Company: PRMLF
Filing Date: 2025-05-13
Form Type: 10-Q
Source: 0001641172-25-010011
Chunk: 108

Company: NexMetals Mining Corp.
Filing Date: 2025-05-13
Form: 10-Q
Item: Item 2
Chunk 108
---
 underlying projects are
in the exploration stage, the fair value of the call and put on the options as at March 31, 2025 and December 31, 2024 is $nil.

Interest Rate Risk

The Company’s exposure to interest rate
risk arises from the interest rate impact on its cash and cash equivalents and debt facilities. Interest payable on the vehicle financing
is based upon a variable base rate, being the lending institution’s prime lending rate, plus a fixed rate margin.

Foreign Currency Exchange Risk

The Company primarily operates in Canada, Barbados
and Botswana and undertakes transactions denominated in foreign currencies such as the US dollar and Botswana pula, and consequently is
exposed to exchange rate risks. The value of cash and other financial assets and liabilities denominated in foreign currencies can fluctuate
with changes in currency exchange rates. Exchange risks are managed by matching levels of foreign currency balances with the related obligations
and by maintaining operating cash accounts in non-Canadian dollar currencies.

The following table illustrates the estimated
impact a 5% USD and BWP change against the CAD would have on net loss before tax as a result of translating the Company’s foreign
denominated financial instruments:

    Currency 
    Change  
    Effect on Net Loss (Earnings) Before Tax $  
    Change  
    Effect on Net Loss (Earnings) Before Tax $ 
  
    USD 
     +5%  
     (125,808) 
     -5%  
     125,808 
  
    BWP 
     +5%  
     86,146  
     -5%  
     (86,146)

Credit Risk

The Company’s credit risk is primarily associated
with its cash and cash equivalents. The Company’s exposure to credit risk arises from the potential default of the counterparty
to its cash and cash equivalents, and the maximum exposure is limited to the carrying value of these instruments. The Company limits exposure
to credit risk on its cash and cash equivalents by holding these instruments at highly-rated financial institutions.

Liquidity Risk

Liquidity risk is the risk that the Company
will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another
financial asset. The Company manages the liquidity risk inherent in these financial obligations by regularly monitoring actual cash flows
against its annual budget, which forecasts expected cash availability to meet future obligations. The Company will defer discretionary
expenditures, as