Irving Resources Inc. — Interim / Quarterly Report 2024

Jan 30, 2024

IRVING RESOURCES INC.

CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE NINE MONTHS ENDED NOVEMBER 30, 2023

(Unaudited)

(Expressed in Canadian Dollars)

IRVING RESOURCES INC.

CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

November 30 2023

Notice of No Auditor Review

The accompanying unaudited condensed interim consolidated financial statements of Irving Resources Inc. for the nine-month period ended November 30, 2023 have been prepared by the Company’s management and approved by the Audit Committee and Board of Directors of the Company.

In accordance with National Instrument 51-102, the Company discloses that its independent auditor has not performed a review of these unaudited condensed interim consolidated financial statements.

January 29, 2024

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IRVING RESOURCES INC.

Condensed Interim Consolidated Statements of Financial Position

(Unaudited)

(Expressed in Canadian Dollars) AS AT

	November 30, 2023 February 28, 2023	November 30, 2023 February 28, 2023	November 30, 2023 February 28, 2023
ASSETS Current assets Cash Receivables (Note 5) Prepaids Prepaids Property and equipment(Note 7) Exploration and evaluation assets(Note 8)	$ 6,574,593 $ 33,309 91,024 6,698,926 65,664 2,196,107 41,401,690 $ 50,362,387		10,909,314 8,680 109,501 11,027,495 98,017 2,172,042 36,582,433 $49,879,987
LIABILITIES & SHAREHOLDERS’ EQUITY Current liabilities Accounts payable and accrued liabilities Lease liabilities (Note 6) Non-current liabilities Lease liabilities (Note 6) Total liabilities Shareholders’ equity Share Capital (Note 10) Reserves (Note 10) Deficit	$ 344,162 95,197 439,359 85,191 524,550 60,329,147 9,555,535 (20,046,845) 49,837,837 $ 50,362,387

Nature and Continuance of Operations (Note 1) Subsequent Event (Note 16)

On behalf of the Board:

“Akiko Levinson” Director “Quinton Hennigh” Director

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

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IRVING RESOURCES INC.

Condensed Interim Consolidated Statements of Loss and Comprehensive Loss (Unaudited)

(Expressed in Canadian Dollars)

	Three months ended Nov 30, 2023 Nov 30, 2022	Three months ended Nov 30, 2023 Nov 30, 2022	Three months ended Nov 30, 2023 Nov 30, 2022	Nine months ended Nov 30, 2023 Nov 30, 2022	Nine months ended Nov 30, 2023 Nov 30, 2022
EXPENSES Consulting fees (Note 11) Depreciation (Note 7) Foreign exchange loss (gain) Insurance Interest expense on lease liabilities (Note 6) Investor relations Management fees (Note 11) Office and miscellaneous Professional fees Property investigation Regulatory fees Salaries and benefits Shareholder costs Share-based compensation (Note 10) Telephone Transfer agent Travel and promotion Operating expenses Interest income Write-off of exploration and evaluation asset (Note 8) Loss and comprehensive loss for the period		$ 64,857 43,662 9,870 7,572 4,225 145 48,000 26,070 31,406 - 12,626 1,879 - 233,648 4,804 8,194 21,930 (518,888) 59,447 741 60,188 $ (458,700)	$ 51,237 64,288 (526,444) 6,965 4,241 6,077 18,000 35,689 60,230 27,326 12,422 35,328 660 373,881 5,169 1,977 29,236 (206,282) 105,211 (15,858) 89,353 $ (116,929)		$ 144,306 135,067 (914,458) 20,895 12,825 36,649 54,000 82,077 167,910 40,993 47,429 101,038 17,582 971,245 15,131 8,229 69,325 (1,010,243) 159,818 (15,858) 143,960 $ (866,283)
Basic and diluted loss per common share		$ (0.01)	$ (0.00)	$ (0.02)	$ (0.01)
Basic and diluted weighted average number of common shares outstanding		73,318,049	72,344,785	69,408,380	67,076,652

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

3

IRVING RESOURCES INC.

Condensed Interim Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)

(Expressed in Canadian Dollars)

			Share Based
			Payment		Total Shareholders'
	Number of Shares	**Share Capital **	Reserves	Deficit	Equity
Balance, February 28, 2022	62,022,016	46,794,646	7,663,341	(16,928,504)	37,529,483
Private placements	10,257,384	11,932,439	-	-	11,932,439
Share issue costs	-	(91,671)	-	-	(91,671)
Shares issued for mineral property
(Note 8)	87,500	65,625	-	-	65,625
Share-based compensation	-	-	971,245	-	971,245
Net loss for the period	-	-	-	(866,283)	(866,283)
Balance, November 30, 2022	72,366,900	$ 58,701,039	$ 8,364,586	$ (17,794,787)	$ 49,540,838
Balance, February 28, 2023	72,366,900	$ 58,701,039	$ 8,961,644	$ (18,382,928)	$ 49,279,755
Exercise of stock options	66,667	96,085	(29,418)	-	66,667
Private placements	1,429,573	1,479,751	-	-	1,479,751
Share issue costs	-	(1,103)	-	-	(1,103)
Shares issued for mineral property
(Note 8)	87,500	53,375	-	-	53,375
Share-based compensation	-	-	623,309	-	623,309
Net loss for the period	-	-	-	(1,663,917)	(1,663,917)
Balance, November 30, 2023	73,950,640	$ 60,329,147	$ 9,555,535	$ (20,046,845)	$ 49,837,837

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

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IRVING RESOURCES INC.

Condensed Interim Consolidated Statements of Cash Flows (Unaudited)

(Expressed in Canadian Dollars)

Nine months ended November 30, 2023 November 30, 2022

Nine months ended November 30, 2023 November 30, 2022

CASH FLOWS FROM OPERATING ACTIVITIES Loss for the period $ (1,663,917) $ Adjustments Depreciation 122,598 Interest expense on lease liabilities 13,857 Share-based compensation 623,309 Write-down of mineral property 39,444 Foreign exchange (60,493) Change in non-cash working capital items: Receivables (24,629) Prepaids 50,830 Accounts payable and accrued liabilities (83,987) Due to related parties - Net cash used in operating activities (982,988) CASH FLOWS FROM FINANCING ACTIVITIES Common shares issued 1,546,418 Share issue costs (1,103) Payment of lease liabilities (30,916) Net cash provided by financing activities 1,514,399 CASH FLOWS FROM INVESTING ACTIVITIES Exploration and evaluation assets, net of recoveries (4,744,197) Acquisition of equipment (119,911) Net cash used in investing activities (4,864,108) Effect of foreign exchange on cash (2,024) Change in cash during the period (4,334,721) Cash, beginning of the period 10,909,314 Cash, end of the period $ 6,574,593 $

(866,283) 135,067 12,825 971,245 15,858 (13,632) (3,203) (31,364) (26,329) - 194,184 11,932,439 (91,671) (85,644) 11,755,124 (5,921,797) (1,684,557) (7,606,354) - 4,342,954 9,691,260 14,034,214

Supplemental disclosure with respect to cash flows (Note 12)

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

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IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

1. NATURE AND CONTINUANCE OF OPERATIONS

Irving Resources Inc. (the “Company” or “Irving”) was incorporated under the Business Corporations Act (British Columbia) on August 28, 2015 and is listed for trading on the Canadian Securities Exchange (“CSE”) under the symbol “IRV”. The Company is a junior resource exploration company that is involved in the acquisition and exploration of mineral properties. The Company’s corporate office is located at 999 Canada Place, Suite 404, Vancouver, BC V6C 3E2.

These condensed interim consolidated financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business in the foreseeable future. As at November 30, 2023, the Company had working capital of $6,259,567 (February 28, 2023 – $10,537,453). Management estimates these funds are sufficient to meet its immediate liquidity requirements as well as those for the next twelve months.

There are many external factors that can adversely affect general workforces, economies and financial markets globally. Examples include, but are not limited to, the COVID-19 global pandemic and political conflict in other regions. It is not possible for the Company to predict the duration or magnitude of adverse results of such external factors and their effect on the Company’s business or ability to raise funds.

2. BASIS OF PREPARATION

a) Statement of Compliance

These condensed interim consolidated financial statements are prepared in accordance with International Accounting Standard (“IAS”) 34 Interim Financial Reporting under International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”).

These condensed interim consolidated financial statements follow the same accounting policies and methods of application as the Company’s most recent annual financial statements but do not contain all of the information required for full annual financial statements. Accordingly, these condensed interim consolidated financial statements should be read in conjunction with the Company’s annual financial statements for the year ended February 28, 2023.

b) Basis of Measurement

These condensed interim consolidated financial statements have been prepared on a historical cost basis except for financial instruments measured at their fair value. In addition, these financial statements have been prepared using the accrual basis of accounting except for cash flow information.

c) Approval of the condensed interim consolidated financial statements

These condensed interim consolidated financial statements were reviewed by the Audit Committee and authorized for issue by the Board of Directors on January 29, 2024.

6

IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

2. BASIS OF PREPARATION (cont’d)

Principles of consolidation

The condensed interim consolidated financial statements include the financial statements of the parent company, Irving Resources Inc., and its subsidiaries listed below:

Irving Resources Japan GK (“Irving GK”) NIRV Resources GK (“NIRV GK”) Spring Take Limited (“STL”) Spring Stone Mining Corporation (“SSM”) Spring Stone Exploration Inc.(“SSE”)	Jurisdiction Nature of Operation Equity Interest
	Japan Exploration 100% Japan Exploration 100% Tanzania, Africa Exploration 100% BC, Canada Holding 100% BC, Canada Holding 100%

All inter-company balances and transactions have been eliminated on consolidation.

3. MATERIAL ACCOUNTING POLICIES

New Accounting Standards not yet adopted

The Company has not applied the following revised IFRS that has been issued but was not yet effective at May 1, 2023. These new accounting standards are not expected to have a significant effect on the Company’s accounting policies or financial statements.

IAS 1, Presentation of Financial Statements - In January 2020 and October 2022, the IASB issued amendments to International Accounting Standards 1 ("IAS 1"), Presentation of Financial Statements, to clarify that liabilities are classified as either current or non-current, depending on the rights that exist at the end of the reporting period. Liabilities should be classified as non-current if a company has a substantive right to defer settlement for at least 12 months at the end of the reporting period. Rights are in existence if covenants are complied with at the end of the reporting period. Settlement refers to the transfer to the counterparty of cash, equity instruments, or other assets or services. The amendments will be effective January 1, 2024, with early adoption permitted. Retrospective application is required on adoption. The Company is in the process of assessing the impact of this amendment to the Company's financial statements and does not expect it to have a significant effect on the Company's financial statements.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

The Company makes estimates and assumptions about the future that affect the reported amounts of assets and liabilities. Estimates and judgments are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions.

The effect of a change in an accounting estimate is recognized prospectively by including it in comprehensive income in the period of the change, if the change affects that period only, or in the period of the change and future periods, if the change affects both. Significant assumptions about the future and

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Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

IRVING RESOURCES INC.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (cont’d)

other sources of estimation uncertainty that management has made at the statement of financial position date, that could result in a material adjustment to the carrying amounts of assets and liabilities, in the event that actual results differ from assumptions made, relate to, but are not limited to, the following:

a) Exploration and evaluation expenditures

The application of the Company’s accounting policy for exploration and evaluation expenditures requires judgment in determining whether it is likely that future economic benefits will flow to the Company, which may be based on assumptions about future events or circumstances. Estimates and assumptions made may change if new information becomes available. If, after expenditures are capitalized, information becomes available suggesting that the recovery of expenditures is unlikely, the amount capitalized is written off in profit or loss in the period the new information becomes available.

b) Title to mineral property interests

Although the Company has taken steps to verify title to mineral properties in which it has an interest, these procedures do not guarantee the Company’s title. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects.

c) Share-based payment transactions

The Company measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. Estimating fair value for share-based payment transactions requires determining the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This estimate also requires determining the most appropriate inputs to the valuation model including the expected life of the share option, volatility and dividend yield and making assumptions about them. The assumptions and models used for estimating fair value for sharebased payment transactions are discussed in Note 10.

d) Income taxes

Significant judgement is required in determining the provision for income taxes. There are many transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The Company recognizes liabilities and contingencies for anticipated tax audit issues based on the Company’s current understanding of the tax law. For matters where it is probable that an adjustment will be made, the Company records its best estimate of the tax liability including the related interest and penalties in the current tax provision. Management believes they have adequately provided for the probable outcome of these matters; however, the final outcome may result in a materially different outcome than the amount included in the tax liabilities.

In addition, the Company recognizes deferred tax assets relating to tax losses carried forward to the extent there are sufficient taxable temporary differences (deferred tax liabilities) relating to the same taxation

8

IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (cont’d)

authority and the same taxable entity against which the unused tax losses can be utilized. However, utilization of the tax losses also depends on the ability of the taxable entity to satisfy certain tests at the time the losses are recouped.

e) Leases

The Company applies judgement in determining whether a contract contains an identified asset, whether the Company has the right to control the asset, the term of the lease and discount rate. The lease term is based on considering facts and circumstances, both qualitative and quantitative, that can create an economic incentive to exercise renewal options.

5. RECEIVABLES

The Company’s receivables arise mainly from goods and services tax due from Canadian government taxation authorities.

6. LEASES

The Company has various leases for equipment, housing and office space. The leases are treated as right-ofuse assets and included in Property and Equipment. The lease liability is presented as a separate line in the consolidated statements of financial position. The related payments are recognized as an expense in the period in which the payment occurs and are included in the consolidated statements of loss and comprehensive loss.

	Nine months ended	Year ended
	November 30, 2023	February 28, 2023
Opening balance	$ 233,212	$ 119,345
Additions	81,402	199,703
Lease payments made	(30,916)	(118,444)
Interest expense on lease liabilities	13,857	19,039
Foreign exchange adjustment	(117,168)	13,569
	180,387	233,212
Less: current portion	(95,197)	(123,022)
Long-term portion	$ 85,190	$ 110,190

The remaining minimum future lease payments, excluding estimated operating costs, for the term of the lease including assumed renewal periods are as follows:

		$
Fiscal	2024	88,213
Fiscal	2025	92,174

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IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

7. PROPERTY AND EQUIPMENT

		Machinery		Office
	Right of Use	and	Computer	furniture and
	Assets	equipment	equipment	fixtures	Total
Cost
Balance, February 28, 2022	$ 224,330	$ 225,493	$ 27,680	$ 12,383	$ 489,886
Disposals	(53,970)	-	-	-	(53,970)
Additions	199,703	1,920,908	-	-	2,120,611
Balance, February 28, 2023	370,063	2,146,401	27,680	12,383	2,556,527
Disposals	(51,347)	-	-	-	(51,347)
Additions	30,916	289,546	14,154	-	334,616
Balance, November30,2023	$ 349,632	$2,435,947	$41,834	$12,383	$2,839,796
Accumulated depreciation
Balance, February 28, 2022	$ 117,649	$ 83,642	$ 15,033	$ 3,636	$ 219,960
Disposals	(53,970)	-	-	-	(53,970)
Additions	107,566	105,899	3,536	1,494	218,495
Balance, February 28, 2023	171,245	189,541	18,569	5,130	384,485
Disposals	(49,143)	-	-	-	(49,143)
Additions	81,402	113,501	4,769	1,642	201,313
Transfer to exploration and
evaluation assets	-	107,034	-	-	107,034
Balance, November30,2023	$203,504	$410,076	$23,338	$ 6,771	$ 643,689
Carrying amounts
At February 28, 2023	$ 198,818	$ 1,956,860	$ 9,111	$ 7,253	$ 2,172,042
At November30,2023	$146,128	$2,025,871	$18,496	$ 5,612	$2,196,107

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IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

8. EXPLORATION AND EVALUATION ASSETS

The following expenditures were incurred on the Company’s exploration and evaluation assets:

Nine months ended November 30, 2023		Omu Property	Other Properties	Other Properties				Total
Opening balance, February 28, 2023 Additions: Acquisition costs Assays and sampling Consulting/management/administration Drilling related Geophysics/other engineering studies Materials and supplies Staking and claims registration Travel and transportation Less: write-down of deferred exploration costs Total, exploration and evaluation assets, November 30, 2023	$ $	34,439,511 - 328,651 1,268,953 1,274,376 37,965 628,929 44,574 425,843 4,009,291 ___- 38,448,802	$ 2,142,922 55,688 739 206,523 - 18,183 208,769 (9,740) 377,624 857,786 __(47,820) $ 2,952,888		$ 36,582,433 55,688 329,390 1,475,476 1,274,376 56,148 837,698 34,834 803,467 4,867,077 __(47,820) $ 41,401,690
						$
Year ended February 28, 2023		Omu Property		Other Properties				Total
Opening balance, February 28, 2022 Additions: Acquisition costs Assays and sampling Consulting/management/administration Drilling related Geophysics/other engineering studies Materials and supplies Staking and claims registration Travel and transportation Less: write-down of deferred exploration costs Total, exploration and evaluation assets, February 28, 2023	$	26,734,659 - 364,689 1,401,610 4,199,006 351,091 723,742 48,595 616,119 7,704,852 ___- 34,439,511		$ 1,339,214 65,625 35,257 265,707 - 368,238 70,234 65,017 107,406 977,484 (173,776) $ 2,142,922		$		28,073,873 65,625 399,946 1,667,317 4,199,006 719,329 793,976 113,612 723,525 8,682,336 (173,776) 36,582,433
	$					$

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IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

8. EXPLORATION AND EVALUATIONS ASSETS (cont’d)

Title to exploration and evaluation assets involves certain inherent risks due to the difficulties of determining the validity of certain claims as well as the potential for problems arising from the frequently ambiguous conveyancing history characteristic of many exploration and evaluation assets. The Company has investigated title to all of its exploration and evaluation assets and to the best of its knowledge, title to all of the assets is in good standing.

a) Omu Property

The Company entered into an agreement to purchase a 100% interest in a mining right for the Omui Property located in Hokkaido, Japan. The mining right encompasses an area of approximately 2.98 sq km. The total purchase price for the mining right is JPY40,000,000 cash (CAD $477,000; paid) and 135,747 common shares of the Company issued at a value of $118,100.

The Company has also filed a total of 57 prospecting licenses covering additional prospective ground in the vicinity of the Omui Property.

The Company purchased a total of 1.35 sq km of surface rights covering an area over the Omui Property for total purchase price JPY38,145,974 (CAD$458,279).

The Company entered into long-term leases of surface rights covering a total area of 1.06 sq km in an area over the Omui Property. The total costs for the initial five-year period is JPY10,637,140 (CAD$129,613). The leases are for a five-year term and can be extended for up to three additional five-year periods. Included in long-term prepaids are the refundable deposits associated with these long-term leases.

b) Other Properties

The Company has filed mineral prospecting licenses with the Ministry of Economy, Trade and Industry (METI) in various other areas (Prefectures) within Japan. These mineral prospecting licenses are in various stages of early exploration. The Company will conduct exploration and if a property does not warrant further exploration, the Company will surrender or withdrawal their applications from the METI.

During the year ended February 28, 2021, the Company signed a binding option agreement to acquire the 5.2 sq km Yamagano mining license. The option is exercisable for a period of ten years from the date of the agreement, September 26, 2020. In order to exercise the option, the Company must issue a total of 350,000 common shares over four years, with the initial 87,500 common shares issued during the year ended February 28, 2021 with a value of $253,750, and 87,500 common shares due on each of the first, second and third anniversaries of the date of the agreement and incur, within three years after the date of the agreement, aggregate property expenditures of US$250,000 on the property and on properties controlled by the Company within 10 km of the outer boundaries of the property. The Company also holds 21 mineral prospecting licenses in areas near the Yamagano mining license.

12

IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

8. EXPLORATION AND EVALUATIONS ASSETS (cont’d)

During the year ended February 28, 2022, the Company issued 87,500 common shares with a value of $99,750 as part of the share issuance due on the first anniversary of the option agreement and during the year ended February 28, 2023, the Company issued 87,500 common shares with a value of $65,625 as part of the share issuance due on the second anniversary. During the period ended November 30, 2023, the Company issued 87,500 common shares with a value of $53,375 as part of the share issuance due on the third anniversary.

During the year ended February 28, 2023, the Company wrote-down the carrying value on claims as it withdrew its application for these prospecting licenses.

• c) Tanzania Property

The Company, through its wholly-owned Tanzanian subsidiary, and with its joint venture participant, JOGMEC, had exploration prospecting licenses in Tanzania, Africa. During the year ended February 28, 2019, the Company elected to surrender the final license and as at February 28, 2022, the Company is in the process of winding up the subsidiary in Tanzania. The carrying value of properties in Tanzania is $Nil (2022 - $Nil).

9. JOINT VENTURES

The Company holds a Joint Exploration Agreement (JEA) under which JOGMEC contributes 67% of the funding and holds a 67% option to all of the JEA projects.

The Company, as operator of the JEA, conducts REE project identification and exploration. The objective of the JEA is to identify, analyze and perform metallurgical evaluation leading to production of REEs. All the property investigation costs will be expensed as incurred until the Company assesses whether there is any future benefit of REEs and acquires the rights to the property.

During the period ended November 30, 2023, the Company terminated the JEA with JOGMEC.

10. SHAREHOLDERS’ EQUITY

Authorized

Unlimited number of common shares without par value.

During the period ended November 30, 2023, the Company:

a) issued 66,667 shares for gross proceeds of $66,667 pursuant to the exercise of stock options.

13

IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

10. SHAREHOLDERS’ EQUITY (cont’d)

• b) Completed a private placement on July 7, 2023, issuing 1,429,573 common shares for gross proceeds of $1,479,751 at a price of $1.035 per common share.

• c) Issued 87,500 common shares valued at $0.61 per share pursuant to the terms of a mineral property agreement. See Note 8

During the year ended February 28, 2023, the Company:

• a) Completed a private placement on August 4, 2022, issuing 2,705,056 common shares for gross proceeds of $3,327,219 at a price of $1.23 per common share.

• b) Completed a private placement on July 12, 2022, issuing 4,577,788 common shares for gross proceeds of $5,630,680 at a price of $1.23 per common share.

• c) Completed a private placement on July 12, 2022, issuing 2,974,540 units at a price of $1.00 per unit for gross proceeds of $2,974,540. Each unit consists of one common share and one-half of a share purchase warrant. Each whole warrant is exercisable into one common share until July 12, 2025 at a price of $1.60 per share.

• d) Issued 87,500 common shares valued at $0.75 per share pursuant to the terms of a mineral property agreement. See Note 8.

Stock options

The Company, in accordance with its stock option plan, is authorized to grant options to directors, employees and consultants, to acquire up to 10% of its issued and outstanding common stock. The exercise price of each option shall not be less than the market price of the Company's stock on the date of grant. The options can be granted for a maximum term of ten years with vesting period determined by the board of directors.

14

IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

10. SHAREHOLDERS’ EQUITY (cont’d)

Stock option transactions and the number of stock options outstanding are summarized as follows:

	Number of	Weighted Average
	Options	ExercisePrice
Opening balance, February 28, 2022	5,293,335	$1.82
Granted	1,795,000	1.00
Expired / Cancelled	(1,898,335)	2.71
Outstanding, February 28, 2023	5,190,000	1.82
Granted	2,055,000	0.95
Exercised	(66,667)	1.00
Expired / Cancelled	(1,760,000)	1.52
Outstanding,November30,2023	5,418,333	$1.03

Stock options outstanding at November 30, 2023 are as follows:

Options	Options	Exercise
Outstanding	Exercisable	Price	ExpiryDate
		$
110,000	110,000	2.09	March 1, 2024
1,620,000	1,620,000	1.09	December 21, 2024
1,633,333	1,133,333	1.00	September 12, 2025
220,000	73,333	1.30	April 10, 2026
1,835,000	-	0.91	September 7, 2026
5,418,333	2,936,666

Warrants

Warrant transactions and the number of warrants outstanding are summarized as follows:

		Weighted
	Number of	Average
	Warrants	ExercisePrice
Opening balance, February 28, 2021 and February 28, 2022	-	$ -
Granted	1,487,270	1.60
Outstanding, February 28, 2023	1,487,270	$ 1.60
Outstanding, November 30, 2023	1,487,270	$ 1.60

15

IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

10. SHAREHOLDERS’ EQUITY (cont’d)

Warrants outstanding at November 30, 2023 are as follows:

Number	Exercise
ofWarrants	Price	ExpiryDate
1,487,270	$ 1.60	July 12, 2025
1,487,270

Share-based compensation

During the period ended November 30, 2023, the Company granted 2,105,000 stock options to employees (2022 – 1,795,000). The estimated weighted average fair value of these options is $0.33 per option (2022 - $0.44). The total amount of fair value of vested stock options amortized during the period is $623,309 (2022 - $971,245). This amount has been expensed as share-based compensation in the statement of loss and comprehensive loss.

The following weighted average assumptions were used for the Black-Scholes valuation of stock options granted during the period:

	Nine months ended	Nine months ended
	November 30, 2023	November 30, 2022
Risk-free interest rate	3.53% - 4.36%	3.55%
Expected life of options	3.0 years	3.0 years
Annualized volatility	75.15% - 81.56%	76.12%
Dividend rate	0.00%	0.00%
Forfeiture rate	0.00%	0.00%

11. RELATED PARTY TRANSACTIONS

	Nine months ended	Nine months ended
	November 30, 2023	November 30, 2022
Management fees	$ 140,200	$ 147,730
Consulting fees	247,932	235,469
	$ 388,132	$ 383,199

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IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited)

(Expressed in Canadian Dollars)

11. RELATED PARTY TRANSACTIONS (cont’d)

• a) Included in the management fees were fees for services provided by the President and Chief Executive Officer and Chief Financial Officer.

• b) Included in consulting fees are amounts paid to independent directors for services other than their role as directors.

• c) During the period, 1,100,000 (2022 – 950,000) stock options were granted to directors and officers. The total vested share-based compensation allocated to directors and officers is $90,223 (2022 - $517,900).

Key Management Compensation

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly. Key management personnel include the Company’s executive officers and Board of Director members.

Other than disclosed above, there was no other compensation paid to key management during the periods ended November 30, 2023 and 2022.

12. SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS

The significant non-cash transactions for the period ended November 30, 2023:

• a) Included in accounts payable and accrued liabilities are $246,913 related to deferred exploration costs.

The significant non-cash transactions for the period ended November 30, 2022:

• b) Included in accounts payable and accrued liabilities are $1,142,926 related to deferred exploration costs.

13. SEGMENTED INFORMATION

The Company has mineral properties and property and equipment located geographically as follows:

As at November 30, 2023	Property and equipment	Exploration and evaluation assets
Canada Japan Total	$ 4,784 2,191,323 $ 2,196,107	$ - 41,401,690 $ 41,401,690
		$

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IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited)

(Expressed in Canadian Dollars)

13. SEGMENTED INFORMATION (cont’d)

Canada Japan Total	$ 23,333 2,148,709 $ 2,172,042	$ - 36,582,433 $ 36,582,433

14. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

IFRS 7 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value as follows:

Level 1 – quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 – inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and Level 3 – inputs for the asset or liability that are not based on observable market data (unobservable inputs).

As at November 30, 2023, the Company’s financial instruments are comprised of cash, accounts payable and accrued liabilities and lease liabilities. The carrying value of accounts payable and accrued liabilities approximate its fair value due to the relatively short period to maturity of this financial instrument. Lease liabilities are accreted over lease terms at market interest rates using the effective interest rate method.

The Company has exposure to the following risks from its use of financial instruments: credit risk, liquidity risk and market risk. Management and the Board of Directors monitor risk management activities and review the adequacy of such activities.

Credit risk

Credit risk is the risk of potential loss to the Company if a customer or counter party to a financial instrument fails to meet its contractual obligations. The Company’s credit risk is limited to the carrying amount on the statement of financial position and arises from the Company’s cash and receivables.

The Company’s cash is held with high-credit quality financial institutions. Receivables mainly consist of goods and services tax due from the Federal Government of Canada.

Liquidity risk

Liquidity risk is the risk that the Company will not meet its financial obligations as they fall due. The Company manages its liquidity risk by forecasting cash flows from operations, and anticipating investing and financing activities. As at November 30, 2023, the Company had cash of $6,574,593 to settle current

18

IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

14. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (cont’d)

liabilities of $439,359 of which a significant amount has contractual maturities of less than 30 days and are subject to normal trade terms.

Market risk

Market risk is the risk of loss that may arise from changes in market prices, such as interest rates and foreign exchange rates.

iii) Interest rate risk

The Company has cash balances and no interest-bearing debt. The Company’s current policy is to invest excess cash in investment-grade short-term certificates of deposits issued by its banking institutions. The Company periodically monitors the investments it makes and is satisfied with the credit rating of its banks.

ii) Price risk

The Company is exposed to price risk with respect to commodity and equity prices. The ability of the Company to explore its mineral properties and future profitability of the Company are directly related to the market price of rare earth elements and other non-gold minerals. The Company monitors commodity prices to determine appropriate actions to be undertaken.

iii) Foreign exchange rate risk

The Company’s functional currency is the Canadian dollar. The Company funds certain operations, exploration and administrative expenses by using US Dollars and Japanese Yen converted from its Canadian bank accounts. Management is aware of the possibility of foreign exchange risk derived from currency conversions. The Company has not entered into any agreements or purchased any instruments to hedge possible foreign exchange rate risk at this time.

15. CAPITAL MANAGEMENT

The Company considers items in its shareholders’ equity as capital. The Company’s capital management objectives are to safeguard its ability to continue as a going concern and to have sufficient capital to be able to meet the Company’s property exploration plans and to ensure the growth of activities.

The Company sets the amount of capital in proportion to risk. The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. The Company is in the exploration stage; as such the Company will rely on the equity markets to fund its activities. The Company will continue to assess new sources of financing available and to manage its expenditures to reflect current financial resources in the interest of sustaining long term viability.

19

IRVING RESOURCES INC.

Notes to the Condensed Interim Consolidated Financial Statements For the nine months ended November 30, 2023 (Unaudited) (Expressed in Canadian Dollars)

15. CAPITAL MANAGEMENT (cont’d)

There were no changes to the Company’s approach to capital management during the period ended November 30, 2023.

16. SUBSEQUENT EVENTS

a) On December 12, 2023, the Company granted 50,000 incentive stock options to a consultant. The options are exercisable at $0.91 for a period of three years and are subject to vesting conditions.

b) On January 23, 2024, the Company announced Newmont Exploration Pty Ltd, a wholly-owned subsidiary of Newmont Corporation (collectively, “Newmont”), has designated the Yamagano and Noto properties (collectively, the “Property”), the exploration work on which has been funded under alliances formed by the Company with Newmont and with Sumitomo Corporation (“Sumitomo”), for joint venture.

The parties will use commercially reasonable best efforts to enter into a joint venture agreement or similar governing agreement within 90 days which is expected to include an exploration program up to an initial US$5 million. Initially, Property interests will be split 60% to Newmont, 27.5% to Irving, and 12.5% to Sumitomo if Sumitomo elects to participate, and Irving will be the initial joint venture manager. Irving and Sumitomo will have a one-time right to elect to maintain their respective interest in the Property by contributing their respective share of Property expenditures. If such right is not exercised, the relevant party’s interest will be subject to dilution.

20