Exhibit 4.2

Ares Strategic Mining Inc. Canadian Dollars

Management’s Responsibility

To the Shareholders of Ares Strategic Mining Inc.:

Management is responsible for the preparation and presentation of the accompanying Consolidated Financial Statements, including responsibility for significant accounting judgments and estimates in accordance with IFRS Accounting Standards. This responsibility includes selecting appropriate accounting principles and methods, and making decisions affecting the measurement of transactions in which objective judgment is required.

In discharging its responsibilities for the integrity and fairness of the Consolidated Financial Statements, management designs and maintains the necessary accounting systems and related internal controls to provide reasonable assurance that transactions are authorized, assets are safeguarded and financial records are properly maintained to provide reliable information for the preparation of the consolidated financial statements.

The Board of Directors and the Audit Committee are composed primarily of Directors who are neither management nor employees of the Company. The Board is responsible for overseeing management in the performance of its financial reporting responsibilities, and for approving the financial information included in the annual report. The Board fulfils these responsibilities by reviewing the financial information prepared by management and discussing relevant matters with management and the external auditors. The Audit Committee has the responsibility of meeting with management, and the external auditors to discuss the internal controls over the financial reporting process, auditing matters and financial reporting issues. The Audit Committee is also responsible for recommending the appointment of Ares Strategic Mining Inc.’s external auditors.

We draw attention to Note 1 in the Consolidated Financial Statements which indicates the existence of a material uncertainty that may cast significant doubt about the Company’s ability to continue as a going concern.

Manning Elliott LLP, an independent firm of Chartered Professional Accountants, is appointed by the shareholders to audit the Consolidated Financial Statements and report directly to them; their report follows. The external auditors have full and free access to meet periodically and separately with the Audit Committee, and management to discuss their audit findings.

17th floor, 1030 West Georgia St., Vancouver, BC, Canada V6E 2Y3 Tel: 604.714.3600     Fax: 604.714.3669     Web: manningelliott.com

INDEPENDENT AUDITORS’ REPORT

To the Shareholders and Directors of Ares Strategic Mining Inc.

Opinion

We have audited the consolidated financial statements of Ares Strategic Mining Inc. and its subsidiaries (together, the “Company”) which comprise:

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at September 30, 2025 and 2024, and its consolidated financial performance and its cash flows for the years ended September 30, 2025 and 2024 in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board.

Basis for Opinion

We conducted our audits in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the consolidated financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the Company in accordance with the ethical requirements that are relevant to our audits of the consolidated financial statements in Canada. We have fulfilled our other ethical responsibilities in accordance with these requirements.

Material Uncertainty Related to Going Concern

We draw attention to Note 1 of the accompanying consolidated financial statements, which describes matters and conditions that indicate the existence of a material uncertainty that may cast significant doubt about the Company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements for the year ended September 30, 2025. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material Uncertainty Related to Going Concern section, the key audit matters to be communicated in our auditors’ report are as follows:

Assessment of Impairment Indicators on Construction in Progress

We draw attention to notes 2(f), 2(h), 4(a) and 8 of the consolidated financial statements. The carrying amount of the construction in progress amounted to $25,721,163 as of September 30, 2025. The Company’s construction in progress is assessed for impairment at the end of each reporting period.

17th floor, 1030 West Georgia St., Vancouver, BC, Canada V6E 2Y3 Tel: 604.714.3600     Fax: 604.714.3669     Web: manningelliott.com

We identified the assessment of impairment indicators on construction in progress as a key audit matter due to the judgements made by management in their assessment of the presence of impairment indicators related to construction in progress, which in turn led to additional auditor judgment, subjectivity, and effort in performing procedures to evaluate audit evidence relating to the judgments made by management in this area that could give rise to the requirement to prepare an estimate of the recoverable amount of the construction in progress.

Our audit response to the key audit matter was as follows:

Other Information

Management is responsible for the other information. The other information comprises the Company’s Management Discussion and Analysis to be filed with the relevant Canadian securities commissions.

Our opinion on the consolidated 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 consolidated financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed on this other information, 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 Consolidated Financial Statements

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

In preparing the consolidated 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 to 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.

Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ 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 the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

17th floor, 1030 West Georgia St., Vancouver, BC, Canada V6E 2Y3 Tel: 604.714.3600     Fax: 604.714.3669     Web: manningelliott.com

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

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 consolidated financial statements of the current period and are, therefore, the key audit matters. We describe these matters in our auditors’ 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 the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditors’ report is Waseem Javed.

CHARTERED PROFESSIONAL ACCOUNTANTS

Vancouver, British Columbia

January 28, 2026

Ares Strategic Mining Inc. Canadian Dollars

Consolidated Statements of Financial Position

The Consolidated Financial Statements were approved by the Board of Directors on 28 January 2026 and were signed on its behalf by:

-- The accompanying notes form an integral part of the consolidated financial statements --

Ares Strategic Mining Inc. Canadian Dollars

Consolidated Statements of Loss and Comprehensive Loss

-- The accompanying notes form an integral part of the consolidated financial statements --

Ares Strategic Mining Inc. Canadian Dollars

Consolidated Statements of Changes in Equity

-- The accompanying notes form an integral part of the consolidated financial statements --

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Consolidated Statements of Cash Flows

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Consolidated Statements of Cash Flows (Cont.)

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements

Ares Strategic Mining Inc. (“Ares” or the “Company”), was incorporated pursuant to the Company Act (Ontario) by registration of its Memorandum and Articles on 20 November 2009. On 9 July 2010, the Company registered in British Columbia for extra provincial registration as the Company’s administrative office is located at 1001-409 Granville Street, Vancouver BC, V6C 1T2. The Company is classified as a Junior Natural Resource Mining Company and is listed on the Canadian Securities Exchange under the stock symbol “ARS”.

The Company was previously in the business of acquiring and exploring lithium properties in Nevada and Arizona. On 18 February 2020, the Company completed a three-cornered amalgamation transaction (the “Amalgamation”) with American Strategic Minerals Inc. (“ASM”). As a result, Ares is focusing on progressing its fluorspar projects towards exploitation, production, and supplying metspar and acidspar to the markets.

These consolidated financial statements (the “Financial Statements”) have been prepared on the basis of the accounting principles applicable to a going concern, which assumes the Company will be able to continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations. There are several adverse conditions that cast significant doubt upon the soundness of this assumption. The business of mining and exploration involves a high degree of risk and there can be no assurance that current exploration programs will result in profitable mining operations. The recoverability of exploration and evaluation expenditures and construction in progress is dependent upon several factors; these factors include the discovery of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete the development of these properties and construction in progress, and future profitable production or proceeds from the disposition of mineral properties or construction in progress once completed.

Consistent with other companies in the mineral exploration sector, the Company has incurred operating losses since inception, has limited sources of revenue, is unable to self-finance operations and has significant cash requirements to meet its overhead, maintain its mineral interests and fund the completion of its construction in progress. These factors indicate the existence of a material uncertainty that may cast significant doubt about the Company’s ability to continue as a going concern.

As discussed in Note 14, the Company was in breach of certain financial covenants as at September 30, 2025. The lender has not demanded repayment; however, this condition contributes to the material uncertainty that may cast significant doubt on the Company’s ability to continue as a going concern.

For the Company to continue to operate as a going concern, it must continue to obtain additional financing to maintain operations. Although the Company has been successful in the past at raising funds, there can be no assurance that this will continue in the future. Subsequent to year-end , the Company has raised additional equity financing and plans to obtain additional equity and debt financing to continue to explore and develop its mineral properties and complete its construction in progress. If the going concern assumptions were not appropriate for these Financial Statements, then adjustments would be necessary to the carrying value of assets and liabilities, the reported expenses and the statement of financial position classifications used, and such adjustments could be material.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

Statement of Compliance

These Financial Statements, including comparatives, have been prepared in accordance with IFRS Accounting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The Financial Statements have been prepared on a 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, these Financial Statements have been prepared using the accrual basis of accounting except for cash flow information.

The policies set out were consistently applied to all the years presented unless otherwise noted below. The preparation of the Financial Statements requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Company’s accounting policies.

The preparation of the Financial Statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, profit and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

These Financial Statements incorporate the accounts of Ares and the entities controlled by the Company, which consist of:

Control exists when the Company has the power, directly or indirectly, to govern the financial and operating policies of an entity to obtain benefits from its activities. The financial statements of subsidiaries are included in the Financial Statements from the date that control commences until the date that control ceases. All significant intercompany transactions and balances have been eliminated.

Non-controlling interest in the net assets of consolidated subsidiaries are identified separately from the Company's equity. Non-controlling interest consists of the non-controlling interest at the date of the original business combination plus the non-controlling interest's share of changes in equity since the date of acquisition.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

These Financial Statements are presented in Canadian dollars, which is the functional and presentation currency of the parent. Each entity determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency. The functional currency of the Company’s Canadian subsidiaries is the Canadian dollar. The functional currency of 101017 BC Inc. and ARES Strategic Mining Inc. (Utah) is the United States dollar.

Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the end of reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the initial transaction dates. Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.

Changes in the fair value of monetary securities denominated in foreign currency classified as fair value through profit or loss are analysed between translation differences and other changes in the carrying amount of the security. Translation differences are recognized in the consolidated statements of loss and comprehensive loss and other changes in carrying amount are recognized in equity.

Translation differences on non-monetary financial assets are included in equity.

The Company considers cash and cash equivalents to include amounts held in banks and highly liquid investments with original maturities at a point of purchase of three months or less.

Restricted cash represents cash as balances that are not available for general use by the Company and are typically held for specific purposes, such as for purchase and construction of fluorspar related capital assets.

Marketable securities consist of equity securities over which the Company does not have control or significant influence.

Property, plant, and equipment are depreciated using the straight-line method based on estimated useful lives. Land is not depreciated.

Where an item of property, plant, and equipment is comprised of major components with different useful lives, the components are accounted for as separate items of property, plant, and equipment.

Expenditures incurred to replace a component of an item of property, plant, and equipment that is accounted for separately, including major inspection and overhaul expenditures, are capitalized. Directly attributable expenses incurred for major capital projects and site preparation are capitalized until the asset is brought to a working condition for its intended use. These costs include dismantling and site restoration costs to the extent these are recognized as a provision.

The costs of day-to-day servicing are recognized in profit or loss as incurred. These costs are more commonly referred to as "maintenance and repairs."

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

Financing costs directly associated with the construction or acquisition of qualifying assets are capitalized at interest rates relating to loans specifically raised for that purpose, or at the average borrowing rate where the general pool of group borrowings is utilized. Capitalization of borrowing costs ceases when the asset is substantially complete.

The depreciation method, useful life and residual values are assessed annually.

Property, plant, and equipment are stated, in the consolidated statement of financial position, at cost less accumulated depreciation and accumulated impairment losses. Assets in the course of construction are carried at cost, less any recognized impairment loss. Depreciation of these assets commences when the assets are ready for their intended use. The cost of property, plant, and equipment includes directly attributed incremental costs incurred in their acquisition and installation.

Assets held under capital lease are depreciated over their expected useful lives on the same basis as owned assets, or where shorter, the term of the relevant lease. The gain or loss arising on the disposal or retirement of an item of equipment is determined as the difference between the sale proceeds and the carrying amount of the asset and is recognized in the consolidated statements of loss and comprehensive loss.

Subsequent costs

The cost of replacing part of an item within property, plant, and equipment is recognized when the cost is incurred if it is probable that the future economic benefits will flow to the Company and the cost of the item can be measured reliably. All other costs are recognized as an expense as incurred.

Impairment

The Company's tangible and intangible assets are reviewed for an indication of impairment at each consolidated statement of financial position date. If indication of impairment exists, the asset's recoverable amount is estimated.

An impairment loss is recognized when the carrying amount of an asset, or its cash-generating unit, exceeds its recoverable amount. A cash-generating unit is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets. Impairment losses are recognized in profit and loss for the year.

Impairment losses recognized in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to cash-generating units and then to reduce the carrying amount of the other assets in the unit on a pro-rata basis.

The recoverable amount is the greater of the asset's fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to which the asset belongs.

Reversal of impairment

An impairment loss is reversed if there is an indication that there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized. An impairment loss with respect to goodwill is never reversed.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

Depreciation is charged so as to write off the cost of the asset using the straight-line method over the estimated useful lives as follows:

The Company is currently in the exploration stage with all of its mineral interests. Exploration and evaluation costs include the costs of acquiring licenses, costs incurred to explore and evaluate properties, and the fair value, upon acquisition, of mineral properties acquired in a business combination.

Costs of acquisition and exploration of mineral properties are capitalized until either commercial production is established or a property is abandoned. Once commercial production has commenced, the net costs of the applicable property are charged to operations using the unit-of-production method based on estimated proven and probable recoverable reserves. The net costs related to abandoned properties are charged to income. Office and administration costs not specifically related to mineral projects are expensed in the year in which they occur.

The Company reviews the indicators of impairment of each property on an annual basis, at a minimum. This review generally is made by reference to the timing of exploration work, work programs proposed, and the exploration results achieved by the Company and others. When the indicators of impairment exist, the carrying value of a property is compared to its net recoverable amount. An impairment adjustment is made for the decline in fair value.

The amounts shown for the exploration and evaluation assets represent costs incurred to date and do not reflect present or future values. Acquisition costs represent shares or cash paid to acquire the rights to the resource property, while exploration expenditures represent amounts paid to explore and develop the resource properties. The recoverability of these capitalized costs is dependent upon the existence of economically recoverable reserves and the ability of the Company to obtain necessary financing to successfully complete their exploration program.

From time to time, the Company may acquire or dispose of mineral interests pursuant to the terms of option agreements. Since options are exercisable entirely at the discretion of the optionee, the amounts payable or receivable are not recorded. Option payments are recorded in the year that the payments are made or received. The Company does not accrue costs to maintain mineral interests in good standing.

Expenditure incurred during the construction period on the projects under implementation are treated as pre-operative expenses pending allocation to property, plant and equipment and are included under construction in progress, which is stated at the amount incurred up to the date of the consolidated statements of financial position.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

Borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset that takes a substantial period of time to get ready for its intended use are capitalized until such time that the assets are substantially ready for their intended use. Other borrowing costs are recognized as an expense in the period in which they are incurred.

Where funds are borrowed specifically to finance a project, the amount capitalized represents the actual borrowing costs incurred. Where the funds used to finance a project form part of general borrowings, the amount capitalized is calculated using a weighted average of interest rates applicable to relevant general borrowings of the Company during the period, to a maximum of actual borrowing costs incurred.

The Company recognizes liabilities for statutory, contractual, constructive or legal obligations associated with the retirement of property, plant and equipment when those obligations result from the acquisition, construction, development or normal operation of the assets. The net present value of future rehabilitation cost estimates is capitalized along with a corresponding increase in the rehabilitation provision in the period incurred. Discount rates using a pre-tax rate that reflect the time value of money are used to calculate the net present value. The rehabilitation asset is depreciated on the same basis as mining assets.

The Company's estimates of reclamation costs could change because of changes in regulatory requirements and assumptions regarding the amount and timing of the future expenditures. These changes are recorded directly to mining assets with a corresponding entry to the rehabilitation provision. The Company's estimates are reviewed annually for changes in regulatory requirements, effects of inflation and changes in estimates.

Changes in the net present value, excluding changes in the Company's estimates of reclamation costs, are charged to profit and loss for the year.

The costs of rehabilitation projects that were included in the rehabilitation provision are recorded against the provision as incurred. The cost of ongoing current programs to prevent and control pollution is charged against profit and loss as incurred.

Provisions are recorded when a present legal or constructive obligation exists as a result of past events where it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made.

The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the consolidated statement of financial position date, considering the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable is recognized as an asset if it is virtually certain that reimbursement will be received, and the amount receivable can be measured reliably.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

Income tax expense comprises current and deferred tax. Income tax expense is recognized in the consolidated statement of loss and comprehensive loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years.

Deferred tax is recognized using the liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized on the initial recognition of assets or liabilities in a transaction that is not a business combination. In addition, deferred tax is not recognized for taxable temporary differences arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis, or their tax assets and liabilities will be realized simultaneously.

A deferred tax asset is recognized to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

All financial instruments are measured at initial recognition at fair value plus any transaction costs that are directly attributable to the acquisition of the financial instruments except for transaction costs related to financial instruments classified as at fair value through profit or loss (FVPL) which are expensed as incurred.

The initial classification of a financial asset depends upon the Company’s business model for managing its financial assets and the contractual terms of the cash flows. There are three categories into which the Company can classify its financial assets:

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

A financial asset is derecognized when the Company no longer has the rights to the contractual cash flows due to expiration of that right or the transfer of the risks and rewards of ownership to another party. The Company recognizes a loss allowance for expected credit losses on its financial assets using the simplified approach which permits the use of the lifetime expected loss provision for all amounts receivables. At each reporting date the Company assesses impairment of amounts receivable on a collective basis as its amounts receivable possess shared credit risk characteristics and have been grouped based on days past due. The loss allowance will be based upon the Company’s historical credit loss experience over the expected life of trade receivables and contract assets, adjusted for forward looking estimates. Loss allowances for financial assets measured at amortized cost are deducted from the gross carrying amount of the assets. The Company’s financial assets consist of cash and cash equivalents, restricted cash, and share proceeds receivable which have been classified at FVPL.

A financial liability is initially classified as measured at amortized cost or FVPL. A financial liability is classified as measured at FVPL if it is held for trading, a derivative, contingent consideration of an acquirer in a business combination, or has been designated as FVPL on initial recognition. Financial liabilities at FVPL are measured at fair value with changes in fair value, along with any interest expense, recognized in profit or loss. All other financial liabilities are initially measured at fair value less directly attributable transaction costs and are subsequently measured at amortized cost using the effective interest method. The Company’s financial liabilities consist of accounts payable, short-term loans, convertible debentures, and long-term loans, which have been classified as financial liabilities at amortized cost and are measured at amortized cost using the effective interest method.

A financial liability is derecognized when the obligation is discharged, cancelled or expired.

Share capital issued for non-monetary consideration is recorded at an amount based on the quoted market value of the Company’s shares at the time of issuance.

The Company engages in equity financing transactions to obtain the funds necessary to continue operations and explore and evaluate mineral properties. These equity financing transactions may involve issuance of common shares or units. A unit comprises a certain number of common shares and a certain number of share purchase warrants ("Warrants"). Depending on the terms and conditions of each equity financing agreement ("Agreement"), the Warrants are exercisable into additional common shares prior to expiry at a price stipulated by the Agreement. Warrants that are part of units are measured at fair value on the date of issue using the Black-Scholes option pricing model and included in share capital with the common shares that were concurrently issued, based on their relative fair values. Broker compensation options are classified as issuance costs and a deduction from equity and measured at fair value on the date of issue using the Black-Scholes option pricing model.

After issuance the terms of Warrants may be modified throughout the Warrant life. At the time of the modification the Warrant is valued under the new terms immediately preceding and immediately after the modification using the Black-Scholes pricing model. The incremental value in the Warrants issued as compensation for services is added to warrant equity and a warrant modification expense is recorded to the consolidated statement of loss and comprehensive loss.

The Company grants stock options to buy common shares of the Company to directors, officers, employees and service providers. The board of directors grants such options for periods of up to five years, with vesting periods determined at its sole discretion and at prices equal to or greater than the closing market price on the day preceding the date the options were granted.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

The fair value of the options is measured at grant date, using the Black-Scholes option pricing model, and is recognized during the year that the employees earn the options. The fair value is recognized as an expense with a corresponding increase in equity. The amount recognized as expense is adjusted to reflect the number of share options expected to vest. Forfeitures of stock options are accounted for as incurred.

Basic loss per share is computed by dividing the net loss available to common shareholders by the weighted average number of shares outstanding during the reporting year. Diluted earnings per share is computed like basic earnings 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 the proceeds from such exercises were used to acquire common stock at the average market price during the reporting periods.

The liability, equity and other (when applicable) components of convertible debentures are presented separately on the consolidated statements of financial position, starting from initial recognition. The Corporation determines the carrying amount of the financial liability by discounting the stream of future payments at the prevailing market rate for a similar liability of comparable credit status and substantially providing the same cash flows. Subsequently, the liability component is then increased by accretion of the discounted amounts to reach the nominal value of the convertible debenture at maturity, which is recorded in the consolidated statements of loss and comprehensive loss as accretion expense.

The carrying amount of other components (when applicable), such as warrants, is obtained by deducting the nominal value of the debentures and the present value of future capital payments at the prevailing market rate for a convertible debenture without warrants. The carrying amount of the equity component is calculated by deducting the carrying amount of the financial liability and the carrying amounts of any other components (when applicable) from the amount of the convertible debenture and is presented in Equity as an equity component of convertible debenture. The equity component is not re-measured subsequent to initial recognition, except on conversion or expiry.

The transaction costs are distributed between liability, equity and other components (when applicable) on a pro-rata basis, according to their carrying amounts.

Comprehensive income (loss) is the change in the Company's net assets that results from transactions, events and circumstances from sources other than the Company's shareholders and includes items that would not normally be included in net profit/loss such as unrealized gains or losses on available-for-sale investments, gains or losses on certain derivative instruments and foreign currency gains or losses related to self-sustaining operations if the functional currency is not the Canadian dollar. The Company's comprehensive loss is presented in the consolidated statements of loss and comprehensive loss and the consolidated statements of changes in equity.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

The following amendments to standards and interpretations became effective for the annual periods beginning on or after 1 January 2024. The application of these amendments and interpretations had no significant impact on the Company’s consolidated financial position or results of operations. The IASB and the IFRIC have issued the following new and revised standards and interpretations that are not yet effective for the relevant reporting periods and the Company has not early adopted these standards, amendments and interpretations. However, the Company is currently assessing what impact the application of these standards or amendments will have on the consolidated financial statements of the Company. The Company intends to adopt these standards, if applicable, when the standards become effective:

IFRS 18 is effective for annual reporting periods beginning on or after 1 January 2027, including for interim financial statements. Earlier application is permitted. The new standard is to be applied retrospectively, and, in the year of adoption, a reconciliation is required between how the statement of profit or loss was presented in the comparative period under IAS 1 and how it is presented in the current year under IFRS 18.

In the application of the Company’s accounting policies, management is required to make judgments, estimates and assumptions about the carrying amount and classification of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revisions affect only that period, or in the period of the revision and future periods, if the revision affects both current and future periods.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

The following are the critical judgments and areas involving estimates, that management have made in the process of applying the Company’s accounting policies and that have the most significant effect on the amount recognized in the Financial Statements.

Income taxes

Deferred tax assets are recognized for all deductible temporary differences, carry-forward of unused tax assets and unused tax losses, to the extent that probable that future taxable profit will be available against which the deductible temporary differences and carry-forward of unused tax assets and unused tax losses can be utilized. In addition, the valuation of tax credits receivable requires management to make judgements on the amount and timing of recovery.

Going concern evaluation

As discussed on Note 1, these Financial Statements have been prepared under the assumptions applicable to a going concern. If the going concern assumption were not appropriate for these Financial Statements, then adjustments would be necessary to the carrying value of assets and liabilities, the reported expenses and the consolidated statement of financial position classifications used and such adjustments could be material.

The Company reviews the going concern assessment at the end of each reporting period. There were no material changes to the assessment as at 30 September 2025.

Exploration evaluation assets

The Company makes certain estimates and assumptions regarding the recoverability of the carrying values of exploration and evaluation assets. The amounts shown for exploration and evaluation assets do not necessarily represent present or future values. The recoverability of the assets’ carrying values is dependent upon the determination of economically recoverable reserves, the ability of the Company to obtain the necessary financing and permits to complete development and future profitable production or proceeds from the disposition thereof.

The Company has taken steps to verify title to exploration and evaluation assets in which it has or is in the process of earning an interest, including review of condition of title reports, vesting deeds, mining claim location notices and filings, and property tax and other public records and is not presently aware of any title defects. The procedures the Company has undertaken and may undertake in the future to verify title provide no assurance that the underlying properties are not subject to prior agreements or transfers of which the Company is unaware.

Long-lived assets

The Company makes certain judgements in its assessment of whether indicators of impairment exist with respect to its long-lived assets. The carrying amounts of the Company’s long-lived assets are reviewed at each reporting date for indicators of impairment. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the amount of the impairment, if any. The recoverable amount of an asset is evaluated at the cash-generating unit level, which is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or group of assets. The recoverable amount of a CGU is the greater of its fair value less costs to sell and its value in use.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

Useful lives of property, plant and equipment

Useful lives are estimated by management based on the expected period over which the assets are anticipated to be available for use, taking into consideration factors such as expected usage, physical wear and tear, technical or commercial obsolescence, and legal or other limits on the use of the assets. The useful lives and residual values of property, plant and equipment are reviewed at least annually and are adjusted prospectively if expectations differ from previous estimates. Changes in the estimated useful lives of assets could result in changes to depreciation expense in current and future periods.

Financial instruments of the Company carried on the consolidated statement of financial position are carried at amortized cost. There are no significant differences between the carrying value of financial instruments and their estimated fair values as at 30 September 2025. There have been no changes in levels during the period.

The Company classifies the fair value of these transactions according to the following hierarchy:

The Company’s financial instruments include cash and cash equivalents, accounts payable, short-term loans and long-term loans. As at 30 September 2025, the carrying value of cash and cash equivalents is at fair value. Accounts payable and short-term loans approximate their fair value due to their short-term nature.

Market risk is the risk that changes in market prices will affect the Company’s earnings or the value of its financial instruments. Market risk is comprised of commodity price risk and interest rate risk. The objective of market risk management is to manage and control exposures within acceptable limits, while maximizing returns. The Company is not exposed to significant market risk.

Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. The Company’s primary exposure to credit risk is on its bank accounts. The Company’s bank accounts are held with major banks in Canada, accordingly the Company is not exposed to significant credit risk.

Interest rate risk is the risk of losses that arise as a result of changes in contracted interest rates. The Company is not exposed to significant interest rate risk.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

Currency risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company is exposed to foreign currency risk on its restricted cash and USDA and PAB loans payable balances that are denominated in other than the functional currencies. As at 30 September 2025, the Company held currency totalling the following:

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they come due. The Company controls liquidity risk by ensuring that it has sufficient cash resources to pay for its financial obligations. As at 30 September 2025, the Company had a cash balance of $6,580,793 to settle current liabilities of $11,656,605 that are due within one year. The Company’s outstanding liabilities, their current values and the principal amounts along with the due dates are as stated in the table below:

Amounts receivable consists of:

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

The following table summarizes the details of share proceeds receivable associated with Sorbie Bornholm LP (“Sorbie”) equity swap agreements, measured through profit and loss:

The following table provides a breakdown of the share proceeds receivable between current and non-current assets based on the timing of the expected cash flows:

On 2 April 2025, the Company entered into a subscription agreement with Sorbie whereby Sorbie agreed to purchase 7,229,730 Units at a price of C$0.1998 per Unit for gross proceeds of $1,000,0000 over 24 months. Each Unit consists of one common share in the capital of the Company (“Common Share”) and one common share purchase warrant (“Warrant”), Note 17.

Sorbie and the Company entered into an equity swap agreement (“Sharing Agreement”) at C$0.1998 (the “Benchmark Price”). The Sharing Agreement shall provide the Company’s economic interest will be realized in 24 monthly settlement tranches as measured against the Benchmark Price. If, at the time of settlement, the Settlement Price (determined monthly based on a volume weighted average price for 20 trading days prior to settlement date) (“Settlement Price”) exceeds the Benchmark Price, the Company shall receive more than 100% of the monthly settlement due, on a pro rata basis. There is no upper limit placed on the additional proceeds receivable by the Company as part of the monthly settlements. If, at the time of settlement, the Settlement Price is below the Benchmark Price, the Company will receive less than the 100% of the monthly settlement due, on a pro rata basis.

The share proceeds receivable relating to the cash receivable of $1,000,000 do not meet the classification of a financial asset measured at amortized cost or at fair value through other comprehensive income as the Company does not have a business model whose objective is to hold financial assets in order to collect contractual cash flows, and the financial asset does not give rise to cash flows that are solely payments of principal and interest. Therefore, the cash receivable is classified as a financial asset measured at fair value through profit or loss.

In accordance with IFRS 9, Financial Instruments, 7,229,730 units were valued based on the fair value of the share proceeds receivable. The Company assessed the fair value of the share proceeds receivable under IFRS 9 and determined to be $842,006 on the date of issuance. The corresponding fair value of the equity instruments of $842,006 was allocated between the Common Shares and Warrants based on their relative fair values in accordance with IAS 32, Financial Instruments: Presentation, and the Company’s accounting policy.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

Subsequently, the financial asset was revalued at 30 September 2025 with the difference between the initial valuation and the value recognized in profit or loss as an unrealized gain (loss) on financial asset. On 30 September 2025, the fair value of the share proceeds receivable was calculated based on the net present value of each future expected cash flows relating to the receivable, adjusted for the observable Settlement Price on the date of measurement. As at 30 September 2025, based on the fair value calculations, the fair value of the share proceeds receivable was determined to be $973,127. This resulted in an increase to the carrying value of the share proceeds receivable of $326,477 which was recognized in the consolidated statement of loss and comprehensive loss as an unrealized gain on share proceeds receivable.

During the year ended 30 September 2024:

As at 30 September 2024, the Company entered into a subscription agreement with Sorbie whereby Sorbie agreed to purchase 8,333,333 Units at a price of C$0.1800 per Unit for gross proceeds of $1,500,000 over 24 months. Each Unit consists of one Common Share in the capital of the Company and one Warrant, Note 17.

Sorbie and the Company entered into a sharing agreement during Fiscal 2024 at C$0.2610 benchmark price, similar to the Fiscal 2025 Sharing Agreement described above.

The share proceeds receivable relating to the cash receivable of $1,500,000 did not meet the classification of a financial asset measured at amortized cost or at fair value through other comprehensive income as the Company does not have a business model whose objective is to hold financial assets in order to collect contractual cash flows, and the financial asset does not give rise to cash flows that are solely payments of principal and interest. Therefore, the cash receivable is classified as a financial asset measured at fair value through profit or loss.

In accordance with IFRS 9, 8,333,333 units were valued based on the fair value of the share proceeds receivable. The Company assessed the fair value of the share proceeds receivable under IFRS 9 and determined to be $830,086 on the date of issuance. The corresponding fair value of the equity instruments of $830,086 was allocated between the Common Shares and Warrants based on their relative fair values in accordance with IAS 32 and the Company’s accounting policy.

Subsequently, the financial asset was revalued at 30 September 2024 and 30 September 2025 with the difference between the initial valuation and the value recognized in profit or loss as an unrealized gain (loss) on financial asset. On 30 September 2024 and 30 September 2025, the fair value of the share proceeds receivable was calculated based on the net present value of each future expected cash flows relating to the receivable, adjusted for the observable Settlement Price on the date of measurement. As at 30 September 2025, based on the fair value calculations, the fair value of the share proceeds receivable was determined to be $735,311 (30 September 2024 - $846,547). This resulted in an increase to the carrying value of the share proceeds receivable of $341,568 (30 September 2024 - $16,461), which was recognized in the consolidated statement of loss and comprehensive loss as an unrealized gain on share proceeds receivable.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

During the year ended 30 September 2021, the Company entered into an agreement to acquire a fluorspar lump manufacturing facility (the “Facility”) pursuant to the terms and conditions of a Profit-Sharing Agreement dated 9 February 2021, as amended (the “Profit Sharing Agreement”) between the Company and the Mujim Group, a non-arm’s length private Shanghai company (“Mujim”). Pursuant to the terms of the Profit-Sharing Agreement, the Company had agreed to acquire the Facility by issuing an aggregate of 5,300,000 common shares in the capital of the Company (each, a “Share”), the fair value of which was determined based on the date when they were issued, i.e. $0.67, and the consideration was recorded as a capital advance to Mujim as at 30 September 2021.

The Company has agreed that, upon completion of the Facility, it would incur costs pertaining to the installation of the Facility, including compensating contractors from Mujim to assist with installation and to begin operating the Facility. Furthermore, once the Facility is operational within parameters and specifications defined in the Profit-Sharing Agreement, the company will pay Mujim, US$20 per ton for ongoing technical support, and has also agreed to pay Mujim, US$10 per ton as agency fee for any sales in Asia.

The final purchase price may vary depending on certain target production output metrics defined in the Profit-Sharing agreement.

During the year ended 30 September 2022, the Company received significant components (including the structure) of the Facility and incurred an additional $572,139 to acquire these additional components and structure for the Facility and received their delivery.

During the year ended 30 September 2023, the Company completed the acquisition of industrial land (Note 10) for installation of the Facility and a flotation plant and incurred further costs towards its completion such as design work and other prerequisites.

During the year ended 30 September 2024, the Company purchased a flotation plant from a non-arm’s length company, which is an entity controlled by a director of the Company. As a result, US$6,007,000 ($8,109,450) has been paid and recorded as a deposit at 30 September 2024.

As at 30 September 2025, the construction of the Facility is in progress and significantly all components of the flotation plant were received. As at 30 September 2025, the Company has incurred $25,721,163 (2024 - $9,762,608) in construction costs on the Facility which included $2,747,544 (2024 - $1,214,437) of capitalized borrowing costs. The Company is expected to incur additional costs to complete the installation of the Facility and the flotation plant, and begin operations.

Deposits consist of:

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

As at 30 September 2025, the balance in deposits of $6,309 (2024 - $2,912) increased with the renewal of short term lease and represents a deposit for office lease; reclamation surety and bond in the amount of $103,489 (2024 - $276,070) paid to the State of Utah for a five-year escalation at Lost Sheep and Bell Hill.

Property and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.

Depreciation is charged to recognize the cost of the asset on the consolidated statements of loss and comprehensive loss using the straight-line method over the estimated useful life of the asset.

During the year ended 30 September 2023, the Company acquired an industrial land parcel located in Millard County, State of Utah in the United States for the purpose of setting up its fluorspar plant, which was pledged as collateral on the USDA loan.

In addition to the land parcel acquired during the year, land comprises five Canadian properties located in Ontario, Canada (Note 11(f)). The Company earns revenues from sale of quarry rock located on these properties. These revenues are offset against maintenance payments made on the property and are included within the resource property expense on the consolidated statement of loss and comprehensive loss.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

The following table summarizes exploration and evaluation assets:

The Company holds a 100% interest in and rights to certain U.S. federal mining claims located at the north-east end of the Spor Mountain Mining District, in section 21, T.12S. 12W, and T.13S. 12W, SLBM of Juab County, western Utah, USA (the “Spor Mountain”). The Spor Mountain property consists of several mineral claim blocks including the Lost Sheep Fluoride Mine, and other unpatented claims. The Company acquired its initial interest through the Amalgamation on 18 February 2020. During the year ended 30 September 2021, the Company acquired additional claims in the region through staking.

As part of the amalgamation with ASM, the Company assumed an underlying property purchase agreement (the “Purchase Agreement”) for certain unpatented claims comprising the Spor Mountain property, pursuant to which the Company would be required to make a payment of US$1,000,000 within 18 months from the commencement of production. During the year ended 30 September 2021, USD $1,000,000 was transferred to the underlying vendor, pursuant to which, the Company is deemed to have fulfilled its obligations under the Purchase Agreement, and the title to the unpatented claims was transferred to the Company.

The Company holds a 100% interest in five properties located in Ontario, Canada.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

The following is a summary of the Company’s short-term loans as at 30 September 2025 and 30 September 2024:

As at 30 September 2025 , the Company obtained a net $696,413 (30 September 2024 - $233,400) loan from the CEO as well as received $112,203 (30 September 2024 $108,810) in loans from companies related to directors of the Company subject to 10% per annum and maturing on 30 August 2025, which have been settled after the year end date. There are no defined terms or due dates of repayment on the loans from the CEO and a non-related party obtained are unsecured. Canada Emergency Business Account loan of $60,000 was refinanced with the financial institution in order to repay the full amount in January 2024 and the Company qualified for $20,000 loan forgiveness which was recognized as other income during the year ended 30 September 2024. The refinanced balance of $40,000 is subsect to prime rate plus 2.14% per annum over 5-year term commencing on 18 January 2024.

On 2 December 2022, the Company closed a non-brokered private placement offering of secured convertible debentures totalling $1,252,700. The Company incurred a financing fee equal to 45% of the principal amount amounting to $563,715 and paid a finders’ fee totalling $52,720 for net proceeds of $636,265. The principal amount of convertible debentures will be convertible at holder’s option into full-paid common shares in the capital of the Company at any time prior to maturity in two years, at an exercise price of $0.26 per common share. Interest on the debentures shall be paid semi-annually at an annual interest rate of 12% per annum.

In connection with the convertible debentures, the Company also issued 202,771 finders’ warrants, with each warrant exercisable into one common share of the Company for a period of two years at a price of $0.26 per common share. The fair value of the warrants was calculated to be $20,000 using the Black-Scholes option pricing model.

During the year ended 30 September 2025, certain holders converted their principal convertible debt totalling $1,070,900 and associated interest of $319,227 into common shares of the Company.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

The following table summarizes the accounting for the convertible debentures and the amounts recognized during the year.

On 30 June 2023, the Company’s subsidiary, Ares Utah, signed a promissory note agreement with Community Bank & Trust (“CB&T”) – West Georgia and received a total loan of US$4,420,000 at prime rate stated in money rates section of Wall Street journal plus 2.50%., in lieu of which it pledged its land that was purchased in conjunction with the proceeds and situated in Utah (Note 10). The loan matures in 15 years and is guaranteed by the US Department of Agriculture (“USDA”). The interest is due and payable on the 1^st of each month starting 1 May 2023 for the initial 12 months after which the Company is required to repay the monthly instalment consisting of the principal and interest (as per repayment schedule) on each payment date. For the purpose of securing payments and obligations, the Company granted the power of sale and right of the parcel of the land purchased with the proceeds as well as all the proceeds and awards or payments from the land purchased.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

The Company has acted as a guarantor in securing the USDA loan payable, and the Company and its subsidiary, Ares Utah, have provided as collateral, interest in all of the Company’s rights, title and interest in and to all property and fixtures (current and future) of the Company and its subsidiaries. In connection with the first USDA loan payable of US$4,420,000, Ares Utah is subject to the following financial covenants:

During the year ended 30 September 2025, the Company received commercial loan of US$1,200,000 from CB&T at prime rate stated in money rates section of Wall Street journal plus 2.50%., the loan maturing on 16 September 2028 is due and payable on the 16^th of each month starting from October 2025 and consisting of the principal and interest (as per repayment schedule) on each payment date. The loan was used primarily to pay for interest and principal of USDA loan and as at 30 September 2025, the remaining balance of cash was US$372,244.

As at 30 September 2025 and 30 September 2024, the Company did not meet the above covenants and therefore, the first USDA loan of US$4,420,000 is in default and has been classified as current liability.

On 15 December 2023, the Company’s subsidiary, Ares Utah closed on the State of Utah’s Private Activity Bond (“PAB”) program from Millard County, Utah (“Millard County”) pursuant to a US$10,000,000 tax-exempt Manufacturing Facility Revenue Bond (the “Series 2023A Bond”), and a US$500,000 taxable Manufacturing Facility Revenue Bond (the “Series 2023B Bond”). The repayment of interest on both the bonds begins 15 December 2024 whereas the principal sum of the Series 2023A Bonds begins annually from 15 December 2025 to 15 December 2034 while the Series 2023B bonds are due to be paid all at once on 15 December 2025. As part of the closing, the Company incurred transaction costs in the amount of US$1,666,940 which were allocated to the issuance cost of loan payable and deducted from the principal value.

In addition, the Company entered into a Guaranty Agreement and Guaranty of Completion agreement with the Trustee, pursuant to which the Company agreed to guaranty certain obligations of Ares Utah, including the repayment of the principal, interest and other amounts owed under the Bonds. The proceeds from the Bonds will be used by Ares Utah to acquire, construct, and develop a processing facility (the “Project”) on the Company’s Lost Sheet Fluorspar Project located in Delta, Millard County, Utah.

During the year ended 30 September 2025, interest expense capitalized within construction in progress was US$1,060,000, the amortization of debt costs being recognized as accretion expense over the loan period totalling US$108,701 (30 September 2024 – US$418,774) which are recorded within interest and accretion expense on the consolidated statement of loss and comprehensive loss.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

The Company also issued 6,780,500 common shares in conjunction with those bonds.

The Company has acted as a guarantor in securing the PAB loan payable, and the Company and its subsidiary, Ares Utah, have provided as collateral, interest in 5.5 out of 48 acres of Ares Utah’s rights, title and interest in property and fixtures (current and future) of the Company and its subsidiaries situated on the site funded by the PAB, the Project. In connection with the PAB loan payable, Ares Utah is subject to the following financial covenants:

The repayment commitment of 2023A Bonds has been described in the table below:

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

On 30 May 2025, the Company’s subsidiary, Ares Utah, signed a promissory note agreement with the State of Utah through the Permanent Community Impact Fund Board and received a total loan of US$11,000,000 at a simple interest rate of 4.50%. The loan matures on 1 May 2031 (“Maturity Date”) for payment in full with accrued interest. Ares Utah may, but is not obligated to make interim payments, of any amount, without penalty, and a final payment will be paid on the Maturity Date.

This loan is secured by and is entitled to the benefits and security contemplated by a Trust Deed Security Agreement and Fixture Filing (“Trust Deed”), covering real property and related improvements, and certain equipment, machinery and fixtures, situated in Millard County, Utah.

During the year ended 30 September 2025, interest expense capitalized within construction in progress was US$nil, the amortization of debt costs being recognized as accretion expense over the loan period totalling US$183,045 (30 September 2024 – US$nil) which are recorded within interest and accretion expense on the consolidated statement of loss and comprehensive loss.

Unlimited common shares without par value.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

During the year ended 30 September 2025:

During the year ended 30 September 2025:

Each Warrant entitles the holder to acquire one additional Common Share at an exercise price of $0.26 per share. The Warrants are subject to an acceleration provision whereby, if the ten-day volume-weighted average trading price of the Company’s common shares on the Canadian Securities Exchange (or such other exchange on which the shares may be listed at the time) equals or exceeds C$0.40 at the close of any trading day, the Company may, at its option, accelerate the expiry date of the Warrants by issuing a press release. In such circumstances, the Warrants will expire on the 30th day following the date of the acceleration press release, and any Warrants remaining unexercised at that time will expire without compensation. The Warrants also include a restriction prohibiting exercise where such exercise would result in the holder owning more than 9.99% of the Company’s outstanding common shares.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

As consideration for entering into the Sharing Agreement with Sorbie, the Company agreed to pay a value payment of $70,000, payable either in cash or in units at a placement price of $0.1480 per unit. The Company elected to settle this obligation through the issuance of 472,973 units to Sorbie, with each unit consisting of one Common Share and one Warrant.

In conjunction with the Sorbie financing, the Company also entered into a finder’s agreement with a third party. Under the terms of this agreement, the Company agreed to pay a cash finder’s fee of $60,000, representing 6% of the total funds raised, together with finder’s warrants equal to the number of common shares that could be purchased with the $60,000 fee based on the 20-day volume-weighted average trading price preceding payment. Based on this calculation, a total of 254,433 finder’s warrants were issuable.

Upon initial recognition, the Company recorded the issuance of the 7,229,730 units in exchange for cash receivable. Using the Black-Scholes option pricing model, the fair value of the 7,229,730 Warrants was determined to be $842,006. The fair value of the 7,229,730 Common Shares was determined to be $1,373,649, based on the closing market price of $0.19 per share on the date of issuance. Based on the relative fair values, $322,134 was allocated to the Warrants and $519,872 was allocated to the Common Shares.

The 472,973 units issued to Sorbie in settlement of the $70,000 value payment were accounted for as consideration for services rendered and, accordingly, the Warrants included in these units were accounted for in accordance with IFRS 2, Share-based Payment. The fair value of the Warrants was determined using the Black-Scholes option pricing model. The 472,973 Warrants were valued at $55,684, and the fair value of the 472,973 Common Shares was determined to be $89,865 based on the closing trading price of $0.19 per share on the date of issuance. Based on the relative fair values, the $70,000 value payment was allocated as $43,219 to Common Shares and $26,781 to Warrants.

The Company is also obligated to pay the finder’s fee of $60,000 in cash and issue 254,433 finder’s warrants. As at September 30, 2025, the Company had issued a total of 875,000 agent warrants in connection with both the 2025 and 2024 tranches of the Sorbie transactions. These agent warrants were valued using the Black-Scholes option pricing model, resulting in a total fair value of $75,000.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

During the year ended 30 September 2024:

As consideration for entering into the sharing agreement with Sorbie, the Company agreed to pay a value payment of $105,000, payable in cash or in units at a placement price of $0.18 per unit. The Company elected to settle this obligation through the issuance of 583,333 units to Sorbie, with each unit consisting of one Common Share and one Warrant.

In conjunction with the Sorbie financing, the Company entered into a finder’s agreement with a third party. Under the terms of this agreement, the Company agreed to pay a cash finder’s fee of $105,000, representing 7% of the total funds raised, together with finder’s warrants equal to the number of common shares that could be purchased with the $105,000 fee based on the 20-day volume-weighted average trading price preceding payment. Based on this calculation, a total of 620,567 finder’s warrants were issuable.

Upon initial recognition, the Company recorded the issuance of the 8,333,333 units in exchange for cash receivable. Using the Black-Scholes option pricing model, the fair value of the 8,333,333 Warrants was determined to be $895,475. The fair value of the 8,333,333 Common Shares was determined to be $1,416,666, based on the closing market price of $0.17 per share on the date of issuance. Based on the relative fair values, the Company recorded the issuance at an initial fair value of $830,086, of which $321,486 was allocated to the Warrants and $508,600 was allocated to the Common Shares.

Ares Strategic Mining Inc. FOR THE YEARS ENDED 30 SEPTEMBER 2025 AND 2024 Canadian Dollars

Notes to the Consolidated Financial Statements (Cont.)

The 583,333 units issued to Sorbie in settlement of the $105,000 value payment were accounted for as consideration for services rendered. Accordingly, the Warrants included in these units were accounted for in accordance with IFRS 2. The fair value of the Warrants was determined using the Black-Scholes option pricing model. The 583,333 Warrants were valued at $62,683, and the fair value of the 583,333 Common Shares was determined to be $99,167 based on the closing market price of $0.17 per share on the date of issuance. Based on the relative fair values, the $105,000 value payment was allocated as $64,334 to Common Shares and $40,666 to Warrants.

The Company is also obligated to pay the finder’s fee of $105,000 in cash and issue 620,567 finder’s warrants. These agent warrants were issued during fiscal 2025 together with the agent warrants associated with the Sorbie transactions in fiscal 2025 described above.

The Company has adopted an incentive stock option plan to grant options to directors, officers, and consultants for up to 10% of the outstanding common shares. The Board of Directors determines the exercise price per share and the vesting period under the plan. The options can be granted for a maximum term of five years.

Stock option activity during the years ended 30 September 2025 and 30 September 2024:

Details of stock options outstanding as at 30 September 2025 and 2024 are as follows: