Fox River Resources Corporation — Audit Report / Information 2020

Feb 10, 2021

==> picture [289 x 98] intentionally omitted <==

Consolidated Financial Statements

October 31, 2020 and 2019

(presented in Canadian dollars)

Independent Auditor's Report

==> picture [107 x 35] intentionally omitted <==

To the Shareholders of Fox River Resources Corporation:

Opinion

We have audited the consolidated financial statements of Fox River Resources Corporation and its subsidiary (the "Company"), which comprise the consolidated statements of financial position as at October 31, 2020 and October 31, 2019, and the consolidated statements of operations and comprehensive income (loss), changes in shareholders' equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at October 31, 2020 and October 31, 2019, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with International Financial Reporting Standards.

Basis for Opinion

We conducted our audits in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audits of the consolidated financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Other Information

Management is responsible for the other information. The other information comprises Management’s Discussion and Analysis.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audits of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audits or otherwise appears to be materially misstated. We obtained Management’s Discussion and Analysis prior to the date of this auditor’s report. If, based on the work we have performed on this other information, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with International Financial Reporting Standards, 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.

In preparing the consolidated financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company’s financial reporting process.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit 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 Company’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audits and significant audit findings, including any significant deficiencies in internal control that we identify during our audits.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

The engagement partner on the audit resulting in this independent auditor's report is Brock Stroud.

==> picture [86 x 21] intentionally omitted <==

Toronto, Ontario February 10, 2021

Chartered Professional Accountants Licensed Public Accountants

==> picture [104 x 35] intentionally omitted <==

Fox River Resources Corporation Consolidated Statements of Financial Position

As at		Oct. 31, 2020		Oct. 31, 2019
Assets
Current assets
Cash and cash equivalents (note 3a)	$	592,666	$	867,400
Sales tax receivable		5,200		5,813
Prepaid expenses		7,011		6,742
Marketable securities (note 7)		39,104		28,576
		643,981		908,531
Non-current assets
Restricted cash (note 3a)		5,000		5,000
Total assets	$	648,981	$	913,531
Liabilities
Accounts payable and accrued liabilities	$	29,748	$	23,138
		29,748		23,138
Shareholders' equity
Share capital (note 4)		1,271,643		1,271,643
Share based payment reserve (note 5)		125,580		125,580
Deficit		(777,990)		(506,830)
		619,233		890,393
Total liabilities and shareholders' equity	$	648,981	$	913,531

Reporting entity (note 1) Commitments and contingencies (note 11)

Approved by the Board:

"Stephen Case" "Elizabeth Leonard" Director Director

The accompanying notes are an integral part of the consolidated financial statements.

1

Fox River Resources Corporation Consolidated Statements of Operations and Comprehensive Income (Loss)

	Year ended	Year ended	Year ended	Year ended
	Oct. 31, 2020		Oct. 31, 2019
Expenses
Consulting fees (note 10)	$	102,000	$	102,000
Exploration & evaluation expenditures (note 8 & 10)		88,232		44,478
Administration		48,163		39,917
Shareholder information		28,713		30,679
Professional fees		21,739		24,561
Share based payments (note 5 & 10)		-		29,000
(Loss) from operations		(288,847)		(270,635)
Interest income		7,159		17,391
Gain (loss) on change in fair value of marketable securities (note 7)		10,528		(11,550)
Net loss and comprehensive loss	$(271,160)		$(264,794)
Basic and fully diluted lossper share(note 6)	$	(0.007)	$	(0.006)

The accompanying notes are an integral part of the consolidated financial statements.

2

Fox River Resources Corporation Consolidated Statements of Cash Flows

For theyear ended,		Oct. 31, 2020		Oct. 31, 2019
Cash flows from operating activities
Net loss	$	(271,160)	$	(264,794)
Unrealized (gain) loss on marketable securities (note 7)		(10,528)		11,550
Share based payments (note 5)		-		29,000
Changes in non-cash working capital items
Accounts receivable		613		(580)
Prepaid expenses		(269)		(1,133)
Accounts payable and accrued liabilities		6,610		(2,815)
		(274,734)		(228,772)
Cash flows from investing activities
Purchase of marketable securities (note 7)		-		(40,126)
Net change in cash and cash equivalents		(274,734)		(268,898)
Cash and cash equivalents, beginning of year		867,400		1,136,298
Cash and cash equivalents, end ofyear	$	592,666	$	867,400
Supplemental cash flow information
Interest received	$	7,159	$	17,391

The accompanying notes are an integral part of the consolidated financial statements.

3

Fox River Resources Corporation Consolidated Statements of Changes in Shareholders' Equity

	Number	Share	Share based	Share based
	of shares	capital	payment reserve			Deficit		Total
Balance, October 31, 2018	41,278,527	$ 1,271,643	$	96,580	$	(242,036)	**$ **	1,126,187
Share based payments	-	-		29,000		-		29,000
Net loss and comprehensive loss for the year	-	-		-		(264,794)		(264,794)
Balance, October 31, 2019	41,278,527	$ 1,271,643	$	125,580	$	(506,830)	$	890,393
Net loss and comprehensive loss for the year	-	-		-		(271,160)		(271,160)
Balance, October 31, 2020	41,278,527	$ 1,271,643	$	125,580	$	(777,990)	$	619,233

The accompanying notes are an integral part of the consolidated financial statements.

4

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

1. REPORTING ENTITY

Fox River Resources Corporation (“Fox River” or the “Company”) was incorporated pursuant to the Canada Business Corporations Act under the name “9508309 Canada Inc.” on November 12, 2015. Articles of amendment were subsequently filed on December 7, 2015 to change the name of the Company to “Fox River Resources Corporation”. The registered office of the Company is located at 350 Bay Street, Suite 700, Toronto, Ontario M5H 2S6. The Company has one wholly-owned subsidiary: Baltic Resources Inc. ("Baltic").

The Company's business plan includes acquiring, exploring, evaluating and developing mineral and natural resources properties such as its wholly-owned Martison Phosphate Project.

In March 2020, the COVID-19 outbreak was declared a global pandemic by the World Health Organization. The situation is dynamic and the ultimate duration and magnitude of the impact on the economy, capital markets and the Company's financial position cannot be reasonably estimated at this time. The Company is monitoring developments and will adapt its business plans accordingly. The actual and threatened spread of COVID-19 globally could adversely impact the Company's ability to carry out its plans and raise capital. To date, the Company's operations have been minimally impacted and the Company continues to be able to plan and carry out activities.

2. BASIS OF PRESENTATION AND STATEMENT OF COMPLIANCE

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and interpretations of the IFRS Interpretations of the IFRS Interpretations Committee ("IFRIC").

These consolidated financial statements have been prepared on the basis of a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business, and on a historical cost basis except for the revaluation of certain financial instruments. In addition, these consolidated financial statements have been prepared using the accrual basis of accounting except for cash flow information.

The Board of Directors approved the consolidated financial statements and authorized their issuance on February, 10, 2021.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Cash and cash equivalents

Cash and cash equivalents include money market instruments and Guaranteed Investment Certificates ("GICs") which are readily convertible into cash or have maturities at the date of purchase of less than ninety days.

	October	31, 2020	October	31, 2019
Cash	$	54,378	$	86,100
Moneymarket instruments & GICs		538,288		781,300
Cash and cash equivalents	$	592,666	$	867,400

Restricted cash consists of GIC collateral of $5,000 for a corporate credit card.

5

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

(b) Changes in accounting policies

The Company adopted the following standard during the year ended October 31, 2020.

IFRS 16 supersedes IAS 17 Leases, IFRIC 4 Determining Whether an Arrangement Contains a Lease, SIC-15 Operating Leases - Incentives and SIC-27 Evaluating the Substance of Transactions Involving the Legal Form of a Lease. IFRS 16 introduces a single lessee accounting model that requires a lessee to recognize assets and liabilities for all leases with a term of more than 12 months, unless the underlying asset is of low value. Lease assets and liabilities are initially recognized on a present value basis and subsequently, similarly to other nonfinancial assets and financial liabilities, respectively. The lessor accounting requirements are substantially unchanged and, accordingly, continue to require classification and measurement as either operating or finance leases. The new standard also introduces detailed disclosure requirements for both the lessee and lessor. The effective date for the application of IFRS 16 was November 1, 2019. The Company's adoption of IFRS 16 did not have a material impact upon the condensed interim consolidated financial statements.

(c) Critical accounting estimates and significant judgements

The preparation of these financial statements requires management to make judgements and estimates the affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of expenses during the reporting period. The financial statements include judgements and estimates which, by their nature, are uncertain, and actual outcomes could differ. The impacts of such judgements and estimates are pervasive throughout the financial statements, and may require accounting adjustments based on future occurrences. Revisions to accounting estimates are recognized in the period in which the estimate is revised and also in future periods when the revision affects both current and future periods. The preparation of these financial statements required the following critical accounting estimates and significant judgements:

• (i) The fair value of stock options issued is subject to the limitations of the Black Scholes option pricing model that incorporates market data and involves uncertainty in estimates used by management in the assumptions. Because the Black Scholes option pricing model requires the input of highly subjective assumptions, including the volatility of share prices, changes in input assumptions can materially affect the fair value estimate.

• (ii) The preparation of the financial statements requires management to make judgments regarding the going concern of the Company.

(d) Functional and presentation currency

The financial statements are presented in Canadian dollars, which is also the Company's functional currency.

(e) Earnings (loss) per share

Basic earnings (loss) per common share amounts are computed by dividing net earnings (loss) by the weightedaverage number of common shares outstanding for the year. The diluted per share amount does not reflect the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted to common shares as it would be anti-dilutive.

6

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

(f) Financial instruments

Financial assets and financial liabilities are recognized when the Company becomes a party to the contractual provisions of the financial instrument. Under IFRS 9, financial assets are classified and measured based on the business model in which they are held and the characteristics of their contractual cash flows. IFRS 9 contains the primary measurement categories for financial assets: measured at amortized cost, fair value through other comprehensive income ("FVTOCI") and fair value through profit and loss ("FVTPL"). The new hedge accounting guidance aligns hedge accounting more closely with an entity's risk management objectives and strategies. IFRS 9 does not fundamentally change the types of hedging relationships or the requirement to measure and recognize ineffectiveness; however, it allows more hedging strategies used for risk management to qualify for hedge accounting and introduces more judgement to assess the effectiveness of a hedging relationship, primarily from a qualitative standpoint.

Below is a summary showing the classification and measurement bases of the Company's financial instruments:

Classification	IFRS 9
Cash and cash equivalents	FVTPL
Marketable securities	FVTPL
Restricted cash	Amortized cost
Accounts payable and accrued liabilities	Amortized cost

Financial assets

Financial assets are classified as either financial assets at FVTPL, amortized cost, or FVTOCI. The Company determines the classification of its financial assets at initial recognition.

Financial assets recorded at fair value through profit and loss (FVTPL)

Financial assets are classified as FVTPL if they do not meet the criteria of amortized cost or FVTOCI. Gains or losses on these items are recognized in profit or loss. The Company's cash and cash equivalents and marketable securities is classified as financial assets measured at FVTPL.

Amortized cost

Financial assets are classified as measured at amortized cost if both of the following criteria are met and the financial assets are not designated as at FVTPL: 1) the object of the Company's business model for these financial assets is to collect their contractual cash flows; and 2) the asset's contractual cash flows represent "solely payments of principal and interest". The Company's restricted cash is classified as a financial asset measured at amortized cost.

Financial assets recorded at fair value through other comprehensive income (FVTOCI)

On initial recognition of an equity investment that is not held for trading, the Company may irrevocably elect to measure the investment at FVOCI whereby changes in the investment’s fair value (realized and unrealized) will be recognized permanently in OCI with no reclassification to profit or loss. The election is made on an investment-byinvestment basis.

7

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

(f) Financial instruments (continued)

Financial liabilities

Financial liabilities are classified as either financial liabilities at FVTPL or at amortized cost. The Company determines the classification of its financial liabilities at initial recognition.

Amortized cost

Financial liabilities are classified as measured at amortized cost unless they fall into one of the following categories: financial liabilities at FVTPL, financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition, financial guarantee contracts, commitments to provide a loan at a below-market interest rate, or contingent consideration recognized by an acquirer in a business combination.

The Company's accounts payable and accrued liabilities does not fall into any of the exemptions and are therefore classified as measured at amortized cost.

Financial liabilities are classified as FVTPL if they fall into one of the five exemptions detailed above.

Transaction costs

Transaction costs associated with financial instruments, carried at FVTPL, are expensed as incurred, while transaction costs associated with all other financial instruments are included in the initial carrying amount of the asset or the liability.

Subsequent measurement

Instruments classified as FVTPL are measured at fair value with unrealized gains and losses recognized in profit or loss. Instruments classified as amortized cost are measured at amortized cost using the effective interest rate method. Instruments classified as FVTOCI are measured at fair value with unrealized gains and losses recognized in other comprehensive income.

Derecognition

The Company derecognizes financial liabilities only when its obligations under the financial liabilities are discharged, cancelled, or expired. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss.

Expected credit loss impairment model

IFRS 9 introduced a single expected credit loss impairment model, which is based on changes in credit quality since initial application. The Company assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due. The Company considers a financial asset to be in default when the borrower is unlikely to pay its credit obligations to the Company in full or when the financial asset is more than 90 days past due.

8

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

(f) Financial instruments (continued)

The carrying amount of a financial asset is written off (either partially or in full) to the extent that there is no realistic prospect of recovery. This is generally the case when the Company determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to the write-off.

Fair value hierarchy

The Company's financial instruments measured at fair value on the balance sheet consist of cash and cash equivalents and marketable securities. Cash and cash equivalents and marketable securities are measured at level 1 of the fair value hierarchy. There are three levels of the fair value hierarchy as follows:

Level 1: Values based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2: Values based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the asset or liability.

Level 3: Values based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement.

(g) Share based payments

The Company has a stock-based compensation plan which is described in Note 5. All stock-based awards are measured and recognized at the date of grant using the Black-Scholes fair valuation option pricing model. The estimated fair value of the stock options is recorded as share based payment expense over the vesting period or at the date of the grant if the options vest immediately with the corresponding effect recorded in share based payment reserve within shareholder's equity. The valuation is dependent on a number of estimates, including the risk free interest rate, the level of share volatility, together with an estimate of the level of forfeiture. Option pricing models require the input of highly subjective assumptions including the expected price volatility. Changes in the subjective input assumptions can materially affect the fair value estimate, and therefore the existing models do not necessarily provide a reliable measure of the fair value of the Company's share purchase options. Any consideration paid to the Company with respect to the exercise of stock options is credited to share capital along with any related share based payment reserve.

(h) Exploration and evaluation expenditures

The Company expenses all costs relating to the acquisition of, exploration for and development of mineral claims and credits all revenues received against the exploration expenditures. Such costs include, but are not limited to geological work, geophysical studies, property holding costs, exploratory drilling and sampling.

Once a project has been established as commercially viable and technically feasible, related development expenditures are capitalized; this includes costs incurred in preparing the site for mining operations. Capitalization ceases when the mine is capable of commercial production, with the exception of development costs that give rise to a future benefit.

(i) Share issue costs

Costs incurred for the issue of common shares and warrants are deducted from share capital and warrants respectively.

9

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

(j) Income taxes

Income tax on the profit or loss for the years presented consists of current and deferred tax. Income tax is recognized in profit or loss except to the extent that it relates to items recognized directly in equity or other comprehensive income.

Current tax is recognized and measured at the amount expected to be recovered from or payable to the taxation authorities based on the income tax rates enacted or substantively enacted at the end of the reporting period and includes any adjustment to taxes payable in respect of previous years.

Deferred tax is recognized on any temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable earnings. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized and the liability is settled. The effect of a change in the enacted or substantively enacted tax rates is recognized either in profit or loss and comprehensive income or loss or in equity depending on the item to which the adjustment relates. Deferred tax assets are recognized to the extent their future recovery is probable. At the end of each reporting period, deferred tax assets are reduced to the extent that it is no longer probable that sufficient taxable earnings will be available to allow all or part of the asset to be recovered.

(k) Asset retirement obligation

The operations of the Company are subject to regulations governing the environment, including future site restoration costs for mineral properties. The Company recognizes the fair value of a liability for an asset retirement obligation in the period in which it is incurred when a reasonable estimate of fair value can be made. If a reasonable estimate of fair value cannot be made in the period the asset retirement obligation is incurred, the liability is recognized when a reasonable estimate of fair value can be made.

The Company has determined that there are no asset retirement obligations or any other environmental obligations with respect to its mineral properties, and therefore no liability has been recognized in these financial statements.

4. SHARE CAPITAL

The authorized share capital consists of an unlimited number of common shares with no par value and an unlimited number of non-voting special shares. As at October 31, 2020, the Company had 41,278,527 common shares issued and outstanding.

The Company did not issue any common shares during the years ended October 31, 2019 and 2020.

					Number of Shares	Consideration
Balance, October	31,	2019	and	2020	41,278,527	$ 1,271,643

10

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

5. SHARE BASED PAYMENTS

The Company has a Share Option Plan (the "Plan") under which it is authorized to grant options to purchase common shares of the Company to directors, senior officers, employees and/or consultants of the Company. The aggregate number of shares of the Company which may be issued and sold under the Plan will not exceed 10% of the total number of common shares issued and outstanding from time to time. Share options are granted with a maximum term of five years with vesting requirements at the discretion of the Board of Directors.

On August 19, 2019, the Company issued 500,000 share options exercisable at $0.07 per share for a period of five years which vested immediately, with an ascribed value of $29,000 estimated using the Black-Scholes model for option pricing using the following assumptions: stock price - $0.07; expected dividend yield - 0%; volatility factor - 120.66%; risk-free interest rate - 1.21%; and expected life of 5 years.

The following table reflects the continuity of share options for the years ended October 31, 2019 and 2020.

	Options	Exercise	price
Balance, October 31, 2018	2,200,000	$	0.05
Granted	500,000		0.07
Balance, October 31, 2019	2,700,000		0.05
Expired	(500,000)		0.05
Balance, October 31, 2020	2,200,000	$	0.05

As at October 31, 2020, the following share options were outstanding and exercisable:

Expiry date	Options	Exercise	price
April 1, 2021	1,700,000		0.05
August 19, 2024	500,000		0.07
Options Outstanding and Exercisable	2,200,000	$	0.05

11

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

6. INCOME (LOSS) PER SHARE

The following table sets forth the computation of basic and diluted income (loss) per share:

	Year ended	Year ended
	Oct. 31, 2020	Oct. 31, 2019
Net income (loss)	$ (271,160)	$ (264,794)
Weighted-average common shares outstanding:
Basic	41,278,527	41,278,527
Diluted	41,278,527	41,278,527
Basic income (loss) per common share	$ (0.007)	$ (0.006)
Diluted income(loss) per common share	$ (0.007)	$ (0.006)

7. MARKETABLE SECURITIES

The Company did not buy or sell any marketable securities during the year ended October 31, 2020. During the year ended October 31, 2019, the Company purchased 300,800 common shares in Chibougamau Independent Mines Inc. The Company held the following marketable securities as at October 31, 2020:

Company								Security				Cost
Chibougamau	Independent Mines			Inc.			300,800 common shares				$	40,126
Fair Value		Acquisition		Unrealized		Fair Value		Acquisition		Unrealized		Fair Value
Oct. 31, 2018		(Disposition)		Gain / (Loss)		Oct. 31, 2019		(Disposition)		Gain / (Loss)		Oct. 31, 2020
$ -	$	40,126	$	(11,550)	$	28,576	$	-	$	10,528	$	39,104

8. EXPLORATION AND EVALUATION EXPENDITURES

The Company owns a 100% interest in the Martison Phosphate Project (the "Project"), which is located about 70 kilometers northeast of the town of Hearst, Ontario. The Project mining leases and claims cover a contiguous area of approximately 8,256 ha. The Company's interest in the Project is subject to a net sales returns ("NSR") royalty of 1% for all phosphate concentrate sold, a royalty of $0.40 per tonne of phosphate concentrate produced subject to escalation based on phosphoric acid prices, and a NSR royalty of 2% for all non-phosphate-related products sold. The Company has a one-time right to acquire the 1% NSR royalty prior to commencement of commercial production for $3,000,000. The following table sets forth the items under exploration and evaluation expenditures:

	Year ended	Year ended	Year ended	Year ended
	Oct.	31, 2020	Oct. 31, 2019
Leases and property taxes	$	15,906	$	14,181
Storage and rent		28,003		21,600
Technical and consulting		36,232		8,697
Travel and transportation		8,091		-
Exploration and evaluation expenditures	$	88,232	$	44,478

12

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

9. INCOME TAXES

(a) Provision for income taxes

The reconciliation of the combined Canadian federal and provincial statutory income tax rate of 26.5% (2019 - 26.5%) to the effective tax rate is as follows:

		2020		2019
Net income (loss) before recovery of income taxes	$	(271,160)	$	(264,794)
Expected income tax (recovery) expense		(71,857)		(70,171)
Increase (decrease) resulting from
Unrealized (gain) loss on marketable securities		(1,395)		1,530
Share based compensation and other permanent difference		3,313		7,685
Other including true-ups		20		35
Change in tax benefits not recognized		69,919		60,921
Total income tax (recovery) expense	$	-	$	-

(b) Unrecognized deferred tax assets

Deferred taxes are provided as a result of temporary differences that arise due to the differences between the income tax values and the carrying amount of assets and liabilities. Deferred tax assets have not been recognized in respect of the following deductible temporary differences:

		2020		2019
Property, plant and equipment	$	766	$	766
Marketable securities		1,022		11,550
Non-capital losses		798,310		563,349
Resource pools - mineral properties		32,616,322		32,580,165
Share issuance costs		-		2,005

The Canadian non-capital loss carry forwards expire as noted in the table below. Share issue and financing costs has been fully amortized in 2020. The remaining deductible temporary differences may be carried forward indefinitely. Deferred tax assets have not been recognized in respect of these items because it is not probable that future taxable profit will be available against which the group can utilize the benefits therefrom.

The Company's Canadian non-capital income tax losses expire as follows:

	2036		2037		2038		2039		2040		Total
$	133,469	$	212,287	$	41	$	217,551	$	234,962	$	798,310

13

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

10. RELATED PARTY TRANSACTIONS

(a) Director and executive compensation

Director and executive compensation for the years ended October 31, 2019 and 2020 consisted of the following:

	Year ended	Year ended	Year ended
	Oct. 31, 2020	Oct.	31, 2019
Cash compensation	$ 102,000	$	102,000
Fair value of share options	-		29,000
Total	$ 102,000	$	131,000

No stock options were granted to directors or officers during the year ended October 31, 2020. A director received the following stock options during the year ended October 31, 2019:

	Number of	Exercise	Stock Price	Risk-free	Expected	Volatility
Expiry date	options	price	at grant	interest rate	life	factor	Fair value
Aug. 19, 2024	500,000	$ 0.07	$ 0.07	1.21%	5.0	120.66%	$ 0.058

(b) Director and executive transactions

The aggregate value of transactions and outstanding balances relating to entities over which directors and executive management have control or significant influence were as follows:

			Transaction	Transaction	value		Balance	outstanding	outstanding
			Year ended		Year ended
	Note	Oct. 31, 2020		Oct. 31, 2019		Oct.	31, 2020	Oct.	31, 2019
Consulting fees	(i)	$	102,000	$	102,000	$	-	$	-
Exploration and evaluation expenditures	(ii)		-		16,200		-		-
Total		$	102,000	$	118,200	$	-	$	-

(i) The Company pays consulting fees of $5,000 per month to Stephen Case, the Chief Executive Officer and a Director, and $3,500 per month to Fraser Laschinger, the Chief Financial Officer.

(ii) The Company pays rent of $1,800 per month for the storage of drill core and supplies to D&S McKinnon Holdings Limited, a corporation controlled by a relative of Gordon McKinnon, a former Director of the Company who ceased to be a related party as of August 1, 2019.

14

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

11. COMMITMENTS AND CONTINGENCIES

(a) Mining leases

The Company has three 21-year mining leases with the Province of Ontario which grant the Company surface and mining rights to the Project. One of the mining leases commenced on August 1, 2002 and the remaining two on May 1, 2011. The aggregate annual payment for the three leases is estimated to be approximately $13,000.

12. CAPITAL MANAGEMENT

The Company's capital structure consists of shareholder's equity, which amounted to $ 619,233 on October 31, 2020. The Company manages its capital structure and makes adjustments to it, based on the funds available to the Company, in order to support the acquisition, exploration and development of mineral properties. The Board of Directors does not establish quantitative return on capital criteria for management, but rather relies on the expertise of the Company's management to sustain future development of the business. Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. Neither the Company nor its subsidiary is subject to externally imposed capital requirements. There were no changes in the Company's approach to capital management during the year ended October 31, 2020.

13. FINANCIAL RISK FACTORS

The Company's risk exposures and the impact on the Company's financial instruments are summarized below:

(a) Credit risk

The Company's cash balance of $ 54,378 is held by a Schedule I Canadian Chartered Bank. The Company's cash equivalents balance of $ 538,288 primarily consists of investment savings accounts and/or guaranteed investment certificates issued by Schedule I Canadian Chartered Banks. The Company has no significant concentration of credit risk arising from operations. Management believes that the credit risk concentration with respect to financial instruments is remote.

(b) Liquidity risk

The Company's approach to managing liquidity risk is to ensure that it will have sufficient liquidity to fund its liabilities as they become due. All of the Company's financial liabilities have contractual maturities of less than 60 days and are subject to normal trade terms. As at October 31, 2020, the Company had cash and cash equivalents of $ 592,666 to settle current liabilities of $ 29,748 .

(c) Interest rate risk

The Company has cash balances and no interest-bearing debt. Interest rate risk is remote.

(d) Market price risk

The Company is indirectly exposed to price risk with respect to the price of phosphate products. The Company closely monitors commodity prices to determine the appropriate course of action to be taken by the Company. Price risk is remote since the Company is not a producing entity.

15

Fox River Resources Corporation Notes to the Consolidated Financial Statements October 31, 2020 and 2019

13. FINANCIAL RISK FACTORS (continued)

(e) Marketable securities price risk

The Company is exposed to equity securities price risk because of the marketable securities held by the Company. The Company's marketable securities are not part of its core operations, and accordingly, gains and losses from these investments are not representative of the Company's performance. As at October 31, 2020, the impact of a 10% increase or decrease in the share prices of the marketable securities would have resulted in an increase or decrease of $ 3,910 that would have been included in net loss and comprehensive loss.

16