Consolidated Financial Statements of
CONSTANTINE METAL RESOURCES LTD.
(Expressed in Canadian Dollars)
For the years ended October 31, 2015 and 2014
S u i t e 3 20 - 8 0 0 W e s t P e n d e r S t . , V a n c o u ve r , B . C . C an a d a V 6 C 2 V 6
P h o n e ( 6 0 4 ) 6 2 9- 2 3 4 8 F a x ( 6 0 4 ) 6 0 8 - 3 8 7 8
INDEPENDENT AUDITORS’ REPORT
To the Shareholders of Constantine Metal Resources Ltd.,
We have audited the accompanying consolidated financial statements of Constantine Metal Resources Ltd. (“the
Company”), which comprise the consolidated statements of financial position as at October 31, 2015 and 2014 and the
consolidated statements of loss and comprehensive loss, cash flows and changes in equity for the years then ended, and a
summary of significant accounting policies and other explanatory information.
Management’s Responsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in
accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board,
and for such internal control as management determines is necessary to enable the preparation of consolidated financial
statements that are free from material misstatement, whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted
our audits in accordance with Canadian generally accepted auditing standards. Those standards require that we comply
with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the consolidated financial
statements are free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated
financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of
material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the
consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating
the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as
well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of
Constantine Metal Resources Ltd. as at October 31, 2015 and 2014 and its financial performance and its cash flows for the
years then ended in accordance with International Financial Reporting Standards as issued by the International Accounting
Standards Board.
Emphasis of Matter
Without qualifying our opinion, we draw attention to Note 1 in the financial statements which indicates that the Company
has limited working capital, no current sources of revenue and is dependent upon its ability to secure new sources of
financing. These conditions, along with other matters as set forth in Note 1, indicate the existence of a material
uncertainty that may cast significant doubt about the Company's ability to continue as a going concern.
CHARTERED PROFESSIONAL ACCOUNTANTS
Vancouver, Canada
February 9, 2016
Consolidated Statements of Financial Position
As at October 31, 2015 and 2014
(Expressed in Canadian dollars)
Assets
Current assets:
Cash
Amounts receivable
Exploration costs recoverable from joint venture partner (Note 5a)
Available-for-sale investments (Note 4)
Advances and prepaid expenses
Deposits
Exploration and evaluation properties (Note 5)
Performance bonds
Equipment
Liabilities
Current liabilities:
Trade payables and accrued liabilities
Deferred recovery of exploration costs (Note 5a)
Amount due to joint venture partner
Amounts due to related parties (Note 7)
Equity
Share capital (Note 6)
Stock options reserve (Note 6b)
Warrants reserve
Available-for-sale investments reserve (Note 4)
Deficit
Nature of Operations and Going Concern (Note 1)
Commitments (Note 12)
Event Subsequent to the End of the Reporting Period (Note 13)
On Behalf of the Board of Directors:
“J. Garfield MacVeigh”
___________________________
Director
See accompanying notes to consolidated financial statements.
2015
2014
$
396,069
39,965
238,334
31,074
21,030
726,472
$
587,481
11,819
-
100,990
31,864
732,154
19,887
13,176,501
32,688
2,968
27,835
14,419,903
28,178
8,429
$
13,958,516
$
15,216,499
$
282,643
-
-
3,199
285,842
$
198,569
34,976
23,802
3,966
261,313
20,326,015
1,535,432
432,941
(95,953)
(8,525,761)
20,250,228
1,409,174
432,941
(26,037)
(7,111,120)
13,672,674
14,955,186
$
13,958,516
$
15,216,499
“G. Ross McDonald”
___________________________
Director
2
Consolidated Statements of Loss and Comprehensive Loss
For the years ended October 31, 2015 and 2014
(Expressed in Canadian dollars)
Expenses:
Amortization
Consulting
General and administrative
Insurance
Legal
Professional fees – audit
Salaries, wages and benefits
Rent (net)
Share-based payments (Note 6b)
Shareholder communications
Travel
Loss from operations
Other Items:
Gain on foreign exchange
Write-off of exploration and evaluation properties (Note 5c)
Recovery of exploration properties previously written off
Loss on sale of available-for-sale investments (Note 4)
Net loss for the year
Other comprehensive income (loss)
Change in available-for-sale investments (Note 4)
Comprehensive loss for the year
Basic and diluted loss per share
2015
2014
$
5,461
39,137
200,410
38,222
5,107
21,360
36,037
70,364
126,258
6,487
9,684
(558,527)
$
10,447
17,776
156,205
33,581
9,874
18,000
128,994
57,675
187,487
29,352
8,499
(657,890)
2,104
(858,218)
-
-
53,534
(457,256)
12,500
(38,250)
(1,414,641)
(1,087,362)
(69,916)
111,611
$ (1,484,557)
$
(0.01)
$
$
(975,751)
(0.01)
Weighted average number of common shares outstanding
116,666,384
116,201,597
See accompanying notes to consolidated financial statements.
3
Consolidated Statements of Cash Flows
For the years ended October 31, 2015 and 2014
(Expressed in Canadian dollars)
Cash provided by (used in):
Operations:
Net loss for the year
Items not affecting cash:
Amortization
Share-based payments (Note 6b)
Write-off of exploration and evaluation properties (Note 5b(v))
Loss on available-for-sale investments (Note 4)
Recovery of exploration properties amount previously written off
Changes in non-cash working capital accounts:
Amounts receivable
Deposits
Amount due to joint venture partner
Trade payables and accrued liabilities
Recovery of exploration costs (Note 5a)
Reclamation bonds
Amounts due to related parties (Note 7)
Advances and prepaid expenses
Investing activities:
Exploration and evalution properties (Note 5)
Recovery of exploration and evalution property expenditures (Note 5a)
Proceeds from sale of available-for-sale investments (Note 4)
Increase (decrease) in cash
Cash, beginning of year
Cash, end of year
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Accounts payable related to exploration and evaluation properties
Value of shares issued for success fee on Palmer option agreement (Notes 5a and 6a)
Interest received
Value of shares issued for mineral properties (Note 6a)
See accompanying notes to consolidated financial statements.
2015
2014
$
(1,414,641)
$
(1,087,362)
5,461
126,258
858,218
-
-
(28,146)
7,948
(23,802)
(4,962)
(273,310)
(4,510)
(767)
10,834
(741,419)
10,447
187,487
457,256
38,250
(12,500)
349
6,720
(5,683)
(4,750)
143,830
(28,178)
(14,741)
2,126
(306,749)
(6,588,919)
7,138,926
-
(7,389,637)
8,028,060
74,250
550,007
712,673
$
$
(191,412)
587,481
396,069
265,659
69,067
-
6,720
$
$
405,924
181,557
587,481
176,623
-
-
23,691
4
Consolidated Statements of Changes in Equity
For the years ended October 31, 2015 and 2014
(Expressed in Canadian dollars)
Share Capital
Reserves
Number of Shares Capital Stock
Stock
Options
Warrants
Available-
for-Sale
Investments
Deficit
Total Equity
116,008,665
$
20,226,538
$
1,221,687
$
432,941
$
(137,648)
$
(6,023,758)
$
15,719,760
-
-
-
-
-
-
-
-
187,487
-
-
-
-
(1,087,362)
(1,087,362)
111,611
-
-
-
111,611
187,487
296,000
116,304,665
-
$
23,690
20,250,228
-
-
1,409,174
$
-
-
432,941
$
-
$
-
(26,037)
-
$
-
(7,111,120)
(1,414,641)
$
23,690
14,955,186
(1,414,641)
-
-
-
-
-
126,258
541,336
75,787
-
-
-
-
(69,916)
-
-
-
-
-
(69,916)
126,258
75,787
Balance, October 31, 2013
Net loss for the year
Unrealized gain (loss)on available-for-sale
investments (Note 4)
Share-based payments
Shares issued for exploration and
evaluation properties (Note 6a)
Balance, October 31, 2014
Net loss for the year
Unrealized gain (loss)on available-for-sale
investments (Note 4)
Share-based payments (Note 6b)
Shares issued for exploration and
evaluation properties (Note 6a)
Balance, October 31, 2015
116,846,001
$
20,326,015
$
1,535,432
$
432,941
$
(95,953)
$
(8,525,761)
13,672,674
See accompanying notes to consolidated financial statements.
5
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
1. Nature of Operations and Going Concern
The Company is in the business of acquiring interests in resource properties that are considered to be sites
of potential economic mineralization, and then subsequently developing such assets with a view to
enhancing their value and to bringing on a major mining partner for development of the assets. The
Company may sell property for an enhanced value or seek a major mining partner to advance one of its
projects on a joint venture basis. Currently the Company is principally engaged in the exploration of mineral
properties which cannot be considered economic until a commercial feasibility study has been completed.
The Company has no sources of operating revenue and, except for cash flow generated from exploration
management fees, property option fees and sale of available-for-sale investments, is dependent upon equity
financing to maintain current operations and to ultimately develop a mineral property interest or interests
which can be profitably sold or further developed and placed into successful commercial production.
The Company has not generated any revenue since inception and has never paid any dividends and is
unlikely to pay dividends or generate earnings in the immediate or foreseeable future. As at October 31,
2015, the Company has incurred losses since inception and has an accumulated operating deficit of
$8,525,761. The continuation and long-term viability of the Company remains dependent upon its ability to
obtain necessary equity financing to continue operations and to determine the existence, discovery and
successful exploitation of economically recoverable reserves in its resource properties, confirmation of the
Company’s interests in the underlying properties, and the attainment of profitable operations.
To continue operations the Company will have to raise additional funds and while it has been successful in
doing so in the past, there can be no assurance it will be able to do so in the future. These financial
statements reflect no adjustments which may become necessary in the event that the Company is unable to
continue as a going concern. These conditions indicate the existence of material uncertainties that cast
significant doubt that the Company will be able to continue on a going concern basis.
The head office and principal address of the Company is #320 – 800 West Pender Street, Vancouver, British
Columbia, Canada, V6C 2V6.
2. Basis of Preparation
a) Statement of Compliance
The accompanying financial statements have been prepared in accordance with the International Financial
Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The
accounting policies, methods of computation and presentation applied in these financial statements are
consistent with those of the previous financial year.
b) Approval of Consolidated Financial Statements
These consolidated financial statements of the Company for the years ended October 31, 2015 and 2014
were approved and authorized for issue by the Board of Directors on February 9, 2016.
These consolidated financial statements include the accounts of the Company and its 100% controlled entity,
Constantine North Inc. (an Alaska corporation).
Inter-company balances and transactions, including unrealized income and expenses arising from inter-
company transactions, are eliminated on consolidation.
6
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
2. Basis of Preparation (continued)
c) Adoption of New Standards
At the date of authorization of these consolidated financial statements, the IASB and IFRS Interpretations
Committee (“IFRIC”) have issued the following new and revised standards and interpretations.
During the year ended October 31, 2015, the following standards were adopted but have had no material
impact on the consolidated financial statements of the Company:
i)
ii)
iii)
iv)
v)
vi)
vii)
IFRS 7 (Amendment): This standard is amended to enhance disclosure requirements related to
offsetting of financial assets and financial liabilities.
IFRS 10: New standard to establish principles for the presentation and preparation of
consolidated financial statements.
IFRS 11: New standard to account for the rights and obligations in accordance with a joint
agreement
IFRS 12: New standard for the disclosure of interest in other entities not within the scope of
IFRS 13: New standard on the measurement and disclosure of fair value.
IAS 27 (Amendment): As a result of the issue of IFRS 10, IFRS 11 and IFRS 12. IAS 27 deals
solely with separate financial statements.
IAS 28 (Amendment): New standard issued that supersedes IAS 28 (2003) to prescribe the
application of the equity method to investments in associates and joint ventures.
d) New standards and interpretations not yet adopted
Other accounting standards or amendments to existing accounting standards that have been issued but have
future effective dates are either not applicable or are not expected to have a significant impact on the
Company’s financial statements.
The Company has not early adopted these standards and is currently assessing the impact these standards
will have on its financial statements.
i)
ii)
IFRS 9: New standard that replaced IAS 39 for classification and measurement of financial
assets, effective for annual periods beginning on or after January 1, 2018;
IAS 32 (Amendment): Standard amended to clarify requirements for offsetting financial assets
and financial liabilities, effective for annual periods beginning on or after January 2014.
3. Significant Accounting Policies
a) Judgments and estimates
The preparation of these consolidated financial statements requires management to make judgments,
estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities,
revenues and expenses. The estimates and associated assumptions are based on historical experience and
various other factors that are believed to be reasonable under the circumstances and which form the basis of
making judgments about carrying values of assets and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates. The estimates and underlying assumptions are
reviewed on an on-going basis. Revisions to accounting estimates are recognized in the period in which the
estimate is revised, if the revision affects only that period, or in the period of the revision and further periods
if the revision affects both current and future periods.
7
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
3. Significant Accounting Policies (continued)
Significant areas requiring the use of estimates relate to the determination of impairment of exploration and
evaluation properties, determination of mineral reserves, and provision for closure and reclamation.
b) Foreign currency translation
The functional and reporting currency of the Company and its subsidiary is the Canadian dollar.
Transactions in currencies other than the functional currency are recorded at the rate of exchange prevailing
on the dates of transactions. Monetary assets and liabilities that are denominated in foreign currencies are
translated at the rates prevailing at each reporting date. Non-monetary assets and liabilities denominated in
foreign currencies that are measured at fair value are retranslated to the functional currency at the exchange
rate at the date the fair value was determined. Non-monetary items that are measured in terms of historical
cost in a foreign currency are not retranslated. Foreign currency translation differences are recognized in
profit or loss, except for differences on the retranslation of available-for-sale instruments, which are
recognized in other comprehensive loss.
c) Exploration and Evaluation Properties
Costs directly related to the exploration and evaluation of resource properties are capitalized once the legal
rights to explore the resource properties are acquired or obtained. When the technical and commercial
viability of a mineral resource have been demonstrated and a development decision has been made, the
capitalized costs of the related property are transferred to mining assets and depreciated using the units of
production method on commencement of commercial production.
If it is determined that capitalized acquisition, exploration and evaluation costs are not recoverable, or the
property is abandoned or management has determined an impairment in value, the property is written down
to its recoverable amount. Resource properties are reviewed for impairment at each reporting date.
From time to time, the Company acquires or disposes of properties pursuant to the terms of option
agreements. Options are exercisable entirely at the discretion of the optionee and, accordingly, are recorded
as mineral property costs or recoveries when the payments are made or received. After costs are recovered,
the balance of the payments received are recorded as a gain on option or disposition of mineral property.
Although the Company has taken steps to verify title to the properties on which it is conducting exploration
and in which it has an interest, in accordance with industry standards for the current stage of exploration of
such properties, these procedures do not guarantee the Company’s title. Property title may be subject to
unregistered prior agreements and non-compliance with regulatory requirements.
d)
Impairment of Non-current Assets
The Company’s tangible and intangible assets are reviewed for an indication of impairment at the end of
each reporting period. If an indication of impairment exists, the Company makes an estimate of the asset’s
recoverable amount. Individual assets are grouped for impairment assessment purposes at the lowest level
at which there are identifiable cash flows that are largely independent of the cash flows of other groups of
assets. The recoverable amount of an asset group is the higher of its fair value less costs to sell and its
value in use. Where the carrying amount of an asset group exceeds its recoverable amount, the asset group
is considered impaired and is written down to its recoverable amount. Impairment losses are recognized in
profit or loss to the extent the carrying amount exceeds the recoverable amount. In assessing value in use,
the estimated future cash flows are adjusted for the risks specific to the asset group and are discounted to
their present value using a pre-tax discount rate that reflects current market assessments of the time value of
money.
8
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
3. Significant Accounting Policies (continued)
An assessment is made at each reporting date as to whether there is any indication that previously
recognized impairment losses may no longer exist or may have decreased. If such indication exists, the
recoverable amount is estimated. A previously recognized impairment loss is reversed only if there has been
a change in the estimates used to determine the asset’s recoverable amount. An impairment loss is
reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would
have been determined, net of depreciation, if no impairment loss had been recognized.
e) Provision for Closure and Reclamation
The Company recognizes liabilities for legal or constructive obligations associated with the retirement of
resource properties and equipment. The net present value of future rehabilitation costs is capitalized to the
related asset along with a corresponding increase in the rehabilitation provision in the period incurred.
Discount rates using a pre-tax rate that reflect the time value of money are used to calculate the net present
value.
The Company’s estimates of reclamation costs could change as a result of changes in regulatory
requirements, discount rates and assumptions regarding the amount and timing of the future expenditures.
These changes are recorded directly to the related assets with a corresponding entry to the rehabilitation
provision. The increase in the provision due to the passage of time is recognized as interest expense.
f)
Income Taxes
The Company uses the balance sheet method of accounting for income taxes. Under this method, deferred
tax assets and liabilities are recognized for the future tax consequences attributable to differences between
the financial statement carrying amounts of existing assets and liabilities and their respective tax basis.
Deferred tax assets and liabilities are measured using substantively enacted tax rates expected to apply to
taxable income in the years in which those temporary differences are expected to be recovered or settled.
Deferred income tax assets also result from unused loss carry-forwards, resource related pools and other
deductions. A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary
differences to the extent that it is probable that future taxable profits will be available against which they can
be utilized.
Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer
probable that the related tax benefit will be realized.
g) Share-based Payments
The Company has a stock option plan that is described in Note 6c. Share-based payments to employees are
measured at the fair value of the instruments issued and amortized over the vesting periods. Share-based
payments to non-employees are measured at the fair value of the goods or services received or the fair
value of the equity instruments issued, if it is determined the fair value of the goods or services cannot be
reliably measured, and are recorded at the date the goods or services are received. The amount recognized
as an expense is adjusted to reflect the number of awards expected to vest. The offset to the recorded cost
is to stock options reserve. Consideration received on the exercise of stock options is recorded as share
capital and the related stock options reserve is transferred to share capital. Charges for options that are
forfeited before vesting are reversed from stock options reserve.
9
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
3. Significant Accounting Policies (continued)
h) Loss per Share
Basic loss per share is calculated by dividing the loss available to common shareholders by the weighted
average number of common shares outstanding in the year. For all years presented, the loss available to
common shareholders equals the reported loss. Diluted loss per share is calculated by the treasury stock
method. Under the treasury stock method, the weighted average number of common shares outstanding for
the calculation of diluted loss per share assumes that the proceeds to be received on the exercise of dilutive
share options and warrants are used to repurchase common shares at the average market price during the
period. In the Company’s case, diluted loss per share is the same as basic loss per share, as the effects of
including all outstanding options and warrants would be anti-dilutive.
i) Advances from Joint Venture Partner
When acting as operator of a particular project, the Company typically receives funds in advance of
performing exploration work. The Company records such advances as a deferred liability until such time as
the applicable costs are incurred, at which point these advances are offset against the costs.
j) Financial Instruments and Comprehensive Income
i)
Financial Assets
The Company classifies its financial assets in the following categories: held-to-maturity, fair
value through profit or loss (“FVTPL”), loans and receivables, and available-for-sale (“AFS”).
The classification depends on the purpose for which the financial assets were acquired.
Management determines the classification of financial assets at recognition.
Held-to-maturity
Held-to-maturity financial assets are recognized on a trade-date basis and are initially measured
at fair value using the effective interest rate method. The Company has no assets classified as
held-to-maturity.
Financial assets at fair value through profit or loss (“FVTPL”)
Financial assets at FVTPL are initially recognized at fair value with changes in fair value
recorded through profit or loss. Cash is included in this category of financial assets.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments
that are not quoted in an active market. They are classified as current assets or non-current
assets based on their maturity date. Loans and receivables are carried at amortized cost less
any impairment. Loans and receivables comprise amounts receivable.
Available-for-sale financial assets
AFS financial assets are non-derivatives that are either designated as available-for-sale or not
classified in any of the other financial asset categories. Changes in the fair value of AFS
financial assets are recognized as other comprehensive income and classified as a component
of equity. AFS assets include investments in marketable securities.
10
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
3. Significant Accounting Policies (continued)
Management assesses the carrying value of AFS financial assets at least annually and any
impairment charges are also recognized in profit or loss. When financial assets classified as
AFS are sold, the accumulated fair value adjustments recognized in other comprehensive
income are included in profit or loss.
ii) Financial Liabilities
The Company classifies its financial liabilities in the following categories:
Borrowings and other financial liabilities
Borrowings and other financial liabilities are non-derivatives and are recognized initially at fair
value, net of transaction costs incurred, and are subsequently stated at amortized cost. Any
difference between the amounts originally received, net of transaction costs, and the redemption
value is recognized in the statement of loss and comprehensive loss over the period to maturity
using the effective interest method.
Borrowings and other financial liabilities are classified as current or non-current based on their
maturity date. Financial liabilities include trade payables and accrued liabilities, amounts due to
joint venture partner and amounts due to related parties.
iii) Fair Value Hierarchy
Fair value measurements of financial instruments are required to be classified using a fair value
hierarchy that reflects the significance of inputs in making the measurements. The levels of the
fair value hierarchy are defined as follows:
Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly or indirectly.
Level 3 – Inputs for the asset or liability that are not based on observable market data.
k) Share Capital
The Company records proceeds from share issuances, net of issue costs. Common shares issued for
consideration other than cash are valued based on their market value at the date the agreement to issue
shares was concluded.
l) Valuation of Equity Units Issued in Private Placements
Proceeds received on the issuance of units, consisting of common shares and warrants, are allocated first to
common shares based on the market trading price of the common shares at the time the units are priced,
and any excess is allocated to warrants.
11
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
4. Available-for-Sale Investments
The following table is a summary of the Company’s available-for-sale investments as at October 31, 2015
and 2014:
October 31, 2015
October 31, 2014
Number
of Shares
Cost
Fair
Value
Number
of Shares
Cost
Fair
Value
Dunnedin Ventures Inc.
776,844
$ 91,527 $ 31,074
776,844
$ 91,527 $ 100,990
For the year ended October 31, 2015, the Company recorded an unrealized loss of $69,916 (2014-$111,611
gain) on its available-for-sale investments. As at October 31, 2015, the balance of the Company’s available-
for-sale investment reserve is $(95,953) (October 31, 2014-($26,037)).
In September 2014, the Company sold 750,000 shares of Dunnedin Ventures Inc. for net proceeds of
$74,250. The Company recorded a gain on disposal of available-for-sale investments of $38,250.
On July 31, 2014, the Company received 250,000 shares of Dunnedin Ventures Inc. as part of the
consideration paid for the sale of the Trapper property in 2013, which was written off at the time of sale. The
250,000 shares were valued at $12,500, which has been recorded as a recovery of exploration properties
amount previously written off.
12
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
5. Exploration and Evaluation Properties
The following tables are a summary of the Company’s exploration and evaluation property interests:
Balance
October 31
2013
Fiscal
2014
Expenditures
Balance
Oct 31
2014
Fiscal
Balance
2015
Expenditures
October 31
2015
Palmer Property, Alaska, USA
Acquisition costs
$
878,712
$
-
$
878,712
$
-
$
878,712
Less: Recovery of acquisition costs
(389,644)
(267,197)
(656,841)
(213,589)
(870,430)
Advance royalty payments
Assaying and testing
Field transportation
Geophysics
Drilling
Property maintenance
Geology and field support
Environmental
Technical consulting
Travel
Cost recoveries
Haines Block
Acquisition costs
Field transportation
Geophysics
Drilling
Geology and field support
Environmental
Travel
Cost recoveries
Total Alaska Properties
(continued on next page)
337,123
238,288
2,975,501
434,550
5,214,338
465,113
2,079,431
-
1,160,974
206,396
46,351
86,792
383,474
325,080
1,175,359
4,150,860
78,214
3,745,517
57,452
1,517,087
331,198
512,764
8,959,855
522,565
3,596,518
331,198
52,952
59,286
812,870
237,573
3,338,002
88,569
1,555,167
415,013
436,426
384,366
4,963,730
750,337
12,297,857
611,134
5,151,685
746,211
-
1,160,974
-
1,160,974
58,806
265,202
126,006
391,208
(2,589,306)
(7,444,617)
(10,033,923)
(6,992,040)
(17,025,963)
11,011,476
(615,038)
10,396,438
(520,191)
9,876,247
$
-
$
32,893
$
32,893
$
63,114
$
96,007
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
161,139
34,356
240,136
92,738
22,986
5,781
161,139
34,356
240,136
92,738
22,986
5,781
(565,148)
(565,148)
$
-
$
11,011,476
$
$
32,893
(582,145)
$
$
32,893
10,429,331
$
$
55,102
(465,089)
$
$
87,995
9,964,242
13
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
5. Exploration and Evaluation Properties (continued)
Balance
October 31
2013
Fiscal
Balance
Fiscal
Balance
2014
Expenditures
October 31
2014
2015
Expenditures
October 31
2015
$
481,578
1,967
107,655
1,127,740
22,298
149,446
65,780
179,529
340,262
-
-
1,096
-
1,058
2,741
-
483,545
107,655
1,127,740
23,394
149,446
66,838
182,270
340,262
1,627
-
-
284
-
288
1,660
-
485,172
107,655
1,127,740
23,678
149,446
67,126
183,930
340,262
2,474,288
6,862
2,481,150
3,859
2,485,009
114,681
23,367
243,471
56,893
946
7,485
81,447
33,107
561,397
29,505
23,283
151,640
11,943
160,669
424,808
84,466
15,601
5,000
-
-
-
-
-
226
-
5,226
38,549
17,546
244,973
10,571
-
83,976
6,504
14,967
119,681
23,367
243,471
56,893
946
7,485
81,673
33,107
566,623
68,054
40,829
396,613
22,514
160,669
508,784
90,970
30,568
5,000
1,353
-
-
-
573
-
6,215
13,141
48,720
-
-
-
-
10,232
-
-
124,681
24,720
243,471
56,893
946
8,058
81,673
39,322
579,764
116,774
40,829
396,613
22,514
160,669
519,016
90,970
30,568
(776,014)
125,901
(457,508)
(1,233,522)
(40,422)
85,479
3,054
62,006
(1,230,468)
147,485
$
3,161,586
$
(28,334)
$
3,133,252
$
79,006
$
3,212,258
Ontario Properties:
Munro-Croesus Property, ON, Canada
Acquisition costs
Assaying and testing
Drilling
Field transportation
Geophysics
Travel
Geology and field support
Technical consulting
Four Corners Property, ON, Canada
Acquisition costs
Assaying and testing
Drilling
Geophysics
Field Transportation
Travel
Technical consulting
Geology and field support
Golden Mile Property, ON, Canada
Acquisition costs
Assaying and testing
Drilling
Field transportation
Geophysics
Geology and field support
Technical consulting
Travel
Cost recoveries
(continued on next page)
14
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
5. Exploration and Evaluation Properties (continued)
Ontario Properties (Balance forward)
$
3,161,586
$
(28,334)
$
3,133,252
$
79,006
$
3,212,258
Balance
October 31
Fiscal
2014
Balance
October 31
Fiscal
2015
Balance
October 31
2013
Expenditures
2014
Expenditures
2015
Phoenix Gold Property, ON, Canada
Acquisition costs
Assaying and testing
Field transportation
Geology and field support
Geophysics
Technical consulting
Travel
Write-off exploration and evaluation
property
Sub-total of Ontario Properties
Trapper Gold Property, B.C., Canada
Acquisition costs
Assaying and testing
Field transportation
Geology and field support
Technical consulting
Travel
Cost recoveries
Yukon, Canada
Acquisition costs
Assaying and testing
Field transportation
Geology
Geochemisty
Technical consulting
Other
Cost recoveries
Writedown of exploration and evaluation
properties
124,125
15,688
6,238
32,964
216,846
41,255
20,140
-
457,256
3,618,842
94,281
3,224
6,055
12,684
24,784
6,079
-
-
-
-
-
-
-
(457,256)
(457,256)
(485,590)
124,125
15,688
6,238
32,964
216,846
41,255
20,140
(457,256)
-
-
-
-
-
-
-
-
-
-
124,125
15,688
6,238
32,964
216,846
41,255
20,140
(457,256)
-
3,133,252
79,006
3,212,258
7,500
101,781
-
-
-
-
-
3,224
6,055
12,684
24,784
6,079
(147,107)
(7,500)
(154,607)
-
-
-
52,401
197,379
476,911
184,588
290,093
61,608
578,278
(25,000)
(953,420)
862,838
-
-
-
165
-
-
(5,683)
-
-
(5,518)
52,401
197,379
476,911
184,753
290,093
61,608
572,595
(25,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
899
-
101,781
3,224
6,055
12,684
24,784
6,079
(154,607)
-
52,401
197,379
476,911
184,753
290,093
61,608
573,494
(25,000)
(953,420)
857,320
(858,218)
(857,319)
(1,811,638)
1
Total Other Properties
$
4,481,680
$
(491,108)
$
3,990,572
$
(778,313)
$
3,212,259
Total Alaska and Other Properties
$
15,493,156
$
(1,073,253)
$
14,419,903
$
(1,243,402)
$
13,176,501
15
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
5. Exploration and Evaluation Properties (continued)
a) Palmer Project, Alaska USA
The Palmer property is comprised of 340 federal mining claims subject to a 99 year mining lease, dated
December 19, 1997, and 63 state mining claims located near Haines, Alaska. To maintain the lease, the
Company is required to make annual advance royalty payments of US$42,500 and pay Federal claim annual
maintenance fees, which were US$52,700 in 2015.
The lease is subject to a 2.5% net smelter returns (“NSR”) royalty. The Company has a right of first refusal
to purchase the NSR or any portion thereof at any time during the term of the lease. The advance royalty
payments are deductible from the NSR royalty.
Option and Joint Venture Agreement with Dowa Metals & Mining Co., Ltd (“Dowa”)
On February 1, 2013, the Company signed an option and joint venture agreement (the “Property
Agreement”) with Dowa relating to the Palmer Property, Alaska (the “Project”).
Under the terms of the Property Agreement, Dowa has an option to earn a 49% interest in the Project by
making aggregate expenditures of US$22,000,000 over a four year period. Expenditures for each year,
including option payments, shall not be less than US$3,000,000. Included in the aggregate expenditures are
cash payments to the Company totaling US$1,250,000 over four years, of which US$1,000,000 has been
received to date. The Company is the operator during the earn-in period.
Following Dowa’s completion of the required earn-in expenditures and their exercise of the option, a 51:49
joint venture (the “Joint Venture”) between the Company (51%) and Dowa (49%) is planned for the Project,
whereby the Company shall continue as operator. After formation of the Joint Venture, the Property
Agreement anticipates that each party shall be responsible for its proportionate share of expenses
determined on the basis of ownership or suffer dilution according to standard dilution provisions.
The Property Agreement also includes terms that allow Dowa to acquire certain zinc and copper off-take
rights in stages, during and upon completion of the earn-in option period.
From inception of the Property Agreement to October 31, 2015, the Company received an aggregate of
US$15,681,535 from Dowa in respect of exploration expenditures incurred. An amount of $238,334 in
recoverable exploration expenditures was also due from Dowa as at October 31, 2015, which was received
in November 2015. At the end of the comparative year, the Company had unspent cash call funds from
Dowa in the amount of $34,976, which were recorded as a deferred recovery of exploration costs in the
Company’s October 31, 2014 statement of financial position.
In March 2015, a finder’s fee payment of US$75,970 was paid in connection with the Property Agreement
transaction, of which $20,000 was paid in cash and the balance in shares of the Company by the issuance of
493,336 common shares at a deemed value of $69,067.
16
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
5. Exploration and Evaluation Properties (continued)
Haines Block Lease
In April 2014, the Company was the successful applicant in a competitive lease process offered by the
Alaska Mental Health Trust Authority (the “Trust”) for the mineral exploration and development of an
approximately 92,000 acre package of land (the “Haines Block”). A formal lease agreement on the property
was completed and signed in September 2014. The principal terms of the lease agreement are as follows:
1. Annual payments of US$25,000 per year for the initial 3 year lease term, US$40,000 for years 4 to 6,
US$55,000 for years 7 through 9;
2. Work commitments of US$75,000 per year, escalating by US$50,000 annually;
3. Annual payments are replaced by royalty payments upon achieving commercial production;
4. Production royalties payable to the Trust include a sliding scale 1% to 4.5% royalty for gold, based
on gold price, and a 3.5% royalty on minerals other than gold.
The Haines Block is contiguous with and surrounds the Federal and State mining claims that make up the
Palmer Property. The Company paid an aggregate of US$25,500 as part of the lease application process,
which includes the first year’s lease of the property.
Haines Block Selection Agreement
In July 2015, the Company signed a Selection Agreement (the “Selection Agreement”) with Dowa on the
Haines Block mining lease. Under the terms of the Selection Agreement, Dowa selected a small subset of
the Haines Block (the “Selection Area”) including both surface and mineral rights, to become part of the
Agreement. The remaining mineral rights of the Haines Block, representing approximately 96 percent of the
total Haines Block land package, are 100 percent Constantine-owned, subject to a Right of First Offer
(“ROFO”) by Dowa that expires on September 1, 2017.
The main elements of the Selection Agreement are as follows:
1. Dowa has selected a Haines Block land parcel with surface and mineral rights comprising
approximately 3483 acres, exclusive of all pre-existing federal claims, to be included as part of the
Palmer Property and therefore subject to Dowa’s option to earn a 49% joint venture interest.
2. Constantine will maintain its 100% interest in the balance of the property of the Haines Block
exclusive of the Selection Area and any exploration done in such area outside of the Selection Area
will be at Constantine’s expense.
3. Dowa and Constantine will share the annual rental requirements of the Lease of US$25,000 for the
first 3 year lease term, in a proportion of 49:51, which are amounts of US$12,250 and US$12,750,
respectively, until a Joint Venture (“JV”) is formed.
4. Dowa will meet the minimum exploration requirements of the Lease during the Option period and
until such time as a JV is formed. These minimum requirements are US$75,000 by September 1,
2015, escalating by US$50,000 annually thereafter and these expenditures will be deemed to be
earn-in expenditures paid by Dowa.
5. Constantine has granted Dowa a ROFO on Haines Block lands located outside of the Selection Area
for a 3 year period beginning as of September 1, 2014, and terminating on September 1, 2017.
17
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
5. Exploration and Evaluation Properties (continued)
b) Ontario Properties
i) Munro-Croesus Property
The Company owns 100% of the Munro-Croesus gold mineral property, including the former Munro-
Croesus gold mine, consisting of 22 patented mining claims and leases (416 hectares), located 90
kilometers east of Timmins, Ontario.
Under the terms of the original acquisition agreement, there is a 2% NSR production royalty payable
on the property, of which 0.5% can be purchased by the Company for $1,000,000, with a right of first
refusal on the remaining 1.5% NSR royalty.
ii) Golden Mile Property
In March 2012, the Company entered into an option agreement to acquire the Golden Mile property
in northern Ontario, Canada. Under the terms of the agreement, in order to maintain the option the
Company must make payments of $175,000 and issue 180,000 of the Company’s shares over a four
year period commencing on December 10, 2012. A total of $72,000 has been paid and a total of
120,000 shares have been issued as at October 31, 2015. See Note 13.
iii) Four Corners Property
The Company owns a 100% interest in the 63 claim Four Corners property located east of Timmins,
Ontario. Under the terms of the original acquisition agreement, the vendors retained a 2.5% NSR
royalty of which 1.0% can be purchased by the Company at any time for $500,000, with a right of
first refusal on the remaining 1.5% NSR royalty.
c) Yukon Land Position and Joint Venture
The Company and Carlin Gold Corporation (“Carlin Gold”) control over 3,000 claims in the Mayo and Watson
Lake Mining Districts, Yukon. The claims are distributed in twelve blocks that total approximately 65,000
hectares (250 square miles).
In April 2015, subsequent to an impairment review in accordance with IFRS, the Company recorded a
$858,218 writedown of the property to a carrying value of $1.
18
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
6. Share Capital
a) Common Shares
Authorized: unlimited common shares without par value
Issued and outstanding: 116,846,001 common shares
i) On March 6, 2015, the Company issued 493,336 shares valued at $69,067 as part of a success
fee payment in regard to the option and joint venture agreement on the Palmer property (Note
5a).
ii) On December 10, 2014, the Company issued 48,000 shares valued at $6,720 related to the
Golden Mile property (Note 5b(ii)).
iii) On April 29, 2014, the Company issued 75,000 shares valued at $7,500 related to the Trapper
Gold property.
iv) On March 3, 2014, the Company issued 185,000 shares at a deemed price of $0.07 per share,
for total consideration of $12,950, pursuant to the terms of an Exploration Agreement signed
with certain First Nations groups in Ontario in January 2014.
b) Stock Options
The Company has established a stock option plan whereby the board of directors may, from time to time,
grant options to directors, officers, employees or consultants. Options granted must be exercised no later
than five years from the date of grant or such lesser period as determined by the Company’s board of
directors. The exercise price of an option is not less than the closing price on the Exchange on the last
trading day preceding the grant date. Options begin vesting on the grant date based on a schedule outlined
in the share purchase option plan. The maximum number of options to be granted under the plan is 10% of
the Company’s issued capital.
On March 6, 2015, the Company issued 1,400,000 incentive share options to management and employees,
exercisable at a price of $0.14, expiring March 6, 2020. The stock options were issued to directors, officers
and employees of the Company.
19
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
6. Share Capital (continued)
b) Stock Options (continued)
A summary of the status of the Company’s stock options at October 31, 2015 and 2014 and changes during
the years therein is as follows:
Balance, beginning of year
Granted
Expired or Cancelled
Balance, end of year
Year ended
October 31, 2015
Number of
Weighted
average
options exercise price
7,325,000
1,400,000
(50,000)
$
0.08
0.14
0.11
Year ended
October 31, 2014
Number of
options
4,800,000
5,400,000
(2,875,000)
Weighted
average
exercise price
$
0.16
0.07
0.19
8,675,000
$
0.09
7,325,000
$
0.08
The fair value cost of the stock options granted during the periods ended October 31, 2015 and 2014 were
calculated using the Black-Scholes Pricing Model using the following range of assumptions:
Risk-free interest rate
Expected life (in days)
Annualized volatility
Dividend rate
October 31, 2015
0.59%
1,825
82.51%
n/a
October 31, 2014
1.33%
1,825
85.05%
n/a
The fair value computed using the Black-Scholes model is only an estimate of the potential value of the
individual options and the Company is not required to make payments for such transactions. An amount of
$126,258 was charged to share-based payments expense for the year ended October 31, 2015 (2014-
$187,487).
A summary of the Company’s stock options outstanding as at October 31, 2015 is as follows:
Expiry Date
March 5, 2017
January 17, 2019
March 6, 2020
Weighted
Average
Exercise
Price
0.11
0.07
0.14
0.09
$
Number
of Options
Outstanding
1,875,000
5,400,000
1,400,000
8,675,000
Weighted
Average
Remaining
Contractual
Life
(in years)
0.37
2.11
4.85
Number
of Options
Exercisable
1,875,000
4,400,000
1,200,000
7,475,000
20
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
6. Share Capital (continued)
b) Stock Options (continued)
Of the 1,400,000 options issued on March 9, 2015, an amount of 1,200,000 were vested immediately and
200,000 options are subject to a vesting agreement, whereby 100,000 options will be vested on each of the
first and second anniversaries of the option.
A summary of the Company’s stock options outstanding as at October 31, 2014 is as follows:
Expiry Date
March 5, 2017
January 17, 2019
Weighted
Average
Exercise
Price
0.11
0.07
0.08
$
Number
of Options
Outstanding
1,925,000
5,400,000
7,325,000
Weighted
Average
Remaining
Contractual
Life
(in years)
0.62
3.11
Number
of Options
Exercisable
1,925,000
4,000,000
5,925,000
Of the 5,400,000 options issued on January 17, 2014, an amount of 4,000,000 were vested immediately and
1,400,000 options are subject to a vesting agreement, whereby 400,000 options were vested on the first
anniversary date of the issuance of the options, and 500,000 options will be vested on each of the second
and third anniversaries of the option.
7. Related Party Transactions
The following represents the details of related party transactions paid or accrued for the years ended
October 31, 2015 and 2014:
For the years ended October 31,
Consulting, administrative and technical
directors
Consulting fees paid to officers
Accounting and administration fees paid or accrued to a company 50% owned by an officer
Share-based payments to key management
fees paid or accrued to companies owned by
2015
2014
$ 43,178 $ 9,833
178,426 81,296
72,000
36,000
71,745 96,087
$ 365,349 $ 223,216
As at October 31, 2015, the unpaid portion of amounts due to key management is $3,199 (2014-$3,966).
The Company paid NS Star Enterprises Ltd., a company controlled by a director, $41,044 for management
and administration services during the year ended October 31, 2015 (2014 - $15,300). The Company paid
Morfopoulos Consulting Associates Ltd., a company controlled by the CFO, $72,000 for accounting, and
management and administration services during the year ended October 31, 2015 (2014 - $72,000). The
Company paid D. Green Geoscience Inc., a company controlled by the vice-president of exploration,
$178,426 for technical consulting and management and administration services during the year ended
October 31, 2015 (2014 - $177,821). The Company paid 44984 Yukon Ltd., a company controlled by a
director of the Company, $2,134 for miscellaneous field operating supplies and services during the year
ended October 31, 2015 (2014 - $3,833).
21
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
8. Management of Capital
The Company manages its cash, common shares, stock options and warrants as capital. The Company’s
objectives when managing capital are to safeguard the Company’s ability to continue as a going concern in
order to pursue the development of its exploration and evaluation properties and to maintain a flexible capital
structure which optimizes the costs of capital at an acceptable risk. The Company does not have any
externally imposed capital requirements to which it is subject. There were no significant changes in the
Company’s approach or the Company’s objectives and policies for managing its capital.
The Company manages the capital structure and makes adjustments to it in light of changes in economic
conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure,
the Company may attempt to issue new shares, issue debt, acquire or dispose of assets or adjust the
amount of cash and cash equivalents.
In order to facilitate the management of its capital requirements, the Company prepares expenditure budgets
that are updated as necessary depending on various factors, including successful capital deployment and
general industry conditions.
9. Financial Instruments
a) Financial Risk Management
The Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk
management framework. The Company’s financial instruments consist of cash and cash equivalents,
amounts receivable, available-for-sale investments, trade payables and amounts due to related parties.
The fair values of cash and cash equivalents, amounts receivable, deposits, trade payables and amounts
due to related parties approximate their book values because of the short-term nature of these instruments.
b) Financial Instrument Risk Exposure
The Company is exposed in varying degrees to a variety of financial instrument-related risks. The Board
approves and monitors the risk management processes.
Credit Risk
The Company’s only exposure to credit risk is on its cash and cash equivalents. Cash and cash equivalents
are with a Canadian Schedule 1 bank and a US bank for its subsidiary. The Company has no asset-backed
commercial paper.
Liquidity Risk
The Company ensures that there is sufficient capital in order to meet short-term business requirements, after
taking into account the Company’s holdings of cash. A portion of the Company’s cash is invested in business
accounts which are available on demand.
22
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
9. Financial Instruments (continued)
Market Risk
The only significant market risk exposure to which the Company is exposed is interest rate risk. The
Company’s bank account earns interest income at variable rates. The fair value of its marketable securities
portfolio is relatively unaffected by changes in short-term interest rates. The Company’s future interest
income is exposed to short-term rates and fluctuations, however management does not consider this risk to
be significant.
Exchange Risk
As at October 31, 2015, the majority of the Company’s cash was held in the USA in U.S. dollars. The
Company’s significant operations are carried out in Canada and in Alaska, USA. As a result a portion of the
Company’s cash and cash equivalents, amounts receivable, and trade payables are denominated in US
dollars and are therefore subject to fluctuations in exchange rates. Management does not believe that the
exchange risk is significant.
c) Fair Value Measurements
The carrying value of financial assets and financial liabilities at October 31, 2015 and 2014 is as follows:
As at
Financial Assets
FVTPL, measured at fair value
Cash
Loans and receivables, measured at amortized cost
Amounts receivable
Exploration costs recoverable from joint venture partner
Available-for-sale, measured at fair value
Available-for-sale investments
Financial Liabilities
Other liabilities, measured at amortized cost
Trade payables and accrued liabilities
Amount due to joint venture partner
Amounts due to related parties
2015
2014
$
396,069
$
587,481
39,965
238,334
11,819
-
31,074
100,990
$
282,643
-
3,199
$
198,569
23,802
3,966
The fair value hierarchy of financial instruments measured at fair value is as follows:
As at
Cash
Available-for-sale investments
The Company does not use Level 2 or Level 3 valuation inputs.
2015
Level 1
2014
Level 1
$
396,069
31,074
$
587,481
100,990
23
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
10. Segmented Information
The Company has one operating segment, which is exploration and evaluation of its mining properties.
At October 31, 2015, the Company operates in two geographic areas, being Canada and the United States.
The following is an analysis of net loss for the period, current assets and non-current assets by geographical
area:
Current Assets
As at October 31, 2015
As at October 31, 2014
Deposits
As at October 31, 2015
As at October 31, 2014
Exploration and Evaluation Properties
As at October 31, 2015
As at October 31, 2014
Performance Bonds
As at October 31, 2015
As at October 31, 2014
Equipment
As at October 31, 2015
As at October 31, 2014
11. Income Taxes
Canada
United States
Total
$
380,207
421,264
$
346,265
310,890
$
726,472
732,154
19,887
27,835
3,212,259
3,990,572
-
-
2,968
8,429
-
-
19,887
27,835
9,964,242
10,429,331
13,176,501
14,419,903
32,688
28,178
-
-
32,688
28,178
2,968
8,429
A reconciliation of income taxes at statutory rates is as follows:
2015
2014
Net loss for the year
$
(1,414,641)
$
(1,087,362)
Expected income tax expense
Net adjustment for amortization and other non-deductible amounts
Unrecognized benefit of DIT assets
(421,413)
257,654
163,759
(282,714)
150,569
132,145
Total income tax recovery
$
-
$
-
There are no deferred tax assets presented in the statement of financial position.
24
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
11. Income Taxes (continued)
Subject to confirmation with regulatory authorities, deductible temporary differences, unused tax losses and
unused tax credits for which no deferred tax assets have been recognized are attributable to the following:
Deferred income tax assets (liabilities):
Net mineral property carrying amounts in excess of tax pools
$
Equipment
Share issue costs
Non-capital loss carryforwards
2015
2014
(2,319,000)
51,000
3,000
6,606,000
$
(2,670,000)
51,000
116,000
6,358,000
$
4,341,000
$
3,855,000
The Company has Canadian non-capital losses of approximately $5,360,000 (2014 - $5,506,000) and US
non-capital losses of US $954,000 (2014 – US $ 936,000), which will be available to reduce future taxable
income in Canada and the US, respectively. The respective non-capital losses will begin to expire in 2016
until 2035.
The Canadian non-capital losses, if not utilized, will expire in the years presented below:
2016
2027
2028
2029
2030
2031
2032
2033
2034
2035
$ 161,000
447,000
594,000
656,000
820,000
995,000
790,000
540,000
203,000
154,000
$ 5,360,000
12. Commitments
The Company has a lease agreement for the rental of office space, which expires on May 31, 2021.
The future minimum lease obligations under the lease are as follows:
2016 fiscal year
2017 fiscal year
2018 fiscal year
2019 fiscal year
2020 fiscal year
2021 fiscal year
Amount
44,287
39,660
40,486
42,469
43,626
25,449
235,977
$
$
The Company currently rents out a portion of its office space on a month-to-month basis for $1,000 per
month.
25
Notes to Consolidated Financial Statements
For the years ended October 31, 2015 and 2014
_____________________________________________________________________________________
13. Event Subsequent to the end of the Reporting Period
On January 28, 2016, the Company received a US $250,000 option payment from Dowa in connection with
its Joint Venture Agreement with Dowa on the Palmer property.
On December 10, 2015, the Company issued 60,000 shares valued at $5,000 as part of an option payment
on the Golden Mile property (Note 5b(ii)).
26
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
General
The information in this Management’s Discussion and Analysis, or MD&A, is intended to assist the reader
in the understanding and assessment of the trends and significant changes in the results of operations
and financial conditions of Constantine Metal Resources Ltd. (the “Company” or “Constantine”). This
MD&A should be read in conjunction with the audited consolidated financial statements of the Company,
including the notes thereto, for the years ended October 31, 2015 and 2014, and the MD&A of such
financial statements, and other information relating to the Company on file with the Canadian provincial
securities regulatory authorities on SEDAR at www.sedar.com. The Company’s audited consolidated
financial statements for the years ended October 31, 2015 and 2014 have been prepared in accordance
with International Financial Reporting Standards (“IFRS”). This MD&A has taken into account information
available up to and including February 9, 2016.
Constantine is a junior exploration company engaged in the exploration and development of several
exploration properties. Its principal project is a polymetallic (copper-zinc-gold-silver) massive sulphide
advanced exploration project in southeast Alaska known as the Palmer Project. Constantine also has
gold properties in Ontario and the Yukon. The Company’s principal Ontario gold projects are the Golden
Mile project in the Timmins gold camp and the Munro-Croesus project, which includes the past-producing
high-grade Croesus gold mine located east of the Timmins gold camp.
The Company is a reporting issuer in British Columbia, Alberta and Ontario and trades on the TSX
Venture Exchange under the symbol CEM.
Historical results of operations and trends that may be inferred from the following discussions and
analysis may not necessarily indicate future results from operations. The Company is currently engaged
in exploration and development of mineral properties and does not have any source of revenue or
operating assets, however the Company has generated cash flow from option earn-in agreements, from
fees for management of option-joint venture exploration projects and from sale of available-for-sale
investments. The recoverability of the amounts shown for mineral properties is dependent upon the ability
of the Company to obtain necessary financing to complete exploration, technical studies and, if
warranted, development and future profitable production or proceeds from the disposition of properties.
The amounts shown as mineral properties represent net costs to date and do not necessarily represent
present or future values.
Highlights
US$250,000 Option Payment Received from Dowa – At the end of January 2016, the
Company received a US$250,000 option payment from Palmer project partner Dowa Metals &
Mining Co., Ltd. (“Dowa”). The funds will be used for general working capital.
No Equity Dilution in 2015 – The Company was once again successful in funding a major
exploration program on the Palmer project, while sustaining its corporate operations, without the
necessity of having to seek an equity financing in these weak financial markets.
Inferred Resource Estimate Almost Doubled at Palmer – In May 2015, the Company
published an updated resource estimate for the Palmer project, almost doubling its size to
8,125,000 tonnes (see details below). This resource estimate also indicates the opportunity for
additional expansion, as many drill intercepts included in the resource are open to expansion.
1
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
2015 Drill Program Completed at Palmer - The Company completed a 7,700 meter drill
program in 2015, focused on exploring for extensions of the deposit within a localized target area.
The 2015 drill program exceeded the original 6,000 meters of diamond drilling that was planned
at the beginning of the season. Results of the drill program were disclosed in the Company’s
November 24, 2015 news release and are also summarized below.
Land Trust Selection Agreement Completed - the Agreement (“Selection Agreement”) signed
in June 2015 allows Dowa to include a 3,483 acre portion of the total 92,000 acre parcel (“Haines
Block”) leased from the Alaska Mental Health Trust Authority. The Selection Agreement land is
immediately adjacent to the Company’s 2015 drilling activities on the Palmer Property. The
Agreement benefits both parties, and leaves Constantine with a 100% interest in the balance of
about 89,000 acres of highly prospective lease land.
2
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
Land Trust Exploration – over $620,000 was spent on exploration work on the Haines Block in
2015. The work included mapping and geochemical sampling of several identified VMS prospects
and alteration zones located proximal to the Palmer Property. The work also included LIDAR
imaging for topographic and geological mapping, reconnaissance scale geochemical surveying,
soil sampling, and prospecting to identify new prospects within prospective host rocks. Promising
VMS targets with high-grade surface sample results in boulders and outcrop have been identified
at the Tsirku prospect and the Waterfall Zone on 100% Constantine-controlled Haines Block
lands. One drill hole was collared on the Selection Agreement land to test the western extension
of the South Wall Zone.
Environmental Studies and Engineering – approximately $770,000 has been spent to date on
environmental and engineering studies to support permitting. Studies include surface and
groundwater hydrology, geotechnical, water quality, wildlife and plant surveys, rock quality
characterization, meteorology, natural hazard assessment, and terrain and surficial geology
analysis
Base Metal Projects
Palmer Project (southeast Alaska, USA)
Palmer is a resource expansion stage, high-grade volcanogenic massive sulphide (VMS) project, with an
Inferred Mineral Resource of 8.1 million tonnes grading 1.41% copper, 5.25% zinc, 0.32 g/t gold and 31.7
g/t silver*. The Project is being advanced in partnership with Dowa Metals & Mining Co., Ltd. who can
earn 49% in the project by making aggregate expenditures of US$22 million over four years. The Palmer
project is located in a very accessible part of coastal southeast Alaska, with road access to the edge of
the property and within 60 kilometers of the year-round deep sea port of Haines. Mineralization at Palmer
occurs within the same belt of rocks that is host to the Greens Creek mine, one of the world’s richest VMS
deposits. There are at least 25 separate base metal and/or barite occurrences and prospects on the
Palmer property, indicating the potential for discovery of multiple deposits beyond the RW-South Wall
deposit area.
* See the Company's news release date May 11, 2015 and available on www.sedar.com. Resource estimate utilizes an NSR cut-
off of US$75/t with assumed metal prices of US$1200/oz for gold, US$18/oz for silver, US$2.75/lb for copper, and US$1.00/lb for
zinc. Estimated metal recoveries are 89.6% for copper, 84.9% for zinc, 75% for gold (61.5% to the Cu concentrate and 13.5% to
the Zn concentrate) and 89.7% for silver (73.7% to the Cu concentrate and 16% to the Zn concentrate) as determined from
metallurgical locked cycle flotation tests. An Inferred Mineral Resource is that part of a Mineral Resource for which quantity and
grade or quality are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient to
imply but not verify geological and grade or quality continuity.
The Company holds a 99 year mining lease dated December 19, 1997 on 340 mining claims that
comprise the original Palmer property. To maintain the lease, the Company is required to make annual
advance royalty payments of US $42,500 and pay Federal claim maintenance fees, which were US
$52,700 in 2015. The lease is subject to a 2.5% net smelter return (“NSR”) royalty. The Company has a
right of first refusal to purchase the NSR or any portion thereof at any time during the term of the lease.
The advance royalty payments are deductible from the NSR royalty.
In September 2014, a formal agreement was signed between the Alaska Mental Health Trust Authority, a
state corporation within Alaska (the “Trust”) and the Company for an upland mining lease on the
approximately 92,000 acre Haines Block land package surrounding the Palmer property. Constantine
3
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
acquired the Haines Block for mineral exploration and development in a competitive lease process
offered by the Trust. The Haines Block is contiguous with and surrounds the Federal and State mining
claims that make up the approximately 16,000 acre Palmer property. The Trust owns the subsurface
mineral estate of the Haines Block and a small subset of the block is held fee simple, for which the Trust
owns both the surface and subsurface estate. General lease terms include annual rental of US $25,000
per year for the initial 3 year lease term, US $40,000 for years 4 to 6, US $55,000 for years 7 through 9,
with work commitments of US$75,000 per year, escalating by US$50,000 annually. There is a mandatory
acreage reduction of 25,000 acres at the end of the first and second 3 year lease terms. The lease can be
extended beyond year 9 by making annual rental payments and continuing to diligently pursue
exploration and development on the lease. Annual payments are replaced by royalty payments upon
achieving commercial production. Production royalties payable to the Trust include a sliding scale 1% to
4.5% royalty for gold based on gold price, and a 3.5% royalty on minerals other than gold. The Alaska
State production royalty levied on State lands does not apply to production on Trust lands.
Dowa exercised the right under the Constantine-Dowa Option-JV Agreement (see Selection Agreement
below) to include a portion of Mental Health Trust Lease land (3,483 acres) that is immediately adjacent
to the Company’s current drilling activities as part of the Palmer Property to the benefit of both parties and
at the same time leaves Constantine with a 100% interest in the balance of approximately 89,000 acres of
highly prospective Haines Block land.
Updated Mineral Resource Estimate
The 2015 resource estimate significantly increases the size of the deposit, highlighting the success of
recent drill campaigns and the growing potential of the project. It is open to expansion in most areas with
the thickest part of the deposit located at the current down dip limit of the South Wall Zone where mineral
zoning and geophysics support potential for a high-grade copper core within a more extensive area of
zinc-copper-barite mineralization.
The Inferred Mineral Resource estimate is tabulated below for a range of NSR (Net Smelter Return) cut-
off values based on assumed underground mining and milling costs. The resource utilizes a base case
cut-off of $75 per tonne and has an effective date of May 11, 2015.
Tonnes
9,133,000
8,125,000
7,072,000
Grade
Cu (%)
1.30
1.41
1.51
Zn (%)
5.00
5.25
5.53
Au (g/t)
0.30
0.32
0.34
Ag (g/t)
30.2
31.7
33.7
CuEq (%)
ZnEq (%)
3.03
3.23
3.43
11.83
12.61
13.39
Cut-off
NSR US$
60
75
95
Notes:
1. NSR equals (US$45.69 x Cu% + US$11.70 x Zn% + US$25.04 x Au g/t + US$0.43 x Ag g/t). NSR formula is based on
assumed values for offsite costs, metal recovery, and metal prices. Offsite costs include transportation of concentrate, smelter
treatment charges, and refining charges.
2. Assumed metal prices are US$2.75/lb for copper (Cu), and US$1.00/lb for zinc (Zn), US$1200/oz for gold (Au), US$18/oz for
silver (Ag).
4
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
3. Estimated metal recoveries are 89.6% for copper, 84.9% for zinc, 75% for gold (61.5% to the Cu concentrate and 13.5% to the
Zn concentrate) and 89.7% for silver (73.7% to the Cu concentrate and 16% to the Zn concentrate) as determined from
metallurgical locked cycle flotation tests.
4. Density was estimated by inverse distance squared interpolation; unique density values were determined by conventional
analytical methods for all assay samples.
5. Copper equivalent (CuEq%) and zinc equivalent (ZnEq%) values were calculated based on the NSR formula above (e.g.
CuEq% = Cu% + (Zn% x $11.70 + Au g/t x $25.04 + Ag g/t x $0.43)/$45.69
6. Mineral resources as reported are undiluted.
7. Mineral resource tonnages have been rounded to reflect the precision of the estimate.
8. Readers are cautioned that mineral resources that are not mineral reserves do not have demonstrated economic viability.
Mineralization at the Palmer Project contains an unusually high concentration of barite. Barite is an inert,
high-density industrial mineral that is in demand for use in oil and gas drilling, with the majority of US
consumption met by imports from Asia. Barium content within the resource area averages approximately
13 to 15%, which equates to a barite mineral content of approximately 22 to 25% by weight*. The
Company will be evaluating the potential to produce a marketable barite concentrate.
*Average barium content within the resource area is based on analysis and block modelling of barium XRF assay data that is
available for 95% of all samples included within the mineralized wireframes. There is insufficient data and confidence to include
barium in the Inferred Mineral Resource and the range of average barite mineral content is presented herein for the purpose of
highlighting exploration potential only.
Resource Model
The independent mineral resource estimate prepared by James N. Gray of Advantage Geoservices Ltd.
is reported in accordance with Canadian Securities Administrators' NI 43-101 and conforms to the
Canadian Institute of Mining "Estimation of Mineral Resources and Mineral Reserves Best Practices"
guidelines. Eighty-two diamond drill holes were used in generating the geological model for the South
Wall and RW zones, 48 of which intersect the interpreted mineralized zones in 19,000 meters of core.
Outlier assays were capped and all assays within the mineralized zones composited to 1.5 meter lengths.
Metal grades were estimated using inverse distance cubed interpolation into a 3D block model with block
dimensions of 6 x 6 x 6 meters. Three dimensional geologic solids were constructed by Darwin Green,
Vice President of Exploration and reviewed by QP Ian Cunningham-Dunlop, P. Eng., and, in general,
were limited to material grading > 0.5% Cu or > 2% Zn that could be demonstrated to be correlative with
definable stratabound zones. As a general rule, solids were extended no more than 50 meters up-dip,
down-dip and along strike from a drill hole; the Inferred Mineral Resource includes only mineralization
within 75 meters of a drill hole. A total of five solids were constructed for sulphide mineralization: South
Wall Zone 1, South Wall Zone 2-3, South Wall EM Zone, RW West, and RW East. The complete NI 43-
101 Technical Report was published on SEDAR on June 25, 2015.
An Inferred Mineral Resource is that part of a Mineral Resource for which quantity and grade or quality
are estimated on the basis of limited geological evidence and sampling. Geological evidence is sufficient
to imply but not verify geological and grade or quality continuity. An Inferred Mineral Resource has a
lower level of confidence than that applying to an Indicated Mineral Resource and must not be converted
to a Mineral Reserve. It is reasonably expected that the majority of Inferred Mineral Resources could be
upgraded to Indicated Mineral Resources with continued exploration.
2015 Project Development and Drilling Program Completed at Palmer
Project development in 2015 included completion of a 7,700 meter drill program and a variety of
environmental and engineering work programs at a cost of over US $ 5.5 million. This work included
5
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
engineering design work, water quality studies, rock geochemical characterizations studies, geotechnical
studies, plant and wildlife surveys, hydrogeology studies, and meteorological work. A Plan of Operations
was completed in 2015 to support permitting the construction of an access road to the South Wall area.
The Plan is subject to a federal Environmental Assessment process, with public and agency scoping
review initiated on December 2nd. The Company is targeting approval in Q2 2015 with the objective of
commencing construction during the 2015 summer field season.
The 7,736 meters of core drilling was completed, consisting of 8 wide spaced exploration drill holes, 1
geotechnical drill hole, and the extension of a 2014 drill hole. The scope of the drilling was focused on
exploring for extensions of the deposit within a localized target area. Drill holes primarily tested areas
around the South Wall EM Zone, including the fault displaced offset of the zone referred to as the Lower
Offset target. EM Zone mineralization was intersected in three holes, extending the known extent of the
mineralized system approximately 100 meters east (holes CMR15-72 and 73) and 65 meters up dip (hole
CMR15-75). Mineralization in these holes is chert-barite dominant with base metal bearing footwall pyrite-
pyrrhotite stringer zones. Significant intersections include:
4.2 meters grading 0.5% copper, 3.98% zinc, 60.4 g/t silver, 0.65 g/t gold in CMR15-75
3.0 meters grading 2.32% copper and 14.9 g/t silver in hole CMR15-75
8.0 meters grading 1.33% zinc and 21.6 g/t silver in hole CMR15-73
10.5 meters grading 1.56% zinc in hole CMR15-72
Four drill holes targeted the Lower Offset target below a fault structure that displaces the down-dip
projection of the EM Zone. One of the four holes, CMR15-69, successfully intersected EM Zone
equivalent massive pyrrhotite mineralization and intense hydrothermal alteration approximately 160
meters below the fault, including 7.2 meters grading 0.43% copper and 0.46% zinc. The other three drill
holes to test the Lower Offset target area did not intersect EM Zone correlative stratigraphy. This includes
CMR14-56 that was re-entered and abandoned after advancing 22 meters due to adverse drilling
conditions, and holes CMR15-71 and 77 that were completed to significant depths prior to being
abandoned.
A large portion of the deposit remains open to expansion in the immediate South Wall and RW resource
areas. Work is ongoing into understanding and interpreting the geological, geochemical, and geophysical
data gained from new drill holes, with the objective of updating the exploration model for future drill
planning.
Geophysics
Borehole and surface electromagnetic (EM) geophysical surveys identified several zones of high
conductivity. Conductive plate modeling of the borehole data has generated targets of potential
mineralization adjacent to the existing mineral resource and at depth below the current extent of surface
drilling. Modeling of surface EM data has generated conductive plate models targets in areas along trend
of the RW and South Wall resource areas. The new geophysical data is being incorporated into planning
and drill hole targeting.
Advanced Project Team and Work Programs
Constantine continues to build its advanced project team. Key personnel include Ian Cunningham-
Dunlop, P. Eng., Senior Advisor Advanced Projects and Engineering; Henry Bogert, Senior Mining
6
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
Engineer; and Rick Richins, Senior Advisor Permitting. All bring a wealth of experience in their respective
fields. The company also signed a memorandum of understanding with Alaska Large Mine Permitting
Team to gain early input into baseline program design and ensure long lead time data is collected in a
manner consistent with the needs of State regulators.
Land Trust Selection Agreement
The Haines Block is an approximately 92,000 acre land package leased by Constantine from the Alaska
Mental Health Trust Authority (see news release dated September 9, 2014), which is subject to an area of
interest clause in the Palmer property agreement with Dowa.
The main elements of the Selection Agreement are as follows:
Dowa has selected a Haines Block land parcel with surface and mineral rights comprising
approximately 3483 acres the “Selection Area” to be included as part of the Palmer Property for
which expenditures will apply to Dowa’s 49% Earn-in Expenditures during the Option phase of
the property agreement.
Constantine will maintain its 100% interest in the balance of the property of the Haines Block
exclusive of the Selection Area and any exploration done in such area outside of the Selection
Area will be at Constantine’s expense.
Dowa and Constantine will share the annual rental requirements of the Lease of US$25,000 for
the first 3 year lease term, in proportion of 49:51, which are amounts of US$12,250 and
US$12,750, respectively, until a Joint Venture (“JV”) is formed.
Dowa will meet the minimum exploration requirements of the Lease during the Option period and
until such time as a JV is formed. These minimum requirements are US$75,000 by September 1,
2015, escalating by US$50,000 annually thereafter and these expenditures will be deemed to be
earn-in expenditures paid by Dowa.
Constantine has granted Dowa a Right of First Offer on Haines Block lands located outside of the
Selection Area for a 3 year period beginning as of September 1, 2014, and terminating on
September 1, 2017.
2015 Haines Block Exploration Program
A total of $620,250 was spent on exploration work on the Haines Block in 2015. The work included
mapping and geochemical sampling of several identified VMS prospects and alteration zones located
proximal to the Palmer Property. The work also included LIDAR imaging for topographic and geological
mapping, reconnaissance scale geochemical surveying, soil sampling, and prospecting to identify new
prospects within prospective host rocks.
Work within the Selection Area included surface geophysics and one drill hole, including down hole
geophysics, that tested the South Wall on the adjacent federal claims of the Palmer Property.
On a portion of the 100% Constantine-controlled Haines Block lands that surround the core of the Palmer
Property, new VMS-style massive sulphide mineralization was discovered during our regional exploration
work. Significant results include:
Delineation of a 2 km trend of massive sulphide boulders associated with altered and mineralized
volcanics at the Tsirku prospect, located 9 km south of the Palmer deposit area. Highlight assays
7
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
of 4.99% copper, 6.32% zinc, 68 g/t silver, and 1.97 g/t gold have been received for chip and grab
samples of boulders that range from 0.2 to 1.5 m in size. Mineralization style at this new prospect
resembles that of the Palmer deposit, and supports management’s strong belief in the potential to
discover other VMS deposits on the Property.
Grab samples grading 8.12% copper and 15.4% zinc have been obtained from outcrop at the
Waterfall prospect, located 3 km southwest of the Palmer deposit area. The Waterfall prospect
occurs adjacent to the silver-rich Cap (e.g. 23.2 m grading 134 g/t silver in historic drill hole), HG
and Nunatak prospects.
See the Company’s news release dated November 24, 2015 for a complete list of assay results.
These prospects collectively define a highly prospective and under-explored environment close to
the current mineral resource and infrastructure.
About the Haines Block and Lease
The Haines Block shares similar geology to the Palmer Property and is considered prospective for
hosting high-grade massive sulphide mineralization. The property also covers areas upland of the active
Porcupine placer gold district that has estimated past production of 82,489 ounces of gold. This
represents the first time the Haines Block has been offered to the public for lease, with very limited
exploration work having taken place in recent decades. Please refer to the Company’s September 9,
2014 news release for additional details about the Haines Block lease agreement.
About the Constantine-Dowa Option and Joint Venture Agreement
Under the terms of an Option and Joint Venture Agreement (the “Agreement”) dated February 1, 2013,
Dowa has the option to earn a 49% interest in the Palmer project by making aggregate expenditures of
US$22,000,000 over a four year period. Expenditures for each year shall not be less than US$3,000,000.
Included in the aggregate expenditure are cash payments to Constantine totaling US$1,250,000 over four
years, of which US$1,000,000 has been received to date. Constantine is the operator of the project and
receives a management fee for work programs during the earn-in period. Constantine has received over
US $15 million from Dowa in combined project expenditures, property payments and management fees in
connection with the project to date.
In March 2015, the Company completed a finder’s fee payment of US$75,970 in connection with the
Agreement. The finder’s fee was completed by the payment of US$20,000 cash and the balance through
the issuance of 493,336 common shares of the Company. A total of US$203,470 in finder’s fees has
been paid in connection with the Dowa agreement, as of the date of this report. The aggregate amount of
finder’s fees payable by the Company in regard to the Dowa agreement is capped at US$250,000.
Gold Projects
Constantine controls a 100% interest in the Munro Croesus and Golden Mile projects in Ontario. The
Munro Croesus project includes the famous high-grade past-producing Croesus Gold Mine located along
the north side of the Pipestone Fault within the Porcupine Destor Fault zone corridor approximately 75
kilometers east of the center of the Timmins gold camp. The Golden Mile Project is also along the
Pipestone Fault, a splay of the Porcupine Destor Deformation Zone and located 30 kilometers east of
Timmins and 9 kilometers northeast of Goldcorp’s multi-million ounce Hoyle Pond Gold Mine. The
Company did not conduct exploration programs on its Ontario properties in 2015.
8
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
Munro-Croesus Project (Ontario)
The Munro-Croesus Project comprises the following properties: Munro-Croesus property, the Four
Corners Property and the JM Property. These properties straddle an area between the prolific Porcupine
Destor Fault Zone (PDDZ), the Pipestone Fault Zone and the Munro Break, and within the same
structural corridor that hosts the neighbouring Fenn-Gibb deposit and the Holt-McDermott and Holloway
Mines located 25 kilometers to the east, which have produced an aggregate of more than 2 million oz. of
gold. Constantine’s Munro-Croesus project area covers an approximately seven kilometer length of this
key structural corridor and has several well defined drilling targets.
The Munro Croesus property includes the formerly producing Croesus mine, known to have produced
some of the highest grade gold ever mined in Ontario. Three drilling programs (8,414 meters) have been
carried out by Constantine on the claims since it was acquired in 2007, The drilling located high-grade
Croesus type gold veins in the south offset fault block of the Croesus Mine vein and identified a new
footwall zone (200 Zone) of high-grade gold mineralization (12.2 g/t gold over 0.46m) at depth under the
historic mine workings. A 750 meter short hole drill program is recommended to test high grade vein
structures in the immediate hanging wall of the Croesus shaft that were intersected for the first time in the
2011 drill program. Nine rock samples of the northeast trending historic #2 Vein with observed widths to
12 meters, located to the southwest and along the same structural trend as the former producing high-
grade Croesus Mine yielded seven plus one gram gold assays over a strike length of approximately 400
meters, with a high value of 15.9 grams per tonne gold. The #2 Vein structure has not been drill tested
and drilling is proposed to test this southwest extension from the interpreted Croesus vein structure.
Eight strategic Munro Croesus property claims lie adjacent to the Fenn-Gib property which was acquired
by Lake Shore Gold Corp. (“Lake Shore”) from Barrick Gold Corporation for $60 million. Since acquiring
the Fenn-Gib property, Lake Shore carried out additional drilling and completed a NI 43-101 resource
estimation. This resource estimate, reported by Lake Shore, includes a total of 40.8 million tonnes
grading 0.99 grams per tonne ("gpt") for a total of 1.35 million contained gold ounces in the Indicated
category and 24.5 million tonnes at 0.95 gpt for a total of 0.75 million ounces gold in the Inferred
category. Lake Shore subsequently completed a drilling program at Fenn-Gib and announced
mineralized intercepts confirming expansion potential of Lake Shore’s resource to the west (Lake Shore
news release May 1, 2012) towards Constantine's eight “Horseshoe claims”. Constantine’s 100% owned
“Horseshoe claims” are located within 300 meters west and along trend from the Fenn-Gib gold resource.
The discovery of the Horseshoe Zone gold mineralization in outcrop in 2012 indicates the potential for
expansion of the Fenn-Gib gold deposit along trend to the west across the southern part of Constantine’s
Horseshoe claims. A 1500 meter drill program would provide an initial test of this highly prospective area.
The JM property, part of the Munro Croesus project, was acquired by staking in August 2010 and consists
of 2 claims (4 units, 65 hectares) immediately to the north of the Munro Croesus property. The property
covers the projected extension of the favourable Croesus mine stratigraphy to the northwest of the
Croesus Mine. Geological mapping and sampling was carried out for assessment work and six samples
from a new gold showing yielded 5 five assays greater than 3 g/t gold with a high value of 15 g/t gold.
On the Four Corners property, Constantine has fulfilled the terms of the underlying option agreement
(subject to an annual advanced royalty payment of $5,000/year and a 2.5% Net Smelter Return Royalty)
to acquire a 100% interest in the 63 claim property that forms part of the Munro-Croesus project. The
Four Corners Property is located 1.2 kilometers east of the Munro Croesus property, contiguous with
Lake Shore’s Fenn-Gib property.
9
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
The geological setting at Four Corners shares many similarities to classic Archean gold systems. Since
acquiring the Four Corners property in 2008, the Company has previously reported on the drilling of 3
holes (1,079 meters) on the Perry Pond prospect (2009 and 2011) and trenching and drilling of 3 holes
(949 meters) in the Canamax zone area (2010 and 2011). The wide spaced (100 meters) drilling at the
Canamax Zone identified broad intervals of gold mineralization within a robust carbonate +/- silica+/-
fuchsite alteration zone (e.g. 18.25 meters grading 0.34 g/t gold in CMX11-01 and 10.05 meters grading
0.55 g/t gold in CMX11-03A).
Golden Mile Property (Ontario)
The Company completed a 1,182 meter drill program on the Golden Mile project in Timmins, Ontario in
2014 and regained a 100% interest in the project from option partner, Teck Resources Limited (“Teck”),
who funded expenditures of over $1.2 million on the project. Sufficient assessment reporting has been
completed to maintain the property in good standing for several years.
Drilling confirmed the presence of a major structure interpreted to be a western extension of the
Pipestone Fault, which is associated with important gold mineralization along trend to both the east and
west of the Golden Mile property. Strongly altered ultramafic rock units were intersected in contact with a
graphitic shear zone and pyritic sediments in the two drill holes designed to test the interpreted structural
contact. Notably, neither the structure nor the altered ultramafics intersected in these drill holes had been
previously identified on government geology maps. The drilling program yielded some weakly anomalous
gold. Management is encouraged by the identification of an important structure, alteration with
associated pathfinder geochemistry, veining and permissive rock units known to be important hosts for
mineralization within the Timmins gold camp. This work has provided an excellent stepping stone for
future advancement and discovery on the large, well located land package.
The Golden Mile property covers the important Pipestone Fault System where it crosses the “Porcupine
Giant Mine Corridor” that has produced more than 55 million ounces of gold. This structural intersection,
which contains excellent targets within the Kidd-Munro volcanic sequence and adjacent Porcupine
sediments, is overburden covered and has seen very limited drill testing for gold. The 423 claim unit, 68
square kilometer Golden Mile property is located 9 kilometers northeast of Goldcorp Inc.’s multimillion
ounce Hoyle Pond deposit and is comparable in area to the West Timmins and Main Camp holdings of
the major gold production companies operating in the Timmins Gold Camp.
The Company is continuing to evaluate opportunities to joint venture its Ontario gold projects.
Yukon Exploration Properties
The Company and Carlin Gold Corporation (“Carlin Gold”) control over 3,000 claims in the Mayo and
Watson Lake Mining Districts, Yukon. The claims are distributed in twelve blocks that total approximately
65,000 hectares (250 square miles).
The Company and Carlin Gold do not plan to pursue exploration on the Yukon exploration properties in
the next year. Based on an impairment review of the Yukon properties, conducted by the Company in
accordance with IFRS, in April 2015 Constantine recorded a $858,218 writedown of the property to a
value of $1.
The Company is evaluating opportunities to joint venture its Yukon and Ontario gold projects.
10
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
Impairment Review of Exploration and Evaluation Properties
In April 2015, the Company recorded a writedown of its Yukon exploration and evaluation properties and
incurred a charge of $858,218 on its Statement of Loss.
Following the end of the fiscal year, the Company conducted an impairment review of its exploration
properties, in accordance with International Financial Reporting Standards as issued by the International
Accounting Standards Board. A number of factors were considered, including exploration expenditures,
geologic merit, indicated property market value and market capitalization of the Company. Other than the
writedown of its Yukon land position and joint venture interest, no other write-downs were indicated as of
October 31, 2015 or as of the date of this report.
Results of Operations
Exploration and Evaluation Property Expenditures
In the year ended October 31, 2015, the Company incurred expenditures of $7,382,537 on exploration
and evaluation properties. The Palmer project accounted for $7,305,686 of those expenditures. In the
year ended October 31, 2015, the Company recorded cost recoveries and project management fees
received from Dowa totaling $7,759,123. For the year ended October 31, 2015, the Company incurred
costs totaling $76,851 on the remainder of its exploration and evaluation properties.
Operating Costs
The Company recorded cash operating expenses of $426,808 for the year ended October 31, 2015
compared to cash operating costs of $459,956 for the previous year. A breakdown of total general and
administrative costs for the years ended October 31, 2015 is shown in the table below. Total costs were
slightly higher than the previous year (2014-$156,205), primarily due to higher conference, trade show
and advertising costs. The Company is projecting that such costs will remain in the same range for the
next fiscal year.
11
General and Administrative expenses for the year ended October 31, 2015AmountConferences, trade shows and advertising $ 76,629 Accounting and administration60,000Office expenses41,034Transfer agent, listing and filing fees18,166Other4,581Total $ 200,410
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
Annual Financial Information
Selected annual financial information for the three years ended October 31, 2015, 2014 and 2013 as
follows:
At October 31,
Loss before other items
Net loss for the year
Loss per share
Total assets
Total liabilities
Total shareholders’ equity
Summary of Quarterly Results
2015
$ (558,527)
(1,414,641)
(0.01)
13,958,516
285,842
13,672,674
2014
$ (657,890)
(1,087,362)
(0.01)
15,216,499
261,313
14,955,186
2013
$ (531,263)
(1,365,872)
(0.01)
15,863,681
143,921
15,719,760
In the three months ended October 31, 2015, the Company incurred aggregate expenditures, before cost
recoveries, of $3,375,715 on exploration and evaluations properties, most of which ($3,359,686) was
incurred on the Palmer project, which was the sole active exploration project during the quarter. The
Company recorded cash operating expenses of $77,928 for the three months ended October 31, 2015,
compared to cash operating expenses of $112,622 for the same period last year.
The following is a summary of certain consolidated financial information of the Company for the past eight
quarters:
Financial Condition, Liquidity and Capital Resources
The Company is not in commercial production on any of its mineral properties and accordingly, it does not
generate cash from operations. The Company finances its activities by raising capital through the equity
markets, option and joint venture agreements that provide cash payments and management fees, and
monetization of assets. In the year ended October 31, 2015, the Company recorded an aggregate of
$630,891 (2014-$620,491) in option payments and management and project fees from operating the
Palmer project.
12
For Quarter EndedTotalAssetsIncome(Loss)Income(Loss)per shareOctober 31, 2015$ 13,958,516 $ (148,405)$ (0.00)July 31, 2015 14,885,665 (101,128) (0.00)April 30, 2015 14,087,749 (1,117,375) (0.01)January 31, 2015 15,083,372 (47,733) (0.00)October 31, 2014 15,216,499 (150,468) (0.00)July 31, 2014 17,581,033 (72,603) (0.00)April 30, 2014 15,354,071 (189,706) (0.00)January 31, 2014 15,383,934 (674,585) (0.01)
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
The Company's cash position at October 31, 2015 was $396,069 (2014-$587,481) and its working capital
at October 31, 2015 was $440,630 (2014-$470,841). At October 31, 2015, the Company had $238,334 in
exploration costs recoverable from Dowa, which were received in November 2015.
The Company’s cash position and working capital as of the date of this report are approximately
$430,000 cash and $360,000 working capital
The Company is dependent on equity capital to fund exploration and development of exploration
properties and its on-going operations. Constantine currently has an option/joint venture agreement in
place which is projected to fund its major project in Alaska in 2016, however additional working capital will
be required in order to finance further exploration work on its other properties.
At this time, the Company has no material contractual commitments for capital expenditures.
Off-Balance Sheet Arrangements
The Company has not entered into any off-balance sheet financing arrangements.
Related Party Transactions
The following represents the details of related party transactions paid or accrued for the years ended
October 31, 2015 and 2014:
As at October 31, 2015, the unpaid portion of amounts due to key management is $3,199 (2014-$3,966).
The Company paid NS Star Enterprises Ltd., a company controlled by a director, $41,044 for
management and administration services during the year ended October 31, 2015 (2014 - $15,300). The
Company paid Morfopoulos Consulting Associates Ltd., a company controlled by the CFO, $72,000 for
accounting, and management and administration services during the year ended October 31, 2015 (2014-
$72,000). The Company paid D. Green Geoscience Inc., a company controlled by the vice-president of
exploration, $178,426 for technical consulting and management and administration services during the
year ended October 31, 2015 (2014 - $177,821). The Company paid 44984 Yukon Ltd., a company
controlled by a director of the Company, $2,134 for miscellaneous field operating supplies and services
during the year ended October 31, 2015 (2014 - $3,833).
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For the years ended October 31,20152014Consulting,administrativeandtechnicalfeespaidoraccruedtocompaniesownedbydirectors $ 43,178 $ 9,833 Consulting fees paid to officers 178,426 81,296 Accounting and administration fees paid or accrued to a company 50% owned by an officer72,00036,000Share-based payments to key management71,745 96,087 $ 365,349 $ 223,216
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
Management of Capital
The Company manages its cash, common shares and stock options as capital. The Company’s
objectives when managing capital are to safeguard the Company’s ability to continue as a going concern
in order to pursue the development of its mineral properties and to maintain a flexible capital structure
which optimizes the costs of capital at an acceptable risk. The Company does not have any externally
imposed capital requirements to which it is subject.
The Company manages the capital structure and makes adjustments to it in light of changes in economic
conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure,
the Company may attempt to issue new shares, issue debt, acquire or dispose of assets or adjust the
amount of cash and cash equivalents.
In order to facilitate the management of its capital requirements, the Company prepares expenditure
budgets that are updated as necessary depending on various factors, including successful capital
deployment and general industry conditions.
In order to maximize ongoing exploration efforts, the Company does not pay out dividends. The
Company’s investment policy is to keep its cash treasury on deposit in an interest bearing Canadian
chartered bank account.
Summary of Outstanding Shares Data
The Company had 116,846,001 shares outstanding on October 31, 2015 and 116,906,061 shares
outstanding as of the date of this report.
In December 2015, the Company issued 60,000 shares in regard to a property option payment on the
Golden Mile property.
In March 2015, the Company issued 493,336 shares as part of a success fee payment in regard to the
option and joint venture agreement on the Palmer property
In December 2014, the Company issued 48,000 shares in regard to a property option payment on the
Golden Mile property.
On March 6, 2015, an aggregate of 1,400,000 stock options at a price of $0.14 and exercisable for five
years were granted to directors, officers and employees of the Company.
The following stock options were outstanding at October 31, 2015:
No. of Stock Options
1,875,000
5,400,000
1,400,000
8,675,000
Price per Share
$0.11
$0.07
$0.14
Expiry Date
March 5, 2017
January 17, 2019
March 6, 2020
14
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
Corporate Governance
Management of the Company is responsible for the preparation and presentation of the interim and
annual financial statements and notes thereto, MD&A and other information contained in this MD&A.
Additionally, it is management’s responsibility to ensure the Company complies with the laws and
regulations applicable to its activities.
The Company’s management is held accountable to the Board of Directors (“Directors”), each member of
which is elected annually by the shareholders of the Company. The Directors are responsible for
reviewing and approving the annual audited financial statements and MD&A. Responsibility for the
review and approval of the Company’s unaudited interim financial statements and MD&A is delegated by
the Directors to the Audit Committee, which is comprised of three directors, two of whom are independent
of management. Additionally, the Audit Committee pre-approves audit and non-audit services provided
by the Company’s auditors.
The auditors are appointed annually by the shareholders to conduct an audit of the financial statements in
accordance with generally accepted auditing standards. The external auditors have complete access to
the Audit Committee to discuss the audit, financial reporting and related matters resulting from the annual
audit as well as assist the members of the Audit Committee in discharging their corporate governance
responsibilities.
Risk Factors
Companies operating in the mining industry face many and varied kind of risks. While risk management
cannot eliminate the impact of all potential risks, the Company strives to manage such risks to the extent
possible and practical. Following are the risk factors most applicable to the Company.
Financial
The Company has not generated any revenue since inception and has never paid any dividends and is
unlikely to pay dividends or generate earnings in the immediate or foreseeable future. As at October 31,
2015, the Company has incurred losses since inception and has an accumulated operating deficit of
$8,525,761. The continuation and long-term viability of the Company remains dependent upon its ability
to obtain necessary equity financing to continue operations and to determine the existence, discovery and
successful exploitation of economically recoverable reserves in its resource properties, confirmation of the
Company’s interests in the underlying properties, and the attainment of profitable operations.
Industry
Exploring and developing mineral resource projects bears a high potential for all manner of risks.
Additionally, few exploration projects successfully achieve development due to factors that cannot be
predicted or foreseen. Moreover, even one such factor may result in the economic viability of a project
being detrimentally impacted such that it is not feasible or practical to proceed. The Company monitors
its risk based activities and periodically employs experienced consulting, engineering, insurance and legal
advisors to assist in its risk management reviews.
15
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
Although the Company has taken steps to verify the title to mineral properties in which it has an interest,
in accordance with industry standards for the current stage of exploration of such properties, these
procedures do not guarantee the company's title. Property title may be subject to unregistered prior
agreements or transfers and title may be affected by undetected defects.
Metal Prices
The principal activity of the Company is the exploration and development of precious metal and base
metal resource properties. The feasible development of such properties is highly dependent upon the
price of gold, silver, copper lead and zinc. A sustained and substantial decline in precious metal and
base metal commodity prices could result in the write-down, termination of exploration and development
work or loss of its interests in identified resource properties. Although such prices cannot be forecasted
with certainty, the Company carefully monitors factors which could affect precious metal and base metal
commodity prices in order to assess the feasibility of its resource projects.
Political Risk
The resource properties on which the Company is actively pursuing its exploration and development
activities are located in Alaska, USA and Ontario, Canada. While the political climate in Alaska, British
Columbia and Ontario is considered by the Company to be stable, there can be no assurances that this
will continue indefinitely. To alleviate such risk, the Company funds its operations on an as-needed basis.
The Company does not presently maintain political risk insurance for its foreign exploration projects.
Environmental
Exploration and development projects are subject to the environmental laws and regulations of the state
of Alaska and of the United States of America (Palmer project) and the environmental laws and
regulations of Canada and the province of Ontario (Munro-Croesus and Golden Mile projects). As such
laws are subject to change, the Company monitors proposed and potential changes and management
believes the Company remains in compliance with current environmental regulations in the relevant
jurisdictions.
On the Palmer project, reclamation of disturbances related to the Company’s permitted exploration
activities are bonded under the Alaska State-wide Bond Pool. The Company has also contracted an
ASTM Phase 1 environmental site assessment (ESA) on the federal lode mining claims of the Palmer
project. The ESA concluded that there are no environmental concerns associated with the Property.
The Munro Croesus project includes the very small past producing Munro Croesus Gold Mine that mined
approximately 5000 tons of ore. The Company has assumed the environmental liability at the Croesus
minesite on the Munro Croesus property. To date it has not incurred any material expenses, however it
does remain an uncertain liability. The Ontario government requires a closure plan if the claims are
abandoned or become inactive and the closure plan will require some water sampling and site
reclamation costs. The previous owner completed remediation of what the Company considers to be the
major liabilities, which included capping the Walsh and Croesus shafts. The Croesus minesite was visited
by a mines inspector in September 2010 and an inspection report received from the Ministry of Northern
Development, Mines and Forestry (Ontario) in early 2011. The summary of field observations and
recommendations in the Inspection Report are near surface stope stability concerns and recommendation
for a crown pillar stability assessment. There is a specific near-term recommendation to secure the
location of a small raise to surface that is filled with waste rock with a fence and signs. The bedrock
around the small raise to surface that is filled with waste rock and the crown pillar at the Croesus shaft
16
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
was cleared of surface rubble by an excavating program in October 2011. The small raise area was
fenced and cautionary signage was installed. A preliminary evaluation of the near surface stope stability
and a crown pillar stability assessment was completed by a qualified engineer, independent of the
Company. The initial conclusion based on historic data and new information from drill data through the
old workings and the recent excavation work is that the “old workings will stand for a long time” and that
“surface subsidence would be minimal at the down-dip edge of the zone and could be as much as 1
meter near the upper edge.” Now that the crown pillar is exposed, a site visit by a qualified Ontario mining
engineer is required with formal reporting of the conclusions to be made to the Ministry of Northern
Development, Mines and Forestry (Ontario). Surface water samples upstream and downstream of the site
have been recommended to determine water quality issues. No specific schedule has been established to
carry out this work.
Operational
Exploration development projects require third party contractors for the execution of certain activities.
The availability and cost of third party contractors is subject to a competitive environment for their use,
which is beyond the control of the Company.
Credit risk
Credit risk is the risk of potential loss to the Company if a customer or counterparty to a financial
instrument fails to meets its contractual obligations. The Company’s credit risk is limited to the carrying
amount on the balance sheet and arises from the Company’s cash and receivables.
The Company’s cash is held primarily through a Canadian chartered bank, which is a high-credit quality
financial institution. The credit risk in receivables is considered low by management as it consists
primarily of amounts owing for Canadian government sales tax credits.
Liquidity risk
Liquidity risk is the risk that the Company will not meet its financial obligations as they fall due. The
Company’s approach to managing liquidity risk is to ensure that it will have sufficient liquidity to meet
liabilities when due. At October 31, 2015, the Company had a cash balance of $396,069 to settle current
liabilities of $285,842.
All other financial liabilities have maturities of 30 days or are due on demand and are subject to normal
trade terms.
Market risk
Market risk is the risk of loss that may arise from changes in market factors such as interest rates and
foreign exchange rates.
Interest rate risk
The Company has cash balances and no interest-bearing debt. The Company’s current policy is to invest
excess cash in investment-grade short-term certificates of deposits issued by its banking institutions. The
Company periodically monitors the investments it makes and is satisfied with the credit ratings of its
banks.
17
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
Foreign currency rate risk
The Company’s functional currency is the Canadian dollar and major purchases are transacted in
Canadian dollars. Management believes the foreign exchange risk derived from currency conversions is
insignificant and therefore does not hedge its foreign exchange risk.
Sensitivity analysis
The carrying value of cash, receivables, accounts payable, and amounts due to related parties closely
approximate their fair values in view of the relatively short periods to maturities of these financial
instruments.
Based on management’s knowledge of and experience in the financial markets, management does not
believe that the Company’s current financial instruments will be materially affected by credit risk, liquidity
risk or market risk.
Forward-Looking Statements
Forward-looking statements include, but are not limited to statements regarding the use of proceeds,
costs and timing of the development of new deposits, statements with respect to success of exploration
and development activities, permitting time lines, currency fluctuations, environmental risks, unanticipated
reclamation expenses, and title disputes or claims.
Forward-looking statements often, but not always are identified by the use of words such as “plans”,
“seeks”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “targets”,
“forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and
phrases or statements that certain actions, events or results “may”, “should”, “could”, “would”, “might”,
“will”, or “will be taken”, “occur” or “be achieved”.
Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other
factors which may cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements expressed or implied by the
forward-looking statements. These statements are based on a number of assumptions and factors,
including assumptions regarding general market conditions; future prices of gold and other metals;
possible variations in ore resources, grade or recovery rates; actual results of current exploration
activities; actual results of current reclamation activities; conclusions of future economic evaluations;
changes in project parameters as plans continue to be refined; failure of plant, equipment, or processes
to operate as anticipated; accidents, labour disputes and other risks of the mining industry; risks related to
joint venture operations; timing and receipt of regulatory approvals of operations; the ability of the
Company and other relevant parties to satisfy regulatory requirements; the availability of financing for
proposed transactions and programs on reasonable terms; the ability of third-party service providers to
deliver services on reasonable terms and in a timely manner; and delays in the completion of
development or construction activities. Other factors that could cause the actual results to differ include
market prices, results of exploration, availability of capital and financing on acceptable terms, inability to
obtain required regulatory approvals, unanticipated difficulties or costs in any rehabilitation which may be
necessary, market conditions and general business, economic, competitive, political and social
conditions. Although the Company has attempted to identify important factors that could cause actual
results to differ materially from those expressed or implied in forward-looking statements, there may be
other factors which cause actual results to differ. Significant additional drilling is required by the Company
at its Palmer property to fully understand the system size before a meaningful resource can be calculated
18
Management’s Discussion and Analysis
For the year ended October 31, 2015
(Expressed in Canadian dollars)
and completed. Accordingly, readers should not place undue reliance on forward-looking statements.
This MD&A includes, but is not limited to, forward-looking statements regarding: the Company’s plans for
upcoming exploration work on the Company’s exploration properties in Alaska, and the Company’s ability
to meet its working capital needs for the next fiscal year.
Forward-looking statements contained herein are made as of the date of this MD&A and the Company
disclaims any obligation to update any forward-looking statements, whether as a result of new
information, future events or results or otherwise, except as required by applicable securities laws.
Approval
Darwin Green, P. Geo., Vice-President Exploration for Constantine, and a qualified person as defined by
Canadian National Instrument 43-101, has reviewed the technical information contained in this MD&A
and has also verified the analytical data for drill core samples disclosed in this release by reviewing the
blanks duplicates and certified reference material standards and confirming that they fall within limits as
determined by acceptable industry practice.
Ian Cunningham-Dunlop, P.Eng. and Technical Advisor to Constantine Metal Resources Ltd., is a
Qualified Person as defined by NI 43-101 for the Palmer project. James N. Gray, P.Geo. of Advantage
Geoservices Ltd. is the Qualified Person as defined by NI 43-101 for the resource estimate discussed
above. They have reviewed and approved the contents of this MD&A.
The Board of Directors of the Company has approved the disclosure contained in this MD&A. A copy of
this MD&A will be provided to anyone who requests it.
Additional Information
Additional disclosures pertaining to the Company’s technical reports, management information circulars,
material change reports, press releases and other information are available on the SEDAR website at
www.sedar.com.
19