Glen Eagle Resources Inc. — Interim / Quarterly Report 2022

Aug 26, 2022

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Consolidated Financial Statements

Glen Eagle Resources Inc.

Second quarter ended June 30, 2022 (in Canadian dollars, unless otherwise stated)

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UNAUDITED CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

Under National Instrument 51-102, Part 4, subsection 4.3 (3)(a), if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.

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 unaudited condensed interim consolidated financial statements of Glen Eagle Resources Inc. as at June 30, 2022 and for the three-month periods ended June 30, 2022 and 2021, have not been reviewed by the Company’s external auditors.

Jean Labrecque Daniel Bélisle Jean Labrecque Daniel Bélisle, CPA, CA President and Chief Executive Officer Chief Financial Officer & Corporate Secretary

Date: August 26th, 2022

Glen Eagle Resources Inc. Consolidated Interim Statements of Financial Position

(in Canadian dollars)

Assets Current assets Cash Short term investments – term deposits Amounts receivable (note 4) Prepaids Inventory (note 5) Non-current assets Property, plant and equipment (note 6) Exploration and evaluation assets (note 7) TOTAL ASSETS Liabilities Current liabilities Accounts payable and accrued liabilities (note 8) Current portion of terms loans and convertible debenture Non-current liabilities Term loans (note 9) Provision (note 10) Convertible debenture (note 11) TOTAL LIABILITIES Equity Share capital (note 12) Warrants (note12) Stock options (note 13) Equity component of convertible debenture (note 11) Contributed surplus Deficit Accumulated other comprehensive loss Total equity TOTAL LIABILITIES AND EQUITY Going concern (note 1) Contingencies (note 19)	June 30 2022 $	December 31 2021 $
	44,629 8,100 93,539 30,776 144,134	199,064 8,114 79,795 123,043 290,230
	321,178	700,246
	2,411,936 31,093	2,505,475 220,237
	2,443,029	2,725,711
	2,764,207	3,425,958
	1,666,664 20,000	1,619,700 20,000
	1,686,664	1,639,700
	560,000 71,542 97,140	560,000 69,936 95,933
	728,682	725,869
	2,415,346	2,365,569
	30,961,795 1,076,127 618,025 7,140 3,498,629 (35,566,164) (246,691)	30,483,689 1,010,692 738,521 7,140 3,378,133 (34,314,317) (243,469)
	348,861	1,060,389
	2,764,207	3,425,958

The accompanying notes are an integral part of these consolidated financial statements Approved by the Board of Directors

/s/ Jean Labrecque___ Director /s/ Guy Chamard__ Director

2

Glen Eagle Resources Inc.

Consolidated Interim Statements of Loss and Comprehensive Loss For the three and six months periods ended June 30, 2022 and 2021 Unaudited

(in Canadian dollars) Sales Gold & silver Cost of sales(note 14) Gross operating margin General and administrative (note 14) Selling expenses General exploration, net of tax credits Operating loss Interest expense Foreign exchange gain (loss) Unrealized gain on fair value of derivative Net loss for the period Other comprehensive income (loss) net of income tax: Currency translation adjustment Net comprehensive loss for the period Weighted average number of outstanding common shares Loss per share Basic and diluted	(in Canadian dollars) Sales Gold & silver Cost of sales(note 14) Gross operating margin General and administrative (note 14) Selling expenses General exploration, net of tax credits Operating loss Interest expense Foreign exchange gain (loss) Unrealized gain on fair value of derivative Net loss for the period Other comprehensive income (loss) net of income tax: Currency translation adjustment Net comprehensive loss for the period Weighted average number of outstanding common shares Loss per share Basic and diluted	Three-month period ended June 30, 2022 $ Three-month period ended June 30, 2021 $ Six-month period ended June 30, 2022 $	Three-month period ended June 30, 2022 $ Three-month period ended June 30, 2021 $ Six-month period ended June 30, 2022 $	Six-month period ended June 30, 2021 $	Six-month period ended June 30, 2021 $
	silver ales(note 14) erating margin nd administrative (note 14) penses xploration, net of tax credits ng loss xpense xchange gain (loss) d gain on fair value of derivative for the period mprehensive income (loss) et of income tax: ncy translation adjustment prehensive loss period d average number of ding common shares r share d diluted	349,235 62,019 617,599 (332,073) (173,761) (1,157,879)		1 (4	63,932 66,680)
		17,162 (111,742) (540,280) (340,333) (142,544) (632,209) (8,268) (991) (17,557) - (13,128) (7,571)		(30 (3 ( (	2,748) 01,949) 15,562) 13,128)
		(331,439) (268,405) (1,197,617) (25,625) (35,085) (51,394) (1,434) (2,258) (2,836) - 2,921 -		(6 (	33,387) 69,456) (1,167) 3,185
		(358,498) (302,827) (1,251,847) 38,432 (26,785) (3,222)		(7 (	00,825) 54,524)
		(320,066) (329,612) (1,255,069)		(7	55,349)
		140,211,852 111,294,883 136,262,552		111,2	94,883 (0.01)
		(0.00) (0.00) (0.	01)

The accompanying notes are an integral part of these consolidated financial statements

3

Glen Eagle Resources Inc.

Consolidated Interim Statements of Changes in Equity For the six months periods ended June 30, 2022 and 2021 Unaudited

(in Canadian dollars, except for the number of shares)

(note) Balance as at January 1, 2021 Net loss for the period Currency translation adjustment Comprehensive loss for the period Fair value of stock option expired (13) Share based compensation expense (13) Balance as at June 30, 2021 Balance as at January 1, 2022 Net loss for the period Currency translation adjustment Comprehensive loss for the period Units issued pursuant to private placements nets of issue costs (12) Warrants issued (12) Warrants exercised (12) Expiration of stock options (13) Balance as at June 30, 2022	Number of common shares Share capital $ Warrants $ Stock options $ Equity component of convertible debenture $ Contributed surplus $ Accumulated other comprehensive loss $ Deficit $ Total $	Number of common shares Share capital $ Warrants $ Stock options $ Equity component of convertible debenture $ Contributed surplus $ Accumulated other comprehensive loss $ Deficit $ Total $
	94,455,608 28,817,777 192005 512,081 7,140 3,284,643 (178,849) (31,545,576) 1,089,221
	- (700,825) (700,825) (54,524) - (54,524)
	(54,524) (700,825) (755,349) 16,839,275 834,753 - - - - - - 834,753 - (112,052) 112,052 - - - - - -
	16,839,275 722,701 112,052 - - - (54,524) (700,825) 79,404
	111,294,883 29,540,478 304,057 512,081 7,140 3,284,643 (233,373)	(32,246,401) 1,168,625
	134,931,652 30,483,689 1,010,692 738,521 7,140 3,378,133 (243,469 ) (34,314,317) 1,060,389
	(1,251,847) (1,251,847) (3,222) - (3,222)
	(3,222) (1,251,847) (1,255,069) 5,150,333 303,541 - - - - - - 303,541 (115,540) 115,540 - - - - - - 3,000,000 290,105 (50,105) - - - - - 240,000 - - - (120,496) - 120,496- - -
	8,150,333 478,106 65,435 (120,496)- 120,496 (3,237) (1,251,847) (711,528)
	143,081,985 30,961,795 1,076,127 618,025 7,140 3,498,629(246,691) (35,566,164) 348,861

The accompanying notes are an integral part of these consolidated financial statements

4

Glen Eagle Resources Inc.

Consolidated Interim Statement of Cash Flows

For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars) Cash flows provided (used in) Operating activities Net income (loss) for the period Adjustments for Depreciation and amortization Unrealized gain on fair value of derivative Accretion expense Foreign exchange gain (loss) Changes in working capital items Amounts receivable Prepaid expense Inventory Accounts payable and accrued liabilities Net cash from (used in) operating activities Investing activities Acquisition of exploration and evaluation asset Sale of phosphate property Acquisition of property, plant & equipment Net cash used in investing activities Financing activities Increase (decrease) of long-term debt Issuance of share capital, net of issue costs Net cash provided by financing activities Net increase (decrease) – cash and cash equivalent Cash and cash equivalents – Beginning of period Cash and cash equivalents – End of period Additional information Interest received	Three-month period ended June 30, 2022 $ Three-month period ended June 30, 2021 $ Six-month period ended June 30, 2022 $	Six-month period ended June 30, 2021 $
	(358,498) (302,827) (1,251,847) 47,224 54,472 102,173 (6,346) (2,921) (6,346) 2,009 3,462 2,224 2,628 6,917 -	(700,825) 110,294 (3,185) 6,586 9,301
	(312,983) (240,897) (1,153,796) 86,372 (117,489) (13,929) 43,162 - 92,268 (6,042) 8,320 146,095 (209,581) (40,400) 47,163	(577,829) (121,766) (10,000) 2,415 3,522
	(399,072) (390,466) (882,199)	(703,658)
	- - (1,856) 191,000 - 191,000 996 8,589 (4,921)	(2,280) - (9,402)
	191,996 8,589 184,223	(11,682)
	(63,678) - - 285,541 592,790 543,541	- 834,754
	221,863 592,790 543,541	834,754
	14,787 210,913 (154,435) 29,842 50,033 199,064	119,414 141,532
	44,629 260,946 44,629	260,946
	15	15

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

5

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

1 Incorporation, nature of activities and going concern

Glen Eagle Resources Inc. (the “Corporation”) is incorporated under the Canada Business Corporations Act and is engaged in the acquisition, the exploration and the evaluation of mining properties. The address of the registered office and its principal place of business is 2075 Victoria Street, #201 St-Lambert (Quebec), Canada. The Corporation’s shares are listed on the TSX Venture Exchange (symbol: GER).

Although management has taken steps to verify titles of mining properties in which the Corporation has an interest, in accordance with industry standards for the current stage of exploration of such properties, these procedures do not guarantee the Corporation’s title. Property title may be subject to unregistered prior agreements and non-compliant with regulatory requirements.

The Corporation has not yet determined whether the exploration and evaluation assets have economically recoverable ore reserves. Recovery of amounts indicated under exploration and evaluation assets are subject to certain conditions: the discovery of economically recoverable reserves, the Corporation’s ability to obtain the financing required to complete exploration, evaluation, development, construction and, ultimately, the sale of such assets.

The Corporation’s consolidated financial statements have been prepared using accounting principles applicable to a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business as they come due. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but not limited to twelve months from the end of the reporting period. Management is aware, in making its assessment, of material uncertainties related to events and conditions that may cast a significant doubt upon the Corporation’s ability to continue as a going concern as described in the following paragraph, and accordingly, the appropriateness of the use of accounting principles applicable to a going concern. These consolidated financial statements do not reflect the adjustment to the carrying values of assets and liabilities, expenses and balance sheet classifications that would be necessary were the going concern assumption would not be appropriate. These adjustments could be material.

For the period ended June 30, 2022, the Corporation reported a net loss of $358,498 (net loss of $302,827 for the period ended June 30, 2021) and has an accumulated deficit of $35,566,164 as of June 30, 2022. In addition to ongoing working capital requirements, the Corporation must secure sufficient funding to meet its existing commitments for exploration and evaluation programs and pay general and administration costs. As of June 30, 2022, the Corporation has a negative working capital of $1,365,486 (negative of $939,454 as at December 31, 2021). Management estimates that current funds will not be sufficient to meet the Corporation’s obligations and budgeted expenses through December 31, 2022. Any additional funding may be met in the future in a number of ways including but not limited to increase in production, the issuance of new equity instruments and debt financing. While management has been successful in securing financing in the past, there can be no assurance it will be able to do so in the future or that these sources of funding or initiatives will be available for the Corporation or that they will be available on terms which are acceptable to the Corporation. If management is unable to obtain new funding, the Corporation may be unable to continue its operations, and amounts realized for assets might be less than amounts reflected in these consolidated financial statements.

The COVID-19 pandemic has negatively impacted the global economy, disrupted global supply chains and workforce participation, and created significant volatility and disruption of financial markets. The extent of the impact of the COVID-19 pandemic on the Corporation operational and financial performance, including its ability to execute the 2022 business plan in the expected time frame, will depend on future developments, including the duration and severity of the pandemic and related restrictions, all of which are uncertain and cannot be predicted. The Corporation has taken and will continue to take action to minimize the impact. However, it is impossible to determine the financial implications of these events for the moment.

6

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

1 Incorporation, nature of activities and going concern - continued

These consolidated financial statements were approved and authorized for issue by the board of directors on August 26[th] , 2022.

2 Summary of significant accounting policies

The Corporation prepares its financial statements in accordance with International Financial Reporting Standards (“IFRS”).

The significant accounting policies used in the preparation of these consolidated financial statements are as follows:

A. Basis of measurement

The consolidated financial statements have been prepared under the historical cost basis, except for the revaluation of certain financial assets and financial liabilities to fair value.

B. Consolidation

These consolidated financial statements include the accounts of the Corporation and those of its wholly owned foreign subsidiary Cobra Oro De Honduras. The amounts reported in the financial statements of the subsidiary have been adjusted, if necessary, so that they meet the accounting policies adopted by the Corporation. Profit or loss or other comprehensive loss of the subsidiary acquired or sold during the period are recorded from the actual date of acquisition or until the effective date of the sale, if any. All intercompany transactions, balances, income and expenses are eliminated at consolidation. During the first quarter of 2022, the Corporation’s subsidiary Cobra Oro De Honduras, created with a local Hondurian partner, a subsidiary called ‘’Inversiones Technicas Del Pacifico’’. Cobra Oro De Honduras owns 70% and the local partner owns 30% of the new company.

C. Cash

Cash consists of cash on hand and bank balances including interest savings accounts.

D. Foreign currency translation

Functional and presentation currency

Items included in the financial statements of each consolidated entity in the Corporation group are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). These consolidated financial statements are presented in Canadian dollars, which is the functional currency of the Corporation. The functional currency of Cobra Oro De Honduras is the Honduran Lempira.

The functional currencies have remained unchanged during the reporting periods.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in the consolidated statement of loss and comprehensive loss.

7

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

2 Summary of significant accounting policies - continued

Non-monetary assets and liabilities are translated at historical rates, unless such assets and liabilities are carried at market value, in which case, they are translated at the exchange rate in effect at the date of the balance sheet. Translation differences on non-monetary financial assets and liabilities, such as equities held at fair value through profit or loss, are recognized in profit or loss as part of the fair value gain or loss.

The results and financial position of foreign subsidiaries that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

• assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position,

• income and expenses for each statement of comprehensive loss are translated at average exchange rates, and

• all resulting exchange differences are recognised in other comprehensive income (loss).

On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings, are recognised in other comprehensive income (loss).

E. Inventories

Finished goods are valued at the lower of average production cost and net realizable value. The stockpiled ore is valued at the lower of the weighted average cost and net realizable value. Net realizable value is the estimated selling price less applicable selling expenses. Cost includes all expenses directly attributable to the manufacturing process as well as suitable portions of related production overheads, based on normal capacity. Consumable inventories are valued at the lower of the average cost and net realizable value. Obsolete, redundant and slow-moving inventories are identified at each reporting date and written down to their net realizable values.

F. Property, plant and equipment

Property, plant and equipment (“PP&E”) are carried at cost, less accumulated depreciation and accumulated impairment losses.

The cost of an item of PP&E consists of the purchase price, applicable borrowing costs, any costs directly attributable to bringing the asset to the location and condition necessary for its intended use, and an initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located. Repairs and maintenance costs are charged to the consolidated statement of loss during the period in which they are incurred unless the PP&E are used in mineral properties under development for which the costs are capitalized in the mineral properties under development assets.

Depreciation is recognized based on the cost of an item of PP&E, less its estimated residual value, over their expected useful lives:

Category Buildings Machinery and equipment Vehicles	Years 20 3 to 20 5

The residual value, useful life and depreciation method for PP&E are reviewed, and adjusted if appropriate, on an annual basis.

8

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

2 Summary of significant accounting policies - continued

An item of PP&E is de-recognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on disposal of the asset, determined as the difference between the net proceeds on disposal and the carrying amount of the asset, is recognized in profit or loss in the consolidated statement of loss.

Where an item of PP&E consists of major components with different useful lives, the components are accounted for as separate items of PP&E. Expenditures incurred to replace a component of an item of PP&E that is accounted for separately, including major inspection and overhaul expenditures, are capitalized.

Capitalized costs are not depreciated until the time at which the related mining property has reached a pre-determined level of operating capacity intended by management. Costs incurred prior to this point, including depreciation of related PP&E, are capitalized and proceeds from sales during this period are offset against capitalized costs.

G. Exploration and evaluation (E&E) assets

Costs related to exploration and evaluation of mineral properties are recognized in profit or loss as incurred. All option payments and costs of acquiring mineral rights are capitalized as exploration and evaluation assets.

Exploration and evaluation assets are assessed for impairment indicators at the end of each reporting period.

Any option payments or proceeds from the sale of royalty interests received by the Corporation are credited to the capitalized cost of the related exploration and evaluation asset. If payments received exceed the capitalized cost of the exploration and evaluation assets, the excess is recognized as income in the period received.

Whenever a mining property is considered no longer viable, or is abandoned, the capitalized amounts are written down to their recoverable amounts with the difference recognized in profit or loss. When the technical feasibility and the commercial viability of extracting a mineral resource are demonstrable and a mine development decision has been made by the Corporation, exploration and evaluation assets related to the mining property are transferred to tangible assets and related development expenditures are capitalized. Before the reclassification, the related exploration and evaluation assets are tested for impairment and any impairment loss is then recognized in profit or loss.

The establishment of technical feasibility and commercial viability of a mineral property is assessed based on a combination of factors, including a) the extent to which mineral reserves or mineral resources as defined in National Instrument 43-101 have been identified through a feasibility study or similar document; b) the results of optimization studies and further technical evaluation carried out to mitigate project risks identified in the feasibility study; c) the status of environmental permits; and d) the status of mining leases or permits.

H. Revenue recognition

Revenue from the sale of gold and silver in the form of dory bars is measured at the transaction price, being the amount of consideration to which the Corporation expects to be entitled in exchange for transferring promised goods. Revenue is recognized at the point in time when control of the asset is transferred to the customer, generally on delivery of the goods.

9

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

2 Summary of significant accounting policies - continued

I. Impairment of non-financial assets

Property, plant and equipment and E&E assets are reviewed for impairment on an annual basis and if there is any indication that the carrying amount may not be recoverable. If any such indication is present, the recoverable amount of the asset is estimated in order to determine whether impairment exists. Where the asset does not generate cash flows that are independent from other assets, the Corporation estimates the recoverable amount of the asset group to which the asset belongs.

An asset’s recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value, using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset or asset group is estimated to be less than its carrying amount, the carrying amount is reduced to the recoverable amount. Impairment is recognized immediately in the consolidated statement of loss and comprehensive loss. Where an impairment subsequently reverses, the carrying amount is increased to the revised estimate of recoverable amount but only to the extent that this does not exceed the carrying value that would have been determined if no impairment had previously been recognized.

J. Income taxes

Income tax on the profit or loss for the years presented comprises current and deferred tax. Income tax is recognized in profit or loss except to the extent that it relates to items recognized directly in other comprehensive income (loss) or in equity, in which case it is recognized in other comprehensive income (loss) or in equity, respectively.

Mining taxes represent Canadian provincial taxes levied on mining operations and are classified as income taxes since such taxes are based on a percentage of mining profits.

Current tax expense is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at year end, adjusted for amendments to tax payable with regards to previous years. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred tax is provided using the liability method, providing for temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements. The temporary differences are not provided for if it arises from the initial recognition of goodwill or the initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. The amount of deferred tax provided is based on the expected manner of realization or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the financial position reporting date and whose implementation is expected over the period during which the deferred tax is realized or recovered.

A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the asset can be utilized.

Deferred income tax assets and liabilities are presented as non-current and are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

10

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

• 2 Summary of significant accounting policies - continued

K. Provisions for other liabilities and charges

Provisions for environmental restoration and legal claims are recognized when: the Corporation has a present legal or constructive obligation because of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognized as interest expense.

L. Share-based compensation

The Corporation accounts for all share-based compensation using the fair value method. Each tranche in an award is considered a separate award with its own vesting period and grant date fair value. Fair value is calculated based on the Black-Scholes valuation model. Compensation expense is recognized over the tranche’s vesting period based on the number of awards expected to vest, by increasing the account stock options. The number of awards expected to vest is reviewed at least annually, with any impact being recognized immediately in the consolidated statement of comprehensive loss, with a corresponding adjustment to equity. When stock options are exercised, any consideration paid is credited to share capital.

M. Earnings per share

Basic earnings per share are computed using the weighted average number of common shares outstanding during the periods. Provided that they are not anti-dilutive, diluted earnings per share amounts are calculated giving effect to the potential dilution that would occur if securities or other contracts to issue common shares were exercised or converted to common shares using the treasury stock method. The treasury stock method assumes that proceeds received from the exercise of stock options and warrants and any unamortized share-based compensation amounts are used to repurchase common shares at the prevailing market rate.

N. Financial instruments

Financial assets and liabilities are recognized when the Corporation becomes a party to the contractual provisions of the instrument. Financial assets are derecognized when the rights to receive cash flows from the assets have expired or have been transferred and the Corporation has transferred substantially all risks and rewards of ownership.

Financial assets and liabilities are offset and the net amount is reported in the consolidated statement of financial position when there is an unconditional and legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis, or realize the asset and settle the liability simultaneously.

Financial Assets

Financial assets are initially measured at fair value. If the financial asset is not subsequently accounted for at fair value, then the initial measurement includes transaction costs that are directly attributable to the asset’s acquisition or origination. On initial recognition, the Corporation classifies its financial assets in the following measurement category:

11

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

2 Summary of significant accounting policies - continued

Financial assets measured at amortized cost

• A financial asset is subsequently measured at amortized cost, using the effective interest method and net of any impairment loss, if:

• the financial asset is held within a business model whose objective is to hold financial assets to collect contractual cash flows; and

• the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial Liabilities

Financial liabilities are initially recorded at fair value net of any directly attributable transaction costs. Subsequent to initial recognition these financial instruments are measured at amortized cost using the effective interest method. Accounts payable and accrued liabilities, term loans and convertible debenture are classified as financial liabilities at amortized cost.

Impairment

The Corporation assesses on a forward-looking basis the expected credit losses associated with its debt instruments carried at amortised cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

For trade receivables, the Corporation applies the simplified approach permitted by IFRS 9, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

The Company assumes that there is no significant increase in credit risk for instruments that have a low credit risk.

Embedded Derivatives

An embedded derivative is a component of a hybrid contract that also includes a non-derivative host, with the effect that some of the cash flows of the combined instrument vary in a way similar to a stand-alone derivative. If a hybrid contract contains a host that is a financial asset, the entire hybrid contract is measured at fair value through net loss. If a hybrid contract contains a host that is not a financial asset, embedded derivatives are recorded at fair value separately from the host contract when their economic characteristics and risks are not clearly and closely related to those of the host contract. Subsequent changes in fair value are recorded in the consolidated statements of loss.

The convertible debenture issued by the Corporation is a hybrid financial instrument that can be converted into units of the Corporation at the option of the holder, each unit comprised of a common share and a purchase warrant. At the date issue, the hybrid financial instrument is recognized as a liability or equity in accordance with the substance of the contractual arrangement. If the hybrid financial instrument is a liability, the initial carrying value of the convertible debenture (host) is the residual amount of the proceeds after separating the derivative component, which is recognized at fair value with subsequent changes in fair value are recorded in the consolidated statements of comprehensive loss. If the hybrid financial instrument is equity, the fair value of the convertible debenture (host) is estimated using the prevailing market interest rate for similar non-convertible instruments with the equity value is the residual amount determined by deducting the amount of the liability component from the proceeds is not subsequently remeasured. Any directly attributable transaction costs are allocated between the components in proportion to their initial carrying amounts. Subsequent to initial recognition, the host component of the hybrid financial instrument is measured at amortized cost using the effective interest method.

12

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

2 Summary of significant accounting policies - continued

• i) The Corporation’s financial instruments consist of the following:

Method

Cash Amounts receivable (excluding tax receivable) Short term investments Accounts payable and accrued liabilities (excluding tax and other non-compliance penalty) Term loans Convertible debenture

Amortized cost Amortized cost Amortized cost

Financial liabilities at amortized cost Financial liabilities at amortized cost Financial liabilities at amortized cost

O. Share capital and warrants

Common shares and warrants are classified as equity. Incremental costs directly attributable to the issuance of shares or warrants are recognized as a deduction from the proceeds in equity in the period where the transaction occurs. As part of its financing activities, the Corporation may grant warrants. Each warrant entitles its holder to purchase a determined number of shares at a price determined at grant for a certain period of time. Proceeds from unit placements are allocated between shares and warrants issued using the relative fair value method on a pro rata basis. The Corporation uses the Black-Scholes pricing model to determine the fair value of warrants issued.

P. Other equity accounts

Warrants and stock options include value of warrants until exercise or expiration and charge related to share options respectively. When share options and warrants are exercised, the related values are transferred to share capital. Contributed surplus includes charges related to share options, broker warrants and value of warrants that are expired. Deficit includes all current and prior year retained profits or losses.

Q. Segment disclosures

The Corporation currently operates in two segments which are the exploration and evaluation of mineral properties in Canada and recovery of gold and silver from tailings and rocks in Honduras. The Corporation’s activities are conducted in Québec (Canada) and Honduras.

13

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

3 Critical accounting estimates, judgments and assumptions

Many of the amounts included in the financial statements require management to make judgments and/or estimates. These judgments and estimates are continuously evaluated and are based on management’s experience and knowledge of the relevant facts and circumstances. Actual results may differ from the amounts included in the financial statements.

Areas of significant judgment and estimates affecting the amounts recognized in the consolidated financial statements include:

• a) Impairment of non-financial assets

After capitalization, property, plant and equipment and mining properties are reviewed for impairment if there is any indication that the carrying amount may not be recoverable.

Determining if there are any facts or circumstances indicating impairment, loss or reversal of impairment losses is a subjective process involving judgment and several estimates and interpretations in many cases. Determining whether to test for impairment exploration and evaluation assets requires management’s judgment regarding the following, among others:

• a) The period for which the entity has the right to explore in the specific area has expired during the period or will expire in the near future, and is not expected to be renewed;

• b) Substantive expenditure on further exploration and evaluation of mineral resources in a specific area is neither budgeted nor planned;

• c) Exploration for and evaluation of mineral resources in a specific area have not led to the discovery of commercially viable quantities of mineral resources and the entity has decided to discontinue such activities in the specific area; or

• d) Sufficient data exists to indicate that, although a development in a specific area is likely to proceed, the carrying amount of the exploration and evaluation asset is unlikely to be recovered in full from successful development or by sale.

Additional external factors which could trigger an impairment review include, but are not limited to, significant negative industry or economic trends and a significant drop in ore prices. When an indication of impairment loss or a reversal of an impairment loss exists, the recoverable amount of the individual asset must be estimated. If it is not possible to estimate the recoverable amount of the individual asset, the recoverable amount of the cash generating unit to which the asset belongs must be determined. Identifying the cash generating units requires considerable management judgment. In testing an individual asset or cash generating unit for impairment and identifying a reversal of impairment losses, management estimates the recoverable amount of the asset or the cash-generating unit. This requires management to make several assumptions as to future events or circumstances. These assumptions and estimates are subject to change if new information becomes available.

14

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

3 Critical accounting estimates, judgments and assumptions - continued

Actual results with respect to impairment losses or reversals of impairment losses could differ in such a situation and significant adjustments to the Corporation’s assets and losses may occur during the next period.

b) Share-based compensation

Management assesses the fair value of stock options and warrants using the Black-Scholes valuation model. The Black-Scholes model requires management to make estimates and assumptions with respect to inputs including the risk-free interest rate, volatility and expected stock option or warrant life. As well, management must make assumptions about anticipated forfeitures based on the historical actions of stock option plan participants.

c) Provision and contingent liabilities

Judgments are made as to whether a past event has led to a liability that should be recognized in the financial statements or disclosed as a contingent liability. Quantifying any such liability often involves judgments and estimations. These judgments are based on several factors including the nature of the claims or dispute, the legal process and potential amount payable, legal advice received, previous experience and the probability of a loss being realized. Several of these factors are source of estimation uncertainty.

d) Income tax recovery

Significant judgment is required in determining the income tax recovery as there are transactions and calculations for which the ultimate tax determination is uncertain.

e) Going concern

The assessment of the Corporation’s ability to execute its strategy by funding future working capital requirements involves judgment. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances (see note 1).

15

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

4 Amounts receivable

Sales tax receivable Subscriptions Trade receivables	June 30 2022 December 31 2021
	$ $
	70,635 33,795 - 46,000 22,904 -
	93,539 79,795

5 Inventories

Consumables Finished goods	June 30 2022 December 31 2021
	$ $
	144,134 28,467 - 261763
	144,134 290,230

16

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

6 Property and equipment

Cost As at January 1, 2022 Additions Foreign exchange As at June 30, 2022 Accumulated depreciation As at January 1, 2022 Depreciation Foreign exchange As at June 30, 2022 Net book value June 30, 2022 Cost As at January 1, 2021 Additions Foreign exchange As at December 31, 2021 Accumulated depreciation As at January 1, 2021 Depreciation Foreign exchange As at December 31, 2021 Net book value December 31, 2021	Land $ Building $ Plant equipment $	Land $ Building $ Plant equipment $	Land $ Building $ Plant equipment $		Machinery and	Machinery and
				Vehicle	Equipment			Total
				$	$			$
	445,548 386,737 2,103,138 17,923 - - - - 755 655 3,562 31				520,118 4,921 931			3,473,464 4,921 5,934 3,484,319
	446,303 387,392 2,106,700 17,954				525,970
	- (162,306) (628,418) (16,857) - (21,324) (63,146) (881) - (390) (1,432) (36)				(160,408) (16,823) (362)			(967,989) (102,174) (2,220) (1,072,383)
	- (184,020) (692,996) (17,774)				(177,593)
	446,303 203,372 1,406,705(180)				348,377			2,411,936
	Land $ Building $ Plant equipment $				Machinery and			Total $
				Vehicle	Equipment
				$	$
	523,732 394,775 2,146,858 18,297 (67,788) - - - (10,396) (8,038) (43,720) (374)				524,961 6,009 (10,852)			3,608,623 (61,779) (73,380) 3,473,464 (762,130) (222,046) 16,187 (967,989) 2,505,475
	445,548 386,737 2,103,138 17,923				520,118
	- (121,984) (497,292) (13,586) - (42,934) (141,680) (3,560) - 2,612 10,554 289				(129,268) (33,872) 2,732
	- (162,306) (628,418) (16,857)				(160,408)
	445,548 224,431 1,474,720 1,066				359,710

17

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

7 Exploration and evaluation assets

Capitalized E&E assets are comprised of wholly owned mining rights and undivided interests in properties, detailed as follows:

Costs of E&E assets at the end of the period:

Mining properties Balance January 1, 2021 Additions Balance December 31, 2021 Additions Disposition (a) Balance June 30, 2022	Mining properties Balance January 1, 2021 Additions Balance December 31, 2021 Additions Disposition (a) Balance June 30, 2022	Mining properties Balance January 1, 2021 Additions Balance December 31, 2021 Additions Disposition (a) Balance June 30, 2022	Moose Lake- Canada (phosphate) La Cobra** Piedra Dorada Honduras (gold) (b) Total**	Moose Lake- Canada (phosphate) La Cobra** Piedra Dorada Honduras (gold) (b) Total**	Moose Lake- Canada (phosphate) La Cobra** Piedra Dorada Honduras (gold) (b) Total**
					$
			214,726 1 214,727 5,510 - 5,510
			220,236 1 220,237 1,856 - 1,856 (191,000) - (191,000)
			31,092 1 31,093

a) Moose Lake (Lac St-Jean – Quebec)

On October 12, 2011, the Corporation entered into an option agreement with a private company and two individuals, to acquire a 100% interest in a phosphate property (“Moose Lake”) located in the St-Jean Lake area (Quebec), approximately 150 km south of Lisette Lake. As the obligations of the option agreement have been fully respected, the right to property was transferred to the Corporation in 2018. The Corporation assumes a 1% NSR payable to the vendor and redeemable by tranche of 0.5% for $500,000 each.

During the quarter ended on March 31, 2022, the Corporation added 27 claims to the property for a total of 108 claims.

On June 17th, 2022 (the Effective date), the Corporation signed a Mineral Option Agreement with an unlisted reporting issuer company (the ‘’buyer’’) for an option to acquire the Moose Lake property. Per agreement, the buyer will pay the Corporation an amount of $1,491,000 and a total of 6,000,000 shares of the buyer, to be issued on or before the 6th month anniversary of the Effective date. The shares will be subject to a voluntary resale restriction from the date of issuance of the shares, with 10% of such shares being released on March 31, 2023 and 15% of shares being released every three months thereafter.

Payment of the amount of $1,491,000 as follows:

• i) $191,000 on the Effective date;

• ii) $300,000 on or before July 7[th] , 2022;

• iii) $500,000 on or before the 4[th] month anniversary of the Effective date;

• iv) $500,000 on or before the 8[th] month anniversary of the Effective date.

18

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

7 Exploration and evaluation assets - continued

b) La Cobra/Piedra Dorada

On May 17, 2017, the Corporation acquired, through its wholly owned Honduran subsidiary, the property called "La Cobra", attributed to the Corporation by the Ministry of Mines of Honduras, which is composed of one claim covering approximately 775 hectares and located in the Valle Department, Honduras.

On March 6, 2020, the Corporation exchanged its La Cobra property for 80% of the Piedra Dorada property, located in the municipality of El Corpus, Choluteca, Honduras. The transaction is still in approval process as the exchange needs to be approved by the Ministry of Mines, for the transaction to be completed.

8 Accounts payable and accrued liabilities

Accounts payable and accrued liabilities
Accounts payable Accrued and other liabilities (a)	June 30 2022 December 31 2021
	$ $
	253,095 156,948 1,413,569 1,462,752
	1,666,664 1,619,700

(a) As at June 30th, 2022, the accrued and other liabilities include a provision of $431,736 (2020: $431,736) for tax and other non-compliance penalty and $250,000 (2020: nil) for contingency (note 21). It also includes interest on loans and debenture due to insiders of $255,296 (2020: $167,631) and management fees due of $87,000 (2020: $87,000).

9 Term loans

Balance – Beginning of the period Increase during the period Repayment during the period by share issuance Decrease during the period Current portion Balance – End of period	June 30 2022 $ December 31 2021 $ 580,000 660,000 63,678 20,000 - (100,000) (63,678) -
	580,000 580,000 (20,000) (20,000)
	560,000 560,000

19

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

9 Term loans - continued

A first loan by an insider, of $100,000, is a non-guaranteed loan, that was closed on October 20, 2018 and bared interest at an annual rate of 15%. The loan was due on April 30, 2021 and subsequently tended until June 30, 2024. On December 20, 2021, this loan was repaid in for 1,218,026 shares of the Corporation.

A second loan by an insider, of $150,000, is a non-guaranteed loan due on April 30, 2021 and bears interest at an annual rate of 15%. The interest is payable twice a year on June 30 and December 31. On August 30, 2021, the maturity date of the loan was extended until June 30, 2024.

A third loan by an insider, of $410,000, is a non-guaranteed long-term loan due on May 29, 2023 and bears interest at an annual rate of 12%. The interest is payable monthly.

A fourth loan by an insider, of $20,000, is a non-guaranteed long-term loan due on demand, that was closed on March 10, 2021 and bears interest at an annual rate of 12%.

A bridge loan by a private company of $50,000 us ($63,678 cad), is a non-guaranteed short-term loan due on demand, that was closed on January 31, 2022, bears a $1,000 us interest charge. This loan was repaid during April, 2022.

10 Provision

Balance – Beginning of the period Increase (decrease) during the period Balance – End of period	June 30 2022 $ December 31 2021 $
	69,936 68,461 1,606 1,475 71,542 69,936

Asset retirement obligations

During 2017, an asset retirement obligation study was conducted for the subsidiary in Honduras. The liability for asset retirement obligations as at June 31, 2022 is $71,542 . The estimated undiscounted value of this liability was $102,262 on June 30, 2022 and disbursements are expected to be made in 2031. A discount rate of 4.22% was used to estimate the obligation. Each quarter, the Corporation reviews the expected timing of the cash payments required to settle the obligations, and adjusts the asset retirement obligation accordingly, which also includes foreign exchange differences. During the periods, the increase in asset obligation retirement is due to accretion. The provision is also subject to variation in foreign exchange.

20

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

11 Convertible debentures

• a) Debenture - $150,000

Balance – January 1, 2020 Unrealized gain on fair value of derivative Accretion Balance – December 31, 2020 Unrealized loss on fair value of derivative Accretion Conversion Balance – December 31, 2021 Balance – June 30, 2022	Host Embedded Derivative **Total **
	130,316 7,280 137,596 - 351 351 9,694 - 9,694
	140,010 7,631 147,641 (6,221) (6,221) 8,580 - 8,580 (148,590) (1,410) (150,000)
	- - -
	- - -

On December 13, 2018, the Corporation completed the financing of a $150,000 convertible debenture bearing interest at a rate of 12% per annum and maturing on December 12, 2021. The principal amount of the debenture will be payable at the maturity date and accrued interest will be paid on June 30 and December 31 of each year until maturity date.

The debenture is convertible at $0.20 into units, composed of one common share and one common share purchase warrant. The unit is to be converted at $0.20 a share until maturity date for a total of 750,000 shares and 750,000 common share purchase warrants to be exercised at $0.30 for two years after conversion of the debenture. In the event the Note is not redeemed or converted into common shares as provided above and the Corporation has not reimbursed the Principal and interest on Maturity date, then the Note shall be converted into common shares at a conversion price equal to the greater of the market price of the common shares or the weighted average price of the Common Shares for the last 10 trading days preceeding the maturity date.

The convertible debenture is a hybrid instrument, which is in its entirety a financial liability. The initial carrying amount of $122,261 for the host represents the residual amount of the proceeds after separating out the $28,532 fair value of the derivative. The derivative value was reduced by $7,631 during 2021 (2020: $351).

In December 2021, the Corporation and the lender agreed to convert the outstanding principal of $150,000 and accrued interest of $54,000, in exchange for 1,827,040 shares. This settlement resulted in an increase in share capital and decrease of convertible debentures of $150,000 and a decrease of interest expense and accruals of $54,000.

21

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

11 Convertible debentures - continued

The derivative was valued using a binomial model. The following key assumptions were used in that model:

	As at December 31,
	2020
Expected life in years	1.0
Expected volatility (unobservable input)	84%
Risk-free rate	0.05%
Share price	$0.07
Exercice price	$0.20

• b) Debenture - $100,000

Balance – beginning of period Accretion Balance – end of period	June 30 2022	December 31 2021
	95,933 1,207	93,752 2,181
	97,140	95,933

On July 18, 2020, the Corporation completed the financing of a $100,000 convertible debenture bearing interest at a rate of 12% per annum and maturing on July 18, 2023. The principal amount of the debenture will be payable at the maturity date and accrued interest will be paid annually on December 31 of each year until maturity date.

The debenture is convertible at $0.12 into common shares. After the end of the first year, the Corporation will be able to force the conversion debentures if the company's stock trades at more than $1.00 for more than 10 consecutive days.

12 Share capital and warrants

Share capital Authorized

Unlimited number of voting common shares, participating, without par value.

• a) Issued and fully paid

• i) On April 6[th] , 2022, the Corporation completed the final closing of a private placement for 5,150,333 units at a price of $0.06 per unit for a cash consideration of $309,020. Each unit consists of one common share and one warrant which entitles its holder to purchase one common share at a price of $0.08 per share for 36 months. The fair value of $115,540 was assigned to the warrant account and the total share issue cost amounted to $5,479. The fair value of the warrants was determined using the Black-Scholes model with the following assumptions: share price of $0.075, expected dividend yield of 0%, expected volatility of 96,3%, risk free rate of 2,4% and expected life of 3 years.

22

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

12 Share capital and warrants - continued

• ii) On December 29, 2021, the Corporation completed the final closing of a private placement for 5,142,855 units at a price of $0.07 per unit for a cash consideration of $360,000. Each unit consists of one common share and one warrant which entitles its holder to purchase one common share at a price of $0.085 per share for 24 months. The fair value of $140,346 was assigned to the warrant account and the total share issue cost amounted to $7,074. The fair value of the warrants was determined using the Black-Scholes model with the following assumptions: share price of $0.075, expected dividend yield of 0%, expected volatility of 134,2%, risk free rate of 0.99% and expected life of 2 years.

• iii) On December 20, 2021, the Corporation issued 1,218,026 common shares at a deemed price of $0.0821 per share, for the settlement of a $100,000 term loan due to an individual.

• iv) On December 10, 2021, the Corporation issued 1,827,040 common shares at a deemed price of $0.0821 per share, for the settlement of a $150,000 convertible debenture and $54,000 of accrued interest.

• v) During December 2021, the Corporation released 763,135 shares for a value of $76,314, that were issued on October 15[th ] 2020 but retained by the Corporation until that date, in waiting for conditions attached to shares issuance, to be completely fulfilled.

• vi) On September 13, 2021, the Corporation completed the final closing of a private placement for 14,285,714 units for a cash consideration of $1,000,000. Each unit consists of one common share and one warrant which entitles its holder to purchase one common share at a price of $0.085 per share for 24 months. The fair value of $423,063 was assigned to the warrant account and the total share issue cost amounted to $61,394. The fair value of the warrants was determined using the Black-Scholes model with the following assumptions: share price of $0.15, expected dividend yield of 0%, expected volatility of 128,2%, risk free rate of 0.41% and expected life of 2 years.

• vii) On September 13, 2021, the Corporation issued 760,000 broker warrants exercisable at $0.085 for 24 months. The fair value of $83,595 was assigned to the warrant account. The fair value of the warrants was determined using the Black-Scholes model with the following assumptions: share price of $0.15, expected dividend yield of 0%, expected volatility of 128,2%, risk free rate of 0.41% and expected life of 2 years.

• viii) On June 2, 2021, the Corporation completed the final closing of a private placement for 12,000,000 units for a cash consideration of $600,000. Each unit consists of one common share and one warrant which entitles its holder to purchase one common share at a price of $0.08 per share for 24 months. The fair value of $200,419 was assigned to the warrant account and the total share issue cost amounted to $5,250. The fair value of the warrants was determined using the Black-Scholes model with the following assumptions: shar$0.05, expected dividend yield of 0%, expected volatility of 118.4%, risk free rate of 0.32% and expected life of 2 years. On April 26[th] , 2021, the Corporation closed the private placement for which a first closing was made on March 11, 2021, with the issuance of 4,839,275 shares at a price of $0.05 per share for a cash consideration of $241,963. No warrants or commission were issued for this placement.

23

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

The expected volatility used by the Corporation is based on the historical value of the Corporation’s shares.

b) Warrants

• i) During the period ended March 31, 2022, a total of 3,000,000 share purchase warrants were exercised for a cash consideration of $240,000. An amount of $50,105 representing residual fair value allocated at the date of issue for the warrants was reclassified from Warrants to Share capital.

• ii) During the period ended December 31, 2021, a total of 400,000 share purchase warrants were exercised for a cash consideration of $32,000. An amount of $3,736 representing residual fair value allocated at the date of issue for the warrants was reclassified from Warrants to Share capital.

• c) Changes in Corporation warrants are as follows:

Share purchase warrants Balance – Beginning of period Issued Exercised Balance – End ofperiod	June 30 2022		December 31 2021	December 31 2021
	Number Weighted average exercise price $		Number Weighted average exercise price $
	43,476,069 0.09 5,150,333 0.08 (3,000,000) 0.08		11,687,500 32,188,569 (400,000)	0.12 0.08 0.08
	45,626,402 0.09		43,476,069	0.09
Number of warrants	Exercise price $
1,250,000 2,337,500 7,500,000 600,000 8,600,000 14,285,714 760,000 5,142,855 5,150,333	0.12 0.12 0.12 0.12 0.08 0.085 0.085 0.085 0.08

24

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

13 Share based payments

The Corporation has a stock option plan whereby the Board of Directors may grant to directors, officers or consultants of the Corporation, options to acquire common shares. The Board of Directors has the authority to determine the terms and conditions of the grant of options. The Board of Directors approved a ‘‘Rolling’’ stock option plan (“Plan”) reserving a maximum of 10% of the shares of the Corporation at the time of the stock option grant, with a vesting period allowed of zero up to eighteen months, when the grant of option is made at market price, for the benefit of its directors, officers, employees and consultants. The Plan provides that no single person may hold options representing more than 5% of the outstanding common shares. The number of stock options granted to a beneficiary and the vesting period are determined by the Board of Directors.

The exercise price of any option granted under the Plan is fixed by the Board of Directors at the time of the grant and cannot be less than the market price per common share the day before the grant. The term of an option will not exceed five years from the date of grant. Options are not transferable and can be exercised while the beneficiary remains a director, an officer, an employee or consultant of the Corporation or between three and up to twelve months after the beneficiary has left.

The options granted in 2022 and 2021 were granted at a price equal to the closing market value of the shares, the previous day before the grant. The changes to the number of stock options granted by the Corporation and their weighted average exercise price are as follows:

Stock option Balance – Beginning of period Granted Expired Balance – End of period Options exercisable End of period	June 30 2022 Number Weighted average exercise price $		December 31 2021 Weighted average exercise price $ 0.12 0.10 0.105
		Number
	10,595,000 0.11 - (910,000) 0.11	6,355,000 5,585,000 (1,345,000)
	9,685,000 0.11	10,595,000	0.11
	9,685,000 0.11	10,595,000	0.11

• a. Options granted

• i. On November 18, 2021, the Corporation granted an aggregate of 100,000 options to an employee. The options are fully vested on the day of granting, in accordance with the option plan. The options issued are exercisable at the price of $0.10 until November 18, 2026. The fair value of these options was estimated at $7,017 using the Black-Scholes option-pricing model with the following assumptions: share price

25

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

of $0.10, expected dividend yield of 0%, expected volatility of 90.9%, risk free rate of 1.47% and expected life of 5 years.

• ii. On October 5, 2021, the Corporation granted an aggregate of 150,000 options to a consultant. The options are fully vested on the day of granting, in accordance with the option plan. The options issued are exercisable at the price of $0.125 until October 5, 2026. The fair value of these options was estimated at $13,353 using the Black-Scholes option-pricing model with the following assumptions: share price of $0.125, expected dividend yield of 0%, expected volatility of 93.5%, risk free rate of 1.10% and expected life of 5 years.

• iii. On August 30, 2021, the Corporation granted an aggregate of 4,535,000 options to officers and a consultant. The options are fully vested on the day of granting, in accordance with the option plan. The options issued are exercisable at the price of $0.10 until August 30, 2026. The fair value of these options was estimated at $260,270 using the Black-Scholes option-pricing model with the following assumptions: share price of $0.085, expected dividend yield of 0%, expected volatility of 91.6%, risk free rate of 0.81% and expected life of 5 years.

• iv. On July 28, 2021, the Corporation granted an aggregate of 800,000 options to an officer and a consultant. The options are fully vested on the day of granting, in accordance with the option plan. The options issued are exercisable at the price of $0.07 until July 28, 2026. The fair value of these options was estimated at $39,290 using the Black-Scholes option-pricing model with the following assumptions: share price of $0.10, expected dividend yield of 0%, expected volatility of 91.9%, risk free rate of 0.78% and expected life of 5 years.

The expected volatility used by the Corporation is based on the historical value of the Corporation’s shares.

For the period ended June 30, 2022 the stock-based compensation charged to the consolidated statement of comprehensive income (loss) was Nil (December 2021 – $319,930). As of June 30, 2022, the Corporation had the following stock options outstanding:

Share based payments Expiry date: January 25, 2023 January 24, 2024 June 25, 2024 February 13, 2025 September 18, 2025 July 28, 2026 August 30,2026 October 5, 2026 November 18, 2026	Exercise price	Exercise price	Options granted Number of options exercisable Remaining contractual life (year)	Options granted Number of options exercisable Remaining contractual life (year)	Options granted Number of options exercisable Remaining contractual life (year)
	$
	0.225 0.13 0.105 0.10 0.10 0.07 0.10 0.125 0.10		175,000 175,000 0.57 350,000 350,000 1.57 1,450,000 1,450,000 1.99 425,000 425,000 2.63 1,700,000 1,700,000 3.22 800,000 800,000 4.08 4,535,000 4,535,000 4.17 150,000 150,000 4.27 100,000 100,000 4.39 9,685,000 9,685,000 3.45

26

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

14 Information included in the consolidated statements of comprehensive income

Cost of sales Material supplies Consumables Salaries, benefits and other expenses Electricity Equipment repair and maintenance Production supplies Depreciation of plant and equipment Depreciation vehicle Variation of finished goods Variation of work in process inventory General and administrative Office expenses and rent Consulting and management fees Share base payments Professional fees Public company expenses Depreciation and amortization Business development	Three-month period ended June 30, 2022 $	Three-month period ended June 30, 2021 $ Six-month period ended June 30, 2022 $	Six-month period ended June 30, 2021 $
	19,045 5,659 105,505 12,231 51,441 64,207 38,541 - - 35,444	10,082 153,811 3,630 99,193 76,754 214,391 9,839 84,067 20,167 146,258 8,437 116,636 38,663 77,333 6,189 6,212 - 259,978 - -	92,180 36,171 120,168 45,523 55,699 26,372 78,071 12,498 - -
	332,073	173,761 1,157,879	466,680
	Three-month period ended June 30, 2022 $	Three-month period ended June 30, 2021 $ Six-month period ended June 30, 2022 $	Six-month period ended June 30, 2021 $
	28,452 66,685 - 157,705 19,437 8,388 59,666	18,321 77,715 51,312 133,476 - - 51,186 269,563 9,340 30,736 9,914 18,336 2,471 102,383	37,289 120,890 - 86,464 20,636 20,019 16,651
	340,333	142,544 632,209	301,949

15 Related party transactions

Remuneration of key management

Key management includes directors and senior executives of the parent company and its subsidiary. The compensation recognized as an expense and paid to key management for services is presented below:

Related party transactions Management fees	Three-month period ended June 30, 2022 $	Three-month period ended June 30, 2021 $ Six-month period ended June 30, 2022 $ Six-month period ended June 30, 2021 $
	54,775	48,600 110,856 97,200
	54,775	48,600 110,856 132,333

27

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

15 Related party transactions - continued

During the period, companies controlled by officers and directors charged an amount of $3,600 ($3,600 – Q2-2021) for office expenses and rent. An amount of $87,000 is due to Officers of the Corporation at the end of the period ($87,000 at the end of 2021).

16 Capital management policies and procedures

The Corporation considers the items included in equity as capital components.

The Corporation’s capital management objectives are:

• to ensure the Corporation’s ability to continue as a going concern;

• to increase the value of the assets of the business; and

• to provide an adequate return to shareholders.

These objectives will be achieved by identifying the right exploration projects, adding value to these projects and ultimately taking them through to production or sale and cash flow, either with partners or by the Corporation’s own means.

The Corporation is not exposed to any externally imposed capital requirements except when the Corporation issues flow-through shares for which amounts should be used for E&E work. There is no dividend policy. Changes in capital are described in the consolidated statements of Changes in Equity and the related notes.

17 Financial instruments

Financial instruments Amortized cost Cash Term deposit Receivable from related party and other receivable (except indirect taxes) Liabilities – Amortized cost Accounts payable, accrued liabilities(1) Term loans Convertible debenture Liabilities at fair value through profit or loss Convertible debenture – Derivative (level 3)		June 30, 2022 $	June 30, 2022 $	June 30, 2022 $	December 31, 2021 $	December 31, 2021 $
		Carrying amount		Fair value	Carrying amount	Fair value
		44,629 8,100 22,904		44,629 8,100 22,904 75,633	199,064 8,114 46,000 253,178	199,064 8,114 46,000 253,178
		75,633
		1,666,664 580,000 97,140		1,666,664 580,000 97,140	937,964 580,000 95,933	937,964 580,000 95,933
		28 2,343,804 -		2,343,804 -	1,613,897 -	1,613,897 -

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

• (in Canadian dollars, except per share amounts)

17 Financial instruments - continued

Measurement categories

As explained in Note 3, financial assets and liabilities have been classified into categories that determine their basis of measurement and, for items measured at fair value, whether changes in fair value are recognized in the consolidated statement of comprehensive loss. Those categories are : fair value through net loss and amortized cost. The following table shows the carrying values of assets and liabilities for

• (1) As at June 30, 2022, the accrued and other liabilities include a provision for $431,736 (2020: $431,736) for tax and other non-compliance penalty and $250,000 (2020: nil) for contingency. It also includes interest on loans and debenture due to insiders of $236,922 (2021: $167,631) and management fees for $87,000 2021: $87,000.

Fair values, including valuation methods and assumptions

Financial assets and financial liabilities measured at fair value in the consolidated statement of financial position are grouped into three levels of a fair value hierarchy. The three levels are defined based on the observability of significant inputs to the measurement, as follows:

• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities

• Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly

• Level 3: unobservable inputs for the asset or liability.

As at June 30, 2022, the carrying values of cash, amounts receivable, trade payables and accrued liabilities approximate their fair value due to their relative short maturities. The estimated fair value of the term loans and convertible debentures was calculated based on the discounted value of future payments using interest rates that the Corporation could have obtained as at the reporting date for similar instruments with similar terms and maturities. Their fair value is equivalent to its carrying amount and is categorized in Level 2.

Financial risks factors

The Corporation’s activities expose it to a variety of financial risks: market risk (including currency risk, interest rate risk, and price risk), credit risk and liquidity risk. Risk management is carried out by management under policies approved by the board of directors. The board provides written principles for overall risk management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, fair value risk, credit risk, use of derivative financial instruments and nonderivative financial instruments, and investment of excess liquidity. The Corporation’s overall risk management program seeks to minimize potential adverse effects on the Corporation’s financial performance.

a) Market risk

Foreign exchange risk

On June 30, 2022, the subsidiary of the Corporation has certain transactions in foreign currencies such as the Hondurans Lempira and the US dollar. Consequently, certain assets and liabilities and expenses are exposed to currency fluctuations. The Corporation does not use derivative or hedge instruments to manage foreign exchange risks.

29

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

17 Financial instruments - continued

The Corporation’s consolidated statement of financial position contains balances of cash, receivables and payables and accrued liabilities in currencies other than the operation’s relevant functional currency. Accordingly, the Corporation is exposed to foreign exchange risk.

The balances in currencies are as follows as at June 30, 2022 and December 31, 2021:

Cash-A/R-A/P in Lempiras Cash-A/R-A/P in US $ CAD dollar equivalents	June 30 2022 December 31 2021
	2,803,317 1,926,680 15,113 881 158,211 81,387

The sensitivity of the Corporation to a variation of 10% in the value of the Honduran Lempira and the US dollar would not have a significant impact on the assets, liabilities and expenses.

b) 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 Corporation is subject to concentrations of credit risk through cash and accounts receivable. The Corporation reduces its credit risk by maintaining part of its cash in financial instruments held with a Canadian chartered bank.

c) Liquidity risk

Liquidity risk is the risk that the Corporation will not be able to meet the obligations associated with its financial liabilities.

Interest income on term deposits measured at amortized cost was nil for the current period (2021- nil). Trade payable and accrued liabilities are due within 90 days.

As at June 30, 2022, the Corporation is committed to minimum future principal and interest payments for term loans and convertible debentures, as follows:

Year ending December 31, 2022 Year ending December 31, 2023 Year ending December 31, 2024	Term loans $ (Note 9) Convertible debenture $ (Note 11) Total $
	59,805 - 59,805 557,869 123,406 681,275 217,623 - 217,623
	835,297 123,406 958,703

30

Glen Eagle Resources Inc. Notes to condensed consolidated Interim financial statements For the three and six months periods ended June 30, 2022 and 2021

(in Canadian dollars, except per share amounts)

18 Segmented information

The Corporation operates in 2 different geographic segments located in Canada and Honduras.

ASSETS Current assets Non-current assets Property and equipment Exploration and evaluation assets Current liabilities Accounts payable and accrued liabilities Current portion of term loans and convertible debenture Non-current liability Term loans Convertible debenture Provision	Exploration and evaluation (Canada) $ Recovery of gold and silver (Honduras) $ Total $
	114,256 206,922 321,178 - 2,411,936 2,411,936 31,093 - 31,093 1,468,476 198,188 1,666,664 20,000 - 20,000 560,000 - 560,000 97,140 - 97,140 - 71,542 71,542

19 Contingencies

In February 2021, the Corporation received a notice of arbitration and claim from a potential investor for failure to issue warrants as provided in an equity line of credit agreement, claiming an amount of approximately $1.3 million which was recently revised at $3.0 million. On July 28, 2020, the TSX Venture reviewed the terms of the agreement and came to the conclusion that the transaction could not take place in its current form and further discussions with the investor stalled. A provision of $250,000 has been recorded in these consolidated financial statements which represents management’s best estimate of the potential liability in this regard. The Corporation intends to vigorously defend its position.

31