UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: ~~July~~October 31, 2022

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission file number: 000-55321

I-MINERALS INC.

(Exact name of registrant as specified in its charter)

Canada		20-4644299
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Suite 1100, 1199 West Hastings Street, Vancouver, BC, Canada V6E 3T5

(Address of principal executive offices)(Zip Code)

(877) 303-6573

Registrant’s telephone number, including area code

880 – 580 Hornby Street, Vancouver, BC, V6C 3B6

(Former name or former address if changed since last report)

Securities registered under section 12(g) of the Exchange Act: Common shares with no par value.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. [X] Yes [ ] No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). [X] Yes [ ] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ]	Accelerated filer [ ]
Non-accelerated filer [ ]	Smaller reporting company [X]
	Emerging growth company [X]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [ ] Yes [X] No

The aggregate market value of the voting stock held by non-affiliates of the registrant was approximately $1.3 million, based upon the closing sale price of the registrant’s common stock as reported by the TSX Venture Exchange on October 31, 2021 and converted to USD based on the Bank of Canada noon rate as of the same date.

As of ~~September~~December 1915, 2022, the registrant had 93,730,212 outstanding shares of common stock.

I-Minerals Inc.

TABLE OF CONTENTS

Part I. Financial Information		3
Item 1.	Financial Statements (Unaudited)	3
	Condensed interim consolidated balance sheets – July 31, 2022 and April 30, 2022	4
	Condensed interim consolidated balance sheets – October 31, 2022 and April 30, 2022	4
	Condensed interim consolidated statements of loss – Three months ended July 31, 2022 and 2021	5
	Condensed interim consolidated statements of loss – Three and six months ended October 31, 2022 and 2021	5
	Condensed interim consolidated statements of cash flows – Three months ended July 31, 2022 and 2021	6
	Condensed interim consolidated statements of cash flows – Six months ended October 31, 2022 and 2021	6
	Condensed interim consolidated statements of capital deficit – Three months ended July 31, 2022 and 2021	7
	Condensed interim consolidated statements of capital deficit – Three and six months ended October 31, 2022 and 2021	7
	Notes to the condensed interim consolidated financial statements – July 31, 2022	8
	Notes to the condensed interim consolidated financial statements – October 31, 2022	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	1721
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2328
Item 4.	Controls and Procedures	2328
Part II. Other Information		2428
Item 1.	Legal Proceedings	2428
Item 1A.	Risk Factors	2428
Item 2.	Unregistered Sales of Equity Securities and use of Proceeds	2428
Item 3.	Defaults Upon Senior Securities	2428
Item 4.	Mine Safety Disclosures	2428
Item 5.	Other Information	2428
Item 6.	Exhibits	2429
Signatures		2731

PART I – FINANCIAL INFORMATION

I-Minerals Inc.

Condensed Interim Consolidated Financial Statements

For the three ~~months~~and six months ended ~~July~~October 31, 2022 and 2021

(Unaudited - Expressed in US dollars)

I-Minerals Inc. Condensed Interim Consolidated Balance ~~Sheets~~SheetsOctober ~~July~~ 31, 2022 and April 30, 2022 (Unaudited - Expressed in US dollars) (Prepared in accordance with US GAAP)

	Notes	~~July~~October 31,2022$	April 30,2022$
ASSETS
Current assets
Cash and cash equivalents		~~164~~16,~~675~~533	2014,~~456~~029
Receivables		2313,~~756~~772	19,584
Prepaids		224,~~574~~385	2823,~~804~~079
		211,005	68,844
Assets held-for-sale	11	2,008,668	1,952,012
Equipment and right-of-use asset		11,633	18,242
TOTAL ASSETS		2,043,358	2,008,704
Mineral property interest and deferred development costs	3	1,892,410	1,892,410
Deposits		29,208	29,208
TOTAL ASSETS		2,144,256	2,008,704
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities	4,8	1,~~560~~490,~~518~~962	1,~~389~~250,~~577~~188
Lease liability – current	5	6,847	13,475
Promissory notes due to related party	6	35,374,376	34,776,937
Promissory notes due to related party	6	35,224,376	34,776,937
Liabilities held-for-sale	11	162,507	152,864
TOTAL LIABILITIES		3637,~~791~~027,~~741~~845	36,179,989
CAPITAL DEFICIT
Capital Stock
Authorized:
Unlimited common shares with no par value
Issued and fully paid: 93,730,212 (April 30, 2022 – 93,730,212)	7	19,225,087	19,225,087
Additional paid-in capital		1,865,342	1,865,342
Deficit		(5556,~~737~~074,~~914~~916)	(55,261,714)
TOTAL CAPITAL DEFICIT		(34,~~647~~984,~~485~~487)	(34,171,285)
TOTAL LIABILITIES AND CAPITAL DEFICIT		2,~~144~~043,~~256~~358	2,008,704

Basis of Presentation and Going Concern (Note 1)

Subsequent events (Note 1112)

On behalf of the Board

“John Theobald” Director

“W. Barry Girling” Director

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

I-Minerals Inc. Condensed Interim Consolidated Statements of ~~Loss~~LossFor ~~For~~ the three and six months ended ~~July~~October 31, 2022 and 2021 (Unaudited - Expressed in US dollars)

		2022	2021
		Three months endedOctober 31,		Six months endedOctober 31,
	Notes	$	$
		2022	2021	2022	2021
OPERATING EXPENSES
	Notes	$	$	$	$
Amortization		444	633
OPERATING EXPENSES
Management and consulting fees	8	5025,~~462~~384	5224,~~114~~802	51,096	52,166
Mineral property expenditures		131,045	136,091
General and miscellaneous		14,183	41,059	30,106	78,279
General and miscellaneous		30,880	52,524
Professional fees	8	102,861	44,561	161,888	143,681
Professional fees	8	59,027	99,320
		(142,428)	(110,422)	(243,090)	(274,126)
		(271,858)	(340,682)
OTHER (EXPENSE) INCOME FROM CONTINUING OPERATION
OTHER (EXPENSE) INCOME
Foreign exchange gain (loss)		3,114	(507)	3,523	596
Foreign exchange (loss) gain		(68)	821
Interest and penalty expense	6	(11,211)	(3,470)	(204,011)	(63,470)
Interest and penalty expense	6	(204,274)	(70,709)
LOSS FOR THE PERIOD FROM CONTINUING OPERATIONS	11	(150,525)	(114,399)	(443,578)	(337,000)
LOSS FOR THE PERIOD		(476,200)	(410,570)
Loss for the period from discontinued operations	11	(186,477)	(200,268)	(369,624)	(388,237)
Loss per share – basic and diluted		(0.01)	(0.00)
NET LOSS FOR THE PERIOD		(337,002)	(314,667)	(813,202)	(725,237)
Weighted average number of shares outstanding		93,730,212	93,730,212
Loss per share from continuing operations– basic and diluted		(0.00)	(0.00)	(0.00)	(0.00)
Loss per share from discontinuing operation – basic and diluted		(0.00)	(0.00)	(0.00)	(0.00)
Weighted average number of shares outstanding		93,730,212	93,730,212	93,730,212	93,730,212

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

I-Minerals Inc. Condensed Interim Consolidated Statements of Cash ~~Flows~~FlowsFor ~~For~~ the ~~three~~six months ended ~~July~~October 31, 2022 and 2021 (Unaudited - Expressed in US dollars)

	2022$	2021$
OPERATING ACTIVITIES
Net loss for the period	(~~476~~813,~~200~~202)	(~~410~~725,~~570~~237)
Items not involving cash:
Amortization	~~444~~997	~~633~~1,267
Change in non-cash operating working capital items:
Receivables	(45,~~172)~~812	(27,~~947~~090)
Prepaids	620,~~230~~475	2336,~~017~~190
Accounts payable and accrued liabilities	~~192~~230,~~917~~781	89126,~~129~~521
Cash flows used in operating activities	(280,781)	(300,738)
Cash flows used in operating activities from continuing operations	(178,906)	(209,977)
Cash flows used in operating activities from discontinued operations	(376,231)	(358,372)
	(555,137)	(568,349)
INVESTING ACTIVITIES
Purchase of equipment	(5,125)	-
Cash flows used in investing activities from discontinued operations	(5,125)	-
FINANCING ACTIVITIES
Proceeds from promissory notes received	~~425~~575,000	~~250~~475,000
Cash flows from financing activities	425,000	250,000
Cash flows from financing activities from continuing operations	575,000	475,000
CHANGE IN CASH EQUIVALENTS	~~144~~14,~~219~~738	(5093,~~738~~349)
CASH AND CASH EQUIVALENTS, BEGINNING OF THE PERIOD	20,456	110,684
CASH AND CASH EQUIVALENTS, END OF THE PERIOD	~~164~~35,~~675~~194	5917,~~946~~335
SUPPLEMENTAL CASH FLOW INFORMATION (Note 10)
Interest paid	-	-
Taxes paid	-	-

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

I-Minerals Inc. Condensed Interim Consolidated Statements of Capital ~~Deficit~~DeficitFor ~~For~~ the ~~three~~six months ended ~~July~~October 31, 2022 and 2021 (Unaudited - Expressed in US dollars)

	Number ofShares#	Amount$	AdditionalPaid-inCapital$	AccumulatedDeficit$	Total CapitalDeficit$
	Number of Shares#	Amount$	Additional Paid-in Capital$	Accumulated Deficit$	Total Capital Deficit$
Balance at April 30, 2021	93,730,212	19,225,087	1,865,342	(53,906,790)	(32,816,361)
Loss for the period	-	-	-	(410,570)	(410,570)
Balance at July 31, 2021	93,730,212	19,225,087	1,865,342	(54,317,360)	(33,226,931)
Loss for the period	-	-	-	(944,354)	(944,354)
Balance at July 31, 2021	93,730,212	19,225,087	1,865,342	(54,317,360)	(33,226,931)
Loss for the period	-	-	-	(314,667)	(314,667)
Balance at October 31, 2021	93,730,212	19,225,087	1,865,342	(54,632,027)	(33,541,598)
Loss for the period	-	-	-	(629,687)	(629,687)
Balance at April 30, 2022	93,730,212	19,225,087	1,865,342	(55,261,714)	(34,171,285)
Loss for the period	-	-	-	(476,200)	(476,200)
Balance at July 31, 2022	93,730,212	19,225,087	1,865,342	(55,737,914)	(34,647,485)
Balance at July 31, 2022	93,730,212	19,225,087	1,865,342	(55,737,914)	(34,647,485)
Loss for the period	-	-	-	(337,002)	(337,002)
Balance at October 31, 2022	93,730,212	19,225,087	1,865,342	(56,074,916)	(34,984,487)

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

I-Minerals Inc. Notes to the Condensed Interim Consolidated Financial ~~Statements~~StatementsFor ~~For~~ the ~~three~~six months ended ~~July~~October 31, 2022 and 2021 (Unaudited - Expressed in US dollars except where otherwise indicated)

1.	NATURE OF BUSINESS AND BASIS OF PRESENTATION AND LIQUIDITY:

I-Minerals Inc. (the “Company”) was incorporated under the laws of British Columbia, Canada, in 1984. The Company is listed for trading on the TSX Venture Exchange under the symbol “IMA” and the OTCQB marketplace under the symbol “IMAHF”.

The Company’s principal business is the development of the Helmer-Bovill industrial mineral property (“the Property”) located in Latah County, Idaho. Since inception, the Company has been in the exploration and evaluation stage but moved into the development stage in fiscal 2018. In fiscal 2019, the Company reverted back to the evaluation stage as management determined that the Feasibility Study on the property should be considered non-current. The Helmer-Bovill property is comprised of eleven mineral leases that host potentially economic deposits of feldspar, quartz and kaolinitic clays, primarily kaolinite and halloysite.

On September 14, 2022, the Company entered into a Stock Purchase Agreement with BV Lending, LLC, an Idaho limited liability company, controlled by a major shareholder and former director of the Company and the Company's subsidiary, I-Minerals USA, Inc., an Idaho company that owns the leases that comprise the Helmer-Bovill Property, to sell all of the issued and outstanding common shares of I-Minerals USA Inc. to BV Lending, LLC (Note 11).

Basis of Presentation and Going Concern

The accompanying unaudited condensed interim consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) Article 10 of Regulation S-X on the basis that the Company will continue as a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for the next year. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. At ~~July~~October 31, 2022, the Company had not yet achieved profitable operations, had an accumulated deficit of $5556,~~737~~074,~~914~~916 since inception and expects to incur further losses in the development of its business, all of which casts substantial doubt upon the Company’s ability to continue as a going concern and, therefore, that it may be unable to realize its assets and discharge its liabilities in the normal course of business.

The Company’s ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to develop the Property and to meet its obligations and repay its liabilities arising from normal business operations when they come due. Although the Company has been successful in the past in obtaining financing, there is no assurance that it will be able to obtain adequate financing in the future or that such financing will be on terms advantageous to the Company. The Company has been receiving funds from a company controlled by a former director of the Company through promissory notes (Note 6). Management considers that the Company will be able to obtain additional funds by promissory notes; however, there is no assurance of additional funding being available. The Company has historically satisfied its capital needs primarily by issuing equity securities and/or promissory notes. Management plans to continue to provide for its capital needs by issuing promissory notes. Upon completion of the sale, the Company plans to undertake a financing to fund its operations and reduce monthly expenses in an effort to conserve cash.

2.	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Basis of Presentation and Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its subsidiaries, i-Minerals USA, Inc. and CKD Ventures Ltd. All inter-company accounts and transactions have been eliminated. The Company’s fiscal year-end is April 30^th.

I-Minerals Inc.

Notes to the Condensed Interim Consolidated Financial Statements

For the six months ended October 31, 2022 and 2021

(Unaudited - Expressed in US dollars except where otherwise indicated)

Financial Instruments and Fair Value Measures

The book value of cash, receivables, accounts payable and accrued liabilities approximate their fair values due to the immediate or short-term maturity of those instruments. The fair value hierarchy under US GAAP is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following:

8Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

~~I-Minerals~~Level ~~Inc.~~2 ~~Notes~~- toobservable ~~the~~inputs ~~Condensed~~other ~~Interim~~than ~~Consolidated~~Level ~~Financial~~I, ~~Statements~~quoted ~~For~~prices ~~the~~for ~~three~~similar ~~months~~assets ~~ended~~or ~~July~~liabilities ~~31,~~in ~~2022~~active ~~and~~prices ~~2021~~whose ~~(Unaudited~~inputs -are ~~Expressed~~observable inor USwhose ~~dollars~~significant ~~except~~value ~~where~~drivers ~~otherwise~~are ~~indicated)~~observable; and

	Level 1 -	quoted prices (unadjusted) in active markets for identical assets or liabilities;
	Level 2 -	observable inputs other than Level I, quoted prices for similar assets or liabilities in active prices whose inputs are observable or whose significant value drivers are observable; and
	Level 3 -	assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities.

Level 3 - assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s promissory notes are carried at amortized cost.

Certain assets and liabilities are measured at fair value on a nonrecurring basis; that is, the instruments are not measured at fair value on an ongoing basis but are subject to fair value adjustments only in certain circumstances (for example, when there is evidence of impairment). There were no assets or liabilities measured at fair value on a nonrecurring basis as at ~~July~~October 31, 2022 and April 30, 2022.

Loss Per Share

The basic loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares outstanding. Diluted loss per common share is computed similar to basic loss per common share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. For the ~~three~~six months ended ~~July~~October 31, 2022, loss per share excludes 1,250,000 (2021 – 2,450,000) potentially dilutive common shares (related to outstanding options and warrants) as their effect was anti-dilutive.

Held-for-sale assets and liabilities

Items are classified as being held-for-sale once they meet criteria relating to the intention to sell and the likelihood of a sale taking place. All of I-Minerals USA’s assets and liabilities have been accounted for as held-for-sale.

Recently Issued Accounting Pronouncements

Financial Instruments - Credit Losses

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 replaced the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 requires use of a forward-looking expected credit loss model for accounts receivables, loans, and other financial instruments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. In October 2019, the FASB issued ASU No. 2019-10, “Financial Instruments-Credit Losses (Topic 326): Effective Dates”, to finalize the effective date delays for private companies, not-for-profits, and smaller reporting companies applying the CECL standards. The ASU is effective for reporting periods beginning after December 15, 2022 and interim periods within those fiscal years. Early adoption is permitted. The Company has not early adopted this update and it will become effective on April 1, 2023 assuming the Company will remain an emerging growth company. The Company is currently assessing the impact of adopting this standard on its consolidated financial statements.

I-Minerals Inc.

Notes to the Condensed Interim Consolidated Financial Statements

For the six months ended October 31, 2022 and 2021

(Unaudited - Expressed in US dollars except where otherwise indicated)

3.	MINERAL PROPERTY INTEREST AND DEFERRED DEVELOPMENT COSTS:

Helmer-Bovill Property – Latah County, Idaho

The Company previously had an undivided 100% interest in 11 State of Idaho mineral leases. The State of Idaho mineral leases are subject to a 5% production royalty on gross sales.

In March 2022, the Company amended the terms of the State of Idaho mineral leases through the Idaho Department of Lands (the “IDL”) and acquired these amended leases at an auction. Of the 11 mineral leases that the Company held previously, 8 mineral leases were amended and acquired at auction and the Company elected to relinquish 3 of the mineral leases. The amended leases now expire in March 2042 and, upon commercial production on one lease, other leases can be held through mine development or exploration work.

I-Minerals Inc. Notes to the Condensed Interim Consolidated Financial Statements For the three months ended July 31, 2022 and 2021 (Unaudited - Expressed in US dollars except where otherwise indicated)

In May 2017, the Idaho Department of Lands accepted the Company’s operation and reclamation plan. Together with a water rights permit from the Idaho Department of Water Resources, the Company was able to proceed with development and construction of the mine, subject to obtaining sufficient financing. As a result, management made the decision to begin capitalizing all development expenditures directly related to the Helmer-Bovill Property. In February 2019, the Company determined that the Feasibility Study should be considered non-current and accordingly, the Company has returned to the evaluation stage for accounting purposes.

4.	ACCOUNTS PAYABLE AND ACCRUED LIABILITIES:

	July 31,2022$	April 30,2022$
	October 31,2022$	April 30,2022$
Trade payables	~~178~~191,~~728~~862	189,615
Amounts due to related parties (Note 8)	~~224~~227,~~619~~362	224,627
Withholding tax on deemed dividends (Note 6)	896,756	896,756
Interest and penalties payable on promissory notes (Note 6)	~~260~~283,~~415~~198	78,579
Total accounts payable and accrued liabilities	1,~~560~~599,~~518~~178	1,389,577

The Company has obtained an indemnification from BV Lending, LLC for the Company’s withholding tax liability, interest and penalties owing.

5.	LEASE LIABILITY:

The Company entered into a property lease in October 2020 and the Company recognized a lease obligation with respect to the operating lease. The terms and the outstanding balances as at ~~July~~October 31, 2022 and April 30, 2022 are as follows:

	July 31,2022$	April 30,2022$
	October 31,2022$	April 30,2022$
Right-of-use asset from property lease repayable in monthly instalments of $2,332 and an interest rate of 13% per annum and an end date of October 15, 2022	~~6,847~~-	13,475
Less: current portion	(6,847)	(13,475)
Lease liability in held-for-sale liabilities (Note 11)	-	13,475
Non-current portion	-	-

I-Minerals Inc.

Notes to the Condensed Interim Consolidated Financial Statements

For the six months ended October 31, 2022 and 2021

(Unaudited - Expressed in US dollars except where otherwise indicated)

The Company extended its property lease in October 2022 and the Company recognized a lease obligation with respect to the operating lease. The terms and the outstanding balances as at October 31, 2022 are as follows:

		October 31, 2022 $

Right-of-use asset from property lease repayable in monthly instalments of $2,382 and an interest rate of 5% per annum and an end date of October 15, 2024		54,291
Lease liability in held-for-sale liabilities (Note 11)		54,291

The following is a schedule of the Company’s future minimum lease payments related to the office lease obligation:

		July 31,2022$
		October 31,2022$
2023		614,~~995~~291
Total minimum lease payments		6,995
2024		28,582
Less: imputed interest		(148)
2025		14,291
Total present value of minimum lease payments		6,847
Total minimum lease payments		57,164
Less: current portion		(6,847)
Less: imputed interest		(2,873)
Non-current portion		-
Total present value of minimum lease payments		54,291

6.	PROMISSORY NOTES DUE TO RELATED PARTY:

	July 31,2022$	April 30,2022$
	October 31,2022$	April 30,2022$
Third promissory notes	27,754,581	27,736,602
Fifth promissory notes	3,389,869	3,387,673
Sixth promissory notes	4,~~079~~229,926	3,652,662
Total promissory notes	35,~~224~~374,376	34,776,937

The Company has Third Promissory Notes, Fifth Promissory Notes and Sixth Promissory Notes due to BV Lending, LLC, a company controlled by a former director of the Company (the “Lender”). The Third Promissory Notes were due on March 31, 2019. On March 27, 2019, an amending agreement was entered into extending the maturity date of the Promissory Notes from March 31, 2019 to June 30, 2019 for no consideration. On June 28, 2019, the Company entered into an amending agreement with the Lender further extending this maturity date to October 31, 2019 for no consideration. The Fifth Promissory Notes were due on December 31, 2019. On October 25, 2019, the Company entered into an amending agreement with the Lender extending the maturity date for both notes, for no consideration, to the earlier of (i) June 30, 2020 and (ii) 60 days after a pre-feasibility study has been filed on SEDAR. The Sixth Promissory Notes have the same maturity date. On June 4, 2020, all three promissory notes were extended to December 15, 2020 for no consideration. On December 3, 2020, the maturity date was extended to March 15, 2021 for no consideration. On March 9, 2021 the maturity date was extended to April 15, 2021 for no consideration. On April 15, 2021 the maturity date was extended to May 15, 2021 for no consideration. On May 10, 2021 the maturity date was extended to June 15, 2021 for no consideration. On June 15, 2021 the maturity date was extended to July 15, 2021 for no consideration. On July 15, 2021 the maturity date was extended to August 15, 2021 for no consideration. In addition, the interest rate was decreased to 0.13% per annum effective May 1, 2021 from 12% to 14%. On August 13, 2021 the maturity date was extended to September 15, 2021 for no consideration. On September 13, 2021 the maturity date was extended to October 15, 2021 for no consideration. On October 13, 2021, the maturity date was extended to November 15, 2021 for no consideration. On November 15, 2021, the maturity date was extended to December 15, 2021 for no consideration. On December 15, 2021, the maturity date was extended to January 15, 2022 for no consideration. On January 13, 2022, the maturity date was extended to February 15, 2022 for no consideration. On February 15, 2022, the maturity date was extended to April 15, 2022 for no consideration. On April 14, 2022, the maturity date was extended to June 15, 2022 for no consideration. On June 14, 2022, the maturity date was extended to September 15, 2022 for no consideration. On September 15, 2022, the maturity date was extended to December 31, 2022 for no consideration.

I-Minerals Inc.

Notes to the Condensed Interim Consolidated Financial Statements

For the six months ended October 31, 2022 and 2021

(Unaudited - Expressed in US dollars except where otherwise indicated)

On October 13, 2021, the maturity date was extended to November 15, 2021 for no consideration. On November 15, 2021, the maturity date was extended to December 15, 2021 for no consideration. On December 15, 2021, the maturity date was extended to January 15, 2022 for no consideration. On January 13, 2022, the maturity date was extended to February 15, 2022 for no consideration. On February 15, 2022, the maturity date was extended to April 15, 2022 for no consideration. On April 14, 2022, the maturity date was extended to June 15, 2022 for no consideration. On June 14, 2022, the maturity date was extended to September 15, 2022 for no consideration. On September 15, 2022, the maturity date was extended to December 31, 2022 for no consideration.

In accordance with the guidance of ASC 470-50 and ASC 470-60, the Company determined that the March 27, 2019, June 28, 2019, October 25, 2019, June 4, 2020, December 3, 2020, March 9, 2021, April 15, 2021, May 10, 2021, June 15, 2021, July 15, 2021, August 13, 2021, September 13, 2021, October 13, 2021, November 15, 2021, December 15, 2021, January 13, 2022, February 15, 2022 and April 14, 2022 extension agreements qualified as troubled debt restructurings. However, as the Company did not transfer assets or grant an equity interest to the Lender and since the carrying amount of the promissory notes at the time of the restructurings did not exceed the total future cash payments specified by the new terms, this change was accounted for prospectively using the effective interest rate that equates the carrying amount to the expected future cash flows.

Certain conditions may result in early repayment including immediate repayment in the event a person currently not related to the Company acquires more than 40% of the outstanding common shares of the Company.

The Company determined that accrued interest on the promissory notes are subject to withholding taxes as the Lender controls over 25% of the common shares of the Company and the Company’s debt to equity ratio exceeded certain statutory limits that caused interest expense deductibility to be partially restricted. The withholding taxes are payable based on the amount of restricted interest, when such interest is paid or at the end of a fiscal year and are accounted for as a deemed dividend in accordance with ASC 740-10-15-4. As at ~~July~~October 31, 2022, the Company had recorded $896,756 of withholding tax on the deemed dividends (April 30, 2022 - $896,756) and penalties and interest of $~~252~~264,~~801~~011 (April 30, 2022 - $60,000) for the unpaid withholding tax. As at ~~July~~October 31, 2022, accrued interest on the promissory notes was $719,~~614~~187 (April 30, 2022 – $18,579).

11During the six months ended October 31, 2022, the Company recorded accrued interest of $114,335 (2021 - $60,000) and an estimate of penalties in the amount of $89,676 (2021- $nil) with respect to the accrued withholding tax payable (Note 4).

During the three months ended July 31, 2022, the Company recorded accrued interest of $103,125 (2021 - $60,000) and an estimate of penalties in the amount of $89,676 (2021- $nil) with respect to the accrued withholding tax payable (Note 4).

Third Promissory Notes

The Third Promissory Notes bear interest at the rate of 0.13% per annum and during the ~~three~~six months ended ~~July~~October 31, 2022, the Company recorded interest of $918,~~102~~196 (2021 - $815,~~789~~011). During the six months ended October 31, 2022 and 2021, the interest expense is included in loss from discontinued operations. Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date. During the ~~three~~six months ended ~~July~~October 31, 2022, the Lender elected to have interest payable from December 1, 2021 to May 31, 2022 of $17,979 deemed as advances.

Fifth Promissory Notes

On September 11, 2018, the Company entered into a Loan Agreement with the Lender pursuant to which up to $2,500,000 will be advanced to the Company in tranches (the “Fifth Promissory Notes”). As at ~~July~~October 31, 2022, the Company had received $2,500,000 (April 30, 2022 - $2,500,000) in advances pursuant to the Fifth Promissory Notes. The Fifth Promissory Notes bear interest at the rate of 0.13% per annum and during the ~~three~~six months ended ~~July~~October 31, 2022, the Company recorded interest of $12,~~111~~221 (2021 - $1,~~071~~833). During the six months ended October 31, 2022 and 2021, the interest expense is included in loss from discontinued operations. Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date. During the ~~three~~six months ended ~~July~~October 31, 2022, the Lender elected to have interest payable from December 1, 2021 to May 31, 2022 of $2,196 deemed as advances.

I-Minerals Inc.

Notes to the Condensed Interim Consolidated Financial Statements

For the six months ended October 31, 2022 and 2021

(Unaudited - Expressed in US dollars except where otherwise indicated)

Sixth Promissory Notes

On October 25, 2019, the Company entered into a Loan Agreement with the Lender pursuant to which up to $700,000 will be advanced to the Company in tranches (the “Sixth Promissory Notes”). On January 20, 2020 and July 8, 2020, the Company entered into amending agreements whereby the Lender agreed to advance an additional $600,000 and $1,200,000, respectively, under the same terms as the Sixth Promissory Notes. As at ~~July~~October 31, 2022, the Company had received $3,~~775~~925,000 in advances pursuant to the Sixth Promissory Notes (April 30, 2022 - $3,350,000). On November 15, 2021, the Company entered into an amending agreement whereby the Lender agreed to advance an additional $500,000, under the same terms as the Sixth Promissory Notes. On March 21, 2022, the Company entered into an amending agreement whereby the Lender agreed to advance an additional $250,000, under the same terms as the Sixth Promissory Notes. On June 14, 2022, the Company entered into an amending agreement whereby the Lender agreed to advance an additional $450,000, under the same terms as the Sixth Promissory Notes. On September 15, 2022, the Company entered into an amending agreement whereby the Lender agreed to advance an additional $450,000, under the same terms as the Sixth Promissory Notes.

The Sixth Promissory Notes bear interest at the rate of 0.13% per annum and during the ~~three~~six months ended ~~July~~October 31, 2022, the Company recorded interest of $12,~~261~~630 (2021 - $~~849~~1,546). During the six months ended October 31, 2022 and 2021, the interest expense is included in loss from discontinued operations. Interest is payable semi-annually as calculated on May 31st and November 30th of each year. Interest is to be paid either in cash, in common shares or deemed an advance of principal at the option of the Lender. A 5% late payment penalty may apply if payment is not paid within ten days after the due date. During the ~~three~~six months ended ~~July~~October 31, 2022, the Lender elected to have interest payable from December 1, 2021 to May 31, 2022 of $2,264 deemed as advances.

The Third Promissory Notes, the Fifth Promissory Notes and the Sixth Promissory Notes are collateralized by the Company’s Helmer-Bovill Property.

The following table outlines the estimated cash payments required, by calendar year, in order to repay the principal balance of the Third Promissory Notes, the Fifth Promissory Notes and the Sixth Promissory Notes:

2023$	2024$	2025$	2026$	2027$	Total$
35,224,376	-	-	-	-	35,224,376
35,374,376	-	-	-	-	35,374,376

7.	SHARE CAPITAL:

Common shares

Authorized:

Unlimited number of common shares, without par value.

The holders of common shares are entitled to receive dividends which are declared from time to time, and are entitled to one vote per share at meetings of the Company. All shares are ranked equally with regards to the Company’s residual assets.

Stock transactions:

During the ~~three~~six months ended ~~July~~October 31, 2022 and 2021, the Company did not complete any stock transactions.

Stock options:

The Company has granted stock options under the terms of its Stock Option Plan (the “Plan”). The Plan provides that the directors of the Company may grant options to purchase common shares to directors, officers, employees and service providers of the Company on terms that the directors of the Company may determine are within the limitations set forth in the Plan. The maximum number of shares available under the Plan is limited to 10% of the issued common shares. The maximum term of stock options is ten years. All stock options vest on the date of grant, unless otherwise stated. As at July 31, 2022, the Company had 8,123,021 stock options available for grant pursuant to the Plan (April 30, 2022 – 8,123,021).14

~~The~~I-Minerals ~~Company’s~~Inc.Notes ~~stock~~to ~~options~~the ~~outstanding~~Condensed asInterim atConsolidated ~~July~~Financial StatementsFor the six months ended October 31, 2022 and ~~the~~2021 ~~changes~~(Unaudited ~~for~~- ~~the~~Expressed ~~period~~in ~~then~~US ~~ended~~dollars ~~are~~except aswhere ~~follows:~~otherwise indicated)

The Company has granted stock options under the terms of its Stock Option Plan (the “Plan”). The Plan provides that the directors of the Company may grant options to purchase common shares to directors, officers, employees and service providers of the Company on terms that the directors of the Company may determine are within the limitations set forth in the Plan. The maximum number of shares available under the Plan is limited to 10% of the issued common shares. The maximum term of stock options is ten years. All stock options vest on the date of grant, unless otherwise stated. As at October 31, 2022, the Company had 8,123,021 stock options available for grant pursuant to the Plan (April 30, 2022 – 8,123,021).

The Company’s stock options outstanding as at October 31, 2022 and the changes for the period then ended are as follows:

Stock Options Outstanding

	NumberOutstanding	WeightedAverageExercise Price(in CAD$)
	Number Outstanding	Weighted AverageExercise Price(in CAD$)
Balance outstanding at April 30, 2021	2,750,000	0.26
Expired	(1,500,000)	0.26
Balance outstanding at April 30, 2022	1,250,000	0.25
Balance outstanding at July 31, 2022	1,250,000	0.25
Balance outstanding at October 31, 2022	1,250,000	0.25
Balance exercisable at July 31, 2022	-	-
Balance exercisable at October 31, 2022	-	-

13Summary of stock options outstanding at October 31, 2022:

Summary of stock options outstanding at July 31, 2022:

Security	~~NumberOutstanding~~Number Outstanding		~~NumberExercisable~~Number Exercisable		Exercise Price(CAD$)	Expiry Date	~~RemainingContractualLife~~Remaining Contractual Life (years)
Stock options	1,250,000	(1)	-	(1)	0.25	August 9, 2023	10.0277

Notes:

⁽¹⁾

1,250,000 stock options vest on the completion of certain milestones including equity financing, project financing, mine construction and achieving commercial production. 200,000 stock options vested as to 25% every three months from the date of grant.

As at ~~July~~October 31, 2022, the unamortized compensation cost of options is $93,382 and the intrinsic value of options expected to vest is $nil.

8.	RELATED PARTY TRANSACTIONS:

During the ~~three~~six months ended ~~July~~October 31, 2022, management and consulting fees of $2448,000 (2021 - $2448,000) were charged by RJG Capital Corporation, a wholly-owned company of W. Barry Girling, Director. Wayne Moorhouse, Director, charged $48,~~211~~236 (2021 - $58,~~706~~924) in management and consulting fees. Gary Childress, Director, charged $36,~~501~~860 (2021 - $37,~~657~~241) in management and consulting fees. $516,~~950~~762 (2021 - $713,~~440~~227) was charged by Malaspina Consultants Inc. for the services of Matt Anderson, CFO, and are included in professional fees.

Included in accounts payable and accrued liabilities are amounts owed to directors or officers or companies controlled by them. As at ~~July~~October 31, 2022, the amount was $~~224~~227,~~619~~362 (April 30, 2022 – $224,627). All amounts are non-interest bearing, unsecured, and due on demand.

~~The promissory notes received from a company controlled by a director (Note 6) are related party transactions.~~15

I-Minerals Inc.

Notes to the Condensed Interim Consolidated Financial Statements

For the six months ended October 31, 2022 and 2021

(Unaudited - Expressed in US dollars except where otherwise indicated)

The promissory notes received from a company controlled by a former director (Note 6) are related party transactions. The Stock Purchase Agreement (Note 11) with a company controlled by a former director is a related party transaction.

I-Minerals Inc.

Notes to the Condensed Interim Consolidated Financial Statements

For the six months ended October 31, 2022 and 2021

(Unaudited - Expressed in US dollars except where otherwise indicated)

9.	SEGMENT DISCLOSURES:

The Company considers its business to comprise a single operating segment being the exploration and development of its resource property. Substantially all of the Company’s ~~long-term~~ assets and operations are located in Latah County, Idaho.

10.

NON-CASH TRANSACTIONS:

Investing and financing activities that affect recognized assets or liabilities but that do not result in cash receipts or cash payments are excluded from the consolidated statements of cash flows. During the ~~three~~six months ended ~~July~~October 31, 2022, the following transactions were excluded from the consolidated statement of cash flows:

The transfer of $22,439 of interest payable on the Third, Fifth and Sixth Promissory Notes from accounts payable and accrued liabilities to promissory notes; and,

b) Deferred mineral property expenditures of $40,062 included in accounts payable and accrued liabilities at ~~July~~October 31, 2022, less $40,062 included in accounts payable at April 30, 2022 (net inclusion of $nil).

During the ~~three~~six months ended ~~July~~October 31, 2021, the following transactions were excluded from the consolidated statement of cash flows:

The transfer of $1,625,421 of interest payable on the Third, Fifth and Sixth Promissory Notes from accounts payable and accrued liabilities to promissory notes; and,

14b) Deferred mineral property expenditures of $40,062 included in accounts payable and accrued liabilities at October 31, 2021, less $40,062 included in accounts payable at April 30, 2021 (net inclusion of $nil).

~~I-Minerals Inc~~11. ~~Notes~~DISCONTINUED ~~to the Condensed Interim Consolidated Financial Statements For the three months ended July 31, 2022 and 2021 (Unaudited - Expressed in US dollars except where otherwise indicated)~~OPERATIONS:

b)On ~~Deferred~~September ~~mineral~~14, ~~property~~2022, ~~expenditures~~the ofCompany ~~$40~~entered into a Stock Purchase Agreement with BV Lending,~~062~~ ~~included~~LLC, inan ~~accounts~~Idaho ~~payable~~limited ~~and~~liability ~~accrued~~company ~~liabilities~~("BV atLending") ~~July~~and 31the Company's subsidiary, ~~2021~~I-Minerals USA, ~~less~~Inc. ~~$40~~("I-Minerals USA"),~~062~~ ~~included~~an inIdaho ~~accounts~~company ~~payable~~that atowns ~~April~~the ~~30,~~leases ~~2021~~that comprise the Helmer-Bovill Property, (~~net~~the ~~inclusion~~"Stock Purchase Agreement"), pursuant to which the Company has agreed to sell all of ~~$nil~~the issued and outstanding common shares of I-Minerals USA to BV Lending (the "Transaction"). BV Lending is a non-arm's length party to the Company as it is a company controlled by a former director of the Company.

11. SUBSEQUENT EVENTS:

Subsequent to July 31, 2022:

i) On August 31, 2022, the Company received $150,000 pursuant to the Sixth Promissory Notes.

ii) On September 15, 2022, the maturity date of the promissory notes was extended to December 31, 2022 for no consideration. In addition, the Lender agreed to advance an additional $450,000, under the same terms as the Sixth Promissory Notes.

iii) On September 13, 2022, the Company entered into a Stock Purchase Agreement with BV Lending, LLC, an Idaho limited liability company ("BV Lending") and the Company's subsidiary, i-minerals USA, Inc. ("i-minerals USA"), an Idaho company that owns the leases that comprise the Helmer-Bovill Property, (the "Stock Purchase Agreement"), pursuant to which the Company has agreed to sell all of the issued and outstanding common shares of i-minerals USA to BV Lending (the "Transaction"). BV Lending is a non-arm's length party to the Company as it is a company controlled by a former director of the Company.

Key Terms of the Transaction:

- Immediately prior to closing of the Transaction, the Company will contribute an intercompany debt owed by iI-~~minerals~~Minerals USA to the Company in the amount of approximately $25.7 million, resulting in the cancellation of the outstanding indebtedness. - the closing of the Transaction, the Company will sell all of the shares of i-minerals USA to BV Lending for an amount equal to C$3,000,000 (the "Share Value"). - The Share Value will be satisfied by BV Lending on a non-cash basis by the set off of an equal amount of debt owed by the Company to BV Lending (the "Set Off"). - Immediately following the Set Off, BV Lending will transfer to the Company the balance of the debt owed by the Company owed by BV Lending (which debt was approximately $35.4 million before the Set Off). - Previously entered into loan agreements dated June 1, 2016, September 11, 2018 and October 25, 2019 among the Company, BV Lending and i-minerals USA, including all security granted thereunder, will be terminated and/or discharged. - he Company will be subject to non-competition and non-solicitation covenants in favour of BV Lending for a period of five years commencing on closing of the Transaction. - The Transaction is subject to the approval of the Transaction by shareholders of the Company (the "Shareholders") and the TSX Venture Exchange. - As part of the Transaction, BV Lending has agreed to pay taxes that will become payable by the Company as a result of the Transaction (approximately $450,000). In consideration for such payment by BV Lending, the Company will issue a promissory note in favor of BV Lending for the amount of the taxes so paid. The promissory note will be repaid out of any refund received by the Company from the applicable government agency.

15- At the closing of the Transaction, the Company will sell all of the shares of I-Minerals USA to BV Lending for an amount equal to C$3,000,000 (the "Share Value").

The Share Value will be satisfied by BV Lending on a non-cash basis by the set off of an equal amount of debt owed by the Company to BV Lending (the "Set Off").

Immediately following the Set Off, BV Lending will transfer to the Company the balance of the debt owed by the Company to BV Lending (which debt was approximately $35.4 million before the Set Off).

Previously entered into loan agreements dated June 1, 2016, September 11, 2018 and October 25, 2019 among the Company, BV Lending and I-Minerals USA, including all security granted thereunder, will be terminated and/or discharged.

The Company will be subject to non-competition and non-solicitation covenants in favour of BV Lending for a period of five years commencing on closing of the Transaction.

The Transaction is subject to the approval of the Transaction by shareholders of the Company (the "Shareholders") and the TSX Venture Exchange.

I-Minerals Inc.

Notes to the Condensed Interim Consolidated Financial Statements

For the six months ended October 31, 2022 and 2021

(Unaudited - Expressed in US dollars except where otherwise indicated)

As part of the Transaction, BV Lending has agreed to pay taxes that will become payable by the Company as a result of the Transaction (approximately $450,000). In consideration for such payment by BV Lending, the Company will issue a promissory note in favor of BV Lending for the amount of the taxes so paid. The promissory note will be repaid out of any refund received by the Company from the applicable government agency.

The disposition of I-Minerals USA, which includes the Company’s mineral exploration activities, is considered to be a discontinued operation for the Company and accordingly, loss from discontinued operations is included in the consolidated statements of loss for all periods presented. Included on the consolidated balance sheets at October 31, 2022 and April 30, 2022 are assets and liabilities held-for-sale. The assets and liabilities of the discontinued operation classified as held-for-sale are as follows:

	October 31, 2022 $	April 30, 2022 $

Cash and cash equivalents	18,661	6,427
Prepaids	3,944	5,725
Equipment and right-of-use asset	64,445	18,242
Mineral property interest and deferred development costs (Note 3)	1,892,410	1,892,410
Deposits	29,208	29,208

Assets held-for-sale	2,008,668	1,952,012

Account payable and accrued liabilities (Note 4)	108,216	139,389
Lease liability (Note 5)	54,291	13,475

Liabilities held-for sale	162,507	152,864


	Three months ended October 31,		Six months ended October 31,
	2022	2021	2022	2021
	$	$	$	$


OPERATING EXPENSES
Amortization	553	634	997	1,267
Management and consulting fees	24,750	24,750	49,500	49,500
Mineral property expenditures	160,357	148,559	291,402	284,650
General and miscellaneous	12,839	14,581	27,796	29,885
Professional fees/ (recovery)	(24,178)	3,900	(24,178)	4,100

	(174,321)	(192,424)	(345,517)	(369,402)
OTHER EXPENSE
Foreign exchange loss	(583)	(163)	(1,060)	(445)
Interest expense	(11,573)	(7,681)	(23,047)	(18,390)

Loss for the period from discontinued operations	(186,477)	(200,268)	(369,624)	(388,237)

I-Minerals Inc.

Notes to the Condensed Interim Consolidated Financial Statements

For the six months ended October 31, 2022 and 2021

(Unaudited - Expressed in US dollars except where otherwise indicated)

12.

SUBSEQUENT EVENTS:

Subsequent to October 31, 2022:

On November 3, 2022 and December 1, 2022, the Company received $120,000 and $120,000, respectively, pursuant to the Sixth Promissory Notes.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report constitute "forward-looking statements.” These statements, identified by words such as “plan,” "anticipate,” "believe,” "estimate,” "should,” "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, general business, economic, competitive, political and social uncertainties; the actual results of current exploration and development activities; changes in project parameters as plans continue to be refined; changes in labour costs or other costs of production; future mineral prices; equipment or processes to operate as anticipated; accidents, labour disputes and other risks of the mining industry, including but not limited to environmental hazards, cave-ins, pit-wall failures, flooding, rock bursts and other acts of God or unfavourable operating conditions and losses; delays in obtaining governmental approvals or financing or in the completion of development or construction activities, as well as those factors discussed in the section titled "Risk Factors" in our Annual Report on Form 10-K which was filed with the SEC on July 21, 2022.

Forward looking statements are based on a number of material factors and assumptions, including the results of exploration/development and drilling activities, the availability and final receipt of required approvals, licenses and permits, that sufficient working capital is available to complete proposed exploration/development and drilling activities, that contracted parties provide goods and/or services on the agreed time frames, the equipment necessary for exploration/development is available as scheduled and does not incur unforeseen break downs, that no labour shortages or delays are incurred and that no unusual geological or technical problems occur. While we consider these assumptions may be reasonable based on information currently available to it, they may prove to be incorrect. Actual results may vary from such forward-looking information for a variety of reasons, including but not limited to risks and uncertainties disclosed in the section titled “Risk Factors” in this Quarterly Report.

We intend to discuss in our Quarterly Reports and Annual Reports any events or circumstances that occurred during the period to which such documents relate that are reasonably likely to cause actual events or circumstances to differ materially from those disclosed in this Quarterly Report. New factors emerge from time to time, and it is not possible for management to predict all of such factors and to assess in advance the impact of each such factor on our business or the extent to which any factor, or combination of such factors, may cause actual results to differ materially from those contained in any forwarding looking statement.

CAUTIONARY NOTE TO U.S. INVESTORS REGARDING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCES AND PROVEN AND PROBABLE RESERVES

The terms “mineral reserve”, “proven mineral reserve” and “probable mineral reserve” as used in this Quarterly Report are Canadian mining terms as defined in accordance with Canadian National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) and the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) – CIM Definition Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as amended (the “CIM Definition Standards”). These definitions differ from the definitions in the United States Securities and Exchange Commission (“SEC”) Industry Guide 7 (“SEC Industry Guide 7”) under the United States Securities Act of 1933, as amended (the “Securities Act”). Under SEC Industry Guide 7 standards, a “final” or “bankable” feasibility study is required to report reserves, the three-year historical average price is used in any reserve or cash flow analysis to designate reserves, and the primary environmental analysis or report must be filed with the appropriate governmental authority.

In addition, the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are defined in and required to be disclosed by NI 43-101; however, these terms are not defined terms under SEC Industry Guide 7 and are normally not permitted to be used in reports and registration statements filed with the SEC. Investors are cautioned not to assume that all or any part of a mineral deposit in these categories will ever be converted into reserves. “Inferred mineral resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all, or any part, of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to assume that all or any part of an inferred mineral resource exists or is economically or legally mineable. Disclosure of unit measures in a resource is permitted disclosure under Canadian regulations; however, the SEC only permits issuers to report mineralization that does not constitute “reserves” by SEC standards as in place tonnage and grade without reference to unit measures.

1620

Accordingly, information contained in this Quarterly Report and any documents incorporated by reference herein contain descriptions of our mineral deposits that may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations thereunder.

As used in this Quarterly Report, unless the context otherwise requires, “we,” “us,” “our,” the “Company” and “I-Minerals” refers to I-Minerals Inc. All dollar amounts in this Quarterly Report are in U.S. dollars unless otherwise stated.

PART I

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

General

We were incorporated under the laws of British Columbia, Canada in 1984. In 2004, we changed our corporate jurisdiction from a British Columbia company to a Canadian corporation. In December 2011, we amended our articles to change our name from “i-minerals inc.” to “I-Minerals Inc.”

The Company is engaged in the exploration, evaluation and development of our Helmer-Bovill industrial minerals property (the “Helmer-Bovill Property”). The Helmer-Bovill Property, in which we hold a 100% interest, is comprised of 8 mineral leases totaling 3,483.15 acres located approximately 6 miles northwest of Bovill, Latah County, Idaho. Since inception, the Company has been in the exploration stage but moved into the development stage in fiscal 2018. In fiscal 2019, the Company reverted back to the evaluation stage.

Our principal executive office is located at Suite 880, 580 Hornby Street, Vancouver, British Columbia, Canada and our telephone number is (877) 303-6573. Our operations office is located at 13403 N. Government Way, #102, Hayden, Idaho.

To date, we have not earned significant revenues from the operation of our Helmer-Bovill Property. Accordingly, we are dependent on debt and equity financing as our primary source of operating working capital. Our capital resources are largely determined by the strength of the junior resource markets and by the status of our projects in relation to these markets, and its ability to compete for investor support of its projects.

~~Subsequent~~Discontinued ~~Event~~Operations

On September 1314, 2022, the Company entered into a Stock Purchase Agreement with BV Lending, LLC, an Idaho limited liability company ("BV Lending") and the Company's subsidiary, ~~i-minerals~~ I-Minerals USA, Inc. ("iI-~~minerals~~Minerals USA"), an Idaho company that owns the leases that comprise the Helmer-Bovill Property, (the "Stock Purchase Agreement"), pursuant to which the Company has agreed to sell all of the issued and outstanding common shares of iI-~~minerals~~Minerals USA to BV Lending (the "Transaction"). BV Lending is a non-arm's length party to the Company as it is a company controlled by a former director of the Company.

Key Terms of the Transaction:

- Immediately prior to closing of the Transaction, the Company will contribute an intercompany debt owed by i-minerals USA to the Company in the amount of approximately $25.7 million, resulting in the cancellation of the outstanding indebtedness. - At the closing of the Transaction, the Company will sell all of the shares of I-Minerals USA to BV Lending for an amount equal to C$3,000,000 (the "Share Value"). - The Share Value will be satisfied by BV Lending on a non-cash basis by the set off of an equal amount of debt owed by the Company to BV Lending (the "Set Off"). - Immediately following the Set Off, BV Lending will transfer to the Company the balance of the debt owed by the Company to BV Lending (which debt was approximately $35.4 million before the Set Off). - Previously entered into loan agreements dated June 1, 2016, September 11, 2018 and October 25, 2019 among the Company, BV Lending and i-minerals USA, including all security granted thereunder, will be terminated and/or discharged. - The Company will be subject to non-competition and non-solicitation covenants in favour of BV Lending for a period of five years commencing on closing of the Transaction.

~~- At the closing of the Transaction, the Company will sell all of the shares of i-minerals USA to BV Lending for an amount equal to C$3,000,000 (the "Share Value").~~21

- The Share Value will be satisfied by BV Lending on a non-cash basis by the set off of an equal amount of debt owed by the Company to BV Lending (the "Set Off").

The Transaction is subject to the approval of the Transaction by shareholders of the Company (the "Shareholders") and the TSX Venture Exchange.

-The Transaction ~~Immediately~~is ~~following~~considered to be a discontinued operation for the ~~Set~~Company ~~Off~~and accordingly, loss BVfrom ~~Lending~~discontinued ~~will~~operations ~~transfer~~is toincluded ~~the~~in ~~Company~~ the ~~balance~~consolidated statements of loss ~~the~~for ~~debt~~all ~~owed~~periods bypresented. Included on the ~~Company~~consolidated ~~owed~~balance bysheets BVat ~~Lending~~October ~~(which~~31, ~~debt~~2022 ~~was~~and ~~approximately~~April ~~$35~~30, 2022 are assets and liabilities held-for-sale.4 The ~~million~~assets ~~before~~and liabilities of the ~~Set~~discontinued ~~Off).~~operation classified as held-for-sale are as follows:

- Previously entered into loan agreements dated June 1, 2016, September 11, 2018 and October 25, 2019 among the Company, BV Lending and i-minerals USA, including all security granted thereunder, will be terminated and/or discharged.

	October 31, 2022 $	April 30, 2022 $

Cash and cash equivalents	18,661	6,427
Prepaids	3,944	5,725
Equipment and right-of-use asset	64,445	18,242
Mineral property interest and deferred development costs	1,892,410	1,892,410
Deposits	29,208	29,208

Assets held-for-sale	2,008,668	1,952,012

Account payable and accrued liabilities	108,216	139,389
Lease liability	54,291	13,475

Liabilities held-for sale	162,507	152,864

- The Company will be subject to non-competition and non-solicitation covenants in favour of BV Lending for a period of five years commencing on closing of the Transaction.

- The Transaction is subject to the approval of the Transaction by shareholders of the Company (the "Shareholders") and the TSX Venture Exchange.

- As part of the Transaction, BV Lending has agreed to pay taxes that will become payable by the Company as a result of the Transaction (approximately $450,000). In consideration for such payment by BV Lending, the Company will issue a promissory note in favor of BV Lending for the amount of the taxes so paid. The promissory note will be repaid out of any refund received by the Company from the applicable government agency.

Following the completion of the Transaction, the Company will have a stronger balance sheet as virtually of its debt will be eliminated. Nevertheless, the Company will not have any mineral properties due to the sale of i-minerals USA, which owns the Helmer-Bovill Property. Accordingly, the Company will need to identify and, if successful, acquire a new business, which it will be positioned to do with a balance sheet free of the existing indebtedness that it is currently unable to service.

Closing of the Transaction is subject to a number of key conditions including shareholder approval, TSX Venture Exchange approval, no more than 5% of the shareholders exercising their dissenting rights and other such other conditions that are customary for this type of Transaction.

Resignation of Mr. Ball

The Company also announces that in advance of the board of directors meeting to consider and approve the Transaction, Mr. Ball resigned as a director of the Company on September 12, 2022 and resigned as a director of i-minerals USA on September 13, 2022.

Our Principal Projects

Our activities at the Helmer-Bovill Property are focused on developing the Bovill Project.

The Bovill Project

Our lead project, the Bovill Project, is a strategically located long term resource of quartz, potassium feldspar (“K-spar”), halloysite and kaolinite formed through weathering of a border phase of the Idaho Batholith causing all minerals to be contained within a fine white clay-sand mixture referred to as “primary clay.” The Bovill Project is located within 3 miles of state highways with electricity and natural gas already at the property boundary.

Since 2010, our exploration work has focused diamond drilling on the Bovill Project. To date, a total of 322 diamond drill holes have been drilled totaling 35,909 feet. As a result of these drill campaigns, four deposits have been identified: Kelly’s Hump, Kelly’s Hump South, Middle Ridge and WBL.

In June 2014, we completed an updated pre-feasibility study on the Bovill Kaolin Project (the “2014 PFS”) and on March 8, 2016, we announced the economic results of our initial feasibility study (the “2016 FS”). However, based on the results of an updated independent market study it is apparent that fundamental changes in the businesses that consume our minerals has taken place over the past several years. These changes include offshoring and reformulation wherein industries that had previously used K-spar for example have reformulated their production batches using alternate minerals. Markets do exist for all of the minerals contained within the Bovill Kaolin Project but not in the volumes contemplated in the 2016 FS. Accordingly, the 2016 FS is considered not to be current and should not be relied upon.

The mineral resources stated in the 2016 FS remain current and have recently been re-stated in a standalone technical report prepared by SRK Consulting (U.S.) recently completed an updated resource estimate. The updated mineral resource statement from this report, summarized below, contains the same tonnages and grades as were disclosed in the 2016 FS and is the basis of the reserves defined in the 2020 Pre-Feasibility Report.

2020 Pre-Feasibility Study

The Company engaged MillCreek Engineering of Salt Lake City, Utah to estimate the capital and operating costs for a smaller plant capable of producing up to 20,000 tons of metakaolin and 10,000 tons of halloysite per year. The estimated Operating Costs and Capital Cost fell in line with expectations and the Company retained MillCreek to complete a Pre-Feasibility Study of a metakaolin and halloysite operation. It is envisioned that the sand fraction (K-spar and quartz) will be screened and sold into lower value industrial applications.

On March 3, 2020, we announced a pre-feasibility study of our metakaolin and halloysite operation (the “2020 PFS”). The 2020 PFS was led by Millcreek Engineering, who were responsible for overall project management and the process plant and infrastructure design (including OPEX and CAPEX) and economic analyses. Other engineering and geological services were provided by Mine Development Associates (mine modelling; ore scheduling; mineral reserve estimation); SRK Consulting (U.S.) Inc. (mineral resource estimation); and, HDR Engineering Inc. (environmental review).

Highlights of the PFS include:

	•	20% Pre-Tax IRR; 18% After Tax IRR
	•	US$48.3 million Pre-Tax NPV; US$33.7 million After Tax NPV
	•	Initial Capital Cost of US$48.3 million
	•	Total Life of Operation Capital Costs of US$54.2 million
	•	25 year mine life with 1.04:1 strip ratio

The 2020 PFS is based on the production of two minerals, halloysite and kaolinite. The halloysite is beneficiated into two mineral products; HalloPure which is about 70% halloysite and 30% kaolinite and premium quality Ultra-Hallopure which is greater than 90% halloysite with the balance kaolinite. The quality of Bovill Halloysite is regarded as being exceptional and the research on halloysite applications has dramatically increased over the past 5 years involving polymers, filtration, extruded polystyrene insulation, green technology and life sciences. The kaolinite is flash calcined to produce metakaolin, a Supplementary Cementitious Material (“SCM”) and highly reactive pozzolan that when added to concrete increases strength and durability, reduces permeability, reduces the effect of alkali-silica reactivity and increases resistance to chloride ingress and sulfate attack. By using metakaolin the sustainability of the concrete is increased through longer service life and the carbon footprint is reduced by lowering the quantity of Portland cement. Feldspathic sand is produced during the production process which meets the specifications of a number of applications including arena sand, USGA bunker and top-dressing sand. There is a potential upside from sale of feldspathic sand which is not included in the project economics and accordingly the feldspathic sand is not included in the reserves.

A conservative approach to the build-up of sales has been assumed with full production being achieved in the first quarter of the 5^th year of operation as some product applications will require development. There is potential for full production to be achieved earlier which would have a corresponding positive effect on the NPV and IRR.

Updated Measured and Indicated Resource Estimate

	•	Measured Resources of 5.7 million tons containing 76.5% quartz/K-spar sand, 12.3% Kaolinite and 4.0% Halloysite.
	•	Indicated Resources of 15.5 million tons containing 57.0% quartz/K-spar sand, 15.5% Kaolinite and 2.8% Halloysite.
	•	667,000 tons of contained halloysite, 3,119,000 tons of contained kaolinite and 13,235,000 tons of contained quartz/K-spar.

Updated Mineral Reserves

	Proven	Probable	Total P&P
K Tons	1,310	1,868	3,178
Halloysite %	8.8	8.0	8.3
Halloysite K Tons	115	149	264
Kaolinite %	11.1	22.4	17.7
Kaolinite K Tons	145	418	563
NSR	$ 109	$ 123	$ 117

* Notes on Mineral Reserves:

• Reserves are based on a $40.00 NSR cutoff grade and pit designs. ~~• Rounding of numbers in mineral reserves listed above may cause apparent inconsistencies. • The reference point for Mineral Reserves is at the plant stockpile~~

19• Rounding of numbers in mineral reserves listed above may cause apparent inconsistencies.

•

The reference point for Mineral Reserves is at the plant stockpile

The full 2020 PFS was filed on www.sedar.com on April 16, 2020 and is available on the Company’s website.

Plan of Operation and Outlook

Refer to the subsequent event section of this Form 10-Q.

The Company is continuing to take a sequential approach to the development of the Bovill Project. The Idaho Department of Lands granted the amended Operations and Reclamation Plan on December 18, 2020. Going forward we intend to initiate a Feasibility Study and a Front End Engineering Design Study.

During 2021 I-Minerals developed a solid market for feldspathic sand. The two developed markets include golf course sand for bunkers and top dressing and equestrian sand. In addition, I-Minerals will be looking to expand the feldspathic sand market to include the tile industry and mortar sand.

Market development for halloysite is ongoing with cutting edge research in epoxy coatings and new developments in wound care. South Korea has received a substantial amount of I-Minerals halloysite to test in various applications and remains to have strong interest.

I-Minerals’ mineral tenure is through the Idaho Department of Lands (“IDL”) mineral leases. The IDL recently amended terms on newly granted mineral leases with terms including an increase in the term of the leases to 20 years from the current leases term of 10 years and, upon commencement of commercial production on one lease, other leases can be held through mine development or exploration work. In contrast, historical leases could only be held by production on the leases from which production occurred. The historical lease terms would mean that leases that held resources, but from which production had not yet occurred, would lapse at end of the 10-year term.

Given the Company’s mineral leases were set to expire on February 28, 2023, the Company approached the IDL with a request to amend the terms of the mineral leases to reflect the terms currently being offered on newly issued mineral leases. The IDL declined the request on the basis that the proposed amendments constituted material changes and material changes would require the leases be put to auction.

Rather than pursue the lease amendment process that would only result in an additional 10 year term on the mineral leases, the Company elected to relinquish the 10 year leases and apply for new 20 year mineral leases. In accordance with IDL procedures the availability of the leases was advertised for 30 days. With no competing bidders forthcoming, in March 2022 the Company secured the 8 new minerals leases of economic importance. The 8 leases acquired by the Company hold the resource and reserves relevant to the project, water supply and infrastructure, such leases now expiring in March 2042. The Company has elected to relinquish 3 additional mineral leases for which it believes the geological potential to support economic deposits of kaolinite and halloysite is very limited.

The ORP, FS and FEED Study is forecasted to take a minimum of 6 months and a maximum of 12 months to complete. Estimated costs to complete is estimated as follows:

Feasibility Study and FEED Study	$ 885,000
Mineral Marketing	420,000
General and administrative	650,000
Sub total	1,955,000
Contingency	105,000
Total	$ 2,060,000

After completion of the proposed Transaction with BV Lending, the Company will have disposed of substantially all of its assets, being the shares held in i-minerals USA, which holds the Helmer-Bovill Property. Until such time that the Company is able to acquire a new mineral property or alternative business, the TSX Venture Exchange will place the Company on notice to move to the NEX Tier of the TSX Venture Exchange. The NEX Tier of the TSX Venture Exchange is for companies that fail to meet continued listing standards. If the Transaction is completed, the Company must continue to comply with reporting requirements under both the United States and Canadian securities laws. However, these requirements should be reduced because we anticipate that we will meet the definition of a “foreign private issuer”. The Company plans to file a Form 15 to terminate and suspend its duty to file reports under the Securities Exchange Act of 1934 after closing the Transaction.

Results of Operations

Three months ended ~~July~~October 31, 2022 and 2021

We recorded a net loss of $~~476~~337,~~200~~002 ($0.0100 per share) for the three months ended ~~July~~October 31, 2022 as compared to a net loss of $~~410~~314,~~570~~667 ($0.00 per share) for the three months ended ~~July~~October 31, 2021. The increase in the net loss recorded for the three months ended ~~July~~October 31, 2022 as compared to the net loss for the three months ended ~~July~~October 31, 2021 is the net ~~result~~ result of changes to a number of expenses. Of Of note are the following items:

20• Management and consulting fees of $25,384 (2021 - $24,802) are comprised of fees to manage our Company. Approximately 75% of the fees to manage our Company are charged to management and consulting fees and the other 25% is charged to mineral property expenditures. • General and miscellaneous expenses of $14,183 (2021 - $41,059) are comprised of office and telephone expenses, payroll taxes, medical benefits, insurance premiums, travel expenses, promotional expenses, shareholder communication fees, transfer agent fees and filing fees. The decrease during the current period was due primarily to a decrease in office rent, insurance and transfer agent fees. • Professional fees of $102,861 (2021 - $44,861) include legal fees, audit fees and financial consulting fees. The increase during the period was due to higher accounting and legal fees. • Interest and penalty expense of $11,211 (2021 - $3,470) is from promissory notes that bear interest at the rates of 12%-14% per year up to April 30, 2021 and 0.13% per year effective May 1, 2021. Interest and penalty increased due to the penalty and interest recorded on the unpaid withholding tax. • Loss from discontinued operations of $186,477 (2021 - $200,268) is the loss included in I-Minerals USA which is treated as a discontinued operation due to the proposed Transaction. Included in the loss from discontinued operations are management and consulting fees of $24,750 (2021 - $24,750), mineral property expenditures of $160,357 (2021 - $148,559) general and miscellaneous expenses of $12,839 (2021 - $14,581) amongst other items.

•Six ~~Management~~months ~~and~~ended ~~consulting~~October fees of $50,462 (2021 - $52,114) are comprised of fees to manage our Company. Approximately 75% of the fees to manage our Company are charged to management and consulting fees and the other 25% is charged to mineral property expenditures. • Mineral property expenditures of $131,045 (2021 - $136,091) are costs incurred on our Helmer-Bovill Property. The expenditures in the current period are pre-development costs that have been expensed during the period. The main components of costs during the current period included metallurgy ($50,509) and engineering and consulting ($30,000). During the current period, the Company continued to optimize the metallurgical processes and detailed engineering. Effective January 31, ~~2019,~~2022 ~~the Company returned to the evaluation stage for accounting purposes~~ and ~~therefore stopped capitalizing development costs. • General and miscellaneous expenses of $30,880 (~~2021 - $52,524) are comprised of office and telephone expenses, payroll taxes, medical benefits, insurance premiums, travel expenses, promotional expenses, shareholder communication fees, transfer agent fees and filing fees. The decrease during the current period was due primarily to a decrease in office rent and insurance. • Professional fees of $59,027 (2021 - $99,320) include legal fees, audit fees and financial consulting fees. The decrease during the period was due to lower professional tax fees. • Interest and penalty expense of $204,274 (2021 - $70,709) is from promissory notes that bear interest at the rates of 12%-14% per year up to April 30, 2021 and 0.13% per year effective May 1, 2021. Interest and penalty increased due to the penalty and interest recorded on the unpaid withholding tax.

We recorded a net loss of $813,202 ($0.01 per share) for the six months ended October 31, 2022 as compared to a net loss of $725,237 ($0.01 per share) for the six months ended October 31, 2021. The increase in the net loss recorded for the six months ended October 31, 2022 as compared to the net loss for the six months ended October 31, 2021 is the net result of changes to a number of expenses. Of note are the following items:

•	Management and consulting fees of $51,096 (2021 - $52,166) are comprised of fees to manage our Company. Approximately 75% of the fees to manage our Company are charged to management and consulting fees and the other 25% is charged to mineral property expenditures.

•	General and miscellaneous expenses of $30,106 (2021 - $78,279) are comprised of office and telephone expenses, payroll taxes, medical benefits, insurance premiums, travel expenses, promotional expenses, shareholder communication fees, transfer agent fees and filing fees. The decrease during the current period was due primarily to a decrease in office rent, insurance and transfer agent fees.
•	Professional fees of $161,888 (2021 - $143,681) include legal fees, audit fees and financial consulting fees. The increase during the period was due to higher accounting and legal fees.
•	Interest and penalty expense of $204,011 (2021 - $63,470) is from promissory notes that bear interest at the rates of 12%-14% per year up to April 30, 2021 and 0.13% per year effective May 1, 2021. Interest and penalty increased due to the penalty and interest recorded on the unpaid withholding tax.
•	Loss from discontinued operations of $369,624 (2021 - $388,237) is the loss included in I-Minerals USA which is treated as a discontinued operation due to the proposed Transaction. Included in the loss from discontinued operations are management and consulting fees of $49,500 (2021 - $49,500), mineral property expenditures of $291,402 (2021 - $284,650) general and miscellaneous expenses of $27,796 (2021 - $29,885) amongst other items.

Liquidity and Capital Resources

Our aggregate operating, investing and financing activities during the ~~three~~six months ended ~~July~~October 31, 2022 resulted in a net cash inflow of $~~144~~14,~~219~~738 (2021 – outflow of $5093,~~738~~349). As at ~~July~~October 31, 2022, we had a working capital ~~deficiency~~ deficiency of $3634,~~580,736~~984.487.

During the ~~three~~six months ended ~~July~~October 31, 2022, $~~280~~555,~~781~~137 was used in operations (2021 - $~~300~~568,~~738~~349) and we received $~~425~~575,000 from financing activities (2021 - $~~250~~475,000).

We have been financed by advances pursuant to promissory notes advanced by BV Lending LLC, an entity controlled by Allen L. Ball, a former member of our Board of Directors and our largest shareholder (the “Lender”). During the ~~three~~six months ~~ended~~ ~~July~~ended October 31, 2022, the Company was receiving advances pursuant to the ~~Sixth~~ Sixth Promissory Notes. As at ~~July~~October 31, 2022, the balance of the promissory notes was $35,~~224~~374,376. Subsequent to ~~July~~ October 31, 2022, the Company received $~~150~~240,000 pursuant to the Sixth Promissory Notes.

As at April 30, 2021, the Third Promissory Notes, the Fifth Promissory Notes and the Sixth Promissory Notes had a maturity date of the earlier of (i) June 30, 2020 and (ii) 60 days after a pre-feasibility study has been filed on SEDAR. On June 4, 2020, the promissory notes maturity date was extended from June 30, 2020 to December 15, 2020 for no consideration. All other terms remained the same. On December 3, 2020, the Lender agreed to extend the maturity date of the promissory notes to March 15, 2021 for no consideration. On March 9, 2021, the Lender agreed to extend the maturity date to April 15, 2021 for no consideration. On April 15, 2021 the maturity date was extended to May 15, 2021 for no consideration. On May 10, 2021 the maturity date was extended to June 15, 2021 for no consideration. On June 15, 2021 the maturity date was extended to July 15, 2021 for no consideration. On July 15, 2021 the maturity date was extended to August 15, 2021. In addition, the interest rate was decreased to 0.13% per annum effective May 1, 2021 for no consideration. On August 13, 2021, the maturity date was extended to September 15, 2021 for no consideration. On September 13, 2021, the maturity date was extended to October 15, 2021 for no consideration. On October 13, 2021, the maturity date was extended to November 15, 2021 for no consideration. On November 15, 2021, the maturity date was extended to December 15, 2021 for no consideration and the Lender agreed to advance an additional $500,000 under the same terms as the Sixth Promissory Notes. On December 15, 2021, the maturity date was extended to January 15, 2022 for no consideration. On January 13, 2022, the maturity date was extended to February 15, 2022 for no consideration. On February 15, 2022, the maturity date was extended to April 15, 2022 for no consideration. On March 21, 2022, the Company entered into an amending agreement whereby the Lender agreed to advance an additional $250,000, under the same terms as the Sixth Promissory Notes. On April 14, 2022, the maturity date was extended to June 15, 2022 for no consideration. On June 14, 2022, the maturity date was extended to September 15, 2022 for no consideration and the Lender agreed to advance an additional $450,000, under the same terms as the Sixth Promissory Notes. On September 15, 2022, the maturity date was extended to December 31, 2022 for no consideration and the Lender agreed to advance an additional $450,000, under the same terms as the Sixth Promissory Notes.

We have not as yet put into commercial production any mineral properties and as such have no operating revenues. Accordingly, we are dependent on debt and equity financing as its primary source of operating working capital. Our capital resources are largely determined by the strength of the junior resource markets and by the status of our projects in relation to these markets, and our ability to compete for investor support of our projects.

2126

We remain dependent on additional financing to fund development requirements on the Helmer-Bovill property and for general corporate costs. With respect to funds required for capital cost items, State-sponsored debt financing instruments may be available on attractive terms, and we intend to pursue such financial instruments to cover portions of the capital costs associated with placing the Bovill Project deposits into production.

We do not have the ability to internally generate sufficient cash flows to support our operations for the next twelve months. We have been receiving funds from a company controlled by a former director of the Company through promissory notes. We have no formal plan in place to address this going concern issue but consider that we will be able to obtain additional funds by equity financing and/or debt financing; however, there is no assurance of additional funding being available. As a result, there is substantial doubt about the Company’s ability to continue as a going concern.

After completion of the proposed Transaction with BV Lending, the Company will be required to undertake an equity financing to fund review of asset opportunities.

During 2020, 2021 and 2022, there was an outbreak of COVID-19 that has impacted the economic environment and the capital markets. As the Company is at the stage of exploration and evaluation and is looking to fund mine development leading to production, the impacts of COVID-19 are not determinable at this date. COVID-19 however, could have a material impact on the Company's financial position, results of operation and cash flows. The Company's liquidity and its ability to continue as a going concern may also be impacted.

Critical Accounting Policies

Measurement Uncertainty

The preparation of these consolidated financial statements in conformity with US GAAP requires us 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 consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. We regularly evaluate estimates and assumptions related to the useful life and recoverability of long lived assets, stock-based compensation, valuation of convertible debentures and derivative liabilities, and deferred income tax asset valuation allowances. We base our estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by us may differ materially and adversely from our estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. The most significant estimates with regard to our condensed consolidated financial statements relate to the determination of fair values of derivative liabilities and stock-based transactions.

Mineral Property Acquisition and Exploration Costs

Mineral property acquisition costs are capitalized when incurred. Acquisition costs include cash consideration and the fair market value of shares issued on the acquisition of mineral property claims.

Costs related to the development of our mineral reserves are capitalized when it has been determined an ore body can be economically developed. The development stage begins when an ore body is determined to be economically recoverable based on proven and probable reserves and appropriate permits are in place, and ends when the production stage or exploitation of reserves begins. Major mine development expenditures are capitalized, including primary development costs such as costs of building access ways, tailings impoundment, development of water supply and infrastructure developments.

Exploration costs include those relating to activities carried out (a) in search of previously unidentified mineral deposits, or (b) at undeveloped concessions. Pre-development activities involve costs incurred in the exploration stage that may ultimately benefit production that are expensed due to the lack of evidence of economic development, which is necessary to demonstrate future recoverability of these expenses. Secondary development costs are incurred for preparation of an ore body for production in a specific ore block or work area, providing a relatively short-lived benefit only to the mine area they relate to, and not to the ore body as a whole.

Once production has commenced, capitalized costs will be depleted using the units-of-production method over the estimated life of the proven and probable reserves. If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to the Consolidated Statements of Loss in that period.

2227

We assess the carrying cost of our mineral properties for impairment whenever information or circumstances indicate the potential for impairment. Such evaluations compare estimated future net cash flows with our carrying costs and future obligations on an undiscounted basis. If it is determined that the future undiscounted cash flows are less than the carrying value of the property, a write down to the estimated fair value is charged to the Consolidated Statements of Loss for the period. Where estimates of future net cash flows are not available and where other conditions suggest impairment, management assesses if the carrying value can be recovered.

For significant exploration and development projects, interest is capitalized as part of the historical cost of developing and constructing assets in accordance with ASC 835-20. Interest is capitalized until the asset is ready for service. Capitalized interest is determined by multiplying the Company’s weighted-average borrowing cost on general debt by the average amount of qualifying costs incurred. Once an asset subject to interest capitalization is completed and placed in service, the associated capitalized interest is expensed through depletion or impairment.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable

Item 4. Controls and Procedures.

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures as of ~~July~~October 31, 2022 (the “Evaluation Date”). Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of ~~July~~October 31, 2022. There were no material changes in the Company’s ~~internal~~ internal control over financial reporting during the first quarter of fiscal 2023.

PART II

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

There have been no material changes from the risk factors as previously disclosed in our Annual Report on Form 10-K which has been filed with the SEC on July 21, 2022.

Item 2. Sale of Unregistered Securities.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (The “Dodd-Frank Act”), issuers that are operators, or that have a subsidiary that is an operator, of a coal or other mine in the United States are required to disclose in their periodic reports filed with the SEC information regarding specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities. During the ~~three~~six months ended ~~July~~October 31, 2022, our U.S. exploration properties were not subject to regulation by the Federal Mine Safety and Health Administration (“MSHA”) under the Federal Mine Safety and Health Act of 1977 (the "Mine Act").

Item 5. Other Information.

None.

2428

Item 6. Exhibits

3.1	Certificate of Continuation.(2)
3.2	Articles of Continuance.(2)
3.3	Certificate of Amendment.(2)
3.4	Articles of Amendment.(2)
3.5	By-Laws.(2)
10.1	Assignment Agreement with Contingent Right of Reverter dated August 10, 2002, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.2	Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated August 10, 2005, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.3	Second Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated August 10, 2005, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.4	Third Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated August 10, 2008, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.5	Fourth Amendment and Ratifications of Assignment Agreement with Contingent Right of Reverter dated January 1, 2010, between the Company, Idaho Industrial Minerals, LLC and Northwest Kaolin Inc.(2)
10.6	Employment Agreement dated April 1, 2013 between the Company and Thomas M. Conway.(2)
10.7	Loan Agreement dated September 13, 2013 between the Company and BV Lending LLC.(2)
10.8	Stock Option Plan.(1)
10.9	Sales Agreement dated April 28, 2014 between I-Minerals USA, Inc. and Pre-Mix, Inc.(2)
10.10	Loan Agreement dated February 18, 2015 between the Company and BV Lending LLC.(3)
10.11	Amendment Agreement dated December 1, 2015 between the Company and BV Lending LLC.(4)
10.12	Loan Agreement dated June 1, 2016 between the Company and BV Lending LLC. (5)
10.13	Amending Agreement dated October 25, 2017 between the Company and BV Lending LLC. (6)
10.14	Amending Agreement dated January 18, 2018 between the Company and BV Lending LLC. (7)
10.15	Amending Agreement dated March 30, 2018 between the Company and BV Lending LLC. (8)
10.16	Employment Agreement dated March 1, 2018 between the Company and John Theobald. (9)
10.17	Settlement Agreement dated August 3, 2018 between the Company and Thomas Conway. (9)
10.18	Loan Agreement dated September 11, 2018 between the Company and BV Lending LLC. (9)
10.19	Amending Agreement dated March 27, 2019 between the Company and BV Lending LLC
10.20	Amending Agreement dated June 28, 2019 between the Company and BV Lending LLC
10.21	Loan Agreement dated October 25, 2019 between the Company and BV Lending LLC. (11)
10.22	Amending Agreement dated October 25, 2019 between the Company and BV Lending LLC. (12)
10.23	Amending Agreement dated November 25, 2019 between the Company and BV Lending LLC. (12)
10.24	Amending Agreement dated January 20, 2020 between the Company and BV Lending LLC. (13)
10.25	Amending Agreements dated June 4, 2020 between the Company and BV Lending LLC. (14)
10.26	Amending Agreement dated July 8, 2020 between the Company and BV Lending LLC. (14)
10.27	Amending Agreements dated December 3, 2020 between the Company and BV Lending LLC. (15)
10.28	Amending Agreements dated March 9, 2021 between the Company and BV Lending LLC. (16)
10.29	Amending Agreements dated July 15, 2021 between the Company and BV Lending LLC. (17)
10.30	Amending Agreements dated November 15, 2021 between the Company and BV Lending LLC. (18)
10.31	Amending Agreements dated March 21, 2022 between the Company and BV Lending LLC. (19)
10.32	Amending Agreements dated June 14, 2022 between the Company and BV Lending LLC. (20)
10.33	Stock Purchase Agreement dated September 1314, 2022 between the Company and BV Lending LLC. (21)
31.1	Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002 (Rule 13a-14 and 15d-14 of the Exchange Act)
31.2	Certification of Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002 (Rule 13a-14 and 15d-14 of the Exchange Act)
32.1	Certification of Chief Executive Officer pursuant to pursuant to Section 1350 of Title 18 of the United States Code
32.2	Certification of Chief Financial Officer pursuant to pursuant to Section 1350 of Title 18 of the United States Code

2529

Notes:

2630

SIGNATURES

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

			I-MINERALS INC.
Date:	~~September~~December 1915, 2022	By:	/s/ John Theobald
			JOHN THEOBALD
			Chief Executive Officer and President
			(Principal Executive Officer)
Date:	~~September~~December 1915, 2022	By:	/s/ Matthew Anderson
			MATTHEW ANDERSON
			Chief Financial Officer
			(Principal Financial Officer and Principal Accounting Officer)

In accordance with the Securities Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Date:	~~September~~December 1915, 2022	By:	/s/ John Theobald
			JOHN THEOBALD
			Chief Executive Officer, President and Director
Date:	~~September~~December 1915, 2022	By:	/s/ W. Barry Girling
			W. BARRY GIRLING
			Director
Date:	~~September~~December 1915, 2022	By:	/s/ Gary Childress
			GARY CHILDRESS
			Director
Date:	~~September~~December 1915, 2022	By:	/s/ Wayne Moorhouse
			WAYNE MOORHOUSE
			Director

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