Sendero Resources Corp. — Interim / Quarterly Report 2023

Apr 24, 2023

1319732 B.C. Ltd.

Amended Condensed Interim Financial Statements

(Unaudited)

(Expressed in Canadian Dollars)

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022

Notice to Reader

The accompanying amended unaudited condensed interim financial statements of 1319732 B.C. Ltd (the " Company ") have been prepared by and are the responsibility of management. The unaudited condensed interim financial statements have not been reviewed by the Company's auditors.

1319732 B.C. LTD. Amended Condensed Interim Statements of Financial Position (Unaudited) (Expressed in Canadian dollars)

As at		January 31, 2023	July31,2022
	Notes	$	$
ASSETS
Current Assets
Cash		4,561	7,379
TOTAL ASSETS		4,561	7,379
LIABILITIES AND SHAREHOLDERS’ DEFICIENCY
Current Liabilities
Accounts payable and accrued liabilities		17,222	32,190
Loans payable	5	1,787	-
TOTAL LIABILITIES		19,009	32,190
SHAREHOLDERS’ DEFICIENCY
Share capital	6	172,504	35,576
Deficit		(186,952)	(60,387)
Total Shareholders’ Deficiency		(14,448)	(24,811)
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		4,561	7,379

Nature of operations and going concern (Note 1) Subsequent event (Note 11)

Approved on Behalf of the Board on April 21, 2023:

“Binyomin Posen” Binyomin Posen – CEO/Director	“Cole Duthie”
	Cole Duthie - Director

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

1319732 B.C. LTD. Amended Condensed Interim Statements of Loss and Comprehensive Loss (Unaudited)

(Expressed in Canadian dollars)

				Period from
	Three	Three		incorporation
	months	months	Six months	(Aug 12, 2021)
	ended	ended	ended	to
	January 31,	January 31,	January 31,	January 31,
	2023	2022	2023	2022
Professional fees	$ 750	$ 223	$ 1,282	$ 973
Corporate management fees	120,000	-	125,000	-
Legal expenses	-	11,404	-	19,955
Filingexpenses	-	4,948	283	4,948
	**$ (120,750) **	$(16,575)	$(126,565)	$(25,476)
Net loss and comprehensive loss for theperiod	$ (120,750)	$(16,575)	$(126,565)	$(25,476)
Weighted average number of shares outstanding
- Basic and Diluted	3,750,006	871,560	3,571,094	511,383
Basic and diluted loss per share	$ (0.03)	$ (0.02)	$ (0.04)	$ (0.05)

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

1319732 B.C. LTD.

Amended Condensed Interim Statements of Changes in Shareholders Equity (Unaudited) (Expressed in Canadian dollars)

Share Capital Number Amount Deficit	Total Shareholders’ Equity
Balance, August 12, 2021 - $ - $ - Shares issued during the period (Note 6) 2,440,368 35,576 - Loss for theperiod - - (25,476)	$ - 35,576 (25,476)
Balance,January31,2022 2,440,368 $ 35,576 $(25,476)	$(10,100)
Balance, July 31, 2022 2,440,368 $ 35,576 (60,387) Shares issued for debt (Note 6) 1,309,638 136,928 - Loss for theperiod - - (126,565)	(24,811) 136,928 (126,565)
Balance, January 31, 2023 3,750,006 $ 172,504 $(186,952)	$(14,448)

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

1319732 B.C. LTD. Amended Condensed Interim Statements of Cash flows (Unaudited) (Expressed in Canadian dollars)

		For the period
		from incorporation
	Six months ended	(August 13, 2021) to
	January 31, 2023	January31,2022
	$	$
CASH FLOWS USED IN OPERATING ACTIVITIES
Net loss for the period	(126,565)	(25,476)
Shares issued to settle debt (Note 6)	136,928	-
Net change in non-cash working capital items:
Accounts payable and accrued liabilities	(14,968)	17,204
Loans payable	1,787	-
Cash flows used in operating activities	(2,818)	(8,272)
CASH FLOWS FROM FINANCING ACTIVITIES
Common shares issued	-	35,576
Net Cash from financing activities	-	35,576
Change in cash during the period	(2,818)	27,304
Cash, beginning of period	7,379	-
Cash, end of period	4,561	27,304

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

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited) (Expressed in Canadian dollars)

1. NATURE OF OPERATIONS AND GOING CONCERN

1319732 BC Ltd. (the “ Company ” or “ 732 ”) was incorporated under the British Columbia Business Corporations Act on August 13, 2021. The head office is located at 1 Adelaide Street East, Suite 801, Toronto, Ontario, M5C 2V9 and records and registered office is located at 1000 – 595 Burrard Street, Vancouver, British Columbia, V7X 1S8.

On October 21, 2021, Rio Verde Industries Inc. (“ Rio Verde ”) received a final order (the " Final Order ") from the Supreme Court of British Columbia approving the previously announced statutory plan of arrangement with its wholly-owned subsidiaries, 1319472 B.C. Ltd., 1319651 B.C. Ltd., 1319732 B.C. Ltd., 1319735 B.C. Ltd., 1319738 B.C. Ltd., 1319741 B.C. Ltd., and 1319743 B.C. Ltd. (the " Plan of Arrangement "). Receipt of the Final Order follows Rio Verde's special meeting of shareholders held on Monday, October 4, 2021 (the " Meeting "), where the Plan of Arrangement was overwhelmingly approved by a total of 23,532,011 common shares in the capital of Rio Verde (" Rio Verde Shares ") having voted in favour representing 98.5% of the total number of Rio Verde Shares represented in person and by proxy at the Meeting.

The Plan of Arrangement closed on October 20, 2021.

Pursuant to the Plan of Arrangement, the shareholders of Rio Verde now hold common shares in the following former subsidiaries of Rio Verde: 1319472 B.C. Ltd., 1319651 B.C. Ltd., 1319732 B.C. Ltd., 1319735 B.C. Ltd., 1319738 B.C. Ltd., 1319741 B.C. Ltd., and 1319743 B.C. Ltd. (collectively referred to as the " Spincos ") Each of the Spincos is now an unlisted reporting issuer in the provinces of British Columbia and Alberta. Shareholders of Rio Verde continue to hold their interest in Rio Verde.

Pursuant to the terms of the Plan of Arrangement: i) Rio Verde altered its share capital to create the additional classes of common shares (the " New Common Shares ") and Reorganization Shares (as defined below); (ii) each of the Rio Verde Shares was exchanged for one New Common Share, one Class 1 Reorganization Share, one Class 2 Reorganization Share, one Class 3 Reorganization Share, one Class 4 Reorganization Share, one Class 5 Reorganization Share, one Class 6 Reorganization Share and one Class 7 Reorganization Share of Rio Verde (collectively referred to as the " Reorganization Shares "), and all of the Rio Verde Shares outstanding prior to the Plan of Arrangement were cancelled; iii) one class of the Reorganization Shares were transferred to each Spinco in exchange for common shares of each Spinco on a 1:1 basis and Rio Verde redeemed all Reorganization Shares through the transfer to each Spinco $5,000 of working capital; and iv) the Rio Verde altered its share capital so that only the New Common Shares remain, were redesignated as “common shares” and deemed to be represented by the same certificate as the previously issued and outstanding Rio Verde Shares.

The Company is investigating and evaluating business opportunities to either acquire or in which to participate.

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited) (Expressed in Canadian dollars)

1. NATURE OF OPERATIONS AND GOING CONCERN (continued)

On April 1, 2022 the Company and Canyon Gold & Gravel Inc. ("CGG") announced that the companies have entered into a binding letter agreement (the "Agreement") which sets forth, in general terms, the basic terms and conditions upon which 732 BC and CGG will combine their business operations resulting in a reverse takeover (the "RTO") of 732 BC by CGG and its shareholders.

On July 7, 2022, the Company announced that the letter agreement (the "Agreement") with Canyon Gold & Gravel Inc. (“CGG”) as previously announced on April 1, 2022 has been terminated and the proposed transaction will not proceed.

On January 21, 2022, the Company closed a non-brokered private placement raising aggregate gross proceeds of $30,576 through the issuance of 26 common shares in the capital of the Company (the “Common Shares”) at a price of $1,176 per share.

These condensed interim financial statements have been prepared in accordance with IFRS (as defined below) with the assumption that the Company will be able to realize its assets and discharge its liabilities in the normal course of business rather than a process of forced liquidation. These condensed interim financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence. At January 31, 2023, the Company had no sources of revenue and had an accumulated deficit of $186,952 (July 31, 2022 - $60,387). At January 31, 2023, the Company had cash of $4,561 (July 31, 2022 - $7,379) and working capital deficit of $14,448 (July 31, 2022 - $24,811). These conditions raise material uncertainties which may cast significant doubt on the Company’s ability to continue as a going concern.

Continuing business as a going concern is dependent upon the ability of the Company to obtain additional debt or equity financing, both of which are uncertain. These material uncertainties may cast significant doubt on the Company’s ability to continue as a going concern.

Should the Company be unable to realize its assets or discharge its liabilities in the normal course of business, the net realizable value of its assets may be materially less than the amounts recorded in the financial statements. These financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. Such adjustments could be material.

In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak, which has continued to spread, and any related adverse public health developments, has adversely affected workforces, economies, and financial markets globally, potentially leading to an economic downturn. It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or results of operations at this time.

1319732 B.C. LTD.

Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022

(Unaudited) (Expressed in Canadian dollars)

2. BASIS OF PRESENTATION

Statement of compliance

The Company applies International Financial Reporting Standards (" IFRS ") as issued by the International Accounting Standards Board (“ IASB ”) and interpretations issued by the International Financial Reporting Interpretations Committee (“ IFRIC ”). These unaudited condensed interim financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting.

Accordingly, they do not include all of the information required for full annual financial statements required by IFRS as issued by IASB and interpretations issued by IFRIC.

The policies applied in these unaudited condensed interim financial statements are based on IFRS issued and outstanding as of April 21, 2023, the date the Board of Directors approved the statements.

The condensed interim financial statements of the Company are presented in Canadian dollars, which is the functional currency of the Company.

3. SIGNIFICANT ACCOUNTING POLICIES

These condensed interim financial statements of the Company have been prepared on the historical cost basis, except for financial instruments classified as financial instruments at fair value through profit and loss, which are stated at their fair value. In addition, the financial statements have been prepared using the accrual basis of accounting, except for the statements of cash flows.

The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the year. Estimates and assumptions are continually evaluated and are based on management’s experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Actual results could differ from these estimates.

The areas which require management to make significant judgments, estimates and assumptions in determining carrying values include, but are not limited to:

Significant Judgments

Critical judgments exercised in applying accounting policies that have the most significant effect on the amounts recognized in the financial statements are as follows:

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited) (Expressed in Canadian dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (continued)

• a. Deferred income taxes

The Company recognizes the deferred tax benefit related to deferred income and resource tax assets to the extent recovery is probable. Assessing the recoverability of deferred tax assets requires management to make significant estimates of future taxable profit. In addition, future changes in tax laws could limit the ability of the Company to obtain tax deductions from deferred income and resource tax assets.

Significant Estimates

• a. Going concern

Management assessment of going concern and uncertainties of the Company’s ability to raise additional capital and/or obtain financing to meet its commitments.

Cash

Cash is comprised of cash on hand and demand deposits.

Loss per share

Basic earnings (loss) per share is computed by dividing net earnings (loss) available to common shareholders by the weighted average number of shares outstanding during the reported period. Diluted earnings (loss) per share is computed similar to basic earnings (loss) per share except that the weighted average shares outstanding are increased to include additional shares for the assumed exercise of stock options and warrants, if dilutive. The number of additional shares is calculated by assuming that outstanding stock options and warrants were exercised and that proceeds from such exercises were used to acquire common stock at the average market price during the reporting periods.

Basic loss per share is calculated using the weighted-average number of shares outstanding during the year.

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited) (Expressed in Canadian dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (continued)

Financial instruments

Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputs used to estimate the fair values. The three levels of the fair value hierarchy are:

Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2 Inputs other than quoted prices that are observable for the assets or liability either directly or indirectly; and Level 3 Inputs that are not based on observable market data.

The measurement of the Company’s financial instruments is disclosed in Note 8 to these financial statements. Any financial instrument that is valued using level 2 or 3 inputs will involve estimation uncertainty.

Financial assets

The Company classifies its financial assets in the following categories: at fair value through profit or loss (“FVTPL”), at fair value through other comprehensive income (“FVTOCI”) or at amortized cost. The determination of the classification of financial assets is made at initial recognition. Equity instruments that are held for trading (including all equity derivative instruments) are classified as FVTPL; for other equity instruments, on the day of acquisition the Company can make an irrevocable election (on an instrument-by-instrument basis) to designate them as at FVTOCI.

The Company’s accounting policy for each of the categories is as follows:

Financial assets at FVTPL : Financial assets carried at FVTPL are initially recorded at fair value and transaction costs are expensed in the statement of income (loss). Realized and unrealized gains and losses arising from changes in the fair value of the financial assets held at FVTPL are included in the statement of (loss) income in the period.

Financial assets at FVTOCI : Investments in equity instruments at FVTOCI are initially recognized at fair value plus transaction costs. Subsequently they are measured at fair value, with gains and losses arising from changes in fair value recognized in other comprehensive income (loss) in which they arise.

Financial assets at amortized cost: A financial asset is measured at amortized cost if the objective of the business model is to hold the financial asset for the collection of contractual cash flows, and the asset's contractual cash flows are comprised solely of payments of principal and interest. They are classified as current assets or non-current assets based on their maturity date and are initially recognized at fair value and subsequently carried at amortized cost less any impairment.

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited) (Expressed in Canadian dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (continued)

Impairment of financial assets at amortized cost: The Company assesses all information available, including on a forward-looking basis, the expected credit losses associated with its assets carried at amortized cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. To assess whether there is a significant increase in credit risk, the Company compares the risk of a default occurring on the asset as at the reporting date, with the risk of default as at the date of initial recognition, based on all information available, and reasonable and supportive forward-looking information.

The following table shows the classification of the Company’s financial instruments: Financial asset Classification Cash Amortized cost Accounts payable and accrued liabilities Amortized cost

Financial liabilities and equity

Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement. An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued are recorded at the proceeds received, net of direct issue costs.

Income taxes

Income tax expense comprises current and deferred tax. Income tax is recognized in profit or loss except to the extent that it relates to items recognized directly in equity. Current tax expense is the expected tax payable on taxable income for the year, using tax rates enacted or substantively enacted at period end, adjusted for amendments to tax payable with regards to previous years.

Deferred tax is recognized in respect of temporary differences, between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Temporary differences are not provided for the initial recognition of assets and liabilities that affect neither accounting nor taxable loss to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realization or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the statement of financial position date.

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

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited) (Expressed in Canadian dollars)

3. SIGNIFICANT ACCOUNTING POLICIES (continued)

IFRS pronouncements not yet implemented

Certain new IFRS standards and interpretations have been issued but are not shown as they are not expected to have a material impact on the Company’s financial statements.

4. RELATED PARTY TRANSACTIONS

Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Related parties may be individuals or corporate entities. A transaction is considered to be a related party transaction when there is a transfer of resources or obligations between related parties.

The Company has identified its directors and certain senior officers as its key management personnel and the compensation costs for key management personnel and companies related to them are recorded at their exchange amounts as agreed upon by transacting parties.

On October 20, 2021, Shimcity Inc. (“Shimcity”), a corporation controlled by the former director of the Company, and 2657456 Ontario Inc. (“265”), a corporation controlled by the former director of the Company (collectively, the “Acquirors”) acquired an aggregate of 677,880 Common Shares.

On January 21, 2022, pursuant to a private placement, both Shimcity and 265 acquired 881,244 Common Shares each.

On August 25, 2022, the Company issued 625,000 Common shares each at a price of $0.10 per share to settle debt owed to 2674049 Ontario Inc. (“267 Ontario”) of Toronto, Ontario, a Company controlled by a former director of the Company and 1000294101 Ontario Inc. (“101 Ontario”), of Toronto, Ontario, a company in which a former director is an officer.

Prior to the completion of the offering, each of Shimcity and 2657456 Ontario Inc. (“265 Ontario” and together, the “Transferors”), of Toronto, Ontario, transferred 610,090 Common Shares to 2578218 Ontario (“218 Ontario”) at an aggregate purchase price of $0.50, in a private transaction (the “Share Transfer”). In connection with the Share Transfer, the Transferors entered into separate options agreement (the “Agreements”) with 218 Ontario pursuant to which the Transferors may repurchase the Common Shares transferred at a price equal to the purchase price, at a later date and subject to certain conditions. Under the Agreements, 218 Ontario has also assigned voting rights applicable to the Common Shares to the Transferors.

5. LOANS PAYABLE

Loans payable are due on demand and carries no interest.

1319732 B.C. LTD.

Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022

(Unaudited)

(Expressed in Canadian dollars)

6. SHARE CAPITAL

(a) Authorized

Unlimited number of common and preferred shares without par value.

(b) Issued and outstanding

As at January 31, 2023, the Company had the following common shares issued and outstanding.

	Number of
	Shares	Amount($)
Shares issued – August 13, 2021	-	-
Shares issued – October 20, 20211	677,880	5,000
Shares issued – January 21, 20222	1,762,488	30,576
Shares issued for debt3	1,309,638	136,928
Balance, January 31, 2023	3,750,006	172,504

• (1) Pursuant to the terms of the Plan of Arrangement effective on October 20, 2021 each of the Rio Verde Shares was exchanged for one New Common Share and seven new classes of Reorganization Shares. The Reorganization Shares were then transferred by the shareholders of Rio Verde, including the Acquirors, to each of the Spincos in exchange for common shares of the Spincos on a 1:1 basis. In addition, each of the Spincos received $5,000 in working capital from Rio Verde.

• (2) On January 21, 2022, the Company closed a non-brokered private placement raising aggregate gross proceeds of $30,576 through the issuance of 1,762,488 common shares (post consolidation shares) in the capital of the Company at a price of $0.0173 per share.

On January 27, 2022 the Company completed a share consolidation (the "Consolidation") of its common shares by exchanging one (1) new post-Consolidation Share for every three million two hundred sixty-seven thousand nine hundred and seventy-three (3,267,973) pre-Consolidation Shares as authorized by a resolution passed by the board of directors of the Company effective January 27, 2022 in accordance to the Company's Articles of Incorporation.

• (3) On August 25, 2022, the shareholders of the Corporation by unanimous resolution approved the split of the issued and outstanding Common Shares on the basis of a ratio 67,788 post-split Common Share for every 1 pre-split Common Share held, such that the Corporation has immediately after the split 2,440,368 Common Shares issued and outstanding on a post-split basis (the “Stock Split”). The Company also announced the completion of a debt settlement of $136,928 by issuing an aggregate of 1,309,638 Common Shares.

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited) (Expressed in Canadian dollars)

7. BASIC AND DILUTED LOSS PER SHARE

The calculation of basic and diluted loss per share for the period ended January 31, 2023 was based on the loss attributable to common shareholders of $126,565 for the six months ended January 31, 2023.

8. MANAGEMENT OF CAPITAL

Capital is comprised of the Company’s shareholders’ equity (deficiency) and any debt that it may issue. The Company’s objectives when managing capital are to maintain financial strength and to protect its ability to meet its ongoing liabilities, to continue as a going concern, to maintain credit worthiness and to maximize returns for shareholders over the long term. Protecting the ability to pay current and future liabilities includes maintaining capital above minimum regulatory levels, current financial strength rating requirements and internally determined capital guidelines and calculated risk management levels.

The Company manages its capital structure to maximize its financial flexibility making adjustments to it in response to changes in economic conditions and the risk characteristics of the underlying assets and business opportunities. The Company does not presently utilize any quantitative measures to monitor its capital, but rather relies on the expertise of the Company’s management to sustain the future development of the business. Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. The Company considers its capital to be shareholders deficiency, comprising common shares and deficit which at January 31, 2023 totalled a deficiency of $186,952 (July 31, 2022 - $60,387). As at January 31, 2023, the Company is not subject to any externally imposed capital requirements.

9. FINANCIAL INSTRUMENTS

The Company is exposed in varying degrees to a variety of financial instrument related risks. The Board of Directors approves and monitors the risk management processes. The type of risk exposure and the way in which such exposure is managed is provided as follows:

Market Risk

Market risk is the risk that the fair value or future cash flows from a financial instrument will fluctuate because of changes in market prices or prevailing conditions. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk and are disclosed as follows:

i. Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company holds no financial instruments that are denominated in a currency other than Canadian dollars. As at January 31, 2023, the Company is not exposed to currency risk.

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited) (Expressed in Canadian dollars)

9. FINANCIAL INSTRUMENTS (continued)

ii. Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows will fluctuate as a result of changes in market risk. The Company’s sensitivity to interest rates relative to its cash balances is currently immaterial. The Company also has no long-term debt with variable interest rates, so it has no negative exposure to changes in the market interest rate.

iii. Price rate risk

The Company is exposed to price rate risk with respect to equity prices. Equity price risk is defined as the potential adverse impact on the Company's earnings due to movements in individual equity prices or general movements in the level of the stock market. Management closely monitors individual equity movements and the stock market to determine the appropriate course of action to be taken by the Company. Given the Company’s limited market exposure at this time it has assessed there to be a low level of price rate risk.

Credit Risk

Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. The Company’s credit risk is primarily attributable to its liquid financial assets including cash. The Company limits the exposure to credit risk by only investing its cash with highcredit quality financial institutions. Management believes that the credit risk related to its cash is negligible.

Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. At January 31, 2023, the Company has limited sources of revenue and has a cash balance of $4,561 (July 31, 2022 - $7,379) to settle current liabilities of $19,009 (July 31, 2022 - $32,190). As such, the Company has insufficient cash to fund corporate overhead costs and the repayment of the Company’s debt obligations for the next year.

Until such time as the Company’s investments increase in value or begin generating significant dividend income, the Company will remain dependent upon the financial support of its shareholders and debt holders or the sale of investments. If the Company is unable to finance itself through these means, it is possible that the Company will be unable to continue as a going concern.

Additionally, the Company likely has insufficient funds from which to finance any identified business acquisition and as such will require additional financing to accomplish the Company’s long-term strategic objectives. Future funding may be obtained by means of issuing share capital and/or debt financing. There can be no certainty of the Company’s ability to raise additional financing through these means. If the Company is unable to continue to finance itself through these means, it is possible that the Company will be unable to continue as a going concern. Consequently, the Company is exposed to liquidity risk as at January 31, 2023.

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited) (Expressed in Canadian dollars)

9. FINANCIAL INSTRUMENTS (continued)

Fair Value Risk

When participating in investment activities, the Company may incur losses if it is unable to resell the securities it has purchased or if it is forced to liquidate its holdings at less than their respective carrying values. All of the Company's investments are carried on a FVTPL basis and are recorded at their fair value. As such, changes in fair value affect earnings as they occur.

The fair value of cash at January 31, 2023 approximates their carrying values due to their short term to maturity.

10. RESTATEMENT OF PREVIOUSLY REPORTED FINANCIAL STATEMENTS

The Company is restating its statements of financial position as at January 31, 2023 and its statement of net loss and comprehensive loss, statement of cash flows and statement of changes in equity for the period ended January 31, 2023. The restatement reflects the shares for debt settlement completed by the Company during the first half of fiscal 2023.

	Statements of Financial Position As previously reported Adjustments As restated
	ASSETS Current Assets Cash $4,561 - $ 4,561
	TOTAL ASSETS $ 4,561 $ - $ 4,561
	LIABILITIES AND EQUITY Current Liabilities Accounts payable and accrued liabilities $ 34,150 (16,928) 17,222 Loanspayable 1,787 - 1,787
	TOTAL CURRENT LIABILITIES 35,937 (16,928) 19,009
	Share Capital and Deficit Share Capital 35,576 136,928 172,504 Accumulated deficit (66,952) (120,000) (186,952)
	(31,376) 16,928 (14,448) TOTAL LIABILITIES AND EQUITY $ 4,561 $ - $ 4,561
	Statement of Loss and Comprehensive Loss Three months ended January 31, 2023 As previously reported Adjustments As restated
	Professional fees $ 750 $ - $ 750 Corporate management fees - 120,000 120,000
	Loss before other items $750 $120,000 $ 120,750

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited)

(Expressed in Canadian dollars)

10. RESTATEMENT OF PREVIOUSLY REPORTED FINANCIAL STATEMENTS (continued)

Statement of Loss and Comprehensive Loss Six months ended January 31, 2023	As previously reported	Adjustments	As restated
Professional fees	$ 1,500	$ (218)	$ 1,282
Legal expenses	4,782	(4,782)	-
Filing expenses	283	-	283
Corporate management fees	-	125,000	125,000
Loss before other items	$6,565	$120,000	$ 126,565

Statement of cash flows Six months ended January 31, 2023	As previously reported	As previously reported	Adjustments	Adjustments	As restated	As restated
Cash provided by (used in):
Operating Activities
Net gain / (loss) for period	$ (6,565)		$ (120,000)		$ (126,565)
Shares issued to settle debt		-	136,928			136,928
Changes in non-cash working capital balances:				-
Accounts payable and accrued liabilities		1,960	(16,928)			(14,968)
Loanspayable		1,787		-		1,787
Cash Used in Operating Activities	(2,818)			-		(2,818)
Financing Activities		-		-		-
Share issuances,net of costs		-		-		-
Cash Provided by Financing Activities		-		-		-
Change in cash	(2,818)			-		(2,818)
Cash, Beginning		7,379		-		7,379
Cash, Ending	$	4,561	$	-	$	4,561
Statement of changes in equity	As previously		Adjustments
For the six months ended January 31, 2023		reported			As restated
Capital and Deficit
Share Capital	$	35,576	$ 136,928		$	172,504
Accumulated deficit		(66,952)	(120,000)			(186,952)
Total	$	(31,376)	$16,928		$	(14,448)

1319732 B.C. LTD. Notes to the Amended Condensed Interim Financial Statements

For the three and six months ended January 31, 2023 and for the period from incorporation (August 12, 2021) to January 31, 2022 (Unaudited) (Expressed in Canadian dollars)

11. SUBSEQUENT EVENT

On March 3, 2023, Sendero Resources Corp., a private company incorporated under the laws of the Province of British Columbia with mineral assets in the Peñas Negras region of Argentina, announced a proposed financing for aggregate gross proceeds of $4,000,000 and the entering into of a binding letter agreement dated March 2, 2023 (the “Agreement”) with 1319732 B.C. Ltd. Pursuant to the Agreement, Sendero and 131 will complete a three-cornered amalgamation (the “Transaction”), subject to the terms and conditions outlined below, with the ultimate result that the resulting successor of the Company (the “Resulting Issuer”) will continue on as a reporting issuer and 100% owner of the business of Sendero.

Concurrently with the completion of the Transaction, the Resulting Issuer will seek to list its common shares for trading on the TSX Venture Exchange (the “Exchange”).

Sendero, through its wholly owned subsidiary, Barton SAS, holds a 100% interest of the 120 km2 Peñas Negras Project (the “Property”), located in the Vicuna district of Argentina. The Property is surrounded by significant copper discoveries belonging to Filo Mining (Filo Del Sol Project), Lundin Mining (Josemaria Project), and NGEx Minerals (Los Helados Project). Sendero will look to take advantage of its experience and operational knowledge to advance high priority drilling targets.

Sendero will be conducting a brokered private placement (the “Brokered Financing”) led by Echelon Wealth Partners Inc. (“Echelon”) as lead agent and sole bookrunner, and including M Partners Inc. (together with Echelon, the “Agents”) for up to $3,000,000 in gross proceeds of subscription receipts (the “Subscription Receipts”). The Agents will be granted an option to increase the size of the Brokered Financing by up to 25% at the discretion of Echelon in its capacity as lead agent (the “Agents’ Option”).

Each Subscription Receipt will be sold at an issue price of $0.20 and will be automatically exchanged, for no additional consideration, into one unit (a “Unit”) of Sendero upon the satisfaction of certain escrow release conditions, including the satisfaction of all conditions precedent to the consummation of the Transaction. Each Unit is comprised of one Sendero common share and one-half of one Sendero common share purchase warrant (each whole warrant, a “Warrant”). Each Warrant will entitle the holder to purchase one additional common share at an exercise price of $0.30 at any time prior to the second anniversary of the date of issuance. The proceeds of the Brokered Financing will be held by a third-party trust company. In the event the escrow release conditions are not satisfied within 120 days of the closing of the Brokered Financing (as such date may be extended by Echelon in its capacity as lead agent) (the "Escrow Release Deadline"), then such proceeds will be returned to the holders of the Subscription Receipts.