Condensed Interim Consolidated Financial Statements For the Nine Months Ended 30 June 2025 VIEW

2020

2025

Notice of No Auditor Review of Condensed Interim Consolidated Financial Statements

The accompanying unaudited condensed interim consolidated financial statements of the Company have been

prepared by and are the responsibility of the Company's management.

The Company's independent auditor has not performed a review of these condensed interim consolidated financial statements in accordance with standards established by the Chartered Professional Accountants of Canada for a review of interim financial statements by an entity's auditor.

Table of Contents

Management's Responsibility 1

Condensed Interim Consolidated Statements of Financial Position 2

Condensed Interim Consolidated Statements of Loss and Comprehensive Loss 3

Condensed Interim Consolidated Statements of Changes in Equity 4

Condensed Interim Consolidated Statements of Cash Flows 5

1. Nature of operations and going concern 6

2. Basis of preparation - Statement of Compliance 6

3. Summary of significant accounting policies 7

4. Critical accounting judgements and key sources of estimation uncertainty 7

5. Financial instruments and risk management 8

6. Amounts receivable 10

7. Share proceeds receivable 10

8. Construction in progress 12

9. Deposits 13

10. Property, plant, and equipment 14

11. Exploration and evaluation assets 15

12. Short-term loans 18

13. Convertible debentures 18

14. USDA loan payable 19

15. PAB loan payable 20

16. State of Utah loan payable 22

17. Share capital 22

18. Related party transactions and obligations 27

19. Segmented disclosure 28

20. Capital management 28

21. Commitments and contingencies 28

To the Shareholders of Ares Strategic Mining Inc.:

Management is responsible for the preparation and presentation of the accompanying Condensed Interim Consolidated Financial Statements, including responsibility for significant accounting judgments and estimates in accordance with International Financial Reporting Standards. This responsibility includes selecting appropriate accounting principles and methods, and making decisions affecting the measurement of transactions in which objective judgment is required.

In discharging its responsibilities for the integrity and fairness of the Condensed Interim Consolidated Financial Statements, management designs and maintains the necessary accounting systems and related internal controls to provide reasonable assurance that transactions are authorized, assets are safeguarded and financial records are properly maintained to provide reliable information for the preparation of the condensed interim consolidated financial statements.

The Board of Directors and the Audit Committee are composed primarily of Directors who are neither management nor employees of the Company. The Board is responsible for overseeing management in the performance of its financial reporting responsibilities, and for approving the financial information included in the annual report. The Board fulfils these responsibilities by reviewing the financial information prepared by management and discussing relevant matters with management and the external auditors. The Audit Committee has the responsibility of meeting with management, and the external auditors to discuss the internal controls over the financial reporting process, auditing matters and financial reporting issues. The Audit Committee is also responsible for recommending the appointment of Ares Strategic Mining Inc.'s external auditors.

We draw attention to Note 1 in the Condensed Interim Consolidated Financial Statements which indicates the existence of a material uncertainty that may cast significant doubt on the Company's ability to continue as a going concern.

"James Walker" "Viktoriya Griffin"

James Walker, CEO Viktoriya Griffin, CFO

As at 30 June

As at 30 September

Note

2025

2024

The Condensed Interim Consolidated Financial Statements were approved by the Board of Directors on 29 August 2025 and were signed on its behalf by:

"Paul Sarjeant" "Raul Sanabria"

Paul Sarjeant, Director Raul Sanabria, Director

(Unaudited) Canadian Dollars

Note

9 Months

Ended 30 June 2025

9 Months

Ended 30 June 2024

3 Months

Ended 30 June 2025

3 Months

Ended 30 June 2024

(Unaudited) Canadian Dollars

Equity attributable to shareholders

9 Months Ended

9 Months Ended

Note

30 June 2025

30 June 2024

Notes to the Condensed Interim Consolidated Financial Statements

1. ‌Nature of operations and going concern

   Ares Strategic Mining Inc. ("Ares" or the "Company"), was incorporated pursuant to the Company Act (Ontario) by registration of its Memorandum and Articles on 20 November 2009. On 9 July 2010, the Company registered in British Columbia for extra provincial registration as the Company's administrative office is located at 1001-409 Granville Street, Vancouver BC, V6C 1T2. The Company is classified as a Junior Natural Resource Mining Company and is listed on the Canadian Securities Exchange under the stock symbol "ARS".

   The Company was previously in the business of acquiring and exploring lithium properties in Nevada and Arizona. On 18 February 2020, the Company completed a three-cornered amalgamation transaction (the "Amalgamation") with American Strategic Minerals Inc. ("ASM"). As a result, Ares is focusing on progressing its fluorspar projects towards exploitation, production, and supplying metspar and acidspar to the markets.

   These Condensed Interim Consolidated Financial Statements (the "Financial Statements") have been prepared on the basis of the accounting principles applicable to a going concern, which assumes the Company will be able to continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations. There are several adverse conditions that cast significant doubt upon the soundness of this assumption. The business of mining and exploration involves a high degree of risk and there can be no assurance that current exploration programs will result in profitable mining operations. The recoverability of exploration and evaluation expenditures is dependent upon several factors; these factors include the discovery of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete the development of these properties, and future profitable production or proceeds from disposition of mineral properties.

   Consistent with other companies, in the sector of mineral exploration, the Company has incurred operating losses since inception, has limited sources of revenue, is unable to self-finance operations and has significant cash requirements to meet its overhead and maintain its mineral interests. These factors indicate the existence of a material uncertainty which casts significant doubt on the Company's ability to continue as a going concern.

   For the Company to continue to operate as a going concern, it must continue to obtain additional financing to maintain operations. Although the Company has been successful in the past at raising funds, there can be no assurance that this will continue in the future. If the going concern assumptions were not appropriate for these Financial Statements, then adjustments would be necessary to the carrying value of assets and liabilities, the reported expenses and the statement of financial position classifications used, and such adjustments could be material.

   (Rounded 000's) 30 June

   2025

   30 September

   2024

   Working capital (deficit)	$	2,628,000	$ (9,448,000)
   Accumulated deficit attributed to shareholders	$	(36,443,000)	$ (34,675,000)

2. ‌Basis of preparation - Statement of Compliance

   These Financial Statements, including comparatives, have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). The Financial Statements have been prepared on a historical cost basis, except for financial instruments classified as financial instruments at fair value through profit and loss, which are stated at their fair value. In addition, these Financial Statements have been prepared using the accrual basis of accounting except for cash flow information.

   Since the Financial Statements do not include all disclosures required by the International Financial Reporting Standards ("IFRS") for annual financial statements, they should be read in conjunction with the Company's audited annual consolidated financial statements for the year ended 30 September 2024.

   Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

   The policies set out were consistently applied to all the years presented unless otherwise noted below. The preparation of the condensed interim consolidated financial statements requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company's accounting policies.

   The preparation of the Financial Statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, profit 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, the results of 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.

3. ‌Summary of significant accounting policies

   The accounting policies and methods of computation followed in preparing these Financial Statements are the same as those followed in preparing the most recent audited annual financial statements. For a complete summary of significant accounting policies, please refer to the Company's audited annual consolidated financial statements for the year ended 30 September 2024.

4. ‌Critical accounting judgements and key sources of estimation uncertainty

   In the application of the Company's accounting policies, management is required to make judgments, estimates and assumptions about the carrying amount and classification of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. 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 revisions affect only that period, or in the period of the revision and future periods, if the revision affects both current and future periods.

   The following are the critical judgments and areas involving estimates, that management have made in the process of applying the Company's accounting policies and that have the most significant effect on the amount recognized in the Financial Statements.

   1. Judgements Income taxes

      Deferred tax assets are recognized for all deductible temporary differences, carry-forward of unused tax assets and

      unused tax losses, to the extent that probable that future taxable profit will be available against which the deductible temporary differences and carry-forward of unused tax assets and unused tax losses can be utilized. In addition, the valuation of tax credits receivable requires management to make judgements on the amount and timing of recovery.

      Going concern evaluation

      As discussed on Note 1, these Financial Statements have been prepared under the assumptions applicable to a going concern. If the going concern assumption were not appropriate for these Financial Statements, then adjustments would be necessary to the carrying value of assets and liabilities, the reported expenses and the statement of financial position classifications used and such adjustments could be material.

      The Company reviews the going concern assessment at the end of each reporting period. There were no material changes to the assessment as at 30 June 2025.

      Exploration evaluation assets

      Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

      The Company makes certain estimates and assumptions regarding the recoverability of the carrying values of exploration and evaluation assets. The amounts shown for exploration and evaluation assets do not necessarily represent present or future values. The recoverability of the assets' carrying values is dependent upon the determination of economically recoverable reserves, the ability of the Company to obtain the necessary financing and permits to complete development and future profitable production or proceeds from the disposition thereof.

      The Company has taken steps to verify title to exploration and evaluation assets in which it has or is in the process of earning an interest, including review of condition of title reports, vesting deeds, mining claim location notices and filings, and property tax and other public records and is not presently aware of any title defects. The procedures the Company has undertaken and may undertake in the future to verify title provide no assurance that the underlying properties are not subject to prior agreements or transfers of which the Company is unaware.

      Long-lived assets

      The Company makes certain judgments in its assessment of whether indicators of impairment exist with respect to its long-lived assets. The carrying amounts of the Company's long-lived assets are reviewed at each reporting date for indicators of impairment. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the amount of the impairment, if any. The recoverable amount of an asset is evaluated at the cash‐generating unit level, which is the smallest identifiable group of assets that generates cash inflows that are largely ind ependent of the cash inflows from other assets or group of assets. The recoverable amount of a CGU is the greater of its fair value less costs to sell and its value in use.

   2. Estimates

      Stock-based compensation

      The company uses Black-Scholes Option Pricing Model for valuation of stock options. Option pricing models require the input of subjective assumptions and estimates including expected price volatility, interest rate and forfeiture rate.

      Convertible debt

      The Company uses an estimated discount rate to determine the liability component of convertible debentures issued during the year.

5. ‌Financial instruments and risk management

   1. Financial instrument classification and measurement

      Financial instruments of the Company carried on the Condensed Interim Consolidated Statement of Financial Position are carried at amortized cost. There are no significant differences between the carrying value of financial instruments and their estimated fair values as at 30 June 2025. There have been no changes in levels during the period.

      The Company classifies the fair value of these transactions according to the following hierarchy:

      • Level 1 - quoted prices in active markets for identical financial instruments.

      • Level 2 - quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets.

        Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

      • Level 3 - valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

   2. Fair values of financial assets and liabilities

      The Company's financial instruments include cash and cash equivalents, accounts payable, short-term loans and long-term loans. As at 30 June 2025, the carrying value of cash and cash equivalents is at fair value. Accounts payable and short-term loans approximate their fair value due to their short-term nature.

   3. Market risk

      Market risk is the risk that changes in market prices will affect the Company's earnings or the value of its financial instruments. Market risk is comprised of commodity price risk and interest rate risk. The objective of market risk management is to manage and control exposures within acceptable limits, while maximizing returns. The Company is not exposed to significant market risk.

   4. Credit risk

      Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. The Company's primary exposure to credit risk is on its bank accounts. The Company's bank accounts are held with major banks in Canada, accordingly the Company is not exposed to significant credit risk.

   5. Interest rate risk

      Interest rate risk is the risk of losses that arise as a result of changes in contracted interest rates. The Company is not exposed to significant interest rate risk.

   6. Currency risk

      Currency risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company is exposed to foreign currency risk on its restricted cash and USDA and PAB loans payable balances that are denominated in other than the functional currencies. As at 30 June 2025, the Company held currency totalling the following:

      Currency (Rounded)

      30 June

      2025

      30 September

      2024

      Canadian (Dollars)	$ 137,000	180,000
      US (Dollars)	$ 9,767,000	1,509,000

      Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

   7. Liquidity risk

   Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they come due. The Company controls liquidity risk by ensuring that it has sufficient cash resources to pay for its financial obligations. As at 30 June 2025, the Company had a cash balance of $13,462,947 to settle current liabilities of $14,336,408 that are due within one year. The Company's outstanding liabilities, their current values and the principal amounts along with the due dates are as stated in the table below:

   	Carrying value	Principal amount	Less than 1 year	1 - 5 years	5+ years
   Accounts payable and accrued liabilities	$ 4,163,484	$ 4,163,484	$ 4,163,484	$ -	$ -
   Short-term loans	1,179,072	1,179,072	1,179,072	-	-
   Convertible debentures	269,064	269,064	269,064	-	-
   USDA loan	7,278,630	7,278,630	7,278,630	-	-
   State of Utah bill	13,866,063	13,866,063	13,866,063		13,866,063
   PAB loan	12,766,448	9,905,000	1,655,500	5,950,000	2,700,000
   Total	$ 39,493,183	$ 36,631,735	$ 28,382,235	$ 5,950,000	$ 16,566,063

6. ‌Amounts receivable

   Amounts receivable consists of:

   Amounts Receivable

   30 June

   2025

   30 September

   2024

   Goods and services tax receivable Receivable on disposition	$ 24,372 60,498	$ 32,892 21,345
   	84,870	54,237

7. ‌Share proceeds receivable

   The following table summarizes the details of share proceeds receivable associated with Sorbie Bornholm LP

   ("Sorbie") equity swap agreements, measured through profit and loss:

   SHARE PROCEEDS RECEIVABLE

   30 June

   2025

   30 September

   2024

   Balance - Beginning of Period	$ 846,547	$ -
   Addition of share proceeds receivable (initial recognition)	842,006	830,086
   Proceeds received, net	499,006	-
   Unrealized gain	631,986	16,461
   Balance - End of Period	$ 2,819,545	$ 846,547

   Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

   The following table provides a breakdown of the share proceeds receivable between current and non-current assets based on the timing of the expected cash flows:

   SHARE PROCEEDS RECEIVABLE

   30 June

   2025

   30 September

   2024

   Current	$ 1,100,825	$ 452,804
   Non-current	720,708	393,743
   	$ 1,821,533	$ 846,547

   On 2 April 2025, the Company entered into another Subscription Agreement with Sorbie whereby Sorbie agreed to purchase 7,229,730 Units at a price of C$0.1998 per Unit for gross proceeds of $1,000,0000 over 24 months. Each Unit consists of one common share in the capital of the Company ("Common Share") and one common share purchase warrant ("Warrant"), Note 17.

   Sorbie and the Company entered into an equity swap agreement ("Sharing Agreement") at C$0.1998 (the "Benchmark Price"). The Sharing Agreement shall provide the Company's economic interest will be realized in 24 monthly settlement tranches as measured against the Benchmark Price. If, at the time of settlement, the Settlement Price (determined monthly based on a volume weighted average price for 20 trading days prior to settlement date) ("Settlement Price") exceeds the Benchmark Price, the Company shall receive more than 100% of the monthly settlement due, on a pro rata basis. There is no upper limit placed on the additional proceeds receivable by the Company as part of the monthly settlements. If, at the time of settlement, the Settlement Price is below the Benchmark Price, the Company will receive less than the 100% of the monthly settlement due, on a pro rata basis.

   The share proceeds receivable relating to the cash receivable of $1,000,000 do not meet the classification of a financial asset measured at amortized cost or at fair value through other comprehensive income as the Company does not have a business model whose objective is to hold financial assets in order to collect contractual cash flows, and the financial asset does not give rise to cash flows that are solely payments of principal and interest. Therefore, the cash receivable is classified as a financial asset measured at fair value through profit or loss.

   In accordance with IFRS 9, 7,229,730 units were valued based on the fair value of the share proceeds receivable. The Company assessed the fair value of the share proceeds receivable under IFRS 9 and determined to be $842,006 on the date of issuance. The corresponding fair value of the equity instruments of $842,006 was allocated between the common shares and the warrants based on their relative fair values in accordance with IAS 32 and the Company's accounting policy.

   Subsequent Measurement of the financial asset was revalued at 30 June 2025 with the difference between the initial valuation and the value recognized in profit or loss as an unrealized gain (loss) on financial asset. On 30 June 2025, the fair value of the share proceeds receivable was calculated based on the net present value of each future expected cash flows relating to the receivable, adjusted for the observable Settlement Price on the date of measurement. As at 30 June 2025, based on the fair value calculations, the fair value of the share proceeds receivable was determined to be $1,393,246. This resulted in an increase to the carrying value of the share proceeds receivable of $551,240 which was recognized in the consolidated statement of loss and comprehensive loss as an unrealized gain on share proceeds receivable

   Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

   During the year ended 30 September 2024:

   As at 30 September 2024, the Company entered into a Subscription Agreement with Sorbie whereby Sorbie agreed to purchase 8,333,333 Units at a price of C$0.1800 per Unit for gross proceeds of $1,500,000 over 24 months. Each Unit consists of one Common Share in the capital of the Company and one Warrant, Note 17.

   Sorbie and the Company entered into a Sharing Agreement during Fiscal 2024 at C$0.2610 Benchmark Price described above.

   The share proceeds receivable relating to the cash receivable of $1,500,000 do not meet the classification of a financial asset measured at amortized cost or at fair value through other comprehensive income as the Company does not have a business model whose objective is to hold financial assets in order to collect contractual cash flows, and the financial asset does not give rise to cash flows that are solely payments of principal and interest. Therefore, the cash receivable is classified as a financial asset measured at fair value through profit or loss.

   In accordance with IFRS 9, 8,333,333 units were valued based on the fair value of the share proceeds receivable. The Company assessed the fair value of the share proceeds receivable under IFRS 9 and determined to be $830,086 on the date of issuance. The corresponding fair value of the equity instruments of $830,086 was allocated between the common shares and the warrants based on their relative fair values in accordance with IAS 32 and the Company's accounting policy.

   Subsequent Measurement of the financial asset was revalued at 30 September 2024 and 30 June 2025 with the difference between the initial valuation and the value recognized in profit or loss as an unrealized gain (loss) on financial asset. On 30 September 2024 and 30 June 2025, the fair value of the share proceeds receivable was calculated based on the net present value of each future expected cash flows relating to the receivable, adjusted for the observable Settlement Price on the date of measurement. As at 30 June 2025, based on the fair value calculations, the fair value of the share proceeds receivable was determined to be $501,087 (30 September 2024 -

   $846,547). This resulted in an increase to the carrying value of the share proceeds receivable of $60,372 (30 September 2024 - $16,461), which was recognized in the consolidated statement of loss and comprehensive loss as an unrealized gain on share proceeds receivable.

8. ‌Construction in progress

   During the year ended 30 September 2021, the Company entered into an agreement to acquire a fluorspar lump manufacturing facility (the "Facility") pursuant to the terms and conditions of a Profit-Sharing Agreement dated 9 February 2021, as amended (the "Profit Sharing Agreement") between the Company and the Mujim Group, a non-arm's length private Shanghai company ("Mujim"). Pursuant to the terms of the Profit-Sharing Agreement, the Company had agreed to acquire the Facility by issuing an aggregate of 5,300,000 common shares in the capital of the Company (each, a "Share"), the fair value of which was determined based on the date when they were issued,

   i.e. $0.67, and the consideration was recorded as a capital advance to Mujim as at 30 September 2021.

   The Company has agreed that, upon completion of the Facility, it would incur costs pertaining to the installation of the Facility, including compensating contractors from Mujim to assist with installation and to begin operating the Facility. Furthermore, once the Facility is operational within parameters and specifications defined in the Profit-

   Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

   Sharing Agreement, the company will pay Mujim, US$20 per ton for ongoing technical support, and has also agreed to pay Mujim, US$10 per ton as agency fee for any sales in Asia.

   The final purchase price may vary depending on certain target production output metrics defined in the Profit-Sharing agreement.

   During the year ended 30 September 2022, the Company received significant components (including the structure) of the Facility and incurred an additional $572,139 to acquire these additional components and structure for the Facility and received their delivery.

   During the year ended 30 September 2023, the Company completed the acquisition of industrial land (Note 10) for installation of the flotation Plant and incurred further costs towards its completion such as design work and other prerequisites.

   As at 30 September 2024, the construction of the Facility remains in progress. During the year ended 30 September

   2024, the Company incurred $5,416,599 (2023 ‐ $56,022) in construction costs on the Facility which included

   $1,214,437 (2023 ‐ $nil) of capitalized borrowing costs. The Company is expected to incur additional costs to

   complete the installation and begin operations.

9. ‌Deposits

Deposits consist of:

30 June

2025

30 September

2024

‌As at 30 June 2025, the balance in deposits of $6,309 (2024 - $$2,912) increased with the renewal of short term lease and represents a deposit for office lease; reclamation surety and bond in the amount of $278,994 (2024 - $276,070) paid to the State of Utah for a five-year escalation at Lost Sheep and Bell Hill.

Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

Property and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.

Depreciation is charged to recognize the cost of the asset on the condensed interim consolidated statements of comprehensive loss using the straight-line method over the estimated useful life of the asset.

Depreciation is charged to recognize the cost of the asset on the Consolidated Statements of Loss and Comprehensive loss using the straight-line method over the estimated useful life of the asset.

During the year ended 30 September 2023, the Company acquired an industrial land parcel located in Millard County, State of Utah in the United States for the purpose of setting up its fluorspar plant, which was pledged as collateral on the USDA loan. There were no additions during the nine-month period ended 30 June 2025.

In addition to the land parcel acquired during the year, land comprises five Canadian properties located in Ontario, Canada (Note 11(f)). The Company earns revenues from sale of quarry rock located on these properties. These revenues are offset against maintenance payments made on the property and are included within the resource property expense on the consolidated statement of loss and comprehensive loss.

Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

1. ‌Exploration and evaluation assets

   The following table summarizes exploration and evaluation assets:

   Ares Strategic Mining Inc.

   FOR THE NINE MONTHS PERIOD ENDED 30 JUNE 2025

   (Unaudited) Canadian Dollars

   	Spor	Liard	Vanadium	Jackpot		Ontario
   Exploration and Evaluation Assets	Mountain	Fluorspar	Ridge	Lake	Wilcox Playa	Properties	Total
   Balance as at 1 October 2023	$ 7,960,140	-	-	-	-	4	7,960,144
   Geological consulting	267,486	-	-	-	-	-	267,486
   Staking and claiming	85,942	-	-	-	-	-	85,942
   Adjustments on currency translation	48,579	-	-	-	-	-	48,579
   Balance as at 30 September 2024	$ 8,362,147	-	-	-	-	4	8,362,151

   Geological consulting	50,987	-	-	-	-	-	50,987
   Acquisition Administration and camp	8,136 16,184	- -	- -	- -	- -	- -	8,136 16,184
   Staking and claiming Adjustments on currency translation	1,828 89,466	- -	- -	- -	- -	- -	1,828 89,466
   Balance as at 30 June 2025	$ 8,528,748	-	-	-	-	4	8,528,748

   
   
   Ares Strategic Mining Inc.

   FOR THE SIX MONTHS ENDED 31 MARCH 2025

   (Unaudited) Canadian Dollars

   Notes to the Consolidated Financial Statements (Cont.)

   1. Spor Mountain (also known as Lost Sheep)

      The Company holds a 100% interest in and rights to certain U.S. federal mining claims located at the north-east end of the Spor Mountain Mining District, in section 21, T.12S. 12W, and T.13S. 12W, SLBM of Juab County, western Utah, USA (the "Spor Mountain"). The Spor Mountain property consists of several mineral claim blocks including the Lost Sheep Fluoride Mine, and other unpatented claims. The Company acquired its initial interest through the Amalgamation on 18 February 2020. During the year ended 30 September 2021, the Company acquired additional claims in the region through staking.

      As part of the amalgamation with ASM, the Company assumed an underlying property purchase agreement (the "Purchase Agreement") for certain unpatented claims comprising the Spor Mountain property, pursuant to which the Company would be required to make a payment of US$1,000,000 within 18 months from the commencement of production. During the year ended 30 September 2021, USD $1,000,000 was transferred to the underlying vendor, pursuant to which, the Company is deemed to have fulfilled its obligations under the Purchase Agreement, and the title to the unpatented claims was transferred to the Company.

   2. Liard Fluorspar

      On 13 April 2020, the Company entered into an agreement to acquire 100% interest in 14 claims in the Liard Fluorspar property, located in British Columbia, from private owners of the property. The consideration is as follows:

      The sellers will retain a 2% of the Net Smelter Returns (NSR) Royalty payment of commercial production for the first 6 months of production, after which Ares will recover full revenues.

      During the year ended 30 September 2023, pursuant to an arrangement agreement with Enyo, the Company transferred all its right, title and interest in and to the Liard Fluorspar property to Enyo at its carrying amount. As a result, the associated assets were derecognized from these Financial Statements.

   3. Vanadium Ridge

      During the year ended 30 September 2022, the Company signed an agreement with Imbue Capital Inc. ("Imbue") for the purchase of an additional 30% beneficial and legal interest in and to the Vanadium Ridge Property, free and clear of all liens, security interests, mortgages, charges, encumbrances or other claims of any third party, whether registered or unregistered and whether arising by agreement, statute or otherwise, such that following the transaction, the Company shall own a combined 50% beneficial and legal interest in and to the Vanadium Ridge Property. As part of the transaction, the Company issued to Imbue an aggregate of 3,000,000 common shares on 19 November 2021. Imbue has agreed to contribute, in cash or equipment, an aggregate of $1,500,000 to the Vanadium Ridge Property, of which a minimum of

      $1,000,000 must be made in cash ("Cash Contribution"). The Company and Imbue agree that should the exploration of the Vanadium Ridge Property require any additional funding following the initial Imbue Cash Contribution, any such financial contribution shall be made equally by the parties.

      During the year ended 30 September 2018, the Company entered into an agreement to acquire 100% interest in the Vanadium Ridge property. The Vanadium Ridge property consists of 20 mining claims, covering over 5,200 acres, situated in close proximity to Kamloops, British Columbia. As consideration, the Company issued 2,500,000 common shares of the Company and paid $135,000 in cash. The vendor retains a 1% Net Smelter Returns Royalty.

      On 2 July 2018, the Company signed an agreement with Argentum to sell 80% interest in the Vanadium Ridge property to Argentum. In exchange, Argentum paid the Company $150,000 cash and issued 1,250,000 Argentum common shares, which were subsequently sold. As a result, the Company retained a 20% interest in the Vanadium Ridge property.

      Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

      During the year ended 30 September 2023, pursuant to an arrangement agreement with Enyo, the Company transferred all its right, title and interest in and to the Vanadium Ridge property to Enyo at its carrying amount. As a result, the associated assets were derecognized for these Financial Statements.

   4. Jackpot Lake property

      On 11 January 2019, the Company acquired 100% of the Jackpot Lake property. The seller retaining a 1% GOR, subject to a buyback provision whereby the Company may acquire, at any time, one-half of the GOR (0.5%) for $1,000,000.

      On 17 March 2022, the Company entered into a mineral property option agreement with USHA Resources Ltd. ("USHA") of Vancouver, British Columbia, whereby USHA was granted an exclusive option to acquire a 100% interest in the claims comprising the Jackpot Lake property in exchange for the following consideration:

      • $75,000 payable in cash (received in 2022) within five days from receiving approval from the TSX Venture Exchange.

      • $500,000 payable in common shares (received in 2022) of USHA within five days from the date of Exchange approval, to be issued at a deemed value at the greater of the 10-day volume weighted average price ("VWAP") or discounted market price.

      • $225,000 payable through a combination of cash or common shares of USHA (received in 2023), up to a maximum of 1,500,000 common shares of USHA, on the six-month anniversary date of the Exchange approval, to be issued at a deemed value at the greater of the 10-day VWAP or discounted market price.

      • $225,000 payable through a combination of cash or common shares of USHA (received in 2023), up to a maximum of 1,500,000 common shares, on the twelve-month anniversary date of the Exchange approval, to be issued at a deemed value at the greater of the 10-day VWAP or discounted market price.

        Additionally, USHA will be required to complete no less than $1,000,000 worth of Expenditures on the claims comprising the Jackpot Lake property within two years unless the option has been exercised in full. The Company will retain a 1% Gross Overriding Royalty (the "GORR"), subject to a buyback provision by USHA, whereby USHA may acquire, at any time, one-half of the GORR for $1,000,000. All securities issued in connection with the option agreement by USHA are subject to a four-month-and-one-day statutory hold period.

        During the year ended 30 September 2023, the Company recorded a gain on disposition of Jackpot Lake of $66,677 (2022

        - loss of $ 229,785) in the consolidated statement of loss and comprehensive loss.

   5. Wilcox Playa

      The Company had written off this property in the year ended 30 September 2019. During the year ended 30 September 2023, the Company sold this property, including its mining information and the right to receive the staking deposit for a cash consideration of $40,000 and receipt of 500,000 common shares in the capital of purchaser. As at 30 September 2023, 250,000 of these common shares were received. During the year ended 30 September 2023, the Company recorded a gain on disposition of Wilcox Playa of $162,196 in the consolidated statement of loss and comprehensive loss.

   6. Ontario properties

   The Company holds a 100% interest in five properties located in Ontario, Canada.

   Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

2. ‌Short-term loans

   The following is a summary of the Company's short-term loans as at 30 June 2025 and 30 September 2024:

   Outstanding

   SHORT-TERM LOANS Year

   Principal

   Operational loans from related parties	2025	$ 1,084,494
   	2024	$ 342,210
   Canada Emergency Business Account loan	2025	$ 29,578
   	2024	$ 34,773
   Others	2025	$ 65,000
   	2024	$ 65,000
   Total as at 30 June 2025	2025	$ 1,179,072
   Total as at 30 September 2024	2024	$ 441,983

   As at 30 June 2025 , the Company obtained a net $974;534 (30 September 2024 - $120,900) loan from the CEO as well as received $109,960 (30 September 2024 $108,810) in loans from companies related to directors of the Company subject to 10% per annum and maturing on 30 August 2025. There are no defined terms or due dates of repayment on the loans from the CEO and a non-related party obtained are unsecured. Canada Emergency Business Account loan of

   $60,000 was refinanced with the financial institution in order to repay the full amount in January 2024 and the Company qualified for $20,000 loan forgiveness which was recognized as other income during the year ended 30 September 2024. The refinanced balance of $40,000 is subsect to prime rate plus 2.14% per annum over 5-year term commencing on 18 January 2024.

3. ‌Convertible debentures

   On 2 December 2022, the Company closed a non-brokered private placement offering of secured convertible debentures totalling $1,252,700. The Company incurred a financing fee equal to 45% of the principal amount amounting to $563,715 and paid a finders' fee totalling $52,720 for net proceeds of $636,265. The principal amount of convertible debentures will be convertible at holder's option into full-paid common shares in the capital of the Company at any time prior to maturity in two years, at an exercise price of $0.26 per common share. Interest on the debentures shall be paid semi-annually at an annual interest rate of 12% per annum.

   In connection with the convertible debentures, the Company also issued 202,771 finders' warrants, with each warrant exercisable into one common share of the Company for a period of two years at a price of $0.26 per common share. The fair value of the warrants was calculated to be $20,000 using the Black-Scholes option pricing model.

   During the period ended 30 June 2025, the Company converted their principal convertible debt of $1,070,900 and associated interest of $319,227 into common shares of the Company.

   The following table summarizes the accounting for the convertible debentures and the amounts recognized during the period/year.

   Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

   Convertible Debentures

   30 June

   2025

   30 September

   2024

   Balance - Beginning of Period/Year	$ 1,386,189	713,865
   Interest expense	127,690	152,830
   Accretion expense	145,446	519,494
   Settlement through shares	(1,390,127)	-
   Balance - End of Period/Year	$ 269,198	1,386,189

4. ‌USDA loan payable

   On 30 June 2023, the Company's subsidiary, Ares Utah, signed a promissory note agreement with Community Bank & Trust ("CB&T") - West Georgia and received a total loan of US$4,420,000 at prime rate stated in money rates section of Wall Street journal plus 2.50%., in lieu of which it pledged its land that was purchased in conjunction with the proceeds and situated in Utah (Note 0. The loan matures in 15 years and is guaranteed by the US Department of Agriculture ("USDA"). The interest is due and payable on the 1stof each month starting 1 May 2023 for the initial 12 months after which the Company is required to repay the monthly instalment consisting of the principal and interest (as per repayment schedule) on each payment date. For the purpose of securing payments and obligations, the Company granted the power of sale and right of the parcel of the land purchased with the proceeds as well as all the proceeds and awards or payments from the land purchased.

   	Amount
   Principal amount (US$4,420,000)	$ 5,979,597
   Less: Transaction cost (US$382,176)	(534,243)
   Amount funded, 30 June 2023	5,445,354

   USDA Loan Payable

   31 December

   2024

   30 September

   2024

   Balance - Beginning of Period/Year	$ 5,768,569	$ 5,501,049
   Amortization of transactions costs - accretion and other	17,359	488,898
   Add: Principal amount received	1,637,160	-
   Less: Principal amount repaid	(201,240)	(187,317)
   Adjustment on currency translation	56,782	(34,061)
   Balance - End of Period/Year	$ 7,278,630	$ 5,768,569

   The Company has acted as a guarantor in securing the USDA loan payable, and the Company and its subsidiary, Ares Utah, have provided as collateral, interest in all of the Company's rights, title and interest in and to all property and fixtures (current and future) of the Company and its subsidiaries. In connection with the USDA loan payable, Ares Utah is subject to the following financial covenants:

   Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

   • Maintain a debt service coverage ratio of at least 1.25 to 1.0, tested annually, beginning December 31, 2023 and for the remaining term of the loan period; and

   • Maintain a debt to net worth ration not to exceed 9.0 to 1.0 at any time, which is to be tested annually.

     As at 30 June 2025, the Company received US$1,200,000 loan maturing on 27 August 2025 that will be used to pay for outstanding interest payments, and remaining balance is US$580,675.

     As at 30 June 2025 and 31 December 2024, the Company did not meet the above covenants and therefore, the USDA loan is in default and has been classified as current liability.

5. ‌PAB loan payable

   On 15 December 2023, the Company's subsidiary, Ares Utah closed on the State of Utah's Private Activity Bond ("PAB") program from Millard County, Utah ("Millard County") pursuant to a US$10,000,000 tax-exempt Manufacturing Facility Revenue Bond (the "Series 2023A Bond"), and a US$500,000 taxable Manufacturing Facility Revenue Bond (the "Series 2023B Bond"). The repayment of interest on both the bonds begins 15 December 2024 whereas the principal sum of the Series 2023A Bonds begins annually from 15 December 2025 to 15 December 2034 while the Series 2023B bonds are due to be paid all at once on 15 December 2025. As part of the closing, the Company incurred transaction costs in the amount of US$1,666,940 which were allocated to the issuance cost of loan payable and deducted from the principal value.

   In addition, the Company entered into a Guaranty Agreement and Guaranty of Completion agreement with the Trustee, pursuant to which the Company agreed to guaranty certain obligations of Ares Utah, including the repayment of the principal, interest and other amounts owed under the Bonds. The proceeds from the Bonds will be used by Ares Utah to acquire, construct, and develop a processing facility (the "Project") on the Company's Lost Sheet Fluorspar Project located in Delta, Millard County, Utah.

   During the period ended 30 June 2025, interest expense capitalized within construction in progress was US$, 1,060,000 and accretion expense, the amortization of debt costs are being recognized over the loan period, with a total of US$105,673 (30 September 2024 - US$418,774) being recognized as accretion expense and recorded within the interest and accretion expense line.

   Notes to the Condensed Interim Consolidated Financial Statements	(CONT.)
   The Company also issued 6,780,500 common shares in conjunction with those bonds.
   	Amount
   Amount funded: Principal amount (US$10,500,000)	$ 14,175,000
   Transaction cash cost	(907,572)
   Transaction shares issued cost	(1,356,100)
   Amortization of transaction costs - accretion	569,868
   Adjustments on currency translation	8,781
   PAB loan balance as at 30 September 2024	$ 12,489,977

   Amortization of transaction costs - accretion Adjustments on currency translation	131,525 144,946
   PAB loan balance as at 30 June 2025 Less: Current portion Non-current portion	$ 12,766,448
   	$ (1,446,158) $ (11,320,290)

   The Company has acted as a guarantor in securing the PAB loan payable, and the Company and its subsidiary, Ares Utah, have provided as collateral, interest in 5.5 out of 48 acres of Ares Utah's rights, title and interest in property and fixtures (current and future) of the Company and its subsidiaries situated on the site funded by the PAB, the Project. In connection with the PAB loan payable, Ares Utah is subject to the following financial covenants:

   • Maintain coverage ratio covenant of at least 1.10 or above for each Fiscal Year commencing more than year after the completion of construction and installation of the Project.

     The repayment commitment of 2023A Bonds has been described in the table below:

     Financial year	Principal (USD)	Interest (USD)
     2025	595,000	530,000
     2026	665,000	990,500
     2027	730,000	924,000
     2028	805,000	851,000
     2029	880,000	770,500
     2030 and above	6,825,000	2,341,000

     Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

6. ‌State of Utah loan payable

   On 30 May 2025, the Company's subsidiary, Ares Utah, signed a promissory note agreement with the State of Utah through the Permanent Community Impact Fund Board and received a total loan of US$11,000,000 at a simple interest rate of 4.50%. The loan matures on 1 May 2031 ("Maturity Date") for payment in full with accrued interest. Ares Utah may, but not obligated to make interim payments, of any amount, without penalty, and a final payment will be paid on the Maturity Date.

   This Note is secured by and is entitled to the benefits and security contemplated by a Trust Deed Security Agreement and Fixture Filing ("Trust Deed"), covering real property and related improvements, and certain equipment, machinery and fixtures, situated in Millard County, Utah.

   			Amount
   Principal amount		US$	11,000,000
   Less: Transaction cost			(836,500)
   Amount funded, 30 May 2023			10,163,500
   ‌17) Share capital
   a) Authorized:
   Unlimited common shares without par value.
   b) Issued or allotted and fully paid:
   During the nine months period ended 30 June 2025:
   	Number of Shares		Amount
   Balance as at 1 October 2024	173,417,021	$	44,383,773
   Shares issued for debt	9,235,035		1,662,849
   Shares issued for Sorbie (Note 7)	7,229,730		842,006
   Shares issued for exercise of options	6,792,131		882,977
   Shares issued for convertible debt settlement	5,346,642		1,390,127
   Shares issued for Offering, net	765,170 137,731
   Balance as 30 June 2025	202,785,729 $ 49,434,929
   During the nine months period ended 30 June 2025:

   • The Company issued 9,235,035 common shares to settle a debt of $1,662,849.

   • 6,792,131 options were exercised for gross proceeds of $882,977.

   • Certain purchasers of Ares debentures have converted their sum of $1,070,900 principal and $319,227 interest to 5,346,642 Ares common shares. All shares issued are subject to a four-month hold period in accordance with applicable securities laws.

   • The Company closed the Offering of units (each, a "Unit") by issuing 765,170 Units at a price of $0.18 per Unit, for aggregate gross proceeds of $137,731. Each Unit consists of one common share in the capital of

     Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

     the Company (each, a "Common Share") and one nontransferable Common Share purchase warrant (each, a "Warrant"). Each Warrant is exercisable into one Common Share (each, a "Warrant Share") at a price of

     $0.26 per Warrant Share for a period of two years.

   • As at 30 June 2025, the Company has raised an additional amount of $1,000,000 payable in 24 monthly settlement tranches based on the volume weighted average price of the common shares against a benchmark price of C$0.1998 from Sorbie and issued 8,333,333 units to Sorbie (Note 7). Each unit consists of one common share in the capital of the Company (each, a "Common Share") and one non-transferable Common Share purchase warrant (each, a "Warrant"). Each Warrant entitles the holder to acquire one additional Common Share in the capital of the Company (each, a "Warrant Share") at a price of $0.26 per Common Share however, that if the ten-day volume-weighted average trading price of the Shares as quoted on the Canadian Securities Exchange (the "CSE") (or such other securities exchange on which the Shares may be traded at such time) is equal to or greater than C$0.40 at the close of any trading day, then Ares may, at its option, accelerate the expiry date of the Warrants by issuing a press release (a "Warrant Acceleration Press Release") announcing that the expiry date of the Warrants shall be deemed to be on the 30th day following the date of the Warrant Acceleration Press Release (the "Accelerated Expiry Date"). All Warrants that remain unexercised following the Accelerated Expiry Date shall immediately expire and all rights of holders of such Warrants shall be terminated without any compensation to such holder. Warrants will include a provision prohibiting exercise if such exercise will take the holder above a 9.99% ownership.

     During the year ended 30 September 2024:

   • As at 30 September 2024, the Company has raised an aggregate amount of $2,868,947 from the five tranche closings of the LIFE Offering. The Company issued 15,938,596 units at a price of $0.18 per Unit. Each Unit consists of one common share in the capital of the Company (each, a "Common Share") and one nontransferable Common Share purchase warrant (each, a "Warrant"). Each Warrant will entitle the holder to acquire one additional Common Share in the capital of the Company (each, a "Warrant Share") at a price of

     $0.26 per Common Share for a period of two years following the closing date of the LIFE Offering subject to accelerated provisions. In connection with the closing of the first, second, and third tranches, an aggregate of $259,203 was paid in cash and a total of 744,376 finder's warrants (each, a "Finder's Warrant") were issued as finder's fees. Each Finder's Warrant entitles the holder thereof to acquire one common share in the capital of the Company (a "Finder's Warrant Share") at a price of $0.26 per Finder's Warrant Share for a period of two years subject to accelerated provisions following the closing date of the first tranche.

   • The Company issued 6,780,500 shares against the discount in lieu of the PAB loan funding received during the year, Note 15.

   • As at 30 September 2024, the Company has raised an amount of $1,500,000 payable in 24 monthly settlement tranches based on the volume weighted average price of the common shares against a benchmark price of $0.2610 from Sorbie and issued 8,333,333 units to Sorbie (Note 7) and terms above. As consideration for entering into the Sharing Agreement, the Company agreed to pay a Value Payment of

$105,000 to be paid by the Company to Sorbie in either cash or Units at the placement price of $0.18. The Company paid the Value Payment by issuing 583,333 Units to Sorbie consisting of one common share and one common share purchase warrant per unit. In concurrence with the agreements entered into with Sorbie, the Company entered into a finders agreement with a third party, whereby the Company agreed to pay cash finders fee of $105,000, equal to 7% of total funds raised (Consultancy Fee), in addition to one warrant per share of common stock equivalent to the $105,000 consultancy fee. The number of warrants

Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

issuable was determined by calculating the equivalent to the number of shares that could be purchased with the Consultancy Fee at a volume weighted average price for 20 trading days prior to the payment of the Consultancy Fee or 620,567 warrants. Upon the initial recognition, the Company issued the 8,333,333 Units in exchange for cash receivable and using the Black-Scholes pricing model, the fair value of the 8,333,333 warrants was determined to be $895,475. The fair value of the 8,333,333 common shares was determined to be $1,416,666 based on the closing trading price of the Company's shares on the date of issuance of $0.17. Based on these amounts, on initial recognition of its fair value at $830,086, the Company allocated $321,486 to the 8,333,333 warrants with $508,600 allocated to the 8,333,333 shares issued. The issuance cost of 583,333 units were issued in lieu of $105,000 based on the terms of the agreement. The

$105,000 value of the units was required to be allocated between the common shares and finder warrants based on their relative fair values. The 583,333 warrants included in the units were issued to Sorbie in exchange for services rendered and therefore the warrants were accounted for in accordance with IFRS 2. As the fair value of the services received cannot be reliably measured, the Company determined the fair value of the warrants using the Black Scholes Option Pricing Model. Using the Black-Scholes pricing model, the 583,333 warrants were valued at $62,683. The fair value of the 583,333 common shares was determined to be $99,167 based on the closing trading price of the Company's shares on the date of issuance of $0.17. Based on these amounts, the $105,000 was allocated as $64,334 to the common shares, and $40,666 to the warrants. The Company is also obligated to pay an agent fee of $105,000 in cash and 620,567 agent warrants that are yet to be accounted for in accordance with IFRS 2. However, the warrants have not yet been issued, awaiting on the Exchange approval. The Company will value the warrants using the Black-Scholes pricing model as well, and recognize the fair value as a deduction from equity upon issuance.

1. Summary of stock option activity

   The Company has adopted an incentive stock option plan to grant options to directors, officers, and consultants for up to 10% of the outstanding common shares. The Board of Directors determines the exercise price per share and the vesting period under the plan. The options can be granted for a maximum term of five years.

   Stock option activity during the nine months period ended 30 June 2025 and 30 September 2024:

   Stock Option Activity

   30 June

   2025

   Weighted Average Exercise Price

   30 September

   2024

   Weighted Average Exercise Price

   Balance - Beginning of Period Exercised Expired	21,793,053 $ 0.12 (6,792,131) - (15,000,922) -	22,238,053 $ 0.12 (445,000) 0.12 - -
   Balance - End of Period	- $ -	21,793,053 $ 0.12

   (1)The exercise price of these stock options was modified to $0.12 upon completion of the spin-out transaction on 15 Spetember2023 (see Note 1).

   Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

   Details of stock options outstanding as at 30 June 2025 and 30 September 2024 are as follows:

   Issuance Date Expiry Date

   Exercise

   Price

   30 June

   2025

   30 September

   2024

   10 February 2023 10 February 2025 $ 0.12	-	21,793,053
   	-	21,793,053

   As at 30 June 2025, the outstanding options have a weighted average remaining life of nil years (2024 -0.36 years) and a weighted average exercise price of $0.12 (2024- $0.12).

   The Company did not grant any stock options during the period ended 30 June 2025. During the year ended 30 September 2024:

   The Company did not grant any stock options during the year ended 30 September 2024.

2. Warrants

   Warrant activity during the nine months ended 30 June 2025 and 30 September 2024 are as follows:

   Weighted

   Weighted

   Warrant Activity

   30 June

   2025

   Average Exercise Price

   30 September

   2024

   Average Exercise Price

   Balance - Beginning of Period Issued Expired	25,903,772 8,898,446 (202,771)	$ 0.26 0.25 -	2,026,568 25,701,001 (1,823,797)	0.45 0.26 0.45
   Balance - End of Period	34,599,447	$ 0.26	25,903,772	$ 0.26

   During the period ended 30 June 2025:

   Details of warrants outstanding as at 30 June 2025 and 30 September 2024 are as follows:

   Issuance Date Expiry Date

   Exercise

   Price

   30 June

   2025

   30 September

   2024

   15 December 2022	15 December 2024	$ 0.26	-	202,771
   31 May 2024	31 May 2026	$ 0.26	6,463,784	6,463,784
   07 June 2024	07 June 2026	$ 0.26	5,709,592	5,709,592
   28 June 2024	28 June 2026	$ 0.26	2,102,914	2,102,914
   16 July 2024	16 July 2026	$ 0.26	1,019,219	1,019,219
   1 August 2024	1 August 2026	$ 0.26	1,387,720	1,387,720
   11 September 2024	11 September 2026	$ 0.26	9,017,772	9,017,772
   07 October 2024	07 October 2026	$ 0.26	765,170	-
   11 March 2025	11 March 2028	$ 0.30	649,113	-
   8 April 2025	8 April 2028	$ 0.24	7,229,730	-
   30 May 2025	30 May 2028	$ 0.30	254,433	-
   			34,599,447	25,903,772

   ‌Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

   As at 30 June 2025, the outstanding warrants have a weighted average remaining life of 1.46 years (2024 - 1.78 years) and a weighted average exercise price of $0.26 (2024- $0.26).

3. Share-based payments

   During the nine months period ended 30 June 2025, the Company did not grant any incentive stock options (30 September 2024 - Nil) to its directors, officer, and consultants.

4. Non-controlling interest

   On 16 October 2014, the Company entered into an investment agreement with OMC Investments Limited ("OMC"), of Hong Kong. The transaction closed on 28 November 2014, and the Company issued 19,048,000 units of the Company by way of private placement at a price of $0.05 per unit, for aggregate proceeds of $952,400. After the 20-for-1 share consolidation during the year ended 30 September 2018, OMC owns 952,400 units. Each Unit consisted of one common share and one common share purchase warrant. Each Warrant is exercisable for a period of six years from the date of closing of the private placement at an exercise price of $0.05. These warrants expired on 30 September 2018. OMC now holds approximately 5.93% of the issued and outstanding shares of the Company. The Company also issued 15 common shares of its subsidiary Canadian Iron to OMC, reducing its ownership share from 100% to 85%. Canadian Iron holds a 100% interest in Karas Iron and Griffith Iron. The Company's interests in the Karas and Griffith properties are held in Karas Iron and Griffith Iron, respectively.

   In addition, the shareholders' agreement with OMC will allow OMC to progressively earn additional equity in

   Canadian Iron, up to a total of 70% of Canadian Iron's issued and outstanding shares, as follows:

   • an additional 30% for $8.2 million in funding from OMC for dewatering, resource drilling and

     environmental permitting ("Resource Definition Funding");

   • an additional 5% for $2 million in total funding for a preliminary economic assessment, funded 70% by OMC and 30% by Ares; and

   • an additional 20% for $20 million in total funding for a feasibility study, funded 70% by OMC and 30% by Ares, and assuming the feasibility study establishes technical and economic viability.

Should either party not fully contribute its share of funding to both the preliminary economic assessment and feasibility study, it may face dilution.

In connection with this transaction, the Company has also agreed to enter into an option agreement with OMC on its other mineral properties. As of 30 September 2023, OMC has not entered into any option agreements related to the Company's other mineral properties. Should OMC fund the full $8.2 million Resource Definition Funding, it has the right to acquire an 80% interest in either the El Sol, Whitemud and Papagonga properties. This may be increased to 90%, if within a five-year period after earning 80%, OMC funds an additional $1.5 million in expenditures on the property chosen.

The value attributed to the non-controlling interest in the Company as at 30 June 2025 is an accumulated deficit of

$1,218,874 (2024 - $1,220,065). For the period ended 30 June 2025, net income and comprehensive income of

$1,191 (2024 - loss of $2,043) has been attributed to the non-controlling interest in these Financial Statements.

Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

1. ‌Related party transactions and obligations

   Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or common significant influence. Related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties.

   The Company compensates certain of its key management personnel to operate its business in the normal course. Key management includes the Company's executive officers and members of its Board of Directors. Transactions and balances with key management personnel and related parties not disclosed elsewhere in the Financial Statements are as follows:

   Related Party Disclosure

   Name and Principal Position Year(i)

   Remuneration

   or fees(ii)

   Share-based payments

   Amounts Payable and Accrued Liabilities

   CEO and Director - Management	2025	$ 108,000	$ - $	757,395
   fees	2024	$ 108,000	$ - $	74,300
   CFO - Management fees	2025	$ 36,000	$ - $	-
   	2024	$ 36,000	$ - $	-
   CFO - Professional fees	2025	$ 71,279	$ - $	43,399
   	2024	$ 52,193	$ - $	23,495
   Directors - Director fees	2025	$ 750	$ - $ 123,214
   	2024	$ 1,000	$ - $ 5,500
   Directors - Consulting fees	2025	$ 21,000	$ - $	137,202
   	2024	$ 21,000	$ - $	82,077
   Former Director - Consulting fees	2025	$	- $ - $	-
   	2024	$	- $ - $	4,800
   Total	2025	$ 237,029	$ - $ 1,061,210
   	2024	$ 218,193	$ - $ 190,172

   (i) For the nine months period ended 30 June 2025 and 2024.

   (ii) Amounts disclosed were paid or accrued to the related party.

   These transactions were in the normal course of operations, which is the amount of consideration established and agreed to by the related parties.

   Accounts payable and accrued liabilities are unsecured, non-interest bearing and due on demand.

   Short-term loans with related parties are described in (Note 12). There are no terms and conditions attached to the said loans.

   During the year ended 30 September 2024, the Company purchased a flotation plant from a non-arm's length company, which is an entity controlled by a director of the Company and paid US$6,007,000 as a deposit. As at 30 June 2025, the plant was received and being assembled and thus recorded within construction in progress.

   Notes to the Condensed Interim Consolidated Financial Statements (Cont.)

2. ‌Segmented disclosure

   The Company has one reportable segment, being the acquisition, exploration, and development of resource properties. The following table provides segmented disclosure of assets and liabilities based on geographic location:

   (Rounded to 000's) Canada US Total

   30 June 2025
   Current Assets	$ 3,442,000 13,505,000	16,947,000
   Non-Current Assets
   Other non-current assets	$ 5,457,000 24,260,000	29,717,000
   Resource properties	$ 5,928,000 2,601,000	8,529,000
   Liabilities
   Current Liabilities	$ 4,731,000 9,605,000	14,336,000
   Non- Current Liabilities	$ 25,186,000	25,186,000

   30 September 2024
   Current Assets	$ 1,038,000	$ 1,108,000	$ 2,146,000
   Non-Current Assets
   Other non-current assets	4,413,000	2,956,000	7,369,000
   Resource properties	5,529,000	2,431,000	7,960,000
   Liabilities
   Current Liabilities	1,714,000	864,000	2,578,000
   Non-Current Liabilities	-	4,679,000	4,679,000

3. ‌Capital management

   The Company's capital consists of shareholders' equity and it has capital resources of cash. The Company's objective when managing capital is to maintain adequate levels of funding to support the development of its businesses and maintain the necessary corporate and administrative functions to facilitate these activities. This is done primarily through equity financing, selling assets, and incurring debt. Future financings are dependent on market conditions and there can be no assurance the Company will be able to raise funds in the future. The Company invests all capital that is surplus to its immediate operational needs in short-term, highly liquid, high-grade financial instruments. There were no changes to the Company's approach to capital management during the year. The Company is not subject to externally imposed capital requirements. The Company does not currently have adequate sources of capital to complete its exploration plan, current obligations and ultimately the development of its business, and will need to raise adequate capital by obtaining equity financing, selling assets and incurring debt. The Company may raise additional debt or equity financing in the near future to meet its current obligations.

4. ‌Commitments and contingencies

On 10 December 2021, the Company acquired an exclusive right and access to develop a project in Kentucky, US., for which an initial payment of $25,000 has already been made during the year ended September 30, 2022 for an initial term of one year (the "Initial Term"). The Company has also agreed to pay the previous owners of this project, a production royalty of $1 per ton of minerals mined from the property and upon exhaustion of the delineated historic resource estimate, a 5% NSR on further extracted minerals from the property. Upon the expiry of the Initial Term, there is an automatic renewal without notice for an additional one-year term ("Renewal Term") with additional $25,000 advance royalty payment to extend this agreement for up to three years, which the Company has not made that payment yet.