NOTE 3 — GOING CONCERN

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As of April 30, 2021, the Company had cash of approximately $13.6 million, working capital of approximately $13.5 million and an accumulated deficit of approximately $44.0 million. The Company had a net loss and cash used in operating activities of approximately $12.4 million and $8.6 million, respectively, for the year ended April 30, 2021. As a result of the utilization of cash in its operating activities, and the development of its assets, the Company has incurred losses since it commenced exploration operations. The Company’s primary source of operating funds since inception has been equity financings. As of the date of filing the annual report for the year ended April 30, 2021, the Company had sufficient cash to fund its operations for approximately 9 to 12 months and expects that it would be required to raise additional funds to fund its operations thereafter. The ongoing COVID-19 pandemic has and may continue to adversely impact the Company’s business, as the Company’s operations are based in and rely on third parties located in areas affected by the pandemic. These matters raise substantial doubt about the Company’s ability to continue as a going concern for the twelve months following the issuance of these financial statements.

Additionally, on February 1, 2021, the Company closed the transaction under the securities purchase agreement (the “February 2021 Purchase Agreement”) with certain institutional and accredited investors (the “Purchasers”). Pursuant to the February 2021 Purchase Agreement, the Company issued and sold to the Purchasers (i) in a registered direct offering (the “Offering”) an aggregate of 914,136 shares of the Company’s common stock at a price of $10.54 per share and (ii) in a concurrent private placement warrants to purchase an aggregate of 457,068 shares of common stock at an exercise price of $14.50 per share for aggregate gross proceeds from the Offering of approximately $9.6 million (see Note 8).

There can be no assurance that the Company will be able to raise additional capital or if the terms will be favorable.

The consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset amounts or the classification of liabilities that might be necessary should the Company be unable to continue as a going concern.