NEWBREAK RESOURCES

Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

INDEX	Page
Independent Auditor’s Report	2-5
Statements of Financial Position	6
Statements of Loss and Comprehensive Loss	7
Statements of Changes in Shareholders’ Equity	8
Statements of Cash Flows	9
Notes to the Financial Statements	10-37

McGovern Hurley

Audit. Tax. Advisory.

Independent Auditor's Report

To the Shareholders of New Break Resources Ltd.

Opinion

We have audited the financial statements of New Break Resources Ltd. (the "Company"), which comprise the statements of financial position as at December 31, 2024 and 2023, and the statements of loss and comprehensive loss, statements of changes in shareholders' equity and statements of cash flows for the years then ended, and notes to the financial statements, including material accounting policy information.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2024 and 2023, and its financial performance and its cash flows for the years then ended in accordance with International Financial Reporting Standards ("IFRS").

Basis for opinion

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

Material uncertainty related to going concern

We draw attention to Note 1 in the financial statements, which indicates that the Company incurred a net loss during the year ended December 31, 2024 and, as of that date, the Company had limited working capital. As stated in Note 1, these events or conditions, along with other matters as set forth in Note 1, indicate that material uncertainties exist that cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

251 Consumers Road, Suite 800

Toronto, Ontario

M2J 4R3

mcgovernhurley.com

t. 416-496-1234

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Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Except for the matter described in the Material uncertainty related to going concern section, we have determined that there were no additional key audit matters to communicate in our report.

Other information

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

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

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

We obtained Management's Discussion and Analysis prior to the date of this auditor's report. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of management and those charged with governance for the financial statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with IFRS, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

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

Auditor's responsibilities for the audit of the financial statements

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

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reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risks of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because

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the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner of the audit resulting in this independent auditor's report is Chris Milios.

McGovern Hurley LLP
McGovern Hurley LLP
Chartered Professional Accountants
Licensed Public Accountants
Toronto, Ontario
April 29, 2025

NEWBREAK
RESOURCES

Statements of Financial Position

As at

(Expressed in Canadian Dollars)		December 31, 2024	December 31, 2023
Assets
Current assets
Cash		$ 37,548	$ 212,205
HST receivable		58,310	22,337
Other amounts receivable	Notes 7, 14	186,597	191,225
Prepaid expenses		12,368	18,701
Investment	Note 6	8,000	-
		302,823	444,468
Non-current assets
Mineral properties	Note 7	543,000	543,000
Total Assets		$ 845,823	$ 987,468
Liabilities and Equity
Current liabilities
Accounts payable and accrued liabilities	Note 8	$ 231,802	$ 143,485
Flow-through share premium liability	Notes 9(b), 13	-	63,683
Total Liabilities		231,802	207,168
Shareholders' Equity
Share capital	Note 9(b)	3,957,582	3,551,942
Warrant reserve	Note 9(e)	402,544	256,432
Stock option reserve	Note 9(d)	291,335	291,335
Deficit		(4,037,440)	(3,319,409)
Total Shareholders' Equity		614,021	780,300
Total Liabilities and Shareholders' Equity		$ 845,823	$ 987,468

Nature of operations and going concern (Note 1)
Commitments and contingencies (Note 13)
Subsequent events (Note 14)

Approved by the Board of Directors and authorized on April 29, 2025:

"Michael Farrant"
Michael Farrant
Director

"Thomas Puppendahl"
Thomas Puppendahl
Director

The accompanying notes form an integral part of these financial statements

NEWBREAK
RESOURCES

Statements of Loss and Comprehensive Loss

For the years ended

(Expressed in Canadian Dollars)	December 31,
		2024	2023
Expenses
Exploration and evaluation	Note 7	$ 425,566	$ 497,026
Management fees	Note 10	146,500	150,000
Consulting fees		16,350	12,984
Professional fees		48,546	55,672
Investor relations		102,259	220,867
General and administrative		97,129	95,259
Shareholder costs and filing fees		32,787	34,169
Travel		-	935
Share-based compensation	Note 9(d)	-	44,280
Loss before the undernoted		(869,137)	(1,111,192)
Bank charges		(1,104)	(1,131)
Part X11.6 tax		(12,794)	(611)
Interest income		1,523	6,994
Flow-through share premium recovery	Note 13	63,683	71,452
Gain on sale of mineral claims	Note 6	10,100	-
Change in unrealized loss on value of investment	Note 6	(1,500)	-
Net loss and comprehensive loss for the year		$ (809,229)	$(1,034,488)
Net loss per share
Basic and diluted loss per share		$ (0.02)	$ (0.02)
Weighted average number of shares outstanding – basic and diluted		51,247,414	44,839,310

The accompanying notes form an integral part of these financial statements

NEWBREAK
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Statements of Changes in Shareholders' Equity

(Expressed in Canadian Dollars)	Note	Share Capital		Reserves		Deficit	Total
		Number of Shares	Amount	Warrants	Stock Options
Balance at December 31, 2022		40,985,750	$ 2,653,107	$ 290,865	$ 269,435	$ (2,467,376)	$ 746,031
Flow-through shares issued for cash	9(b)(iii) (vii)	4,588,000	625,700	-	-	-	625,700
Warrants issued as part of flow-through unit financing	9(b)(vii)	-	(38,250)	38,250	-	-	-
Flow-through premium	9(b)(iii) (vii)	-	(93,635)	-	-	-	(93,635)
Share issue costs on flow-through financing	9(b)(iii)	-	(17,459)	4,544	-	-	(12,915)
Shares issued for cash as part of unit financing	9(b)(vi)	750,000	60,000	-	-	-	60,000
Warrants issued as part of unit financing	9(b)(vi)	-	(24,075)	24,075	-	-	-
Shares issued for purchase of mineral claims	9(b)(ii)(v)	1,800,000	228,000	-	-	-	228,000
Exercise of warrants	9(b)(i)(iv)	1,448,850	256,919	(39,592)	-	-	217,327
Issuance of incentive warrants	9(b)(iv)	-	(98,365)	98,365	-	-	-
Expiry of warrants	9(e)	-	-	(160,075)	-	160,075	-
Expiry of stock options	9(d)	-	-	-	(22,380)	22,380	-
Share-based compensation	9(d)	-	-	-	44,280	-	44,280
Net loss for the year		-	-	-	-	(1,034,488)	(1,034,488)
Balance at December 31, 2023		49,572,600	3,551,942	256,432	291,335	(3,319,409)	780,300
Flow-through shares issued for cash	9(b)(ix)	1,500,000	165,000	-	-	-	165,000
Warrants issued as part of flow-through unit financing	9(b)(ix)	-	(71,100)	71,100	-	-	-
Shares issued for cash as part of unit financings	9(b)(viii)(x)	6,356,000	477,950	-	-	-	477,950
Warrants issued as part of unit financings	9(b)(viii)(x)	-	(166,210)	166,210	-	-	-
Expiry of warrants	9(e)	-	-	(91,198)	-	91,198	-
Net loss for the year		-	-	-	-	(809,229)	(809,229)
Balance at December 31, 2024		57,428,600	$ 3,957,582	$ 402,544	$ 291,335	$ (4,037,440)	$ 614,021

The accompanying notes form an integral part of these financial statements

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Statements of Cash Flows

For the years ended

(Expressed in Canadian Dollars)		December 31,
		2024	2023
Cash flows from operating activities
Net loss for the year		$ (809,229)	$ (1,034,488)
Adjustments not affecting cash:
Flow-through share premium recovery	Note 13	(63,683)	(71,452)
Share-based compensation	Note 9(d)	-	44,280
Provision for mineral claim deposits	Note 7	-	52,110
Gain on sale of mineral claims	Note 6	(10,500)	-
Change in unrealized loss on value of investments	Note 6	1,500	-
Operating cash flows before changes in non-cash working capital:		(881,912)	(1,009,550)
Changes in non-cash working capital:
HST receivable		(35,973)	16,512
Other amounts receivable		5,628	(51,225)
Prepaid expenses		6,333	170,080
Accounts payable and accrued liabilities		88,317	55,814
Cash used in operating activities		(817,607)	(818,369)
Cash flows from investing activities
Purchase of mineral claims	Note 7	-	(90,000)
Cash used in investing activities		-	(90,000)
Cash flows from financing activities
Proceeds from private placements	Note 9(b)	642,950	685,700
Share issue costs	Note 9(b)	-	(12,915)
Exercise of warrants	Note 9(e)	-	217,327
Cash provided by financing activities		642,950	890,112
Decrease in cash during the year		(174,657)	(18,257)
Cash, beginning of year		212,205	230,462
Cash, end of year		$ 37,548	$ 212,205
Supplemental cash flow information:
Value of investment received on sale of mineral claims	Note 6	$ 9,500	$ -
Value of finder warrants issued	Note 9(b)(iii)	$ -	$ 4,544
Value of common shares issued for purchase of mineral claims	Note 9(b)(ii)(v)	$ -	$ 228,000

The accompanying notes form an integral part of these financial statements

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Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK
RESOURCES

1. NATURE OF OPERATIONS AND GOING CONCERN

New Break Resources Ltd. (the "Company" or "New Break") is a Canadian mineral exploration company currently engaged in the acquisition, exploration and evaluation of mineral properties in Canada. All of the Company's mineral property interests are currently in the exploration and evaluation stage.

The Company was incorporated under the name "8861587 Canada Corporation" under the laws of Canada on April 18, 2014. Effective December 28, 2018, the Company changed its name to New Break Resources Ltd. On November 24, 2021, New Break was also registered as Extra-Territorial in Nunavut, Canada. On September 7, 2022, the Company became listed on the Canadian Securities Exchange (the "CSE") and trades under the symbol NBRK. The address of the Company's corporate office and principal place of business is 110 Yonge Street, Suite 1601, Toronto, Ontario, M5C 1T4, Canada.

These financial statements have been prepared on a going concern basis, which contemplates that the Company will be able to realize its assets and discharge its liabilities in the normal course of business. Accordingly, they do not give effect to adjustments that would be necessary should the Company be unable to continue as a going concern, and therefore be required to realize its assets and liquidate its liabilities and commitments in other than the normal course of business and at amounts different from those in the accompanying financial statements. Such adjustments could be material. It is not possible to predict whether the Company will be able to raise adequate financing or to ultimately attain profitable levels of operations. Changes in future conditions could require material write downs of the carrying values.

The business of exploring for minerals involves a high degree of risk and there can be no assurance that the exploration programs will result in profitable operations. The Company is in the process of exploring its mineral properties and has not yet determined whether these properties contain mineral reserves that are economically recoverable. The recoverability of amounts shown for mineral properties is dependent upon the establishment of a sufficient quantity of economically recoverable reserves, the ability of the Company to obtain necessary financing to complete the development and upon future profitable production or proceeds from the disposition of these assets.

Although the Company has taken steps to verify title to the properties on which it is conducting exploration and in which it has an interest, in accordance with industry standards for the current stage of operations of such properties, these procedures do not guarantee the Company's title. Property title may be subject to government licensing requirements or regulations, unregistered prior agreements, unregistered claims, indigenous claims, and non-compliance with regulatory, environmental and social licensing requirements. The Company's assets may also be subject to increases in taxes and royalties, renegotiation of contracts, political uncertainty and currency exchange fluctuations and restrictions.

The Company has not realized a profit from operations and has incurred expenditures related to property exploration, resulting in a cumulative deficit of $4,037,440 as at December 31, 2024 (December 31, 2023 - $3,319,409). The recoverability of the carrying value of mineral properties and the Company's continued existence is dependent upon the preservation of its interest in the underlying properties, the discovery of economically recoverable reserves, the achievement of profitable operations, or the ability of the Company to raise alternative financing, if necessary, or alternatively upon the Company's ability to dispose of its property interests on an advantageous basis. Management cannot provide assurance that it will be successful in future financing activities or be able to execute its business strategy. As at December 31, 2024, the Company had current assets of $302,823 (December 31, 2023 - $444,468) to cover current liabilities of $231,802 (December 31, 2023 - $143,485, exclusive of non-cash flow-through share premium liability). These conditions indicate that material uncertainties exist that cast significant doubt on the Company's ability to continue as a going concern.

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Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

2. BASIS OF PRESENTATION

(a) Statement of Compliance

These financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and include interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”). The policies set out were consistently applied to all periods presented unless otherwise noted below.

(b) Basis of Presentation

These financial statements have been prepared on the historical cost basis, except for financial instruments designated at fair value through profit and loss, which are stated at their fair value. In addition, these financial statements have been prepared using the accrual basis of accounting except for cash flow information. These financial statements are presented in Canadian dollars, which is the Company’s functional currency. All values are rounded to the nearest dollar.

(c) Approval of the Financial Statements

The financial statements of the Company for the year ended December 31, 2024 were reviewed, approved and authorized for issue by the Board of Directors of the Company on April 29, 2025.

(d) Use of estimates and judgments

The preparation of financial statements in conformity with IFRS requires that management make judgements, estimates and assumptions about future events that affect the amounts reported in the financial statements and related notes to the financial statements. Although these estimates are based on management’s best knowledge of the amount, event or actions, actual results may differ from those estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. The Company makes estimates and assumptions about the future that affect the reported amounts of assets and liabilities, profits and expenses. 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. The effect of a change in an accounting estimate is recognized prospectively by including it in 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.

Information about critical judgments in applying accounting policies that have the most significant risk of causing material adjustment to the carrying amounts of assets and liabilities recognized in the financial statements are discussed below:

Share-based payment transactions

The Company measures the cost of equity-settled transactions with employees and applicable non-employees by reference to the fair value of the equity instruments at the date at which they are vested. 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, risk-free interest rates, volatility and dividend yield and making assumptions about them. The assumptions and models used for estimating fair value for share-based payment transactions are disclosed in Note 9(d).

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

2. BASIS OF PRESENTATION (Continued)

Title to exploration and evaluation property interests

Although the Company has taken steps to verify title to exploration and evaluation 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.

Rehabilitation provisions

The Company records management’s best estimate of the present value of the future cash requirements of any rehabilitation obligation as a long-term liability in the period in which the related environmental disturbance occurs based on the net present value of the estimated future costs. This obligation is adjusted at each period end to reflect the passage of time and any changes in the estimated future costs underlying the obligation. In determining this obligation, management must make a number of assumptions about the amount and timing of future cash flows and discount rate to be used. The actual future expenditures may differ from the amounts currently provided if the estimates made are significantly different than actual results or if there are significant changes in environmental and/or regulatory requirements in the future.

Income, value added, withholding and other taxes

The Company is subject to income, value added, withholding and other taxes. Significant judgment is required in determining the Company’s provisions for taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Company recognizes liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. The determination of the Company’s income, value added, withholding and other tax liabilities requires interpretation of complex laws and regulations. The Company’s interpretation of taxation law as applied to transactions and activities may not coincide with the interpretation of the tax authorities. All tax related filings are subject to government audit and potential reassessment subsequent to the financial statement reporting period. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the tax related accruals and deferred income tax provisions in the period in which such determination is made.

Capitalization of mineral property acquisition costs

Where mineral properties are acquired through an acquisition agreement, management has determined that capitalized acquisition costs have future economic benefits and are economically recoverable. In making this judgement, management has assessed various sources of information including, but not limited to, the geologic and metallurgic information, operating management expertise and existing permits. See Note 7 for details of the Company’s capitalized acquisition costs in respect of mineral properties.

Impairment of mineral properties

While assessing whether any indications of impairment exist for mineral properties, consideration is given to both external and internal sources of information. Information the Company considers includes changes in the market, economic and legal environment in which the Company operates that are not within its control that could affect the recoverable amount of mineral properties. Internal sources of information include the manner in which the mineral properties are being used or are expected to be used and indications of expected economic performance of the properties. Estimates include, but are not limited to, estimates of the discounted future cash flows expected to be derived from the Company’s mining properties, costs to sell the properties and the appropriate discount rate. Reductions in metal price forecasts, increases in estimated future costs of production, increases in estimated future capital costs, reductions in the amount of recoverable mineral reserves and mineral resources and/or adverse current economics can result in a write-down of the carrying amounts of the Company’s mineral properties.

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Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK
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3. MATERIAL ACCOUNTING POLICIES

The accounting policies set out below have been applied consistently to all periods presented in these financial statements except where noted.

(a) Cash

Cash consists of cash on deposit with a major Canadian bank. Cash is measured at Amortized Cost.

(b) Exploration and Evaluation Properties

Acquisition Costs

The costs of acquiring mineral property interests comprised of payments of cash and common shares, are capitalized as mineral property assets. This does not include payments of cash and common shares in respect of option agreements where the ultimate acquisition of the property is uncertain at the time the initial payment is made.

Exploration and Evaluation Expenditures

Payments of cash and common shares pursuant to option agreements, costs of staking and all expenditures on exploration and evaluation activities are recorded as exploration and evaluation expenses until it has been established that a mineral property is commercially viable.

Development Assets

When economically viable reserves have been determined and the decision to proceed with development has been approved, the expenditures related to development and construction are capitalized as construction-in-progress and classified as a component of property, plant and equipment. Costs associated with the commissioning of new assets incurred in the period before they are operating in the way intended by management are capitalized. Interest on borrowings related to the construction and development of assets are capitalized until substantially all the activities required to make the asset ready for its intended use are complete.

Disposition or Abandonment of Mineral Properties

Proceeds received from the sale of any interest in a mineral property are first credited against the carrying value of the property, with any excess included in operations for the period. If a property is abandoned, the acquisition cost of the property is written off to operations.

Impairment

The application of the Company's accounting policy for acquisition costs related to mineral properties, requires judgement in determining whether there are future economic benefits, which may be based on assumptions about future events or circumstances. Estimates and assumptions made may change if new information becomes available. If information becomes available suggesting that the recovery of the carrying value is unlikely, the amount to be written off is expensed in the statement of operations in the period when the new information becomes available. The Company assesses each cash generating unit ("CGU") at each reporting date to determine whether any indication of impairment exists.

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

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3. MATERIAL ACCOUNTING POLICIES (Continued)

Where an indicator of impairment exists, a formal estimate of the recoverable amount is made, which is considered to be the higher of the fair value less costs to sell and value in use. These assessments require the use of estimates and assumptions such as long-term commodity prices, discount rates, future capital requirements, exploration potential and operating performance. Fair value is determined as the amount that would be obtained from the sale of the assets in an arm’s length transaction between knowledgeable and willing parties. The carrying amount of the asset is reduced to its recoverable amount and the impairment loss is recognized in profit or loss in the statement of loss for the period.

(c) Equipment

Recognition and Measurement

Equipment is measured at cost less accumulated depreciation and accumulated impairment losses. Cost includes all expenditures that are directly attributable to the acquisition of the asset.

Depreciation

When applicable, depreciation is calculated using the straight-line method over the estimated useful lives of assets as follows:

Office furniture and equipment - 3 years.
Computer hardware and software – 2 years.

The Company does not currently have any office or computer equipment.

Impairment

The carrying amounts of the Company’s equipment are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated.

Impairment is determined for an individual asset unless the asset does not generate cash inflows that are independent of those generated from other assets or group of assets, in which case, the individual assets are grouped together into CGUs for impairment purposes.

An impairment exists when the carrying amount of the asset, or group of assets, exceeds its recoverable amount. The impairment loss is the amount by which the carrying value exceeds the recoverable amount and such loss is recognized in the statement of operations. The recoverable amount of an asset is the higher of its fair value less costs to dispose and its value in use.

A previously recognized impairment loss is reversed if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognized such that the recoverable amount has increased. The carrying amount after a reversal must not exceed the carrying account (net of depreciation) that would have been determined had no impairment loss been recognized.

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Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

3. MATERIAL ACCOUNTING POLICIES (Continued)

(d) Financial Instruments

Financial assets

Initial recognition and measurement

Non-derivative financial assets within the scope of IFRS 9 are classified and measured as “financial assets at fair value”, as either fair value through profit or loss (“FVPL”) or fair value through other comprehensive income (“FVOCI”), and “financial assets at amortized costs”, as appropriate. The Company determines the classification of financial assets at the time of initial recognition based on the Company’s business model and the contractual terms of the cash flows.

All financial assets are recognized initially at fair value plus, in the case of financial assets not at FVPL, directly attributable transaction costs on the trade date at which the Company becomes a party to the contractual provisions of the instrument.

Subsequent measurement – financial assets at FVPL

Financial assets measured at FVPL include financial assets management intends to sell in the short term and any derivative financial instrument that is not designated as a hedging instrument in a hedge relationship. Financial assets measured at FVPL are carried at fair value in the statements of financial position with changes in fair value recognized in other income or expense in the statements of loss. The Company’s investment is measured at FVPL.

Subsequent measurement – financial assets at amortized cost

After initial recognition, financial assets measured at amortized cost are subsequently measured at the end of each reporting period at amortized cost using the Effective Interest Rate (“EIR”) method. Amortized cost is calculated by taking into account any discount or premium on acquisition and any fees or costs that are an integral part of the EIR. Cash is measured at amortized cost.

Subsequent measurement – financial assets at FVOCI

Financial assets measured at FVOCI are non-derivative financial assets that are not held for trading and the Company has made an irrevocable election at the time of initial recognition to measure the assets at FVOCI. The Company does not measure any financial assets at FVOCI.

Derecognition

A financial asset is derecognized when the contractual rights to the cash flows from the asset expire, or the Company no longer retains substantially all the risks and rewards of ownership.

Impairment of financial assets

IFRS 9 allows a simplified approach to impairment assessment, which requires the expected lifetime loss to be recognized at the time of initial recognition of the financial assets. An impairment loss is reversed in subsequent periods if the amount of the expected loss decreases and the decrease can be objectively related to an event occurring after the initial impairment was recognized.

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

3. MATERIAL ACCOUNTING POLICIES (Continued)

Financial liabilities

Initial recognition and measurement

Financial liabilities are measured at amortized cost, unless they are required to be measured at FVPL as is the case for held for trading or derivative instruments, or the Company has opted to measure the financial liability at FVPL. The Company’s financial liabilities include accounts payable and accrued liabilities, which are measured at amortized cost. All financial liabilities are recognized initially at fair value.

Subsequent measurement – financial liabilities at amortized cost

After initial recognition, financial liabilities measured at amortized cost are subsequently measured at the end of each reporting period at amortized cost using the EIR method. Amortized cost is calculated by taking into account any discount or premium on acquisition and any fees or costs that are an integral part of the EIR.

Subsequent measurement – financial liabilities at FVPL

Financial liabilities measured at FVPL include financial liabilities management intends to sell in the short term and any derivative financial instrument that is not designated as a hedging instrument in a hedge relationship. Financial liabilities measured at FVPL are carried at fair value in the statements of financial position with changes in fair value recognized in other income or expense in the statement of loss. The Company does not measure any financial liabilities at FVPL.

Derecognition

A financial liability is derecognized when the obligation under the liability is discharged, cancelled or expires with any associated gain or loss recognized in other income or expense in the statement of loss.

Provisions

A provision is recognized when the Company has a present legal or constructive obligation as a result of a past event, it is probable that an outflow of economic benefits will be required to settle the obligation, and the amount of the obligation can be reliably estimated. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.

Fair Value Hierarchy

Financial instruments recorded at fair value on the statements of financial position are classified using a financial value hierarchy that reflects the significance of the inputs used in marking the measurements. The fair value hierarchy has the following levels:

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

The Company’s investment in Planet Green Metals Inc. is classified as level 1.

16 | Page

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

3. MATERIAL ACCOUNTING POLICIES (Continued)

(e) Government Assistance

The Company recognizes government grants given on eligible expenditures when it is reasonably assured that the Company will comply with the conditions attached to them and the grants will be received. Grants are recognized as either income over the period(s) necessary to match them with the related costs or if related to a specific expense, as a reduction to the expenses for which they are intended to reimburse. Grants receivable for costs already incurred or for immediate financial support, with no future related costs, are recognized as income in the period in which the grant is receivable. If a grant becomes repayable, it is treated as a change in estimate. Where the original grant related to income, the repayment would be applied first against any related unamortized deferred credit, and any excess would be expensed. Where the original grant related to an asset, the repayment would be treated as increasing the carrying amount of the asset or reducing the deferred income balance. The cumulative depreciation which would have been charged had the grant not been received would be charged as an expense.

(f) Share Capital

Equity instruments are contracts that give a residual interest in the net assets of the Company. Financial instruments issued by the Company are classified as equity only to the extent that they do not meet the definition of a financial liability or financial asset.

The Company's common shares, warrants, stock options and flow-through shares are classified as equity instruments. Preference share capital is classified as equity if it is non-retractable, or redeemable only at the Company's option, and any dividends are discretionary. Dividends thereon are recognized as distributions within equity.

Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from proceeds.

(g) Warrants

Proceeds from unit placements are allocated between shares and warrants issued according to their relative fair value. The relative fair value of the share component is credited to share capital and the relative fair value of the warrant component is credited to warrant reserve. Upon exercise of the warrants, consideration paid by the warrant holder together with the amount previously recognized in the warrant reserve account is recorded as an increase to share capital. For those warrants that expire unexercised, the recorded fair value is transferred from warrant reserve to deficit.

(h) Flow-Through Shares

Upon the issuance of flow-through shares ("F-T Shares"), the Company records the initial proceeds to share capital, net of tax liability, if any. The flow-through share premium liability on the statement of financial position represents the premium of the financing price in excess of the market share price on the date of the flow-through share financing. The financial liability pertaining to the premium is recognized in the statement of loss consistent with expenditure renunciations. As the Company incurs eligible Canadian Exploration Expenditures ("CEE") to meet flow-through requirements, a corresponding flow-through share premium recovery is recognized in the statement of loss.

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

3. MATERIAL ACCOUNTING POLICIES (Continued)

(i) Share-Based Payments

The Company accounts for share-based payments using the fair value method. Under this method, compensation expense for employees is measured at fair value on the date of grant using the Black-Scholes option pricing model, and is recognized as an expense with a corresponding increase in stock option reserve, a component of equity, over the period that the employees earn the options. The amount recognized as an expense is adjusted to reflect the number of share options expected to vest. The Black-Scholes option pricing model requires the input of subjective assumptions, including the expected term of the option and stock price volatility.

Upon the exercise of stock options, consideration paid by the option holder together with the amount previously recognized in the stock option reserve account is recorded as an increase to share capital. For those options that are cancelled or expire after vesting, the recorded fair value is transferred from stock option reserve to deficit.

Warrants, stock options, and other equity instruments issued as purchase consideration in non-cash transactions are recorded at fair value of the goods or services received or if the value of the goods or services received is not reliably measurable then the value of such goods and services are measured with reference to the fair value of the equity instruments issued. With respect to the acquisition of exploration and evaluation assets, the Company does not believe that the fair value of these assets is reliably measurable at the time of purchase. As such, when shares of the Company are issued as consideration for the purchase of exploration and evaluation assets, classified as mineral properties, the fair value of the asset is based upon the price of the Company's shares on the date of the agreement to issue shares as determined by the Board of Directors. In the event that options or warrants are issued where the fair value of goods or services are not reliably measurable, they are valued using the Black-Scholes pricing model.

(j) Reclamation Obligation

A legal or constructive obligation to incur restoration, rehabilitation, and environmental costs may arise when environmental disturbance is caused by the exploration, development, or ongoing production of a mineral property interest. The Company's exploration activities are subject to various governmental laws and regulations relating to the protection of the environment. These environmental regulations are continually changing and are generally becoming more restrictive.

The fair value of the liability for an asset retirement obligation is recorded when the legal obligation arises and the corresponding increase to the asset is amortized over the life of the asset. The liability is increased over time to reflect an accretion element considered in the initial measurement at fair value. The Company does not currently have any significant legal or constructive obligations and therefore, no reclamation provision has been recorded as at December 31, 2024 and December 31, 2023.

(k) Loss Per Common Share

The Company presents basic and diluted loss per share ("EPS") data for its common shares. Basic EPS is calculated by dividing the profit or loss attributable to common shareholders of the Company by the weighted average number of common shares outstanding during the period, adjusted for own shares held. Diluted EPS is determined by adjusting the profit or loss attributable to common shareholders and the weighted average number of common shares outstanding, adjusted for own shares held, for the effects of all dilutive potential common shares, which comprise convertible warrants and stock options granted by the Company. Diluted loss per share for the periods presented does not include the effect of the stock options and warrants issued by the Company, as they are anti-dilutive.

18 | Page

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

3. MATERIAL ACCOUNTING POLICIES (Continued)

(l) Income Taxes

Income tax expense is comprised of current and deferred tax expense. Current tax expense is the expected tax payable or receivable on the taxable income or loss for the period, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. Deferred tax assets and liabilities are recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for tax purpose.

Income tax expense is recognized in profit or loss except to the extent that it relates to a business combination, or items recognized directly in equity. Income taxes are calculated using the asset and liability method of accounting for income taxes. Deferred tax assets and liabilities are recognized for the deferred tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and for tax losses and other deductions carried forward.

Deferred income tax assets and liabilities are calculated using enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability is settled. An asset is recognized on the statement of financial position only when it is probable that the future economic benefits will flow to the entity and the asset has a cost or value that can be measured reliably. The effect on deferred tax assets and liabilities of changes in tax rates are recognized in operations in the period in which the change is substantively enacted.

(m) New Standards Issued and Adopted

The Company adopted the following accounting standards and amendments to accounting standards, effective January 1, 2024:

On January 23, 2020, the IASB issued amendments to IAS 1 Presentation of Financial Statements, to clarify the classification of liabilities as current or non-current. For the purposes of non-current classification, the amendments removed the requirement for a right to defer settlement or roll over of a liability for at least twelve months to be unconditional. Instead, such a right must have substance and exist at the end of the reporting period. The amendments also clarify how a company classifies a liability that includes a counterparty conversion option. The amendments state that:

settlement of a liability includes transferring a company's own equity instruments to the counterparty, and
when classifying liabilities as current or non-current a company can ignore only those conversion options that are recognized as equity.

The amendments have been adopted by the Company, however the amendments did not result in any changes to the financial statements.

(n) Standards and Amendments Issued But Not Yet Effective

Certain pronouncements were issued by the IASB or the IFRIC that are mandatory for accounting periods commencing on or after January 1, 2025. Many are not applicable or do not have a significant impact on the Company. The Company is currently assessing the impact of these new pronouncements.

Standards issued, but not yet effective or adopted include:

IFRS 18 Presentation and Disclosure in Financial Statements

In April 2024, the IASB issued IFRS 18 Presentation and Disclosure in Financial Statements, which is intended to give investors more transparent and comparable information about companies' financial performance, thereby enabling better investment decisions. IFRS 18 introduces new sets of requirements to improve companies' reporting of financial performance and give investors a better basis for analyzing and comparing companies through

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

3. MATERIAL ACCOUNTING POLICIES (Continued)

Improved comparability in the statement of profit or loss or income statement;
Enhanced transparency of management-defined performance measures; and
More useful grouping of information in the financial statements.

IFRS 18 also requires companies to provide more transparency about operating expenses, helping investors to find and understand the information they need. IFRS 18 is effective for annual reporting periods beginning on or after January 1, 2027, but companies can apply it earlier. IFRS 18 replaces IAS 1. It carries forward many requirements from IAS 1 unchanged.

Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures

In May 2024, the IASB issued amendments to the classification and measurement requirements in IFRS 9. The amendments will address diversity in accounting practice by making the requirements more understandable and consistent. These include:

Clarifying the classification and assessment of contractual cash flows of financial assets with environmental, social and corporate governance (“ESG”).
Settlement of liabilities through electronic payment systems - the amendments clarify the date on which a financial asset or financial liability is derecognized. The IASB also decided to develop an accounting policy option to allow a company to derecognize a financial liability before it delivers cash on the settlement date if specified criteria are met.

With these amendments, the IASB has also introduced additional disclosure requirements to enhance transparency for investors regarding investments in equity instruments designated at fair value through other comprehensive income and financial instruments with contingent features, for example features tied to ESG-linked targets. The amendments are effective for annual reporting periods beginning on or after January 1, 2026.

Annual improvements to IFRS Accounting Standards

In July 2024, the IASB issued narrow amendments to IFRS Accounting Standards and accompanying guidance as part of its regular maintenance of the Standards. The amended Standards are:

IFRS 1 First-time Adoption of International Financial Reporting Standards;
IFRS 7 Financial Instruments: Disclosures and its accompanying Guidance on implementing IFRS 7;
IFRS 9 Financial Instruments;
IFRS 10 Consolidated Financial Statements; and
IAS 7 Statement of Cash Flows.

The amendments are effective for annual periods beginning on or after January 1, 2026, with earlier application permitted. Annual improvements are limited to changes that either clarify the wording in an IFRS Accounting Standard or correct relatively minor unintended consequences or oversights in the Accounting Standards. They also correct minor conflicts between the requirements of the Accounting Standards

4. FINANCIAL INSTRUMENTS

The Company manages its exposure to a number of different financial risks arising from its operations as well as its use of financial instruments including market risks (commodity prices, foreign currency exchange rate and interest rate), credit risk and liquidity risk through its risk management strategy. The objective of the strategy is to support the delivery of the Company's financial targets while protecting its future financial security and flexibility.

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)
NEWBREAK RESOURCES

4. FINANCIAL INSTRUMENTS (Continued)

Financial risks are primarily managed and monitored through operating and financing activities and, if required, through the use of derivative financial instruments. The Company does not use derivative financial instruments for purposes other than risk management. The financial risks are evaluated regularly with due consideration to changes in the key economic indicators and up to date market information.

Market Risk

Market risk is the risk or uncertainty arising from possible market price movements and their impact on the future performance of the business. The Company may use derivative financial instruments such as foreign exchange contracts and interest rate swaps to manage certain exposures. These market risks are evaluated by monitoring changes in key economic indicators and market information on an ongoing basis.

Commodity Risk

The Company is exposed to price risk with respect to commodity prices. Commodity price risk is defined as the potential adverse impact on earnings and economic value due to commodity price movements and volatilities. The Company monitors commodity prices as they relate to gold and the stock market to determine the appropriate course of action to be taken.

Liquidity Risk

Liquidity risk encompasses the risk that a company cannot meet its financial obligations in full. The Company's main source of liquidity is derived from its common stock issuances. These funds are primarily used to finance working capital, operating expenses, capital expenditures and acquisitions.

The Company manages its liquidity risk by regularly monitoring its cash flows from operating activities and holding adequate amounts of cash. The 2025 Moray exploration budget is planned to be partially funded from flow-through funds raised in July 2024 and from the $200,000 reimbursement from the government of Ontario under the Ontario Junior Exploration Program (“OJEP”), while the 2025 operating expenses are expected to be partially funded from proceeds anticipated to be received in connection with the planned sale of the Company’s interest in the Sundog gold project (see Note 14). There is no certainty of the Company’s ability to secure adequate funding through the completion of additional financings or asset sales.

As at December 31, 2024 the Company held current assets of $302,823 (December 31, 2023 - $444,468) to settle current liabilities of $231,802 (December 31, 2023 - $143,485, exclusive of non-cash flow-through premium liability).

Interest Rate Risk

Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate due to changes in market interest rates. Cash bears interest at market rates. In the event that the Company held interest bearing debt, the Company could be exposed to interest rate risk. The Company does not have any interest-bearing debt. Other current financial assets and liabilities are not exposed to interest rate risk because of their short-term nature.

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. Financial instruments that potentially subject the Company to credit risk consist of cash. The Company has reduced its credit risk by investing its cash with a Canadian chartered bank.

21 | Page

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK

RESOURCES

4. FINANCIAL INSTRUMENTS (Continued)

The Company's financial assets and liabilities as at December 31, 2024 and 2023 were as follows:

	Amortized Cost	FVPL	Total
December 31, 2023
Financial assets
Cash	$ 212,205	$ -	$ 212,205
Other amount receivable	$ 191,225	$ -	$ 191,225
Financial liabilities
Accounts payable and accrued liabilities	$ 143,485	$ -	$ 143,485
December 31, 2024
Financial assets
Cash	$ 37,548	$ -	$ 37,548
Other amounts receivable	$ 186,597	$ -	$ 186,597
Investment	$ -	$ 8,000	$ 8,000
Financial liabilities
Accounts payable and accrued liabilities	$ 231,802	$ -	$ 231,802

The fair values of these financial instruments approximate their carrying values because of their short-term nature.

5. CAPITAL MANAGEMENT

The Company defines capital management as the manner in which it manages its share capital. As at December 31, 2024, the Company's share capital was $3,957,582 (December 31, 2023 - $3,551,942).

There were no changes in the Company's approach to capital management during the years ended December 31, 2024 and 2023 and the Company is not subject to any externally imposed capital requirements.

The Company's objective in managing capital is to maintain the entity's ability to continue as a going concern, support the Company's normal operating requirements and to continue the exploration and evaluation of its mineral properties.

The Board of Directors does not establish a quantitative return on capital criteria for management but rather relies on the expertise of the Company's management to sustain future development of the business.

The Company regularly monitors and reviews the amount of capital in proportion to risk and future development and exploration opportunities. The Company manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Company may issue new debtor equity or similar instruments to obtain additional financing.

22 | Page

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK

RESOURCES

6. INVESTMENT

	December 31, 2024			December 31, 2023
	Shares	Share Price	Fair Value	Shares	Share Price	Fair Value
Planet Green Metals Inc.	100,000	$0.08	$ 8,000	-	-	$ -
Total Fair Value of Investment			$ 8,000			$ -

On October 16, 2024, New Break entered into an agreement with Planet Green Metals Inc. ("Planet Green") to sell a 100% interest in eight mineral claims located in Sheraton Township, Ontario in exchange for $1,000 in cash and 100,000 common shares of Planet Green. The common shares were received on October 28, 2024, at an estimated fair value of $9,500 based on their market price of $0.095 per share. The cash payment, which was due by December 15, 2024, is still outstanding and included in other amounts receivable as at December 31, 2024. New Break staked the claims in June 2024 at a cost of $400 and has recorded a gain of $10,100 during the year ended December 31, 2024, in respect of the sale of the mineral claims. The fair value adjustment of the investment in Planet Green resulted in an unrealized loss of $1,500 during the year ended December 31, 2024.

7. MINERAL PROPERTIES

Acquisition Costs	Moray Gold Project
Balance, December 31, 2022	$ 225,000
Mineral claim acquisitions during 2023	318,000
Balance, December 31, 2023 and 2024	$ 543,000

Moray Gold Project

In September 2020, New Break acquired a 100% interest in certain unpatented mining claims in Zavitz, Hincks and Hutt Townships, southeast of Timmins, Ontario (the "Moray property") from a private company, Exiro Minerals Corp. ("Exiro") in exchange for $100,000 in cash and 2,500,000 common shares of New Break. The 2,500,000 common shares were issued on July 15, 2020 at an estimated fair value of $125,000.

On May 23, 2023, New Break acquired a 100% interest in certain additional mineral claims contiguous to the northern Moray property boundary (the "Beyers claims") from three arm's length vendors in exchange for $80,000 in cash and 1,500,000 common shares of New Break at an estimated fair value of $195,000, based on their market price of $0.13 per share.

On July 21, 2023, New Break acquired a 100% interest in certain additional mineral claims in Zavitz Township contiguous to the western Moray property boundary (the "Zavitz claims") from two arm's length vendors in exchange for $10,000 in cash and 300,000 common shares of New Break at an estimated fair value of $33,000, based on their market price of $0.11 per share.

Certain of the claims acquired from Exiro ("Exiro Claims") are subject to a 2% Net Smelter Return ("NSR") royalty and certain other of the claims ("Voyageur Claims") are subject to a 1% NSR royalty in favour of Exiro. The Voyageur Claims are also subject to a 1% NSR royalty in favour of a previous property owner. New Break can repurchase 50% of the Exiro NSR royalty at any time for a payment of $1.0 million and can repurchase 50% of the Voyageur NSR royalty at any time for a payment of $750,000. In addition, the Beyers claims are subject to a 1.5% NSR royalty in favour of the previous property owners. New Break can reduce the NSR to 0.5% at any time for a payment of $750,000.

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

7. MINERAL PROPERTIES (Continued)

Effective October 22, 2021, the Company entered into a memorandum of understanding ("MOU") with the Matachewan First Nation and Mattagami First Nation (collectively, the "First Nations") as it relates to carrying out Prescribed Exploration Activities, as such term is defined by the Ontario Mining Act, on the Moray property. Under the terms of the MOU, New Break made payments of $5,000 to each First Nation and on November 19, 2021, the Company granted stock options to each of the First Nations to purchase up to 50,000 common shares of the Company at a price of $0.10 per share for a period of five years. As Prescribed Exploration Activities are conducted, New Break will make payments to the First Nations equal to 2% of the cost of such activities. During the year ended December 31, 2024, $3,687 was accrued to the First Nations in respect of Prescribed Exploration Activities completed during the year (December 31, 2023 - $2,779). Subject to New Break's adherence to the terms and conditions of the MOU, the First Nations agree to support the Moray Project while the MOU remains in force.

Ontario Junior Exploration Program

In each of 2022, 2023 and 2024, the Company's Moray project has been accepted into OJEP, a program run by the government of Ontario, under which New Break has received a 50% reimbursement of certain exploration and evaluation expenditures for work and activities performed on the Moray property within the OJEP funding periods noted below. In addition to the amounts shown below, New Break received an additional $14,403 in respect of expenditures incurred from January 1 to February 28, 2025 (see Note 14). The reimbursements received and receivable, have been netted against exploration and evaluation expenditures in the periods in which the expenditures were incurred.

Moray Gold Project – Reimbursement of Exploration Expenditures

OJEP Funding Period	Year Ended December 31,
	2024	2023	2022
April 1, 2022 to February 15, 2023	$ -	$ -	$ 200,000
April 1, 2023 to February 15, 2024	14,998	221,226	-
April 1, 2024 to February 28, 2025	185,597	-	-
	$ 200,595(3)	$221,226(2)	$ 200,000(1)

(1) $60,000 received November 2022 and $140,000 received March 2023.
(2) $30,000 received November 2023 and $191,226 received March 2024.
(3) $14,998 received March 2024 and $185,597 received March 2025 (see Note 14)

Sundog Gold Project

Effective September 1, 2021, New Break entered into an Inuit Owned Lands Mineral Exploration Agreement ("MEA") with Nunavut Tunngavik Incorporated ("NTI") for exclusive rights to a 100% interest in the minerals within, upon or under a 9,415-hectare exploration area on Inuit Mineral Title Lands parcel AR-35 in Kivalliq Region, Nunavut (the "Sundog Gold Project").

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

7. MINERAL PROPERTIES (Continued)

Per the terms of the MEA, New Break is required to make the following annual rent payments to NTI on the anniversary date of the MEA and meet the following annual work requirements in order to maintain the agreement in good standing:

Years	Hectares (“ha”)	Annual Rent ($/ha)	Annual Rent	Annual Work ($/ha)	Annual Work Requirement
1	9,415	$1.00	$9,415 (paid)	$5.00	$47,075 (completed)
2	9,415	$2.00	$18,830 (paid)	$5.00	$47,075 (completed)
3	9,415	$2.00	$18,830 (paid)	$10.00	$94,150 (completed)
4	9,415	$2.00	$18,830 (paid)	$10.00	$94,150
5	9,415	$2.00	$18,830	$10.00	$94,150
6-10	9,415	$3.00	$28,245	$20.00	$188,300
11-15	9,415	$4.00	$37,660	$30.00	$282,450
16-20	9,415	$5.00	$47,075	$40.00	$376,600

In the event that New Break establishes a mineral resource estimate in accordance with National Instrument 43-101 ("NI 43-101") of a minimum of one million ounces of gold in a Measured category, as defined by the Canadian Institute of Mining Metallurgy and Petroleum ("CIM") Definition Standards for Mineral Resources and Mineral Reserves ("CIM Definition Standards"), the Company will make a bonus payment to NTI of $1.0 million. Further bonus payments are payable, contingent upon each of New Break establishing an estimated Measured mineral resource of a minimum of five million ounces of gold ($5.5 million), making the decision to conduct an NI 43-101 Feasibility Study ($3.0 million) and the commencement of commercial production ($5.0 million). In addition, the Company is subject to advance royalty payments in the event that an NI 43-101 Feasibility Study is approved, which confirms the economic viability of a minimum of one million ounces of estimated gold mineral resources in a Measured category.

Nunavut Gold Projects on Crown Land

During the year ended December 31, 2021, New Break staked certain claims, located in Kivalliq Region, Nunavut, referred to as the Sy, Noomut and Angikuni Lake claims and paid $52,110 in refundable work charges to Crown-Indigenous Relations and Northern Affairs Canada ("CIRNAC") in relation to the first year's work requirement on these claims. The amounts were refundable following the issuance of a certificate of work by CIRNAC in respect of completion of the related exploration work requirement for the period associated with the deposit. As at December 31, 2023, the Company recorded a provision against these deposits due to the uncertainty of their collectability and during 2024, the Company decided to allow the claims to lapse.

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK

RESOURCES

7. MINERAL PROPERTIES (Continued)

Exploration and Evaluation Expenditures

For the year ended December 31, 2024

	Moray	Sundog	Other	Total
Consulting fees	$ 122,691	$ 5,254	$ 37,430	$ 165,375
Assessment reports	108,131	-	-	108,131
IP Survey	268,182	-	-	268,182
Trenching	10,833	-	-	10,833
Prospecting	8,296	-	-	8,296
Community relations	3,687	-	-	3,687
Land management	6,471	18,830	2,832	28,133
Travel	5,120	-	-	5,120
Staking costs	4,300	-	16,950	21,250
Assaying	3,781	-	-	3,781
Other	168	240	2,965	3,373
OJEP reimbursement	(200,595)	-	-	(200,595)
	$ 341,065	$ 24,324	$ 60,177	$ 425,566

For the year ended December 31, 2023

	Moray	Sundog	Other Nunavut	Other	Total
Consulting fees	$ 210,272	$ 17,850	$ -	$ -	$ 228,122
Stripping and channel sampling	138,970	-	-	-	138,970
Structural mapping and sampling	114,783	-	-	-	114,783
Prospecting and mapping	21,514	37,301	-	-	58,815
Drone survey	10,864	-	-	-	10,864
Community relations	2,779	-	-	-	2,779
Land management	6,529	18,830	52,110	837	78,306
Travel	19,569	-	-	-	19,569
Staking costs	6,150	-	-	700	6,850
Other	-	57,609	-	1,585	59,194
OJEP reimbursement	(221,226)	-	-	-	(221,226)
	$ 310,204	$ 131,590	$ 52,110	$ 3,122	$ 497,026

8. ACCOUNTS PAYABLE

Accounts payable and accrued liabilities consist primarily of outstanding vendors' invoices and accrued expenses incurred during the periods. The balances owing to the creditors are payable in accordance with the vendors' individual credit terms.

	December 31, 2024	December 31, 2023
Trade and other payables	$ 196,492	$ 110,850
Audit and tax services fees	35,310	32,635
	$ 231,802	$ 143,485

26 | Page

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK

RESOURCES

9. SHARE CAPITAL

(a) Authorized

The Company is authorized to issue an unlimited number of common shares without par value.

(b) Issued and outstanding

Share Capital	Note 9(b)	Number of Common Shares	Amount
Balance at December 31, 2022		40,985,750	$ 2,653,107
Private placement of $0.15 F-T common shares – May 31, 2023	(iii)	3,338,000	500,700
Less: flow-through premium on F-T common shares	(iii)	-	(66,760)
Share issue costs – cash	(iii)	-	(12,915)
Share issue costs – fair value of warrants	(iii)	-	(4,544)
Common shares issued for mineral claims – May 23, 2023	(ii)	1,500,000	195,000
Common shares issued for mineral claims – July 21, 2023	(v)	300,000	33,000
Exercise of warrants – cash proceeds	(i, iv)	1,448,850	217,327
Exercise of warrants – fair value	(i, iv)	-	39,592
Less: warrant valuation of incentive warrants – June 23, 2023	(iv)	-	(98,365)
Private placement of $0.08 units – December 29, 2023	(vi)	750,000	60,000
Less: warrant valuation	(vi)	-	(24,075)
Private placement of $0.10 F-T units – December 29, 2023	(vii)	1,250,000	125,000
Less: flow-through premium on F-T common shares	(vii)	-	(26,875)
Less: warrant valuation	(vii)	-	(38,250)
Balance at December 31, 2023		49,572,600	3,551,942
Private placement of $0.08 units – March 5, 2024	(viii)	250,000	20,000
Less: warrant valuation	(viii)	-	(7,210)
Private placement of $0.11 F-T units – July 18, 2024	(ix)	1,500,000	165,000
Less: warrant valuation	(ix)	-	(71,100)
Private placement of $0.075 units – November 15, 2024	(x)	6,106,000	457,950
Less: warrant valuation	(x)	-	(159,000)
Balance at December 31, 2024		57,428,600	$ 3,957,582

(i) On April 28, 2023, warrants to purchase 375,000 common shares of the Company at a price of $0.15 were exercised for proceeds of $56,250. Issue date fair value of $7,425 was moved from warrant reserve to share capital.

(ii) On May 23, 2023, the Company issued 1,500,000 common shares in connection with the purchase of additional mineral claims associated with the Moray Project. The fair value of the 1,500,000 shares was estimated at $195,000 based on their market price of $0.13 per share (see Note 7).

(iii) On May 31, 2023, the Company completed a non-brokered private placement for gross proceeds of $500,700 through the issuance of 3,338,000 F-T Shares at a price of $0.15 per F-T Share. The Company paid aggregate finder's fees of $12,915 and issued 51,000 finder warrants. Each finder warrant is exercisable into one common share at a price of $0.15 per share for 24 months from the date of closing. The issue date fair value of these warrants was estimated to be $4,544 based on their Black-Scholes value, using the assumptions in Note 9(c) and recorded as share issuance costs. The Company recognized an aggregate flow-through premium of $66,760 as a result of the issuances of the F-T Shares.

27 | Page

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

9. SHARE CAPITAL (Continued)

(iv) On June 23, 2023, warrants to purchase an aggregate of 1,073,850 common shares of the Company at a price of $0.15 were exercised for proceeds of $161,077. Issue date fair value of $32,167 was moved from warrant reserve to share capital. A director of the Company and a greater than 10% securityholder exercised 25,000 and 173,000 of these warrants, respectively. Pursuant to a common share purchase warrant exercise incentive program, the Company issued 1,073,850 warrants (“Incentive Warrants”) to those warrant holders who exercised. Each Incentive Warrant entitles the holder thereof to purchase one common share at an exercise price of $0.20 for a period of thirty-six (36) months until June 23, 2026 (see Note 9(e)).

(v) On July 21, 2023, the Company issued 300,000 common shares in connection with the purchase of additional mineral claims associated with the Moray Project. The fair value of the 300,000 shares was estimated at $33,000 based on their market price of $0.11 per share (see Note 7).

(vi) On December 29, 2023, the Company completed a non-brokered private placement offering through the issuance of 750,000 units at a price of $0.08 per unit for aggregate gross proceeds of $60,000. Each unit consists of one common share and one common share purchase warrant, with each warrant entitling the holder thereof to purchase one common share at an exercise price of $0.12 for a period of twenty-four (24) months from the date of closing. A greater than 10% securityholder of the Company subscribed for 375,000 of the units for gross proceeds of $30,000 and a geological consulting company, the President and CEO of which is also a director of New Break subscribed for 125,000 of the units for gross proceeds of $10,000. The issue date fair value of the warrants was estimated to be $24,075 based on their Black-Scholes values, using assumptions in Note 9(e). No finder fees were paid.

(vii) On December 29, 2023, the Company completed a non-brokered private placement offering through the issuance of 1,250,000 flow-through units (“F-T Unit”) at a price of $0.10 per F-T Unit, for aggregate gross proceeds of $125,000. Each F-T Unit consists of one F-T Share and one common share purchase warrant, with each whole warrant entitling the holder thereof to purchase one non-flow-through common share at an exercise price of $0.15 for a period of twenty-four (24) months from the date of closing. The Company recognized an aggregate flow-through premium of $26,875 as a result of the issuance of the F-T Shares. The issue date fair value of the warrants was estimated to be $38,250 based on their Black-Scholes value, using assumptions in Note 9(e). No finder fees were paid.

(viii) On March 5, 2024, the Company completed a non-brokered private placement offering through the issuance of 250,000 units at a price of $0.08 per unit for aggregate gross proceeds of $20,000. Each unit consists of one common share and one common share purchase warrant, with each warrant entitling the holder thereof to purchase one common share at an exercise price of $0.12 for a period of twenty-four (24) months from the date of closing. 125,000 of the units were purchased by a company owned by an officer of the Company. The issue date fair value of the warrants was estimated to be $7,210 based on their Black-Scholes values, using assumptions in Note 9(e). No finder fees were paid.

(ix) On July 18, 2024, the Company completed a non-brokered private placement offering through the issuance of 1,500,000 F-T Units at a price of $0.11 per F-T Unit, for aggregate gross proceeds of $165,000. Each F-T Unit consists of one F-T Share and one common share purchase warrant, with each whole warrant entitling the holder thereof to purchase one non-flow-through common share at an exercise price of $0.25 for a period of sixty (60) months from the date of closing. There was no flow-through premium on the issuance of the F-T Shares. The issue date fair value of the warrants was estimated to be $71,100 based on their Black-Scholes value, using assumptions in Note 9(e). No finder fees were paid.

28 | Page

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK

RESOURCES

9. SHARE CAPITAL (Continued)

(x) On November 15, 2024, the Company completed a non-brokered private placement through the issuance of 6,106,000 units at a price of $0.075 per unit for gross proceeds of $457,950. Each unit consists of one common share and one common share purchase warrant, with each warrant entitling the holder thereof to purchase one common share at an exercise price of $0.12 for a period of twenty-four (24) months from the date of closing. 1,350,000 of the units were purchased by a company owned by a then director of the Company. The issue date fair value of the warrants was estimated to be $159,000 based on their Black-Scholes values, using assumptions in Note 9(e). No finder fees were paid.

(c) Escrow Shares

On August 4, 2022, the Company entered into an escrow agreement pursuant to which 4,348,000 common shares were placed in escrow and are subject to release in tranches over time in accordance with the policies of the Canadian Securities Administrators. The escrow agreement provides that 10% of the escrowed shares will be released from escrow upon the original CSE listing date of September 7, 2022, and that an additional 15% will be released therefrom every six-month interval thereafter, over a period of 36 months. As at December 31, 2024, the Company had 1,311,900 (December 31, 2023 – 2,623,800) common shares held in escrow with the next escrow release on March 7, 2025 (see Note 14).

	Number of Common Shares
Balance at December 31, 2022	3,913,200
Released from escrow – March 7, 2023	(652,200)
Added to escrow pursuant to warrant exercise – June 23, 2023	25,000
Released from escrow – June 23, 2023	(6,250)
Released from escrow – September 7, 2023	(655,950)
Balance at December 31, 2023	2,623,800
Released from escrow – March 7, 2024	(655,950)
Released from escrow – September 7, 2024	(655,950)
Balance at December 31, 2024	1,311,900

The common shares underlying the exercise of 25,000 warrants by a director of the Company on June 23, 2023, are subject to the Escrow Agreement. 6,250 of those shares or 25% were eligible for immediate release. The other 18,750 shares were added to the balance held in escrow.

(d) Stock Options

The Company has a stock option plan (the "Plan") to provide directors, officers, employees and consultants with options to purchase common shares of the Company. The maximum number of common shares reserved for issuance upon the exercise of options, is not to exceed 10% of the total number of common shares outstanding immediately prior to such issuance. The stock options have a maximum term of five years and a vesting period and exercise price determined by the board of directors. The exercise price of the stock options is fixed by the board of directors and may not be less than the market price of the shares at the time of grant, subject to all applicable regulatory requirements. As at December 31, 2024, 1,942,860 (December 31, 2023 – 1,157,260) additional options remain available for issuance under the Plan.

29 | Page

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

9. SHARE CAPITAL (Continued)

The following table reflects the continuity of stock options for the years ended December 31, 2024 and 2023.

	Number of Stock Options	Weighted Average Exercise Price
Outstanding at December 31, 2022	3,600,000	$0.10
Granted	500,000	$0.10
Expired	(300,000)	$0.10
Outstanding at December 31, 2023 and 2024	3,800,000	$0.10

Stock Option Grants

On January 20, 2023, the Company granted options to purchase up to 200,000 common shares of the Company to a consultant at a price of $0.10 per share for a period of five years. The options vest 25% after three months, 25% after six months, 25% after nine months and 25% after one year. The Company recorded the entire grant date fair value of $17,100 of share-based compensation over the course of the year ended December 31, 2023.

On June 2, 2023, the Company granted options to purchase up to 300,000 common shares of the Company to two consultants at a price of $0.10 per share for a period of five years. The options vested immediately. The Company recorded $27,180 of share-based compensation expense, being the entire grant date fair value during the year ended December 31, 2023.

The fair value of the options granted, are estimated on the dates of grant using the Black-Scholes option pricing model with the following assumptions:

Grant Date	Stock Price	Exercise Price	Risk-free Interest Rate	Expected Stock Price Volatility	Expected Life (in years)	Expected Dividend Rate	Expected Forfeiture Rate
November 19, 2021	$0.10	$0.10	1.45%	100%	5	0%	0%
December 30, 2022	$0.10	$0.10	3.41%	103%	5	0%	0%
January 20, 2023	$0.10	$0.10	2.82%	127%	5	0%	0%
June 2, 2023	$0.10	$0.10	3.49%	146%	5	0%	0%

Stock Option Expiries

Effective March 31, 2023, stock options to purchase up to 50,000 common shares of the Company at a price of $0.10 per share, granted to a consultant on November 19, 2021, expired unexercised. Grant date fair value of $3,730 was transferred to deficit.

On October 19, 2023, stock options to purchase up to 250,000 common shares of the Company at a price of $0.10 per share, granted to the Company's former Chairman on November 19, 2021, expired unexercised. Grant date fair value of $18,650 was transferred to deficit.

30 | Page

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK

RESOURCES

9. SHARE CAPITAL (Continued)

The following table reflects the stock options outstanding and exercisable at December 31, 2024:

Date of Grant	Number of Options Outstanding	Exercise Price	Weighted Average Remaining Life(years)	Date of Expiry	Number of Options Exercisable	Grant Date Fair Value
November 19, 2021	2,700,000	$ 0.10	1.88	November 18, 2026	2,700,000 (1)	$ 201,420
November 19, 2021	250,000	$ 0.10	0.16	February 28, 2025	250,000 (2)	18,650
December 30, 2022	350,000	$ 0.10	2.99	December 27, 2027	350,000	26,985
January 20, 2023	200,000	$ 0.10	3.05	January 19, 2028	200,000	17,100
June 2, 2023	240,000	$ 0.10	3.42	June 1, 2028	240,000	21,744
June 2, 2023	60,000	$ 0.10	0.01	January 3, 2025	60,000 (3)	5,436
	3,800,000	$ 0.10	2.00		3,800,000	$ 291,335

(1) 1,950,000 of these stock options are subject to the escrow agreement entered into by the Company on August 4, 2022. In the event that any of these options are exercised, the underlying shares will be released from escrow on the same schedule as outlined in Note 9 (c), beginning from September 7, 2022, the date of listing on the CSE.

(2) 250,000 stock options granted to a former officer of the Company on November 19, 2021, expired unexercised on February 28, 2025, in accordance with the terms of the Plan (see Note 14).

(3) 60,000 stock options granted to a consultant of the Company on June 2, 2023, expired unexercised on January 3, 2025, in accordance with the terms of the Plan (see Note 14).

The weighted average remaining contractual life of options outstanding and exercisable at December 31, 2024 is 2.00 years (December 31, 2023 - 3.17 years) at a weighted average exercise price of $0.10 (December 31, 2023 - $0.10).

(e) Warrants

The following table reflects the continuity of warrants for the years ended December 31, 2024 and 2023:

	Number of Warrants	Issue Date Fair Value	Weighted Average Exercise Price
Balance at December 31, 2022	7,999,200	$ 290,865	$ 0.19
Issued	3,124,850	165,234	$ 0.16
Exercised	(1,448,850)	(39,592)	$ 0.15
Expired	(5,212,350)	(160,075)	$ 0.15
Balance at December 31, 2023	4,462,850	256,432	$ 0.22
Issued	7,856,000	237,310	$ 0.14
Expired	(1,338,000)	(91,198)	$ 0.35
Balance at December 31, 2024	10,980,850	$ 402,544	$ 0.15

Warrant Exercises and Expiries

On April 28, 2023, warrants to purchase 375,000 common shares of the Company at a price of $0.15 were exercised for proceeds of $56,250. Issue date fair value of $7,425 was moved from warrant reserve to share capital.

On June 8, 2023, the Company announced the repricing of 1,715,500 warrants having an expiry date of June 23, 2023, from an exercise price of $0.20 per share to an exercise price of $0.15 per share. In addition, the Company announced a warrant exercise incentive program ("Incentive Program") in respect of 5,925,500 warrants due to expire on June 23, 2023, having an exercise price of $0.15, including the repriced warrants (the "Subject Warrants").

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)
NEWBREAK RESOURCES

9. SHARE CAPITAL (Continued)

Under the Incentive Program, for each Subject Warrant exercised, the holder thereof would receive a new warrant with an exercise price of $0.20 for a period of three years from the date of issuance.

Effective June 23, 2023, 418,850 of the repriced warrants were exercised for proceeds of $62,827. Issue date fair value of $11,141 was moved from warrant reserve to share capital. In addition, 1,296,650 of the repriced warrants and 14,500 warrants having an exercise price of $0.20 which could not be repriced, expired unexercised. Issue date fair value of $34,877 was moved from warrant reserve to deficit.

Effective June 23, 2023, 655,000 warrants having an original exercise price of $0.15 were exercised for gross proceeds of $98,250. Issue date fair value of $21,026 was moved from warrant reserve to share capital. In addition, 3,555,000 of these warrants expired unexercised. Issue date fair value of $114,114 was moved from warrant reserve to deficit.

On June 23, 2023, 334,200 finder warrants having an exercise price of $0.15 expired unexercised. Issue date fair value of $10,761 was moved from warrant reserve to deficit.

On December 10, 2023, 12,000 finder warrants having an exercise price of $0.30 expired unexercised. Issue date fair value of $323 was moved from warrant reserve to deficit.

On September 6, 2024, 80,000 warrants issued on December 31, 2021, having an exercise price of $0.35 expired unexercised. Issue date fair value of $5,392 was moved from warrant reserve to deficit.

On September 6, 2024, 578,000 warrants issued on March 30, 2022, having an exercise price of $0.35 expired unexercised. Issue date fair value of $39,362 was moved from warrant reserve to deficit. 218,000 of these were held by a director of the Company.

On September 6, 2024, 680,000 warrants issued on May 31, 2022, having an exercise price of $0.35 expired unexercised. Issue date fair value of $46,444 was moved from warrant reserve to deficit.

Warrant Issuances

On May 31, 2023, the Company issued 51,000 finder warrants with an exercise price of $0.15 for a period of 24 months (see Note 9(b)(iii)). Issue date fair value of $4,544 was recorded as share issuance costs.

On June 23, 2023, the Company issued 1,073,850 warrants with an exercise price of $0.20 for a period of three years in connection with the Incentive Program. Issue date fair value of $98,365 was moved from share capital to warrant reserve (see Note 9(b)(iv)).

On December 29, 2023, the Company issued 750,000 warrants with an exercise price of $0.12 for a period of 24 months (see Note 9(b)(vi)). Issue date fair value of $24,075 was moved from share capital to warrant reserve.

On December 29, 2023, the Company issued 1,250,000 warrants with an exercise price of $0.15 for a period of 24 months (see Note 9(b)(vii)). Issue date fair value of $38,250 was moved from share capital to warrant reserve.

On March 5, 2024, the Company issued 250,000 warrants with an exercise price of $0.12 for a period of 24 months (see Note 9(b)(viii)). Issue date fair value of $7,210 was moved from share capital to warrant reserve.

32 | Page

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK

RESOURCES

9. SHARE CAPITAL (Continued)

On July 18, 2024, the Company issued 1,500,000 warrants with an exercise price of $0.25 for a period of 60 months (see Note 9(b)(ix)). Issue date fair value of $71,100 was moved from share capital to warrant reserve. The warrants were issued to two shareholders, who together are a Control Person (as such term is defined in accordance with Canadian securities law).

On November 15, 2024, the Company issued 6,106,000 warrants with an exercise price of $0.12 for a period of 24 months (see Note 9(b)(x)). Issue date fair value of $159,000 was moved from share capital to warrant reserve. 1,350,000 of these warrants were issued to a company owned by a then director of the Company.

As at December 31, 2024, the following warrants were outstanding, which entitle the holders to purchase the stated number of common shares at the exercise price on or before the expiry date:

Issue Date	Warrants Outstanding	Exercise Price	Weighted Average Remaining Life (years)	Expiry Date	Issue Date Fair Value
May 31, 2023	51,000	$0.15	0.41	May 30, 2025	$ 4,544
December 29, 2023	750,000	$0.12	0.99	December 29, 2025(1)	24,075
December 29, 2023	1,250,000	$0.15	0.99	December 29, 2025(1)	38,250
March 5, 2024	250,000	$0.12	1.18	March 5, 2026(1)	7,210
June 23, 2023	1,073,850	$0.20	1.48	June 23, 2026(2)	98,365
July 18, 2024	1,500,000	$0.25	4.55	July 18, 2029(2)	71,100
November 15, 2024	6,106,000	$0.12	1.87	November 13, 2026(1)	159,000
	10,980,850	$0.15	2.01		$ 402,544

(1) These warrants are subject to a potential acceleration clause should the trading price of the common shares equal or exceed $0.25 for any five (5) non-consecutive trading days over a 365-day period.

(2) These warrants are subject to a potential acceleration clause should the trading price of the common shares equal or exceed $0.40 for any five (5) non-consecutive trading days over a 365-day period.

The weighted average remaining contractual life of warrants outstanding as at December 31, 2024 is 2.01 years (December 31, 2023 – 1.71 years) at a weighted average exercise price of $0.15 (December 31, 2023 – $0.22).

The Company follows the fair value method of accounting for warrants using the Black-Scholes option pricing model. The issue date fair values of warrants issued were calculated based on the following assumptions:

Issue Date	Stock Price	Exercise Price	Risk-free Interest Rate	Expected Stock Price Volatility	Expected Life (in years)	Expected Dividend Rate	Expected Forfeiture Rate
May 31, 2023	$0.13	$0.15	4.22%	145%	2	0%	0%
June 23, 2023	$0.12	$0.20	4.25%	149%	3	0%	0%
December 29, 2023	$0.048	$0.12	3.88%	172%	2	0%	0%
December 29, 2023	$0.048	$0.15	3.88%	172%	2	0%	0%
March 5, 2024	$0.051	$0.12	4.04%	144%	2	0%	0%
July 18, 2024	$0.063	$0.25	3.34%	132%	5	0%	0%
November 15, 2024	$0.049	$0.12	3.15%	140%	2	0%	0%

33 | Page

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK

RESOURCES

10. RELATED PARTY TRANSACTIONS AND KEY MANAGEMENT COMPENSATION

Key Management Compensation

In accordance with IAS 24, key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Company directly or indirectly, including any directors (executive and non-executive) of the Company. Key management of New Break includes the President and Chief Executive Officer, Vice President, Exploration and Chief Financial Officer.

	For the years ended December 31,
	2024	2023
Management fees and benefits	$ 163,706	$ 170,489
Management fees included in exploration and evaluation	90,000	90,000
Total fees paid to management and directors	$ 253,706	$ 260,489
Exploration and evaluation, and consulting fees charged by a geological consulting company, the President & CEO of which, is also a director of New Break	$ 130,946	$ 185,600

Related Party Transactions

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

On June 2, 2023, the Company granted options to purchase up to 300,000 common shares of the Company at a price of $0.10 per share for a period of five years. 240,000 of these were granted to a consultant of the Company, who is also a Control Person (see Note 9(d)).

On June 23, 2023, warrants to purchase 1,073,850 common shares of the Company at a price of $0.15 were exercised for proceeds of $161,077. 25,000 were exercised by an investment company that is wholly-owned by one of the Company's then directors and 173,000 were exercised by a Control Person (see Note 9(b)(iv)). As a result of the exercise, the investment company and the Control Person were also issued 25,000 and 173,000 incentive warrants, respectively at $0.20 for a period of three years (see Note 9(e)).

On December 29, 2023, the Company completed a non-brokered private placement for gross proceeds of $60,000 through the issuance of 750,000 units at a price of $0.08 per unit and $125,000 through the issuance of 1,250,000 F-T units at a price of $0.10 per F-T unit. A geological consulting company, the President and CEO of which was a director of New Break, subscribed for 125,000 of the units for proceeds of $10,000 and was issued 125,000 warrants exercisable at $0.12 for a period of 24 months. In addition, a Control Person subscribed for 375,000 of the units and 1,000,000 of the F-T units for gross proceeds of $30,000 and $100,000, respectively and was issued 375,000 warrants exercisable at $0.12 and 1,000,000 warrants exercisable at $0.15 for a period of 24 months.

On March 5, 2024, the Company completed a non-brokered private placement for gross proceeds of $20,000 through the issuance of 250,000 units at a price of $0.08 per unit. A company owned by a former officer of the Company subscribed for 125,000 of the units for proceeds of $10,000 and was issued 125,000 warrants exercisable at $0.12 for a period of 24 months.

On July 18, 2024, the Company completed a non-brokered private placement for gross proceeds $165,000 through the issuance of 1,500,000 F-T units at a price of $0.11 per F-T unit. Two shareholders, who together are a Control Person, subscribed for all of the F-T units and were issued an aggregate of 1,500,000 warrants exercisable at $0.25 for a period of 60 months.

34 | Page

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

10. RELATED PARTY TRANSACTIONS AND KEY MANAGEMENT COMPENSATION (Continued)

On September 6, 2024, 218,000 warrants held by a director of the Company, issued on March 30, 2022, having an exercise price of $0.35 expired unexercised.

On November 15, 2024, the Company completed a non-brokered private placement for gross proceeds of $457,950 through the issuance of 6,106,000 units at a price of $0.075 per unit. A company owned by a then director of the Company subscribed for 1,350,000 of the units for proceeds of $101,250 and was issued 1,350,000 warrants exercisable at $0.12 for a period of 24 months.

As at December 31, 2024, $97,058 (December 31, 2023 - $66,511) included in accounts payable and accrued liabilities was owing to related parties, including $56,550 (December 31, 2023 - $32,761) owed to a geological consulting company, the President and Chief Executive Officer of which, was also a director of New Break. These amounts are unsecured, non-interest bearing, with no fixed terms of repayment.

11. LOSS PER SHARE

Net loss per share has been calculated by dividing the net loss for the period by the weighted average number of common shares outstanding during the period. The effect of stock options and warrants was anti-dilutive and hence, the diluted loss per share equals the basic loss per share.

12. INCOME TAXES

a. Provision for Income Taxes

Major items causing the Company's effective income tax rate to differ from the combined Canadian federal and provincial statutory rate of 26.5% (2023 – 26.5%) were as follows:

	For the years ended December 31,
	2024	2023
Loss before income taxes	$ (809,229)	$ (1,034,488)
Expected income tax recovery based on statutory rate	$ (214,000)	$ (274,000)
Adjustment to expected income tax benefit:
Share-based compensation	-	12,000
Flow-through renunciation	98,000	166,000
Expenses not deductible for tax purposes	8,000	10,000
Benefit of tax assets not recognized	121,000	98,000
Other	4,000	7,000
Flow-through premium recovery	(17,000)	(19,000)
Deferred income tax provision (recovery)	$ -	$ -

b. Deferred Income Tax

Deferred income tax assets have not been recognized in respect of the following deductible temporary differences:

	December 31, 2024	December 31, 2023
Non-capital loss carry-forwards	$ 1,923,800	$ 1,677,700
Share issue costs	22,000	10,000
Mineral property costs	901,000	129,000
Total	$ 2,846,800	$ 1,816,700

Notes to the Financial Statements

For the years ended December 31, 2024 and 2023

(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

12. INCOME TAXES (Continued)

Deferred tax assets have not been recognized in respect of these items because it is not probable that future taxable profit will be available against which the Company can use the benefits.

c. Non-capital Losses Carried Forward

The Company has approximately $1,923,800 (2023 - $1,677,700) of non-capital losses as at December 31, 2024 available to be carried forward against future taxable income. These non-capital losses will expire as follows:

Year of Expiry	December 31, 2024	December 31, 2023
2038	$ 200	$ 200
2039	172,800	172,800
2040	184,200	184,200
2041	328,400	328,400
2042	213,200	446,900
2043	591,800	545,200
2044	433,200	-
	$ 1,923,800	$ 1,677,700

13. COMMITMENTS AND CONTINGENCIES

As at December 31, 2024, the Company had a commitment to spend $165,000 (December 31, 2023 - $401,062) on eligible CEE, from amounts raised from flow-through financings, by December 31, 2025.

Flow-Through

Flow-through common shares require the Company to incur an amount equivalent to the proceeds of the issued flow-through common shares on eligible qualifying CEE. Certain interpretations are required to assess the eligibility of flow-through expenditures that if changed, could result in the denial of renunciation. The Company has indemnified current and previous flow-through subscribers for any tax and related costs payable by them in the event the Company does not incur the required exploration expenditures. No amounts have been recorded in these financial statements for potential liabilities relating to these indemnities as a triggering event has not taken place. Upon issuance of the flow-through shares during 2024 in the amount of $165,000 (2023 - $625,700), the Company recorded an aggregate flow-through share premium liability of $nil (2023 - $93,635). As eligible CEE is incurred, the amount is drawn down as income through the statement of loss. During the year ended December 31, 2024, the Company incurred $401,062 (2023 - $349,138) in eligible CEE and recorded a flow-through share premium recovery of $63,683 in the statement of loss (December 31, 2023 - $71,452).

Environmental

The Company's exploration and evaluation activities are subject to laws and regulations governing the protection of the environment. These laws and regulations are continually changing and generally becoming more restrictive. The Company believes its activities 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.

Notes to the Financial Statements
For the years ended December 31, 2024 and 2023
(Expressed in Canadian Dollars)

NEWBREAK RESOURCES

13. COMMITMENTS AND CONTINGENCIES (Continued)

Contingent Payments and Commitments

Effective October 1, 2021, the Company became party to certain consulting agreements that contain clauses that could require additional aggregate payments of $198,000 upon termination without cause and $396,000 upon termination in connection with a change of control. As a triggering event has not taken place, the contingent payments have not been reflected in these financial statements.

14. SUBSEQUENT EVENTS

Expiry of Stock Options

Effective January 3, 2025, stock options to purchase up to 60,000 common shares of the Company at a price of $0.10 per share, granted to a consultant on June 2, 2023, expired unexercised in accordance with the terms of the Plan, following the death of the consultant.

Effective February 28, 2025, stock options to purchase up to 250,000 common shares of the Company at a price of $0.10 per share, granted to a former officer of the Company on November 19, 2021, expired unexercised in accordance with the terms of the Plan.

Escrow Shares

On March 7, 2025, an additional 655,950 common shares were released from escrow, leaving a remaining balance of 655,950 common shares held in escrow.

Receipt of Other Amount Receivable

On March 26, 2025, the Company received a payment of $200,000 from the Ontario Ministry of Mines pursuant to OJEP, as reimbursement of 50% of certain exploration and evaluation expenditures for work and activities on the Moray gold project for the period April 1, 2024 to February 28, 2025. $185,597 of this amount is in respect of work completed during fiscal 2024 and was recorded in other amounts receivable as at December 31, 2024, while the remaining $14,403 is in respect of work completed in fiscal 2025 (see also Note 7).

Sale of Sundog Gold Project and Related Assets

On April 10, 2025, New Break entered into a definitive asset purchase and sale agreement with Guardian Exploration Inc. ("Guardian"), replacing a non-binding letter of intent signed December 5, 2024, to sell a 100% interest in its Sundog gold project and 60 drums of Jet A fuel (12,300 litres) warehoused in Arviat, Nunavut (the "Assets"). Guardian has agreed to pay New Break $75,000 in cash and issue to New Break, 5,000,000 shares of Guardian in exchange for the Assets upon closing. In addition, Guardian has agreed to reimburse New Break $18,830 for the Sundog annual rent paid to NTI on December 27, 2024. This amount was recorded in exploration and evaluation expenditures for the year ended December 31, 2024. New Break will retain an option to purchase a 20% interest in the Sundog project at any time for $1, carried through to a decision to mine (the "Option"). Upon exercise of the Option, New Break and Guardian would enter into an agreement on standard industry terms to be mutually agreed upon, governing the joint operation on a 20/80 basis, respectively. New Break would only become responsible for funding 20% of mine development costs once a construction decision has been made. New Break can sell its 20% interest at any time, subject to Guardian having a right of first refusal to buy New Break's 20% interest.

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New Break Resources Ltd. — Audit Report / Information 2024

48179_rns_2025-04-29_365c9c79-ee55-4460-a10c-42e116d48c9f.pdf

Financial Statements

Independent Auditor's Report

Opinion

Basis for opinion

Material uncertainty related to going concern

McGovern Hurley

Key audit matters

Other information

Responsibilities of management and those charged with governance for the financial statements

Auditor's responsibilities for the audit of the financial statements

McGovern Hurley

Statements of Financial Position

Statements of Loss and Comprehensive Loss

For the years ended

Statements of Cash Flows

1. NATURE OF OPERATIONS AND GOING CONCERN

2. BASIS OF PRESENTATION

(a) Statement of Compliance

(b) Basis of Presentation

(c) Approval of the Financial Statements

(d) Use of estimates and judgments

Share-based payment transactions

2. BASIS OF PRESENTATION (Continued)

Title to exploration and evaluation property interests

Rehabilitation provisions

Income, value added, withholding and other taxes

Capitalization of mineral property acquisition costs

Impairment of mineral properties

3. MATERIAL ACCOUNTING POLICIES

(a) Cash

(b) Exploration and Evaluation Properties

Acquisition Costs

Exploration and Evaluation Expenditures

Development Assets

Disposition or Abandonment of Mineral Properties

Impairment

3. MATERIAL ACCOUNTING POLICIES (Continued)

(c) Equipment

Recognition and Measurement

Depreciation

Impairment

3. MATERIAL ACCOUNTING POLICIES (Continued)

(d) Financial Instruments

Financial assets

Initial recognition and measurement

Subsequent measurement – financial assets at FVPL

Subsequent measurement – financial assets at amortized cost

Subsequent measurement – financial assets at FVOCI

Derecognition

Impairment of financial assets

3. MATERIAL ACCOUNTING POLICIES (Continued)

Financial liabilities

Initial recognition and measurement

Subsequent measurement – financial liabilities at amortized cost

Subsequent measurement – financial liabilities at FVPL

Derecognition

Provisions

Fair Value Hierarchy

3. MATERIAL ACCOUNTING POLICIES (Continued)

(e) Government Assistance

(f) Share Capital

(g) Warrants

(h) Flow-Through Shares

3. MATERIAL ACCOUNTING POLICIES (Continued)

(i) Share-Based Payments

(j) Reclamation Obligation

(k) Loss Per Common Share

3. MATERIAL ACCOUNTING POLICIES (Continued)

(l) Income Taxes

(m) New Standards Issued and Adopted

(n) Standards and Amendments Issued But Not Yet Effective

IFRS 18 Presentation and Disclosure in Financial Statements

3. MATERIAL ACCOUNTING POLICIES (Continued)

Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures

Annual improvements to IFRS Accounting Standards

4. FINANCIAL INSTRUMENTS

4. FINANCIAL INSTRUMENTS (Continued)

New Break Resources Ltd. Audit Report / Information 2024