addition, the purchaser of our shares of common stock from a non-U.S. holder generally would be required to withhold and remit to the IRS fifteen percent (15%) of the purchase price paid to such non-U.S. holder unless, at the time of such sale or other disposition, any class of our stock is regularly traded on an established securities market (as discussed above) or any other exception to such withholding applies.
Added
Federal Estate Tax Our common stock beneficially owned by an individual who is not a citizen or resident of the United States (as defined for United States federal estate tax purposes) at the time of death generally will be includable in the decedent’s gross estate for United States federal estate tax purposes, unless an applicable estate tax treaty provides otherwise.
Added
Additional Withholding Tax on Payments Made to Foreign Accounts Withholding taxes may be imposed under Sections 1471 to 1474 of the Code (such sections commonly referred to as the Foreign Account Tax Compliance Act, or “FATCA”) on certain types of payments made to non-U.S. financial institutions and certain other non-U.S. entities.
Added
Specifically, a 30% withholding tax may be imposed on dividends paid to a non-U.S. holder on, or subject to the proposed Treasury Regulations discussed below, gross proceeds from the disposition 104 Table of Contents of, our common stock paid to a “foreign financial institution” or a “non-financial foreign entity” (each as defined in the Code), unless (i) the foreign financial institution undertakes certain diligence and reporting obligations, (ii) the non-financial foreign entity either certifies it does not have any “substantial United States owners” (as defined in the Code) or furnishes identifying information regarding each substantial United States owner, or (iii) the foreign financial institution or non-financial foreign entity otherwise qualifies for an exemption from these rules.
Added
If the payee is a foreign financial institution and is subject to the diligence and reporting requirements in clause (i) above, it must enter into an agreement with the United States Department of Treasury requiring, among other things, that it undertake to identify accounts held by certain “specified United States persons” or “United States owned foreign entities” (each as defined in the Code), annually report certain information about such accounts, and withhold 30% on certain payments to non-compliant foreign financial institutions and certain other account holders.
Added
Foreign financial institutions located in jurisdictions that have an intergovernmental agreement with the United States governing FATCA may be subject to different rules.
Added
Under the applicable Treasury Regulations and administrative guidance, withholding under FATCA generally applies to payments of dividends on our common stock, and subject to proposed Treasury Regulations described below, to payments of gross proceeds from the sale or other disposition of such stock.
Added
The United States Department of Treasury has released proposed Treasury Regulations (the preamble to which specifies that taxpayers may rely on them pending finalization) which would eliminate FATCA withholding on payments of gross proceeds from the sale or other disposition of our common stock.
Added
There can be no assurance that the proposed Treasury Regulations will be finalized in their present form. Prospective investors should consult their own tax advisors regarding the potential application of withholding under FATCA to an investment in our common stock.
Added
Backup Withholding and Information Reporting Backup withholding, currently at a rate of 24%, generally will not apply to dividends paid to a non-U.S. holder on, or to the gross proceeds paid to a non-U.S. holder from a disposition of, our common stock, provided that the non-U.S. holder furnishes the required certification for its non-U.S. status, such as by providing a valid IRS Form W-8BEN, IRS Form W-8BEN-E, IRS Form W-8ECI, or certain other requirements are met.
Added
Backup withholding may apply if the payor has actual knowledge, or reason to know, that the holder is a United States person who is not an exempt recipient. We are required to report annually to the IRS the amount of any dividends paid to a non-U.S. holder, regardless of whether we actually withheld any tax.
Added
Copies of the information returns reporting such dividends and the amount withheld may also be made available to the tax authorities in the country in which the non-U.S. holder resides under the provisions of an income tax treaty or other agreement between the United States and the tax authorities in such country.
Added
In addition, proceeds from the disposition by a non-U.S. holder of our common stock that is transacted within the United States or conducted through certain United States-related brokers generally will not be subject to backup withholding or information reporting if the applicable withholding agent receives the certification described above and does not have actual knowledge or reason to know that such holder is a United States person, or the holder otherwise establishes an exemption.
Added
Proceeds of a disposition of our common stock conducted through a non-U.S. office of a non-U.S. broker generally will not be subject to backup withholding or information reporting. Backup withholding is not an additional tax. The United States federal income tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld.
Added
If backup withholding results in an overpayment of taxes, a refund or credit may generally be obtained from the IRS, provided that the required information is timely furnished to the IRS. The preceding summary is for informational purposes only and is not tax advice.
Added
Each prospective investor should consult its own tax advisor regarding the particular United States federal, state and local and non-United States tax consequences of purchasing, holding and disposing of our common stock, including the consequences of any proposed change.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

59 edited+44 added−54 removed19 unchanged
Biggest changeSeveral items contributed to the increase, including: • a $3.4 million increase in directors and officers insurance expenses during the year ended December 31, 2022 in relation to the new director and officers insurance policy we entered into when we became a public company in June 2022.
Biggest changeSeveral items contributed to the increase, including: • a $15.0 million increase in non-cash stock-based compensation expense from $2.0 million for the year ended December 31, 2022 to $17.0 million for the year ended December 31, 2023 primarily due to Ivanhoe Electric stock option and RSU grants that have occurred from November 2022 onwards. • a $1.9 million increase in directors and officers insurance expenses from $3.4 million for the year ended December 31, 2022 to $5.3 million for the year ended December 31, 2023 in relation to the director and officers insurance policy that we entered into when we became a public company in June 2022; and • a $1.9 million increase in salary and wages from $2.0 million for the year ended December 31, 2022 to $4.7 million for the year ended December 31, 2023 due to adding more people to our management and administrative teams following our IPO in June 2022.
We have based these estimates on our current assumptions which may require future adjustments based on our ongoing business decisions as well as, in particular, exploration success at our mineral projects. Accordingly, we may require additional cash resources earlier than we currently expect or we may need to curtail currently planned exploration activities.
We have based these estimates on our current assumptions which may require future adjustments based on our ongoing business decisions as well as, in particular, exploration success at our mineral projects. Accordingly, we may require additional cash resources earlier than we currently expect or we may need to curtail currently planned activities.
Exploration expenses also include salaries, benefits and stock-based compensation expenses of the employees performing these activities. Exploration expenses also include payments under earn-in and option agreements where the option right is with respect to ownership interests in legal entities owning the underlying mineral project in the exploration project phase.
Exploration expenses also include salaries, benefits and non-cash stock-based compensation expenses of the employees performing these activities. Exploration expenses also include payments under earn-in and option agreements where the option right is with respect to ownership interests in legal entities owning the underlying mineral project in the exploration project phase.
Our investing activities generally relate to acquisitions of mineral property interests, purchases of public company shares in companies that we may partner with and capital expenditures at our projects. To date, due to our mining projects being in the exploration stage we have not incurred material capital expenditures.
Our investing activities generally relate to acquisitions of mineral property interests, purchases of shares in companies that we may partner with and capital expenditures at our projects. To date, due to our mining projects being in the exploration stage we have not incurred material capital expenditures.
In addition to the potential generation of future taxable income through the establishment of economic feasibility, development and operation of mines on our exploration assets, estimates of future taxable income could change in the event of disposal of assets, the identification of tax-planning strategies or changes in tax laws that would allow the benefits of future deductible temporary differences in certain entities or jurisdictions to be offset against future taxable temporary differences in other entities or jurisdictions.
In addition to the potential generation of future taxable income through the establishment of 115 Table of Contents economic feasibility, development and operation of mines on our exploration assets, estimates of future taxable income could change in the event of disposal of assets, the identification of tax-planning strategies or changes in tax laws that would allow the benefits of future deductible temporary differences in certain entities or jurisdictions to be offset against future taxable temporary differences in other entities or jurisdictions.
We generate revenue from our technology businesses. We have not generated any revenue from our mining projects and do not expect to generate any revenue from our mining projects for the foreseeable future. We have funded our operations primarily through the sale of our equity and convertible securities.
We have not generated any revenue from our mining projects and do not expect to generate any revenue from our mining projects for the foreseeable future. We have funded our operations primarily through the sale of our equity and convertible securities.
Prior to the maturity date, the convertible bond will be automatically converted into equity of VRB upon an equity financing or sale event, at a price per share equal to the lower of (A) the transaction price of the equity financing or sale event, and (B) the valuation cap price of $158.0 million divided by the total shares outstanding at the time of the event.
Prior to the maturity date, the convertible bond will be automatically 112 Table of Contents converted into equity of VRB upon an equity financing or sale event, at a price per share equal to the lower of (A) the transaction price of the equity financing or sale event, and (B) the valuation cap price of $158.0 million divided by the total shares outstanding at the time of the event.
In determining our valuation 99 Table of Contents allowance, we have not assumed future taxable income from sources other than the reversal of existing temporary differences. The extent to which a valuation allowance is warranted may vary as a result of changes in our estimates of future taxable income.
In determining our valuation allowance, we have not assumed future taxable income from sources other than the reversal of existing temporary differences. The extent to which a valuation allowance is warranted may vary as a result of changes in our estimates of future taxable income.
An accounting estimate is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that 98 Table of Contents reasonably could have been used or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact our financial statements.
An accounting estimate is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact our financial statements.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated and combined carve-out financial statements and the related notes to those statements included elsewhere in this Annual Report.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and the related notes to those statements included elsewhere in this Annual Report.
The licensing of certain software for a one-time fee of $6.5 million had a direct impact on gross profit as the licenses had no underlying carrying value and therefore resulted in a $6.5 million gross profit being recognized.
The 2022 licensing of certain software for a one-time fee of $6.5 million had a direct impact on gross profit as the licenses had no underlying carrying value and therefore resulted in a $6.5 million gross profit being recognized for the year ended December 31, 2022.
If no equity financing or sale event occurs, VRB must repay the outstanding principal and interest on maturity. Bridge Loan — Cordoba Minerals. In December 2022, JCHX advanced a bridge loan of $10 million to Cordoba Minerals in connection with the strategic arrangement for the joint development of Cordoba Mineral’s Alacran Project.
If no equity financing or sale event occurs, VRB must repay the outstanding principal and interest on maturity. Bridge Loan — Cordoba. In November 2023, JCHX advanced a short-term loan of $4 million to Cordoba in connection with the strategic arrangement for the joint development of Cordoba’s Alacran Project.
All references to common stock, options to purchase common stock, per share data and related information have been retrospectively adjusted to reflect the effect of the Reverse Stock Split for all periods presented.
The number of authorized shares and the par value of the common stock were not adjusted as a result of the Reverse Stock Split. All references to common stock, options to purchase common stock, per share data and related information have been retrospectively adjusted to reflect the effect of the Reverse Stock Split for all periods presented.
In the event we cease making expenditures on an exploration mineral project or fail to incur the agreed level of exploration expenditures, we will not obtain an ownership right beyond any which may have been acquired as of the date of termination. 92 Table of Contents During 2021, Cordoba’s San Matias project accounted for a significant portion of our exploration expenses.
In the event we cease making expenditures on an exploration mineral project or fail to incur the agreed level of 108 Table of Contents exploration expenditures, we will not obtain an ownership right beyond any which may have been acquired as of the date of termination.
In addition, VRB also recognized $0.3 million in revenue from the sale of electrolyte. VRB had a gross loss for the year ended December 31, 2022 of $1.8 million largely due to an inventory impairment of $1.9 million being recognized in relation to the termination of a tolling agreement with a producer of ammonium metavanadate.
VRB’s gross loss for the year ended December 31, 2022 was largely due to an inventory impairment of $1.9 million being recognized in relation to the termination of a tolling agreement with a producer of ammonium metavanadate.
The amount that is ultimately incurred for an individual uncertain tax position or for all uncertain tax positions in the aggregate could differ from the amount recognized. We had no uncertain tax positions as of December 31, 2022. Emerging Growth Company Status We are an “emerging growth company”, as defined in the JOBS Act.
The amount that is ultimately incurred for an individual uncertain tax position or for all uncertain tax positions in the aggregate could differ from the amount recognized. We had no uncertain tax positions as of December 31, 2023.
Cash Flows The following table presents our sources and uses of cash for the periods indicated: (In thousands) Year Ended December 31, 2022 Year Ended December 31, 2021 Net cash (used in) provided by: Operating activities (115,734) $ (47,832) Investing activities (48,384) (22,632) Financing activities 254,410 110,976 Effect of foreign exchange on cash (482) (3) Total change in cash $ 89,810 $ 40,509 Operating activities.
Cash Flows The following table presents our sources and uses of cash for the periods indicated: (In thousands) Year Ended December 31, 2023 Year Ended December 31, 2022 Net cash (used in) provided by: Operating activities (150,515) $ (115,734) Investing activities (150,766) (48,384) Financing activities 366,454 254,410 Effect of foreign exchange on cash 210 (482) Total change in cash $ 65,383 $ 89,810 Operating activities.
Off Balance Sheet Arrangements As of December 31, 2022, we were not involved in any off-balance sheet arrangements that have or are reasonably likely to have a material effect on our financial condition, results of operations, or liquidity.
Off Balance Sheet Arrangements As of December 31, 2023, we were not involved in any off-balance sheet arrangements that have or are reasonably likely to have a material effect on our financial condition, results of operations, or liquidity. Related Party Transactions See Note 19 of our consolidated financial statements for the years ended December 31, 2023 and 2022.
During the year ended December 31, 2022, we recorded a non-cash $19.0 million loss on revaluation of convertible debt which related to the convertible notes that were automatically converted into shares of common stock upon the completion of our initial public offering on June 30, 2022. 94 Table of Contents Revenue for the year ended December 31, 2022 was $8.4 million, an increase of $3.8 million from $4.7 million for the year ended December 31, 2021.
During the year ended December 31, 2022, we recorded a non-cash $19.0 million loss on revaluation of convertible debt which related to the convertible notes that were automatically converted into shares of common stock upon the completion of our initial public offering on June 30, 2022. There was no similar expense in 2023.
Our mineral projects focus on copper, nickel, vanadium, cobalt, platinum group elements, gold and silver. 90 Table of Contents “Our” mineral projects refers to our interests in such projects which may be a direct ownership interest in mineral titles (including through subsidiary entities), a right to acquire mineral titles through an earn-in or option agreement, or, in the case of our investments in publicly listed companies in Canada, through our ownership of the equity of those companies, that have an interest in such mineral projects.
References to our mineral projects refers to our interests in such projects which may be a direct ownership interest in mineral titles (including through subsidiary entities), a right to acquire mineral titles through an earn-in or option agreement, or, in the case of our investments in publicly listed companies in Canada, through our ownership of the equity of those companies that have an interest in such mineral project.
(In thousands, except per share amounts) Year Ended December 31, 2022 Year Ended December 31, 2021 Revenue $ 8,440 $ 4,652 Cost of sales (3,135) (1,520) Gross profit 5,305 3,132 Expenses: Exploration expenses 105,286 39,505 General and administrative expenses 26,971 20,402 Research and development expenses 5,040 3,825 Net loss attributable to: Common stockholders or parent 149,813 59,320 Comprehensive loss attributable to: Common stockholders or parent 149,501 59,284 Basic and diluted loss per share attributable to common stockholders or parent $ 1.91 $ 0.96 Total assets 260,486 153,531 Total non-current liabilities 40,606 85,134 91 Table of Contents Segments We account for our business in three business segments – (i) critical metals, (ii) data processing and software licensing services and (iii) energy storage systems.
(In thousands, except per share amounts) Year Ended December 31, 2023 Year Ended December 31, 2022 Revenue $ 3,903 $ 8,440 Cost of sales (2,986) (3,135) Gross profit 917 5,305 Expenses: Exploration expenses 126,719 105,286 General and administrative expenses 48,204 26,971 Research and development expenses 6,120 5,040 Net loss attributable to: Common stockholders or parent 199,377 149,813 Comprehensive loss attributable to: Common stockholders or parent 200,261 149,501 Basic and diluted loss per share attributable to common stockholders or parent $ 1.95 $ 1.91 Total assets 487,226 260,486 Total non-current liabilities 71,223 40,606 Segments We account for our business in three business segments – (i) critical metals, (ii) data processing and software licensing services and (iii) energy storage systems.
VRB’s energy storage system revenue represented 8.4% of our revenue for the year ended December 31, 2022 ($0.7 million) and 3.0% for the year ended December 31, 2021 ($0.1 million). During the year ended December 31, 2022, VRB delivered, installed and commissioned a 125kW/500kWh energy storage system to a customer which resulted in $0.3 million of revenue being recognized.
VRB’s energy storage system revenue represented 67% of our revenue for the year ended December 31, 2023 ($2.6 million) and 8% for the year ended December 31, 2022 ($0.7 million). During the year ended December 31, 2023, VRB delivered, installed and commissioned energy storage systems of 2.18MW/6.25MWh to customers, which resulted in $2.6 million of revenue being recognized.
These activities may or may not proceed to earn-in agreements depending on our evaluation. These are categorized as “Project generation and other”.
Included in exploration expenses are exploration costs that we incur in relation to generating new projects. These activities may or may not proceed to earn-in agreements depending on our evaluation. These are categorized as “Project generation and other”.
Net cash used in operating activities for the year ended December 31, 2022 was $115.7 million, a decrease of $67.9 million from the $47.8 million of net cash used for the year ended December 31, 2021. Investing activities.
Net cash used in operating activities for the year ended December 31, 2023 was $150.5 million, an increase of $34.8 million from the $115.7 million of net cash used for the year ended December 31, 2022. Investing activities.
Exploration expenses were $105.3 million for the year ended December 31, 2022 an increase of $65.8 million from $39.5 million for the year ended December 31, 2021.
Exploration expenses were $126.7 million for the year ended December 31, 2023 an increase of $21.4 million from $105.3 million for the year ended December 31, 2022.
During the year ended December 31, 2022, there was $254.4 million of net cash provided by financing activities representing the $159.3 million of net cash raised upon the closing of our initial public offering on June 30, 2022, and $86.2 million raised from the sale of the Series 2 Convertible Notes.
Our subsidiary, Cordoba, raised $39.5 million during the year ended December 31, 2023 in relation to financing its Alacran project through its strategic arrangement with JCHX. 113 Table of Contents During the year ended December 31, 2022, there was $254.4 million of net cash provided by financing activities representing the $158.1 million of net cash raised upon the closing of our initial public offering on June 30, 2022, and $86.2 million raised from the sale of the Series 2 Convertible Notes.
Related Party Transactions See Note 20 of our consolidated and combined carve-out financial statements for the years ended December 31, 2022 and 2021. Critical Accounting Estimates Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated and combined carve-out financial statements which have been prepared in accordance with U.S. GAAP.
Critical Accounting Estimates Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements which have been prepared in accordance with U.S. GAAP.
In addition, Cordoba Minerals, received a $10.0 million bridge loan from JCHX in connection with the strategic arrangement for the joint development of the Alacran Project. During the year ended December 31, 2021, cash provided by financing activities was $111.0 million.
In addition, Cordoba, received a $10.0 million bridge loan from JCHX in connection with the strategic arrangement for the joint development of the Alacran Project.
Our general and administrative expenses have increased significantly now that we are operating as a public company and have added to our management team.
General and Administrative Expenses Our general and administrative expenses consist of salaries and benefits, stock-based compensation, professional and consultant fees, insurance and other general administration costs. Our general and administrative expenses have increased significantly now that we are operating as a public company and have added to our management team.
Significant contributors to this increase in the year ended December 31, 2022 included an increase of $65.8 million in exploration expenditures, an increase of $14.4 million in non-cash loss on revaluation of 93 Table of Contents convertible debt and an increase of $6.6 million in general and administrative expenses, offset by an increase of $3.8 million in revenue compared to the year ended December 31, 2021.
Significant contributors to this increase in the year ended December 31, 2023 included an increase of $21.4 million in exploration expenditures, an increase of $21.2 million in general and administrative expenses, an increase of $32.2 million in share of loss of equity method investees, a decrease of $4.5 million in revenue compared to the year ended December 31, 2022 offset by a decrease of $19.0 million in non-cash loss on revaluation of convertible debt as compared to the year ended December 31, 2022.
CGI’s gross profit for the year ended December 31, 2022 was $7.2 million, a $4.1 million or 132% increase from $3.1 million for the year ended December 31, 2021.
VRB’s gross profit for the year ended December 31, 2023 was $0.1 million, a $2.0 million or 106% increase from the $1.8 million gross loss for the year ended December 31, 2022.
Significant Components of Results of Operations Revenue, Cost of Sales and Gross Profit We generate revenue from our technology businesses CGI and VRB, which are included in the data processing and energy storage systems business segments, respectively. We have not generated any revenue from our mining projects because they are in the exploration stage.
Significant Components of Results of Operations Revenue, Cost of Sales and Gross Profit We have not generated any revenue from our mining projects because they are in the exploration stage. We do not expect to generate any revenue from our mining projects for the foreseeable future.
Reverse Stock Split On June 16, 2022, we effected a reverse stock split of our outstanding common stock at a ratio of 3-for-1 (the “Reverse Stock Split”). The number of authorized shares and the par value of the common stock were not adjusted as a result of the Reverse Stock Split.
Our shares of common stock are listed on the NYSE American and the TSX under the ticker symbol “IE”. Reverse Stock Split On June 16, 2022, we effected a reverse stock split of our outstanding common stock at a ratio of 3-for-1 (the “Reverse Stock Split”).
Research and development expenses for the year ended December 31, 2022 were $5.0 million, an increase of $1.2 million from the same period in 2021 attributable to a $0.7 million an increase in research and development activity at CGI and a $0.4 million an increase at VRB.
Research and development expenses for the year ended December 31, 2023 were $6.1 million, an increase of $1.1 million from the same period in 2022. The increase is primarily attributable to incurring $2.9 million of Typhoon related research and development activities for the year ended December 31, 2023 compared to $0.2 million for the year ended December 31, 2022.
There are foreign exchange policies in the PRC that limit the amount of capital that can be directly transmitted offshore from VRB’s PRC subsidiaries to VRB.
There are foreign exchange policies in the PRC that limit the amount of capital that can be directly transmitted offshore from VRB’s PRC subsidiaries to VRB. Since their incorporation, these PRC subsidiaries have had accumulated losses and have not declared or paid any dividends or made any distribution of earnings.
Year Ended December 31, 2022 Year Ended December 31, 2021 Percentage change year-over-year (In thousands) Software licensing and data processing services: Revenue $ 7,729 $ 4,512 71 % Cost of sales (577) (1,427) (60) % Gross profit 7,152 3,085 132 % Energy storage systems: Revenue $ 711 $ 140 409 % Cost of sales $ (2,558) $ (93) 2664 % Gross (loss) profit (1,847) 47 -4028 % Total Revenue 8,440 4,652 81 % Cost of sales (3,135) (1,520) 106 % Gross profit 5,305 3,132 69 % CGI’s software licensing and data processing services to the mining and oil and gas industries represented 91.6% of our revenue for the year ended December 31, 2022 ($7.7 million) and 97.0% for the year ended December 31, 2021 ($4.5 million).
Year Ended December 31, 2023 Year Ended December 31, 2022 Percentage change year-over-year (In thousands) CGI: Software licensing and data processing services: Revenue $ 1,300 $ 7,729 (83) % Cost of sales (497) (577) (14) % Gross profit 803 7,152 (89) % VRB: Energy storage systems: Revenue $ 2,603 $ 711 266 % Cost of sales (2,489) (2,558) (3) % Gross profit (loss) 114 (1,847) 106 % Total Revenue $ 3,903 $ 8,440 (54) % Cost of sales (2,986) (3,135) (5) % Gross profit 917 5,305 (83) % 110 Table of Contents CGI’s software licensing and data processing services to the mining and oil and gas industries represented 33% of our revenue for the year ended December 31, 2023 ($1.3 million) and 92% for the year ended December 31, 2022 ($7.7 million).
Risk Factors for a further discussion of the potential adverse impact of COVID-19 on our business, results of operations, and financial condition. Selected Financial Information The selected financial information set forth below is presented in accordance with U.S. GAAP and is derived from our audited consolidated and combined carve-out financial statements for the years ended December 31, 2022 and 2021.
The sale of the shares closed on October 31, 2023. 107 Table of Contents Selected Financial Information The selected financial information set forth below is presented in accordance with U.S. GAAP and is derived from our audited consolidated financial statements for the years ended December 31, 2023 and 2022.
The use of the Black-Scholes option pricing model requires input estimation of the expected life of the option and volatility, which can have a significant impact on the valuation model and resulting expense recorded. In November 2022, we granted 2,760,509 stock options at an exercise price of $11.75 per share to certain officers and employees.
The use of the Black-Scholes option pricing model requires input estimation of the expected life of the option and volatility, which can have a significant impact on the valuation model and resulting expense recorded. We granted 950,000 stock options during the year ended December 31, 2023.
Recoverable value of exploration mineral interests We review and evaluate exploration mineral interests for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
We have outlined below those policies identified as being critical to the understanding of our business and results of operations and that require the application of significant management judgment in developing estimates. 114 Table of Contents Recoverable value of exploration mineral interests We review and evaluate exploration mineral interests for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
Currency by Denomination (in USD Equivalents) US dollars Canadian dollars Chinese Renminbi Colombian Pesos Other Total (In thousands) Jurisdiction of Entity: USA $ 117,827 $ 536 $ — $ — $ — $ 118,363 Colombia — — — 7,524 — 7,524 Cayman Islands 7,606 4 — — — 7,609 Canada 3,425 2,033 — — — 5,458 China — — 231 — — 231 British Virgin Islands 422 1 — — — 424 Other 16 1 — — 33 51 Total $ 129,297 $ 2,575 $ 231 $ 7,524 $ 33 $ 139,660 Our subsidiary VRB, domiciled in the Cayman Islands, is subject to certain foreign exchange restrictions with respect to its PRC subsidiaries.
Currency by Denomination (in USD Equivalents) US dollars Canadian dollars Chinese Renminbi Colombian Pesos Other Total (In thousands) Jurisdiction of Entity: USA $ 189,081 $ 188 $ — $ — $ — $ 189,269 Singapore 6,609 — — — — 6,609 Canada 2,905 475 — — — 3,380 Colombia — — — 3,233 — 3,233 China — — 930 — — 930 Cayman Islands 806 2 — — — 807 British Virgin Islands 683 2 — — — 685 Other 35 1 — — 94 130 Total $ 200,119 $ 667 $ 930 $ 3,233 $ 94 $ 205,043 Our subsidiary VRB, domiciled in the Cayman Islands, is subject to certain foreign exchange restrictions with respect to its PRC subsidiaries.
(In thousands) Year Ended December 31, 2022 Year Ended December 31, 2021 Revenues: CGI: Software licensing and data processing services $ 7,729 $ 4,512 VRB: Energy storage systems 711 140 Total $ 8,440 $ 4,652 Cost of sales: CGI: Software licensing and data processing services $ 577 $ 1,427 VRB: Energy storage systems 2,558 93 Total $ 3,135 $ 1,520 Gross profit: CGI: Software licensing and data processing services $ 7,152 $ 3,085 VRB: Energy storage systems (1,847) 47 Total $ 5,305 $ 3,132 Exploration Expenses Exploration expenses include topographical, geological, geochemical and geophysical studies, exploratory drilling, trenching, sampling and activities in relation to identifying a mineral resource and then evaluating the technical feasibility and commercial viability of extracting the mineral resource, as well as value-added taxes in relation to these direct exploration and evaluation costs incurred in foreign jurisdictions where recoverability of those taxes is uncertain.
Exploration Expenses Exploration expenses include topographical, geological, geochemical and geophysical studies, exploratory drilling, trenching, sampling and activities in relation to identifying a mineral resource and then evaluating the technical feasibility and commercial viability of extracting the mineral resource, as well as value-added taxes in relation to these direct exploration and evaluation costs incurred in foreign jurisdictions where recoverability of those taxes is uncertain.
Also in November 2022, we granted 750,000 RSU’s to our incoming CEO which had a fair value on the grant date of $9.98 per share. 95 Table of Contents Liquidity, Capital Resources and Capital Requirements Cash Resources We have recurring net losses and negative operating cash flows and we expect that we will continue to operate at a loss for the foreseeable future.
Liquidity, Capital Resources and Capital Requirements Cash Resources We have recurring net losses and negative operating cash flows and we expect that we will continue to operate at a loss for the foreseeable future. We generate revenue from our technology businesses.
The following assumptions were used to compute the fair value of the options granted: Grant Date Risk-free interest rate 4.2% Dividend yield nil Estimated volatility 69.5% Expected option life 4 years The risk-free interest rate assumption was based on the U.S. treasury constant maturity yield at the date of the grant over the expected life of the option.
The table below details the options granted and the Black-Scholes option pricing model assumptions used to compute the fair value of the options: February 1, 2023 Grant Date March 1, 2023 Grant Date July 1, 2023 Grant Date August 9, 2023 Grant Date November 1, 2023 Grant Date Number of options granted 500,000 100,000 100,000 200,000 50,000 Exercise price $13.23 $15.46 $13.04 $16.03 $11.75 Black-Scholes option-pricing model fair value $7.22 $8.53 $6.95 $8.46 $5.96 Black-Scholes option-pricing model assumptions: Risk-free interest rate 3.7% 4.5% 4.4% 4.4% 4.2% Dividend yield nil nil nil nil nil Estimated volatility 69.8% 69.5% 66.2% 65.4% 64.7% Expected option life 4 years 4 years 4 years 4 years 4 years The risk-free interest rate assumption was based on the U.S. treasury constant maturity yield at the date of the grant over the expected life of the option.
Net cash used in investing activities for the year ended December 31, 2022 of $48.4 million was mainly attributable to $35.9 million for payments for mineral interests and $8.5 million for payments for property, plant and equipment.
Net cash used in investing activities for the year ended December 31, 2023 of $150.8 million was mainly attributable to $80.5 million related to acquisitions of exploration properties and $68.7 million for purchases of investments subject to significant influence.
Business — Mineral Project Obligations and Payments. Cash Balances as of December 31, 2022 The table below discloses the amounts of cash disaggregated by currency denomination as of December 31, 2022 in each jurisdiction that our affiliated entities are domiciled.
However, there can be no assurance that we will be successful in our efforts to raise additional capital on terms favorable to us, or at all. Cash Balances as of December 31, 2023 The table below discloses the amounts of cash disaggregated by currency denomination as of December 31, 2023 in each jurisdiction that our affiliated entities are domiciled.
Of the total cash and cash equivalents at December 31, 2022, and December 31, 2021, $20.7 million and $28.5 million, respectively, was not available for the general corporate purposes of the Company as these amounts were held by non-wholly-owned subsidiaries.
Of the total cash and cash equivalents at December 31, 2023, and December 31, 2022, $15.0 million and $20.7 million, respectively, was not available for the general corporate purposes of the Company as these amounts were held by non-wholly-owned subsidiaries. 111 Table of Contents As at February 26, 2024, we believe that we will have sufficient cash resources to carry out our business plans for at least the next 12 months, after which we expect to need additional financing to further advance our projects and conduct our business.
Activities during the year ended December 31, 2022 at Santa Cruz were focused on a program of exploration and infill resource, geotechnical, hydrological and metallurgical drilling, advancing technical studies along with completing an Updated Mineral Resource estimate for the Santa Cruz Copper Project. In addition, a 26.5 km2 (6,500 acre) Typhoon™ 3D IP survey that was completed in July 2022.
Activities during the year ended December 31, 2023, at Santa Cruz were focused on a program of exploration and infill resource, geotechnical, hydrological and metallurgical drilling, advancing technical studies, completing the updated mineral resource estimate released in February 2023 and the finalization of the IA and the National Instrument 43-101 Preliminary Assessment and Technical Report ("PEA") which were released on September 6, and September 11, 2023. • the San Matias Project where $28.1 million of exploration expenditure was incurred by Cordoba in the year ended December 31, 2023 compared to $18.5 million in the year ended December 31, 2022.
During the year ended December 31, 2022, expenditures largely focused on exploration activities at: • the Santa Cruz Project where $61.2 million of exploration expenditure was incurred in the year ended December 31, 2022 compared to $10.0 million incurred in the year ended December 31, 2021.
Drilling has focused on deep targets guided by geophysical data; and • the Hog Heaven Project in Montana where $7.8 million of exploration expenditure was incurred in the year ended December 31, 2023 compared to $2.2 million in the year ended December 31, 2022.
(In thousands) Year Ended December 31, 2022 Year Ended December 31, 2021 Research and development expenses: CGI: Software licensing and data processing services $ 3,342 $ 2,606 VRB: Energy storage systems 1,453 1,031 Other 245 188 Total $ 5,040 $ 3,825 Year Ended December 31, 2022 Compared to Year Ended December 31, 2021 For the year ended December 31, 2022 we recorded a net loss attributable to common stockholders of $149.8 million ($1.91 per share), compared to $59.3 million ($0.96 per share) for the year ended December 31, 2021, which was an increase of $90.5 million.
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022 For the year ended December 31, 2023 we recorded a net loss attributable to common stockholders of $199.4 million ($1.95 per share), compared to $149.8 million ($1.91 per share) for the year ended December 31, 2022, which was an increase of $49.6 million.
General and administrative expenses were $27.0 million for the year ended December 31, 2022, an increase of $6.6 million from $20.4 million in the year ended December 31, 2021.
During 2023, we completed 12 drill holes, totaling 10,905 meters. In November 2023, we conducted a Typhoon TM geophysical survey covering approximately 10 km 2 of land. General and administrative expenses were $48.2 million for the year ended December 31, 2023, an increase of $21.2 million from $27.0 million in the year ended December 31, 2022.
Since their incorporation, these PRC subsidiaries have had accumulated losses and have not declared or paid any dividends or made any distribution of earnings. 96 Table of Contents There were no cash transfers to or from our PRC subsidiaries in the form of intercompany loans during the years ended December 31, 2022 and 2021.
There were no cash transfers to or from our PRC subsidiaries in the form of intercompany loans during the years ended December 31, 2023 and 2022. Refer to Note 17 of our consolidated financial statements which outlines other restrictions on transfers of net assets from our consolidated subsidiaries to the Company.
The gross proceeds from the offering were approximately $169.1 million, before deducting underwriting discounts and commissions and estimated offering expenses payable by us. At December 31, 2022, and 2021, we had cash and cash equivalents of $139.7 million and $49.9 million, respectively, and a working capital of $133.6 million and $17.7 million, respectively.
At December 31, 2023, and 2022, we had cash and cash equivalents of $205.0 million and $139.7 million, respectively, and a working capital of $176.8 million and $133.6 million, respectively.
Revenue from this customer represented 82%, and 74% of sales for the years ended December 31, 2022 and 2021. During the fourth quarter of 2021, CGI entered into a new agreement with this customer whereby it agreed to license certain software for a one-time fee of $6.5 million, which was received and recognized in the first quarter of 2022.
The decrease of $6.4 million in CGI’s revenue from 2023 to 2022 was a direct result of the year ended December 31, 2022 including revenue from a customer who licensed certain software from CGI for a one-time fee of $6.5 million.
This agreement resulted in $6.9 million of revenue from this customer being recognized in the year ended December 31, 2022. We cannot provide any assurance that we will enter into any additional contracts with this customer in the future.
There were no similar agreements in 2023 and we cannot provide any assurance that CGI will enter into any similar contracts in the future. CGI’s gross profit for the year ended December 31, 2023 was $0.8 million, a $6.3 million or 89% decrease from $7.2 million for the year ended December 31, 2022.
A summary of our significant accounting policies is detailed in Note 3 to our consolidated and combined carve-out financial statements included in this Annual Report. We have outlined below those policies identified as being critical to the understanding of our business and results of operations and that require the application of significant management judgment in developing estimates.
A summary of our significant accounting policies are detailed in Note 2 to our consolidated financial statements included in this Annual Report.
We believe the United States is significantly underexplored and will yield major new discoveries of these metals.
(“CGI”), to accelerate and de-risk the mineral exploration process as we seek to discover new deposits of critical metals that may otherwise be undetectable by traditional exploration technologies. We believe the United States is significantly underexplored and has the potential to yield major new discoveries of critical metals.
The $14.4 million of cash used for purchases of mineral interests related to $8.5 million of payments related to the Santa Cruz Project and $5.7 million of payments for the Tintic Project. Financing activities.
The $80.5 million of payments for mineral interests included $76.6 million paid to acquire land at the Santa Cruz Project and $3.5 million of option payments at our Tintic Project. The $68.7 million for purchases of investments subject to significant influence primarily consists of our $66.0 million investment in the Ma'aden Joint Venture. Financing activities.
We expect higher costs related to salaries, benefits, stock-based compensation, legal fees, compliance and corporate governance, accounting and audit expenses, stock exchange listing fees, transfer agent and other shareholder-related fees, directors’ and officers’ and other insurance costs and other administrative costs.
In particular, we incurred increased general and administrative expenses costs in 2023 compared to 2022 for salaries, non-cash stock-based compensation, compliance related costs and directors’ and officers’ insurance expense.
The agreement also provided for $0.5 million of service fees payable in two installments, one in the first quarter of 2022 and one in the first quarter of 2023. This agreement resulted in $6.9 million of revenue from this customer being recognized in the year ended December 31, 2022.
Revenue for the year ended December 31, 2023 was $3.9 million, a decrease of $4.5 million from $8.4 million for the year ended December 31, 2022.
Removed
See “Cautionary Note Regarding Forward-Looking Statements.” Separation from HPX We were incorporated under the laws of the State of Delaware on July 14, 2020, as a wholly-owned subsidiary of HPX.
Added
See “Cautionary Note Regarding Forward-Looking Statements.” Business Overview We are a United States domiciled company that combines advanced mineral exploration technologies with electric metals exploration projects predominantly located in the United States. We use our accurate and powerful Typhoon™ geophysical surveying system, together with advanced data analytics provided by our 94.3% owned subsidiary, Computational Geosciences Inc.
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On April 30, 2021, HPX completed a reorganization whereby HPX contributed (i) all of the issued and outstanding shares of HPX’s subsidiaries, other than those holding direct or indirect interests in its Nimba Iron Ore Project in Guinea; (ii) certain property, plant and equipment; and (iii) certain financial assets in exchange for shares of our common stock.
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Our mineral exploration efforts focus on copper as well as other metals including nickel, vanadium, cobalt, platinum group elements, gold and silver.
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HPX then distributed the shares of our common stock to HPX stockholders by way of a dividend, with each HPX stockholder receiving one share of our common stock for each HPX share of common stock then held by the stockholder. The Company has historically operated as part of the HPX business and not as a standalone company.
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Through the advancement of our portfolio of electric metals exploration projects, headlined by the Santa Cruz Project in Arizona and the Tintic Project in Utah, as well as other exploration projects in the United States, we intend to support the United States' supply chain independence by finding and delivering critical metals necessary for the electrification of the economy.
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Financial information for historical periods presented prior to April 30, 2021, the spinoff date, were derived from the consolidated financial statements and accounting records of HPX prepared on a carve-out and combined basis.
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We also operate a 50/50 joint venture with Saudi Arabian Mining Company Ma’aden ("Ma'aden") to explore for minerals on ~48,500 km 2 of underexplored Arabian Shield in Saudi Arabia. Finally, in addition to our mineral projects, we also own a 90.0% controlling interest in VRB Energy Inc.
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The combined carve-out financial information may not be indicative of our future performance and does not necessarily reflect what the financial position, results of operations, and cash flows would have been had we operated as an independent company during such periods, particularly because of changes arising subsequently as a result of the separation, including changes in the financing, cash management, operations, cost structure, and personnel needs of our business.
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("VRB") which is primarily engaged in the design, manufacture, installation, and operation of vanadium redox flow energy storage systems. At our Santa Cruz Project in Arizona, we are evaluating the potential for a high-grade modern underground copper mining operation.
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The combined carve-out financial information for periods prior to April 30, 2021 included certain assets and liabilities that were historically held at the HPX corporate level, but are specifically identifiable to or otherwise attributable to us. Prior to completing the spinoff, HPX incurred corporate and technical costs attributable to the Company and the Nimba Iron Ore Project.
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In September 2023, we completed the Initial Assessment & Technical Report Summary for the Santa Cruz Project (the "IA"), which outlines a potential 5.9 million tonnes per year underground mining operation, supported by 105.2 million tonnes of modeled mill feed with an average grade of 1.58% copper from the Santa Cruz and East Ridge Deposits, resulting in an estimated 20-year mine life.
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Accordingly, the combined carve-out financial information includes cost allocations from HPX, including executive oversight, occupancy, office overhead, accounting, tax, treasury, legal, information technology, human resources and mineral exploration. These allocations were made on the basis of direct usage.
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We are advancing further studies for an underground copper mining operation with a focus on minimizing the surface footprint of the mine while at the same time incorporating leading technologies to improve efficiencies and costs.
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All such amounts were deemed incurred and settled by the Company in the period in which the costs were recorded and are included in net parent investment in the consolidated financial statements up to the date of the spinoff.
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We are designing a technologically advanced mine that we expect to result in low carbon dioxide emissions per pound of copper produced and be a leading example of responsibly produced domestic copper.
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Allocated costs for the period from January 1, 2021 to April 30, 2021 totaled $1.3 million and were primarily included in general and administrative expenses and exploration expenses in the consolidated statements of loss.
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Key considerations that will influence our decision making include, but are not limited to, using clean and renewable energy in our future mining operations, optimizing and minimizing our water utilization, minimizing our environmental footprint, ensuring workforce diversity and hiring from local communities, health, safety and environmental performance, support of local cultural heritage and biodiversity protection.
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Initial Public Offering On June 30, 2022, we completed an initial public offering of 14,388,000 shares of our common stock at a price of $11.75 per share, resulting in gross proceeds from the offering of $169.1 million. The Company’s shares were listed on the NYSE American and the TSX under the ticker symbol “IE”.
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Business Developments in the Year On May 15, 2023, we signed a Common Stock Subscription Agreement ("the Subscription Agreement") with Ma’aden. On July 6, 2023, we completed the closing of the transactions contemplated by the Subscription Agreement (the 106 Table of Contents “Ma’aden Transactions”) and entered into an investor rights agreement, a shareholders’ agreement and the other instruments contemplated thereby.
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Business Overview We are a United States domiciled minerals exploration and development company with a focus on developing mines from mineral deposits principally located in the United States in order to support American supply chain independence and to deliver the critical metals necessary for electrification of the economy.

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