Minnova Corp — Interim / Quarterly Report 2023

Mar 1, 2023

MINNOVA CORP.

CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE AND NINE MONHTS ENDED DECEMBER 31, 2022 AND 2021

(UNAUDITED)

(Expressed in Canadian Dollars)

NOTICE TO READER

The accompanying unaudited condensed interim consolidated financial statements of Minnova Corp. (the "Company") have been prepared by and are the responsibility of management. The unaudited condensed interim consolidated financial statements as at and for the three and nine months ended December 31, 2022, have not been reviewed by the Company's auditors.

Page 1

MINNOVA CORP. CONDENSED INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED)

(Expressed in Canadian Dollars)

	December 31,	December 31,		March 31,
		2022		2022
ASSETS
CURRENT ASSETS
Cash	$	24,008	$	138,038
Amounts receivable		55,445		54,784
Prepaid expenses		82,935		144,279
TOTAL CURRENT ASSETS		162,388		337,101
NON-CURRENT ASSETS
Equipment (Note 4)		213,563		223,996
Exploration properties and deferred exploration expenditures (Note 5)		20,855,227		20,626,843
TOTAL NON-CURRENT ASSETS		21,068,790		20,850,839
TOTAL ASSETS	**$ **	21,231,178	**$ **	21,187,940
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities (Notes 6 and 13)	$	1,148,126	$	790,411
Loan payables (Note 7)		115,256		-
TOTAL CURRENT LIABILITIES		1,263,382		790,411
NON-CURRENT LIABILITIES
Provision for closure and reclamation (Note 8)		2,723,603		2,889,083
TOTAL LIABILITIES		3,986,985		3,679,494
EQUITY
Share capital (Note 10(b))		24,875,486		24,634,327
Share-based payment reserves (Note 11)		2,149,105		2,061,614
Non-controlling interest		(37,371)		-
Deficit		(9,743,027)		(9,187,495)
TOTAL EQUITY		17,244,193		17,508,446
TOTAL LIABILITIES AND EQUITY	**$ **	21,231,178	**$ **	21,187,940

NATURE OF OPERATIONS AND GOING CONCERN (Note 1) COMMITMENTS AND CONTINGENCIES (Notes 5, 8,15 and 16) SUBSEQUENT EVENTS (Note 17)

APPROVED ON BEHALF OF THE BOARD:

Signed "James White" , Director Signed "Gorden Glenn" , Director

See accompanying notes to the unaudited condensed interim consolidated financial statements

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MINNOVA CORP. UNAUDITED CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME (UNAUDITED)

(Expressed in Canadian Dollars)

		Three months ended December 31, 2022 2021	Three months ended December 31, 2022 2021	Nine months ended December 31 2022 2021
REVENUES Gross revenue $ 1,381 $ COST OF GOODS SOLD Cost of goods sold 832 GROSS MARGIN 549 EXPENSES Stock-based payments (Note 11(a)) - General and administrative (Note 12) 20,004 Management and directors' compensation (Note 13(b)) 26,055 Professional and consulting fees (Note 13(a)) 8,350 Amortization (Note 4) 4,126 LOSS BEFORE BELOW ITEMS (58,535) Foreign exchange income (loss) - Gain (loss) on debt settlement (1,737) Realized loss on deconsolidation (Note 14) - Interest income - Write-off of receivables - Acquisition cost (Note 3) - Reversal of flow-through premium liability - Finance cost (Note 8) (22,606) NET (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME FOR CONTINUING OPERATIONS FOR THE PERIOD (82,329) NET (LOSS) AND COMPREHENSIVE (LOSS) FOR DISCONTINUED OPERATIONS FOR THE PERIOD(Note 14) - NET (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME FOR THE PERIOD $ (82,329) NET LOSS ATTRIBUTABLE TO: Shareholders of the Company (76,450) Non-controlling interest (5,879) Net (loss) income per common share - basic $ (0.00) - diluted $ (0.00) Weighted average number of shares outstanding - basic and diluted 60,888,176 - diluted 60,188,176

See accompanying notes to the unaudited condensed interim consolidated financial statements

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MINNOVA CORP. CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(Expressed in Canadian Dollars)

For the Nine Months Ended December 31,		2022		2021
CASH FLOWS USED IN OPERATING ACTIVITIES
Net (loss) income for the period	$	(561,411)	$	641,214
Items not involving cash:
Amortization (Note 4)		12,242		13,808
Acquisition cost (Note 3)		131,492		-
Foreign exchange gain		-		217
Realised loss on deconsolidation		-		32,503
Write-off of receivables		-		95,969
Stock-based payments		-		113,179
(Gain) on settlement of debt		1,737		(1,007,411)
Accretion of provision for closure and reclamation		67,273		32,696
Reversal of flow-through premium liability		-		(44,794)
		(350,404)		(122,619)
Changes in non-cash working capital balances:
Amounts receivable		283		35,462
Prepaid expenses		79,281		95,996
Accounts payable and accrued liabilities		392,713		(122,518)
		472,277		8,940
Cash flows (used in) provided by operating activities		121,873		(113,679)
CASH FLOWS USED IN INVESTING ACTIVITIES
Increase in exploration properties and deferred exploration expenditures		(461,136)		(533,435)
Change in restricted cash		-		75,000
Payment for purchase of Duma (Note 3)		(100,000)		-
Cash flows used in investing activities		(561,136)		(458,435)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from private placements		293,650		800,000
Share issue costs		-		(44,569)
Proceeds from sale of investment in subsidiary		-		1,478
Proceeds from loan payable		31,583		-
Cash flows provided by financing activities		325,233		756,909
(Decrease) in cash		(114,030)		184,795
Effect of deconsolidation		-		54,418
Cash, beginning of period		138,038		128,291
Cash, end of period	$	24,008	$	367,504

Cash flows from discontinued operations (Note 14)

See accompanying notes to the unaudited condensed interim consolidated financial statements

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MINNOVA CORP. CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (UNAUDITED)

(Expressed in Canadian Dollars)

		Share Capital Number Amount	Share Capital Number Amount	Share-based Payment Reserves Stock Share purchase DSU and Non-controlling options warrant reserve RSU interest	Share-based Payment Reserves Stock Share purchase DSU and Non-controlling options warrant reserve RSU interest	Share-based Payment Reserves Stock Share purchase DSU and Non-controlling options warrant reserve RSU interest	Share-based Payment Reserves Stock Share purchase DSU and Non-controlling options warrant reserve RSU interest	Deficit	Total
Balance, March 31, 2021 Flow-through common shares issued, after costs Common shares issued, after costs Fair value of broker warrants issued Stock-based compensation Expiry of stock options Deconsolidation Loss and comprehensive loss for the period Balance, December 31, 2021 Balance, March 31, 2022 Common shares issued, after cost Fair value of warrants and broker warrants Non-controlling interest upon acquisition of Duma (Note 3) Income and comprehensive income for the period Balance, December 31, 2022		43,580,484 $ 2,307,692 5,000,000 - - - - - 50,888,176 $ 50,888,176 $ 10,000,000 - - - 60,888,176 $	23,901,545 $ 272,980 482,451 (22,649) - - - - 24,634,327 $ 24,634,327 $ 328,650 (87,491) - - 24,875,486 $	1,148,909 $ - - - 113,179 (188,555) - - 1,073,533 $ 717,872 $ - - - - 717,872 $	492,403 $ - - 22,649 - - - - 515,052 $ 515,052 $ - 87,491 - - 602,543 $	828,690 $ - - - - - - - 828,690 $ 828,690 $ - - - - 828,690 $	- $ - - - - - - - - $ - $ - - (31,492) (5,879) (37,371) $	(10,143,631) $ - - - - 188,555 54,418 641,214 (9,259,444) $ (9,187,495) $ - - - (555,532) (9,743,027) $	16,227,916 272,980 482,451 - - - 54,418 641,214 17,792,158 17,508,446 328,650 - (31,492) (555,532) 17,244,193

See accompanying notes to the unaudited condensed interim consolidated financial statements

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED) (Expressed in Canadian Dollars)

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1. NATURE OF OPERATIONS AND GOING CONCERN

Minnova Corp. (the "Company") is a public company incorporated on July 19, 1994, pursuant to the laws of the Companies Act of Barbados. Since the Company's management and the principal office of the Company are located in Toronto, Ontario, a continuance (the "Continuance") of the Company from the laws of Barbados to the laws of the Province of Ontario was filed on April 21, 2010. As a result of the Continuance, the corporate legislation that governs the Company ceased to be the Barbados Act and the Company is now governed by the Business Corporations Act (Ontario). The registered office of the Company is located at 217 Queen Street West, Suite 401, Toronto, Ontario, M5V 0R2. On June 26, 2014, the Company changed its name to "Minnova Corp." and commenced trading on the Toronto Stock Venture Exchange ("TSX-V") on June 27, 2014, under the new symbol "MCI".

The Company's exploration operations are subject to government legislation, policies and controls relating to prospecting, development, production, environmental protection, mining taxes and labour standards. In order for the Company to carry out its exploration activities, the Company is required to hold certain permits. There is no assurance that the Company's existing permits will be renewed or that new permits that have been or will be applied for will be granted.

Major expenditures are required to locate and establish ore reserves, to develop metallurgical processes and to construct mining and processing facilities at a particular site. The recoverability of valuations assigned to exploration properties and deferred exploration expenditures is dependent upon discovery of economically recoverable reserves, the ability to obtain necessary financing to complete development and future profitable production or proceeds from disposition.

Although the Company has taken steps to verify title to exploration properties in which it has an interest in accordance with industry standards for the current stage of exploration of such properties, these procedures do not guarantee the Company's title. Property title may be subject to other licensing requirements or regulations, social licensing requirements unregistered prior agreements, unregistered claims, aboriginal land claims and non-compliance with regulatory requirements.

In order to meet future expenditures and cover administrative costs, the Company will need to raise additional financing. The Company has a working capital deficiency of $1,100,994 (March 31, 2022 - $453,310) and a deficit of $9,743,027 (March 31, 2022 - $9,187,495) as at December 31, 2022 and will require additional financing to fund its continuing exploration efforts. These conditions indicate the existence of material uncertainties that cast significant doubt about the Company's ability to continue as a going concern. Although the Company has been successful in raising funds to date, there can be no assurance that adequate funding will be available in the future, or available under terms acceptable to the Company. These unaudited condensed interim consolidated financial statements have been prepared on a going concern basis that assumes the Company will be able to continue to realize its assets and discharge its liabilities in the normal course of business. In the event the Company is not able to obtain adequate funding, there is uncertainty as to whether the Company will be able to maintain its property interests. These unaudited condensed interim consolidated financial statements do not reflect the adjustments to the carrying values of assets and liabilities that would be necessary if the Company were unable to obtain adequate financing. Such adjustments could be material. Changes in future conditions could require material write downs of the carrying values of certain assets.

The unaudited condensed interim consolidated financial statements were approved by the Board of Directors on March 1, 2023.

Since March 2020, the spread of COVID-19 has severely impacted many local economies around the globe. In many countries, including Canada, organizations and businesses are being forced to cease or limit operations for long or indefinite periods of time. Measures taken to contain the spread of the virus, including travel bans, quarantines, social distancing, and closures of non-essential services have triggered significant disruptions to organizations worldwide, resulting in an economic slowdown. Global stock markets have also experienced great volatility and a significant weakening. Governments and central banks have responded with monetary and fiscal interventions to stabilize economic conditions. Management believes COVID-19 has had no material impact on the Company.

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED) (Expressed in Canadian Dollars)

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2. BASIS OF PREPARATION AND ACCOUNTING POLICIES

Statement of Compliance:

These unaudited condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting. Accordingly, they do not include all of the information required for full annual consolidated financial statements required by International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and interpretations of the International Financial Reporting Interpretations Committee ("IFRIC").

The accounting policies applied in these unaudited condensed interim consolidated financial statements are based on IFRS issued and outstanding as at March 1, 2023, the date the Board of Directors approved these unaudited condensed interim consolidated financial statements for issue. The same accounting policies and methods of computation are followed in these unaudited condensed interim consolidated financial statements as compared with the most recent annual financial statements as at and for the year ended March 31, 2022. Any subsequent changes to IFRS that are issued and effective as at March 31, 2023 could result in a restatement of these unaudited condensed interim consolidated financial statements.

New accounting policy adopted

Revenue

Revenue is generated from sale of engineering services.

The revenue recognition standard contains a single model that applies to contracts with customers and two approaches to recognizing revenue, at a point in time or over time, the assessment of which requires judgment. The model features the following five-step contract-based analysis of transactions to determine whether, how much and when revenue is recognized:

• a. Identify the contract with a customer;

• b. Identify the performance obligation(s) in the contract;

• c. Determine the transaction price;

• d. Allocate the transaction price to the performance obligation(s) in the contract; and

• e. Recognize revenue when or as the Company satisfies the performance obligation(s).

Revenue from the sale of engineering services is generally recognized when the services have been delivered to the customer. Payment is typically due and is recognized in revenue upon the satisfaction of the performance obligation. The Company satisfies its performance obligation to the customer upon delivery and acceptance by the customer.

Non-controlling interest

The non-controlling interest, which represent the portion of net income and net assets in subsidiaries that are not 100% owned by the Company, is reported separately within equity in the consolidated statement of financial position.

For a business combination including the non-controlling interest, the acquirer measures the non-controlling interest in the acquiree either at fair value or at the proportionate share of the acquirer’s identifiable net assets.

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED)

Page 7

(Expressed in Canadian Dollars)

2. BASIS OF PREPARATION AND ACCOUNTING POLICIES (Continued)

New IFRS Standards Adopted

During the nine months ended December 31, 2022, the Company adopted the following new IFRS standards, interpretations, amendments and improvements of existing standards. These new standards and changes did not have any material impact on the Company’s unaudited condensed interim consolidated financial statements, and are described as follows:

IAS 37 – Provisions, Contingent Liabilities, and Contingent Assets (“IAS 37”) was amended. The amendments clarify that when assessing if a contract is onerous, the cost of fulfilling the contract includes all costs that relate directly to the contract – i.e., a full-cost approach. Such costs include both the incremental costs of the contract (i.e., costs a company would avoid if it did not have the contract) and an allocation of other direct costs incurred on activities required to fulfill the contract – e.g. contract management and supervision, or depreciation of equipment used in fulfilling the contract.

IFRS 3 – Business Combinations (“IFRS 3”) was amended. The amendments introduce new exceptions to the recognition and measurement principles in IFRS 3 to ensure that the update in references to the revised conceptual framework does not change which assets and liabilities qualify for recognition in a business combination. An acquirer should apply the definition of a liability in IAS 37 – rather than the definition in the Conceptual Framework – to determine whether a present obligation exists at the acquisition date as a result of past events. For a levy in the scope of IFRIC 21, the acquirer should apply the criteria in IFRIC 21 to determine whether the obligating event that gives rise to a liability to pay the levy has occurred by the acquisition date. In addition, the amendments clarify that the acquirer should not recognize a contingent asset at the acquisition date.

IAS 16 – Property, Plant and Equipment (“IAS 16”) was amended. The amendments introduce new guidance, such that the proceeds from selling items before the related property, plant and equipment is available for its intended use can no longer be deducted from the cost. Instead, such proceeds are to be recognized in profit or loss, together with the costs of producing those items.

IFRS 16 – The IASB has extended the rent concessions amendment issued May 2020 by one year. This amendment provides lessees with an exemption from assessing whether a COVID-19 related rent concession is a lease modification. The practical expedient was originally available only for payments due on or before June 30, 2021, however, since the effects of COVID-19 are ongoing and significant, the IASB decided to extend the time period over which the practical expedient is available for use.

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED) (Expressed in Canadian Dollars)

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2. BASIS OF PREPARATION (Continued)

Accounting Pronouncements Issued but not Applied

Certain pronouncements were issued by the IASB or the IFRIC that are mandatory for accounting periods commencing on or after April 1, 2022. Many are not applicable or do not have a significant impact to the Company and have been excluded. The following have not yet been adopted and are being evaluated to determine their impact on the Company:

IFRS 10 – Consolidated condensed interim financial statements (“IFRS 10”) and IAS 28 – Investments in Associates and Joint Ventures (“IAS 28”) were amended in September 2014 to address a conflict between the requirements of IAS 28 and IFRS 10 and clarify that in a transaction involving an associate or joint venture, the extent of gain or loss recognition depends on whether the assets sold or contributed constitute a business. The effective date of these amendments is yet to be determined; however early adoption is permitted.

IAS 1 – Presentation of Financial Statements (“IAS 1”) was amended in January 2020 to provide a more general approach to the classification of liabilities under IAS 1 based on the contractual arrangements in place at the reporting date. The amendments clarify that the classification of liabilities as current or noncurrent is based solely on a company’s right to defer settlement at the reporting date. The right needs to be unconditional and must have substance. The amendments also clarify that the transfer of a company’s own equity instruments is regarded as settlement of a liability, unless it results from the exercise of a conversion option meeting the definition of an equity instrument. The amendments are effective for annual periods beginning on January 1, 2023.

IAS 8 – In February 2021, the IASB issued ‘Definition of Accounting Estimates’ to help entities distinguish between accounting policies and accounting estimates. The amendments are effective for year ends beginning on or after January 1, 2023.

IAS 12 – In May 2021, the IASB issued ‘Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction’ that clarifies how entities account for deferred tax on transactions such as leases and decommissioning obligations. The amendments are effective for year ends beginning on or after January 1, 2023.

There are no other IFRS standards or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the Company.

3. ACQUISITION OF DUMA

On September 30, 2022, the Company completed the initial acquisition of 50% interest in Duma Engineering (2018) Inc. ("Duma") with consideration of $100,000. Negotiationson the terms for the acquisition of the remaining 50% interest are in progress. Final acquisition terms will consist of a combination of cash payments and shares.

In accordance with IFRS 3, Business Combination, the substance of the transaction is an asset acquisition. The transaction does not constitute a business combination as Duma does not meet the definition of a business under the standard.

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED)

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(Expressed in Canadian Dollars)

3. ACQUISITION OF DUMA (Continued)

Consideration
Cash	$	100,000
Total consideration	$	100,000
Identifiable assets acquired
Amounts receivable	$	18,881
Computer		1,809
Loanpayable		(83,674)
		(62,983)
Minus: Non-controllinginterest		(31,492)
Total net liability acquired		(31,492)
Acquisition cost		131,492
Total net identifiable liability and acquisition cost	$	100,000

4. EQUIPMENT

Cost

Cost
		Computer		Equipment		Buildings		Total
Balance, March 31, 2022	$	-	$	105,000	$	305,096	$	410,096
		1,809		-		-		1,809
Balance, December 31, 2022	$	1,809	$	105,000	$	305,096	$	411,905

Accumulated Amortization

Accumulated Amortization
		Computer		Equipment		Buildings		Total
Balance, March 31, 2022	$	-	$	71,454	$	114,646	$	186,100
Amortization for theperiod		68		5,032		7,142		12,242
Balance, December 31, 2022	$	68	$	76,486	$	121,788	$	198,342
Carrying Amount
		Computer		Equipment		Buildings		Total
Balance, March 31, 2022	$	-	$	33,546	$	190,450	$	223,996
Balance, December 31, 2022	$	1,741	$	28,514	$	183,308	$	213,563

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED)

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(Expressed in Canadian Dollars)

5. EXPLORATION PROPERTIES AND DEFERRED EXPLORATION EXPENDITURES

As at December 31, 2022

As at December 31, 2022
							Changes for
		March 31,					closure and		December 31,
		2021			Additions		reclamation			2022
Exploration and Evaluation Properties
Nokomis Property	$	2,929,472		$	-		$	-	$	2,929,472
PL Property		17,697,371			461,136			(232,752)		17,925,755
	**$ **	20,626,843		$	461,136		$	(232,752)	**$ **	20,855,227
As at March 31, 2022
						Changes for
		March 31,				closure and				March 31,
		2021		Additions		reclamation		Write-off		2022
Exploration and Evaluation Properties
Nokomis Property	$	2,929,472	$		-	$	-	-	$	2,929,472
PL Property		17,238,886		783,701			(252,681)	(72,535)		17,697,371
	**$ **	20,168,358	$	783,701		$	(252,681)	**(72,535) **	**$ **	20,626,843

PL Project (PL Property and Nokomis Property)

The Company owns a 100% interest in the PL Mine and contiguous Nokomis property, located in Manitoba, subject to a 3% net smelter royalty (NSR) that reduces to 2.5% and 2% if gold is below US$1,000/oz and US$750/oz, respectively.

6. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

	December 31,	December 31,		March 31,
		2022		2022
Trade payables	$	751,316	$	508,612
Accrued andpayroll liabilities		396,810		281,799
Total	**$ **	1,148,126	$	790,411

The following is an aged analysis of the accounts payable and accrued liabilities:

	December 31,	December 31,		March 31,
		2022		2022
Less than 1 month	$	440,826	$	354,474
1 to 3 months		94,334		25,239
Over 3 months		612,966		410,698
Total	**$ **	1,148,126	$	790,411

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED) (Expressed in Canadian Dollars)

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7. LOAN PAYABLES

The loan payables are non-interet bearing and due on demand. The loan payables include $38,000 loan payable to the CEO of the Company.

8. PROVISION FOR CLOSURE AND RECLAMATION

The Company's provision for closure and reclamation costs is based on management's estimates of costs to abandon and reclaim mineral properties and facilities as well as an estimate of the future timing of the costs to be incurred. The Company has estimated its total provision for closure and reclamation to be $2,723,603 at December 31, 2022 ($2,889,083 - March 31, 2022), based on a total future liability of approximately $3,073,000 (March 31, 2022 - $3,073,000), an inflation rate of 2.11% (March 31, 2022 - 1.19%) and a discount rate of 3.30% (March 31, 2022 - 1.39%). Reclamation is expected to occur in approximately 9 years.

The Company has provided a letter of credit in the amount of $75,000 to the Government of Manitoba under the terms of the closure plan on the PL Property. The letter of credit was used in the year ended March 31, 2021 and has not been replenished. The impact of this to the Company is unknown. The Company further provided all assets, goods and personal property involved in the operation of the PL Property, as a security of up to $5,000,000 for the performance of the closure plan and the rehabilitation program. As at December 31, 2022, the investment backing the letter of credit has been liquidated and not replaced.

The following is an analysis of the provision for closure and reclamation:

Balance, March 31, 2022	$	2,889,083
Effect of changes in the inflation and discount rate		(232,753)
Accretion incurred in theyear		67,273
Balance, December 31, 2022	$	2,723,603

During the three and nine months ended December 31, 2022, the Company expensed $22,606 and $67,273, respectively, as accretion, which was recorded in finance cost on the statements of operations (three and nine months ended December 31, 2021 - $10,999 and $32,696, respectively).

9. DEFERRED STOCK UNITS AND RESTRICTED STOCK UNITS

On January 12, 2017, the Company announced that it issued a total of 300,000 Deferred Stock Units ("DSUs") to nonexecutive directors as an annual award as outlined in the DSU Plan adopted in August 2016.

The Company also granted 1,500,000 Restricted Share Units ("RSUs") to executives and consultants. The RSUs were granted in accordance with the Company's Restricted Share Unit Plan and are subject to vesting provisions. More specifically, the grant consists of a base amount of 500,000 units with vesting subject to retention while the remaining bonus units are subject to performance conditions.

The DSUs vested immediately on the date of grant and the RSUs vest as to one-third on the date of grant, one-third in six months and one-third in twelve months.

During the year ended March 31, 2019, 825,000 RSU had been forfeited or expired. As at Decembrer 31, 2020, the DSUs and the RSUs had fully vested.

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED)

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(Expressed in Canadian Dollars)

9. DEFERRED STOCK UNITS AND RESTRICTED STOCK UNITS (Continued)

Under the DSU and RSU plan, the maximum number of common shares subject to issuance is 2,160,307.

	DSU	RSU
Balance, March 31, 2021, December 31, 2021, March 31, 2022 and
December 31, 2022	300,000	675,000

10. SHARE CAPITAL

(a) Authorized:

Unlimited number of common shares with no par value.

(b) Common Shares Issued:

	Number of
	Shares		Amount
Balance, March 31, 2021	43,580,484	**$ **	23,901,545
Flow-through common shares issued, after costs (ii)	2,307,692		272,980
Common shares issued, after costs (i)	5,000,000		482,451
Fair value of broker warrants(i)(ii)	-		(22,649)
Balance, December 31, 2021	50,888,176	**$ **	24,634,327
Balance, March 31, 2022	50,888,176	**$ **	24,634,327
Common shares issued, after costs (iii)(iv)	10,000,000		328,650
Fair value of warrants and broker warrants(iii)(iv)	-		(87,491)
Balance, December 31, 2022	60,888,176	**$ **	24,875,486

(i) On December 8, 2021, the Company closed a non-brokered private placement through the issuance of 5,000,000 common shares at a price of $0.10 per common share for gross proceeds of $500,000.

Certain directors and officers of the Company subscribed for an aggregate of 940,000 common shares of the private placement for gross proceeds of $94,000.

In connection with the private placement, The Company paid $27,020 in broker fees and issued 270,200 broker warrants. The grant date fair value assigned to the broker warrants was $16,724, estimated using the Black-Scholes valuation model with the following assumptions: expected dividend yield of 0%, expected volatility of 123%, risk-free interest rate of 1.07% and an expected life of 1.25 years. In connection wtih the private placement, the Company

(ii) On December 30, 2021, the Company closed a non-brokered private placement of flow-through shares (each, a “FT Share”) through the issuance of 2,307,692 FT Shares at a price of $0.13 per FT Share for gross proceeds of $300,000. In connection with the issuance of these FT shares, the Company recorded a FT premium of $nil.

Certain directors and officers of the Company subscribed for an aggregate of 314,192 common shares of the private placement for gross proceeds of $40,841.

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED) (Expressed in Canadian Dollars)

Page 13

10. SHARE CAPITAL (Continued)

(b) Common Shares Issued (continued):

In connection with the private placement, The Company paid $17,549 in broker fees and issued 107,694 broker warrants. The grant date fair value assigned to the broker warrants was $5,925, estimated using the Black-Scholes valuation model with the following assumptions: expected dividend yield of 0%, expected volatility of 109%, risk-free interest rate of 0.98% and an expected life of 1.25 years.

(iii) On August 17, 2022, the Company closed the first tranche of its previously announced non-brokered private placement, through the issuance of 2,000,000 units at a price of $0.035 per unit for gross proceeds of $70,000. Each unit is comprised of one common share in the capital of the Company and one-half of one whole common share purchase warrant. Each warrant shall entitle the holder thereof to purchase one common share at a price of $0.07 per common share until August 17, 2024, provided, that in the event the closing price at which the common shares trade on the TSX Venture Exchange (or any such other stock exchange in Canada as the common shares may trade at the applicable time) exceed $0.15 for 20 consecutive trading days at any time following December 18, 2022, the Company may accelerate the Warrant Term (the "Reduced Warrant Term") such that the Warrants shall expire on the date which is 30 business days following the date a press release is issued by the Company announcing the Reduced Warrant Term. The Company incurred share issuance costs of $1,750 of which $400 was allocated to the warrants.

The grant date fair value assigned to the warrants was $15,263, estimated using the Black-Scholes valuation model with the following assumptions: expected dividend yield of 0%, expected volatility of 115.40%, risk-free interest rate of 3.40% and an expected life of 2 years.

The Company also issued 50,000 broker warrants in relation to the private placement. The grant date fair value assigned to the broker warrants was $1,474 estimated using the Black-Scholes valuation model with the following assumptions: expected dividend yield of 0%, expected volatility of 115.40%, risk-free interest rate of 3.40% and an expected life of 2 years.

(iv) On August 23, 2022, the Company closed the second tranche of its previously announced non-brokered private placement, through the issuance of 8,000,000 units at a price of $0.035 per unit for gross proceeds of $280,000. Each unit is comprised of one common share in the capital of the Company and one-half of one whole common share purchase warrant. Each warrant shall entitle the holder thereof to purchase one common share at a price of $0.07 per common share until August 23, 2024, provided, that in the event the closing price at which the common shares trade on the TSX Venture Exchange (or any such other stock exchange in Canada as the common shares may trade at the applicable time) exceed $0.15 for 20 consecutive trading days at any time following December 18, 2022, the Company may accelerate the Warrant Term (the "Reduced Warrant Term") such that the Warrants shall expire on the date which is 30 business days following the date a press release is issued by the Company announcing the Reduced Warrant Term. The Company incurred share issuance costs of $19,600 of which $4,480 was allocated to the warrants.

The grant date fair value assigned to the warrants was $56,192, estimated using the Black-Scholes valuation model with the following assumptions: expected dividend yield of 0%, expected volatility of 115.35%, risk-free interest rate of 3.48% and an expected life of 2 years.

The Company also issued 560,000 broker warrants in relation to the private placement. The grant date fair value assigned to the broker warrants was $14,562 estimated using the Black-Scholes valuation model with the following assumptions: expected dividend yield of 0%, expected volatility of 115.35%, risk-free interest rate of 3.48% and an expected life of 2 years.

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED) (Expressed in Canadian Dollars)

Page 14

11. SHARE-BASED PAYMENT RESERVES

(a) Stock Options

The Company has granted options for the purchase of common shares to its directors, officers, employees and certain consultants. The purpose of the plan is to attract, retain and motivate these parties by providing them with the opportunity, through share options, to acquire a proprietary interest in the Company and to benefit from its growth. These options are valid for a maximum of 5 years from the date of issue. Vesting terms and conditions are determined by the Board of Directors at the time of the grant. The maximum number of options to be issued under the plan shall not exceed 10% of the total number of common shares issued and outstanding.

The following table shows the continuity of stock options for the periods ended December 31, 2022 and 2021:

	Number of	Weighted Average	Weighted Average
	Stock Options	Exercise Price
Balance, March 31, 2021	3,675,000	$	0.42
Expired	(275,000)		0.72
Granted(i)	1,400,000		0.11
Balance, December 31, 2021	4,800,000	$	0.31
Balance, March 31, 2022 and December 31, 2022	4,260,000	$	0.25

(i) On December 13, 2021, the Company granted 1,400,000 stock options to certain directors, officers and consultants to purchase common shares of the Company, exercisable at a price of $0.11 per common share for a period of 5 years. These options vest 4 months from the date of grant. The grant date fair value of $113,179 was assigned to the stock options as estimated by using the Black-Scholes option valuation model with the following assumptions: expected dividend yield of 0%, expected volatility of 107% based on historical prices of the Company's stock, risk-free rate of return of 1.24% and an expected life of 5 years. Certain directors and officers of the Company were granted a total of 750,000 options.

The following are the stock options outstanding at December 31, 2022:

				Weighted Average
Number of	Grant Date	Number of	Weighted	Remaining
Options	Fair	Options	Average	Contractual Life
Issued	Value($)	Exercisable	Exercise Price($)	(years)	Expiry Date
860,000	256,549	860,000	0.43	1.08	January 31, 2024
900,000	132,766	900,000	0.25	2.58	July 30, 2025
1,050,000	204,739	1,050,000	0.30	3.19	March 11, 2026
1,400,000	113,180	1,400,000	0.11	3.95	December 13, 2026
50,000	10,638	50,000	0.13	4.23	March 24,2027
4,260,000	717,872	4,260,000	0.25	2.90

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED)

Page 15

(Expressed in Canadian Dollars)

11. SHARE-BASED PAYMENT RESERVES (Continued)

(b) Share Purchase Warrants

The following table shows the continuity of share purchase warrants for the periods ended December 31, 2022 and 2021:

	Number of	Weighted Average	Weighted Average
	Warrants	Exercise Price
Balance, March 31, 2021 and December 31, 2021	4,371,250	$	0.30
Balance, March 31, 2022	4,371,250	$	0.30
Issued	5,000,000		0.07
Expired	(2,077,500)		0.25
Balance, December 31, 2022	7,293,750	$	0.16

The following are the warrants outstanding as at December 31, 2022.

			Weighted Average
Number of	Grant Date	Weighted	Remaining
Warrants	Fair	Average	Contractual Life
Issued	Value($)	Exercise Price($)	(years)	Expiry Date
1,200,000	117,972	0.35	0.07	January 25, 2023
1,093,750	128,749	0.35	0.10	February 4, 2023
1,000,000	15,263	0.07	1.63	August 17, 2024
4,000,000	56,192	0.07	1.65	Augus 23,2024
7,293,750	318,176	0.16	1.15

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED)

Page 16

(Expressed in Canadian Dollars)

11. SHARE-BASED PAYMENT RESERVES (Continued)

(c) Broker Warrants

The following table shows the continuity of broker warrants for the periods ended December 31, 2022 and 2021:

	Number of	Weighted Average	Weighted Average
	Broker Warrants	Exercise Price
Balance, March 31, 2021	629,678	$	0.27
Issued(note 10(b)(i)(ii))	377,894		0.15
Balance, December 31, 2021	1,007,572	$	0.23
Balance, March 31, 2022	1,007,572	$	0.23
Issued	610,000		0.10
Expired	(474,000)		0.25
Balance, December 31, 2022	1,143,572	$	0.15

The following are the broker warrants outstanding at December 31, 2022:

			Weighted Average
Number of	Grant Date	Weighted	Remaining
Broker Warrants	Fair	Average	Contractual Life
Issued	Value($)	Exercise Price($)	(years)	Expiry Date
32,928	9,810	0.35	0.07	January 25, 2023
122,750	31,195	0.35	0.10	February 4, 2023
270,200	16,724	0.15	0.18	March 8, 2023
107,694	5,925	0.15	0.24	March 30, 2023
50,000	1,474	0.10	1.63	August 17, 2024
560,000	14,562	0.10	1.65	August 23,2024
1,143,572	79,690	0.15	0.96

12. GENERAL AND ADMINISTRATIVE

12. GENERAL AND ADMINISTRATIVE
		Three Months		Ended		Nine Months		Ended
		December		31,		December		31,
		2022		2021		2022		2021
Office and general	$	18,548	$	(21,187)	$	27,060	$	(11,061)
Business development		-		780		-		5,895
Stock exchange and transfer agent fees		432		10,529		20,655		21,706
Shareholder information		1,024		5,513		4,354		9,778
General and administrative	$	20,004	$	(4,365)	$	52,069	$	26,318

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED) (Expressed in Canadian Dollars)

Page 17

13. RELATED PARTY TRANSACTIONS

Related parties include the Board of Directors, close family members and enterprises that are controlled by these individuals as well as certain persons performing similar functions.

(a) The Company entered into the following transactions with related parties recorded as professional and consulting fees and share issue costs:

		Three	Months	Ended		Nine Months Ended
		December		31,		December 31,
		2022		2021		2022 2021
Irwin Lowy LLP (i) - professional and consulting fees	$	-	$	2,027	$	4,776 $ 7,625

• (i) A director of the Company is a partner at Irwin Lowy LLP, a law firm, and the fees relate to professional services provided by the firm. As at December 31, 2022, the Company owed ($469) (March 31, 2022 - $14,908) to this firm and this amount is included in accounts payable and accrued liabilities. The amount is unsecured, non-interest bearing with no fixed terms of repayment.

• (ii) As at December 31, 2022, the Company owed $515,228 (March 31, 2022 - $246,828) to a corporation controlled by the Chief Executive Officer ("CEO") of the Company and this amount is included in accounts payable and accrued liabilities. During the three and nine months ended December 31, 2022, $60,000 and $180,000, respectively (three and nine months ended December 31, 2021 - $45,000 and $135,000, respectively) of these fees were recorded as capitalized exploration and evaluation costs and $nil (three and nine months ended December 31, 2021 - $15,000 and $45,000, respectively) were recorded in management and directors' compensation on the statements of operations.

• (b) Remuneration of directors and key management personnel of the Company was as follows:

		Three Months	Three Months	Ended		Nine Months	Nine Months	Ended
		December		31,		December		31,
		2022		2021		2022		2021
Directors fees	$	16,000	$	16,000	$	48,000	$	48,000
Amounts paid or accrued to CEO for
salaries, consulting and benefits		60,000		60,000		180,000		180,000

Director fees - the Board of Directors do not have employment or service contracts with the Company. Directors are entitled to director fees and stock options for their services. As at December 31, 2022, the Company owed $177,998 (March 31, 2022 - $129,998) to the directors and $102,352 (March 31, 2022 - $102,352) to the CEO of the Company which was included in the accounts payable and accrued liabilities. These amounts are unsecured, non-interest bearing with no fixed term of repayment.

Salaries and benefits - officers are entitled to stock options, consulting fees or salaries and benefits where employment or service contracts are in place with the Company for their services.

As at December 31, 2022, $6,107 (March 31, 2022 - $96,915) of cash was held in the Irwin Lowy LLP trust account, a law firm, where the interim CFO is a partner.

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED) (Expressed in Canadian Dollars)

Page 18

14. DISCONTINUED OPERATIONS

On October 1, 2021, the Company disposed of its shares in Minnova Peru S.A.C. to a Peruvian company where certain directors and officers were in common to the Company at $1,478, resulting in a loss on disposition of $74,054.

Pursuant to IFRS 5, Non-Current Assets Held for Sale and Discontinued Operations, the financial statements of the Company have been reclassified to reflect discontinued operation of Minnova Peru S.A.C.. Accordingly, net loss of discontinued operation have been segregated in the statements of income and comprehensive income.

The following tables present summarized financial information related to discontinued operations in Minnova Peru S.A.C.: Statements of operations and comprehensive loss of discontinued operations for the three and nine months ended December 31, 2022 and 2021:

		Three Months	Three Months	Ended		Nine Months	Nine Months	Ended
		December		31,		December		31,
		2022		2021		2022		2021
General and administrative	$	-	$	-	$	-	$	1,649
Foreign exchange		-		-		-		7,899
Net loss and comprehensive loss	$	NIL	$	NIL	$	NIL	$	9,548

Statements of cash flows of the discontinued operation for the periods ended December 31, 2022 and 2021:

Nine Months Ended December 31,		2022		2021
Net cash flows provided by operating activites for discontinued operations	$	-	$	(1,681)
Cash and cash equivalents, beginning of the year for discontinued operations	$	-	$	3,159
Cash and cash equivalents, end of the year for discontinued operations	$	NIL	$	1,478

15. ENVIRONMENTAL CONTINGENCIES

The Company's exploration activities are subject to various laws and regulations governing the protection of the environment. These laws and regulations are continually changing and are generally becoming more restrictive. The Company conducts its operations so as to protect public health and the environment and believes its operations are materially in compliance with all applicable laws and regulations. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations.

MINNOVA CORP. NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS DECEMBER 31, 2022 (UNAUDITED) (Expressed in Canadian Dollars)

Page 19

16. COMMITMENTS AND CONTINGENCIES

Pursuant to the terms of the flow-through share agreements, the Company needs to comply with its flow-through contractual obligations with subscribers with respect to the Income Tax Act (Canada). The Company has indemnified the subscribers of current and previous flow-through share offerings against any tax related amounts that become payable by the shareholder as a result of the Company not meeting its expenditure commitments.The Company is committed to incur flow-through eligible expenditures of $362,420 by December 31, 2022, of which all expenditures have been incurred to December 31, 2022.

The Company is party to a senior management contract. This contract contains clauses requiring additional payments of up to $480,000 be made upon the occurrence of certain events such as a change of control. As a triggering event has not occurred, the contingent payments have not been reflected in these financial statements. Additional minimum management contractual commitments remaining under the agreement are approximately $480,000, of which $240,000 is due within one year.

The Company is party to additional management contracts. These contracts contain clauses requiring additional payments of up to $120,000 be made upon the occurrence of certain events such as a change of control. As a triggering event has not occurred, the contingent payments have not been reflected in these financial statements. Additional minimum management contractual commitments remaining under the agreements are approximately $120,000, of which $120,000 is due within one year.

17. SUBSEQUENT EVENTS

On February 6, 2023, the Company completed the first tranche of its non-brokered private placement through the issuance of 3,000,000 common shares in the capital of the Company at a price of $0.05 per Common Share for gross proceeds of $150,000. An insider of the Company subscribed for 1,650,000 common shares pursuant to the offering.

On February 8, 2023, the Company completed the final tranche of its non-brokered private placement through the issuance of 6,000,000 common shares in the capital of the Company at a price of $0.05 per Common Share for gross proceeds of $300,000.

In connection with the offering, the Company paid certain finders (i) a cash commission in the aggregate of $21,000; and (ii) an aggregate of 420,000 broker warrants. Each broker warrant is exercisable into common shares at a price of $0.05 per common share until February 8, 2025.