SEDAR Interim Financial Statements

Xigem Technologies Corporation Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Unaudited) Xigem Technologies Corporation For the three and nine-month periods ended September 30, 2025 and 2024 (Unaudited) Table of Contents Interim Condensed Consolidated Statements of Financial Position........................................................................................ 3 Interim Condensed Consolidated Statements of Loss and Comprehensive Loss .................................................................. 4 Interim Condensed Consolidated Statements of Changes in Equity....................................................................................... 5 Interim Condensed Consolidated Statements of Cash Flows ................................................................................................. 6 Notes to the Interim Condensed Consolidated Financial Statements ..................................................................................... 7 Xigem Technologies Corporation Interim Condensed Consolidated Statements of Financial Position As at September 30, 2025 and December 31, 2024 (Expressed in Canadian dollars) (Unaudited) The accompanying notes are an integral part of and should be read in conjunction with these interim condensed consolidated financial statements. Page 3 of 19 Note September 30, 2025 December 31, 2024 $ $ ASSETS Current Cash 14,536 34,446 Accounts receivable 9(b) 125,255 65,050 Indirect taxes recoverable 32,304 44,838 Loan receivable 4(b) 500,000 - 672,094 144,334 Non-current Property and equipment 5 18,647 44,639 Intangible assets 6 702,490 783,372 721,137 828,011 1,393,231 972,345 LIABILITIES Current Accounts payable and accrued liabilities 325,674 536,915 Interest payable 7 1,524 - Promissory notes payable 7 50,000 - Loan payable 4(b) 500,000 - 877,198 536,915 SHAREHOLDERS' EQUITY Share capital 4, 8 10,842,070 10,451,000 Contributed surplus 4,036,985 4,036,985 Options reserve 8 103,925 103,925 Deficit (14,466,946) (14,156,480) 516,034 435,430 1,393,231 972,345 Xigem Technologies Corporation Interim Condensed Consolidated Statements of Loss and Comprehensive Loss For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) (Unaudited) The accompanying notes are an integral part of and should be read in conjunction with these interim condensed consolidated financial statements. Page 4 of 19 Note For the 3 months ended 30-Sep-25 For the 9 months ended 30-Sep-25 For the 3 months ended 30-Sep-24 For the 9 months ended 30-Sep-24 $ $ $ $ REVENUE 4 921,017 2,006,812 167,624 1,581,967 DIRECT COSTS 4 893,387 1,946,607 162,596 1,534,509 GROSS MARGIN 27,631 60,206 5,028 47,458 EXPENSES Management and consulting 9 57,000 157,274 57,000 171,000 Amortization 5, 6 59,533 106,875 25,005 100,222 Financing fee 4(b) 50,000 50,000 - - Public filing fees 4,873 24,688 14,075 38,298 Professional fees 9 5,000 14,051 27,000 127,713 Investor relations 5,000 10,297 392 4,781 Advertising and promotion 3,281 6,705 2,103 4,491 Interest and bank charges (9) 782 245 592 Insurance - - 4,706 13,846 Dues and subscriptions - - - 452 184,678 370,672 130,526 461,395 LOSS BEFORE INCOME TAXES (157,047) (310,466) (125,498) (413,937) INCOME TAXES Current - - - - Deferred - - - - - - - - NET LOSS AND COMPREHENSIVE LOSS (157,047) (310,466) (125,498) (413,937) LOSS PER SHARE Basic 10 (0.002) (0.005) (0.002) (0.008) Dilute --- d 10 (0.002) (0.005) (0.002) (0.008) Xigem Technologies Corporation Interim Condensed Consolidated Statements of Changes in Equity For the nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) (Unaudited) The accompanying notes are an integral part of and should be read in conjunction with these interim condensed consolidated financial statements. Page 5 of 19 Note Share capital Share capital Contributed surplus Warrant reserve Options reserve Deficit Total equity # $ $ $ $ $ $ Balance, as at December 31, 2023 47,051,275 10,188,250 2,866,083 1,170,902 103,925 (13,668,238) 660,922 Private placemment 8(b) 2,500,000 105,000 - - - - 105,000 Debt conversion 8(b) 3,155,000 157,750 - - - - 157,750 Expiry of warrants 8(c) - 1,170,902 - (1,170,902) - - - Net loss and comprehensive loss - - - - - (413,937) (413,937) Balance, as at September 30, 2024 52,706,275 11,621,902 2,866,083 - 103,925 (14,082,175) 509,735 Balance, as at December 31, 2024 52,706,275 10,451,000 4,036,985 - 103,925 (14,156,480) 435,430 Debt conversion 8(b) 11,369,000 341,070 - - - - 341,070 Financing fee 4(a) 1,000,000 50,000 - - - - 50,000 Net loss and comprehensive loss - - - - - (310,466) (310,466) Balance, as at June 30, 2025 65,075,275 10,842,070 4,036,985 - 103,925 (14,466,946) 516,034 Xigem Technologies Corporation Interim Condensed Consolidated Statements of Cash Flows For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) (Unaudited) The accompanying notes are an integral part of and should be read in conjunction with these interim condensed consolidated financial statements. Page 6 of 19 For the 3 months ended 30-Sep-25 For the 9 months ended 30-Sep-25 For the 3 months ended 30-Sep-24 For the 9 months ended 30-Sep-24 $ $ $ $ OPERATING ACTIVITIES Net loss and comprehensive loss (157,047) (310,466) (125,498) (413,937) Items not affecting cash: Amortization and impairment 59,533 106,875 25,005 100,222 (97,514) (203,591) (100,493) (313,715) Changes in non-cash working capital balances: Accounts receivable (27,631) (60,206) (5,028) (47,458) Indirect taxes recoverable 8,473 12,534 7,876 50,879 Interest payable 1,250 1,524 - - Accounts payable and accrued liabilities 97,277 179,829 33,409 242,917 79,369 133,681 36,257 246,338 (18,145) (69,910) (64,236) (67,377) FINANCING ACTIVITIES Proceeds from issuance of promissory notes - 50,000 - - Proceeds from issuance of shares - - - 105,000 - 50,000 - 105,000 Change in cash (18,145) (19,910) (64,236) 37,623 Cash, beginning of period 32,681 34,446 105,750 3,891 Cash, end of period 14,536 14,536 41,514 41,514 Supplementary non-cash investing and financing transactions Shares issued for debt settlement 50,000 391,070 - - TLA Facility (Note 4(b)), payable 500,000 500,000 - - TLA Facility (Note 4(b)), receivable (500,000) (500,000) - - Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 7 of 19 1. GENERAL INFORMATION Xigem Technologies Corporation ("Xigem" or the "Company") seeks to become a leading Software as a Service technology platform. Using patented and proprietary technology, the Company seeks to provide organizations with the infrastructure necessary to manage employees, assets, resources, and other business operations in a variety of environments. 10557536 Canada Corp. ("105CC") was incorporated on D --- ecember 27, 2017 under the Canada Business Corporations Act with its head office located at 401 Bay Street, Suite #2100, Toronto, Ontario, Canada, M5H 2Y4. The Company was incorporated under the Business Corporations Act of Ontario on June 15, 2020. The Company's registered head office is located at 70 Great Gulf Drive, Suite 67, Vaughan, Ontario, L4K 0K7. 2. BASIS OF PREPARATION (a) Going concern These interim condensed consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will continue in operations for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of business. The realizable values may be substantially different from their carrying values, as shown in these interim condensed consolidated financial statements. These interim condensed consolidated financial statements do not affect 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. Such adjustments could be material. As at September 30, 2025, the Company had an accumulated deficit of $14,416,946 (December 31, 2024 – $14,156,480). The Company has not yet been able to generate positive cash flows from operations. Whether and when the Company can generate sufficient cash flows to pay for its expenditures and settle its obligations as they fall due after September 30, 2025, is uncertain. To address the going concern risk, the Company continues to seek equity and other financing alternatives to support ongoing operations, monitor general and administrative expenses compared to budget, and optimize its operating processes. (b) Statement of compliance The interim condensed consolidated financial statements of the Company have been prepared in accordance with International Accounting Standards (“IAS”) 34 – Interim Financial Reporting, prepared using accounting policies consistent with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and interpretations of the IFRS Interpretations Committee (“IFRIC”). These interim condensed consolidated financial statements do not include all of the information required for full annual consolidated financial statements and should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2024. These interim condensed consolidated financial statements were approved by the Board of Directors on November 21, 2025. Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 8 of 19 2. BASIS OF PREPARATION (CONT'D) (c) Basis of consolidation The interim condensed consolidated financial statements comprise the accounts of the Company and its controlled subsidiaries. The financial statements of subsidiaries are included in the interim condensed consolidated financial statements from the date that control commences until the date that control ceases. The interim condensed consolidated financial statements are prepared using uniform accounting policies for like transactions and other events in similar circumstances. Control is achieved when the Company is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns --- through its power over the investee. Specifically, the Company controls an investee if and only if the Company has all the following: • power over the investee. • exposure, or rights, to variable returns from its involvement with the investee; and • the ability to use its power over the investee to affect the amount of the investor’s returns. All transactions and balances between the Company and its subsidiaries are eliminated on consolidation, including unrealized gains and losses on transactions between companies. The Company’s material subsidiaries as at September 30, 2025 are as follows: Name of subsidiary Country of incorporation Ownership percentage Functional currency Xigem Technology Canada 100% Canadian Dollar Solutions Inc. 1000145269 Ontario Inc. Canada 100% Canadian Dollar (d) Basis of presentation The interim condensed consolidated financial statements are prepared on a going concern basis using the historical cost method, except for certain financial instruments that have been measured at fair value. In addition, these interim condensed consolidated financial statements have been prepared using the accrual basis of accounting, except for cash flow information. The Company presents its classified consolidated statements of financial position distinguished between current and non-current assets and liabilities. (e) Significant judgments The preparation of the Company's interim condensed consolidated financial statements under IFRS requires management to exercise judgment in applying the Company's accounting policies. Judgments made by management in the ongoing application of IFRS that have a significant effect on the interim condensed consolidated financial statements are outlined below: i) Going concern The Company applies judgment to determine whether there are material uncertainties that may cast significant doubt on the Company’s ability to continue as a going concern. Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 9 of 19 2. BASIS OF PREPARATION (CONT'D) (e) Significant judgments (cont’d) ii) Non-financial assets The Company applies judgment to assess whether there are any indications that its non-financial assets may be impaired. This assessment requires an assessment of external, internal and other indicators at the end of each reporting period. iii) Provisions and contingencies The Company may encounter obligations arising from past events, which will only be confirmed by the occurrence or non-occurrence of future events not wholly within the control of the Company or where the obligation cannot be reliably estimated. The Company reviews such situations at each consolidated statement of financial position date and makes judgments on all information available to determine if an outflow of economic resources can be reliably estimated or not. If this is not possible, a contingency is reported for each material case. iv) Research and development costs Judgment is required to distinguish the research phase and the development phase to correctly identify costs that qualify for capitalization. v) Income taxes The Company applies judgment in determining the tax rates applicable to the temporary differences to determine the provision for income taxes. Deferred taxes relate to temporary differences between accounting and tax asset values. They are measured using tax rates --- that are expected to apply in the year when the asset is realized, or the liability is settled. Temporary differences are differences between accounting and tax asset values expected to be deductible or taxable in the future. (f) Use of estimates and assumptions The preparation of the Company's interim condensed consolidated financial statements requires management to make estimates based on events and circumstances that existed at the consolidated statement of financial position date. Accordingly, actual results may differ from these estimates. Significant estimates made by management with a significant risk of material adjustment in the current and following years are discussed below: i) Non-financial assets The Company estimates the useful life of its non-financial assets, which include an assessment of the expected usage of the asset, product life-cycles, technological obsolescence and the period of control over the asset. The useful life impacts the amount of amortization recorded in profit or loss in during the year, and the corresponding reduction of the non-financial assets value. Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 10 of 19 2. BASIS OF PREPARATION (CONT'D) (f) Use of estimates and assumptions (cont’d) ii) Share subscription receivable The Company applies judgment in determining the recoverability of the share subscription receivable. iii) Share-based payments The Company measures equity-settled share-based payment transactions based on an estimate of the fair value of goods or services received, unless that fair value cannot be estimated reliably, in which case the Company measures the fair value of the goods or services received based on the fair value of the equity instruments granted. iv) Warrants The Company uses the Black-Scholes model to calculate the value of warrants issued as part of the Company's private placements. The Black-Scholes model requires six key inputs to determine a value of warrants: risk-free interest rate, exercise price, market price at the date of issuance, expected dividend yield, expected life, and expected volatility. Certain of the inputs are estimates which involve considerable judgment and are or could be, affected by significant factors that are out of the Company's control. For example, a longer expected life of the warrants or higher volatility number used would result in an increase in the warrant value. (g) Functional and presentation currency These interim condensed consolidated financial statements are presented in Canadian dollars, which is the Company’s functional and presentation currency. 3. SIGNIFICANT ACCOUNTING POLICIES (a) Future accounting pronouncements The following standards have not yet been adopted and are being evaluated to determine their impact on the Company. Amendments to IAS 21 Lack of exchangeability Amendments to IFRS 18 Presentation and disclosures in financial statements Amendments to IFRS 7 & 9 Classification and measurement of financial instruments Annual Improvements to IFRS Volume 11 The directors do not expect that the adoption of the Standards listed above will have a material impact on the interim condensed financial statements of the Company in future periods. Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods --- ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 11 of 19 4. ACQUISITION (a) Acquisition of SaaS, EAFdigital Inc. On November 24, 2022, the Company entered into a letter of intent to acquire substantially all of the assets of EAFdigital Inc. (“EchoDigital”), an online SaaS-based artificial intelligence-driven automobile shopping and delivery platform, for aggregate consideration that was to be determined prior to closing, and was satisfied through and paid in Common Shares of the Company on the basis of a deemed price per Common Share equal to the share price at the day of Closing on which the Company’s shares have traded on the Canadian Securities Exchange (“CSE”), unless otherwise mutually agreed to by the parties. On February 24, 2023, the Company closed the acquisition of “EchoDigital”. The Company purchased substantially all of the assets of EchoDigital from EAF Group of Companies for aggregate consideration of 8,924,495 common shares. Based on the closing price of the Company’s common shares on February 24, 2023, the EchoDigital’s shares were valued at $892,450. On March 8, 2023, the Company announced that it had closed its acquisition of substantially all of the assets of EchoDigital. In addition to the Shares issued to the Vendor, a finder’s fee of 892,450 common shares of the Company, representing approximately 10% of the value of the Transaction has been issued to an arm’s-length party and is subject the customary four (4) month resale restriction under applicable securities laws. As of the date of these statements, the majority of the shares issued pursuant to the Transaction remain under resale restriction. EchoDigital is the Company’s proprietary Saas-based, AI employing platform which assists in seamlessly capturing and converting used car consumer leads from traditional sources. EchoDigital can then assess and qualify the leads in part to determine their aptitude, and subsequently match them with a used car dealer’s most suitable customer sales representative. EchoDigital has been solely responsible for the Company’s growth in its most recent fiscal periods. In accordance with the royalty and service-based management agreement between Xigem and Carnance Inc. (“Carnance”), in the three-month period ending September 30, 2025, Xigem: (i) charged a royalty fee of $921,017 and (ii) accrued a management fee payable to Carnance Inc. of $893,387. (b) Acquisition of SaaS, EAFdigital Inc. During the nine-month period ended September 30, 2025 the Company closed on a tripartite loan agreement (the “TLA Facility”) where the lender provided up to $500,000 to support the Company’s EchoDigital business unit through an arrangement that provides funding to Carnance. The parties to the TLA Facility include: the Company, Carnance, and an entity controlled by a Director of the Company (hereafter, the “Lender”). The sole purpose of the TLA Facility is to provide Carnance with the further ability to purchase non-commercial passenger cars, light trucks and sport utility/activity vehicles as inventory for re-sale. As at September 30, 2025, the Company had recognized a loan payable of $500,000 to the Lender, a corresponding loan receivable of $500,000 from Carnance, and has settled a financing fee of $50,000 with a combination of common shares of the Company and warrants (Note 8). Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended Septembe --- r 30, 2025 and 2024 (Expressed in Canadian dollars) Page 12 of 19 5. PROPERTY AND EQUIPMENT The right-of-use asset consists of a lease for corporate office facilities and is amortized on a monthly basis over 5- year term of lease on a straight-line basis, ending on April 30, 2026. The useful life of the leasehold improvement is 2 years, amortized on a straight-line basis. 6. INTANGIBLE ASSETS The Company periodically reassess the estimated economic life and the recoverability of the capitalized software costs. If the Company determines that the capitalized amounts are not recoverable based on the expected net cash flows to be generated from sales of the applicable software solutions, the amount by which the unamortized capitalized costs exceed the net realizable value is written down as a charge to the consolidated statements of operations and comprehensive loss. The software is amortized over a period of 180 months on straight-line basis. Leasehold improvements Right-of-use asset Total $ $ $ Cost Balance at December 31, 2024 313,273 173,270 173,270 Additions - - - Balance at September 30, 2025 313,273 173,270 173,270 Accumulated amortization Balance at December 31, 2024 313,273 128,631 128,631 Amortization - 25,992 25,992 Balance at September 30, 2025 313,273 154,623 154,623 Carrying amounts At December 31, 2024 - 44,639 44,639 At September 30, 2025 - 18,647 18,647 Licences and trademarks Software Total $ $ $ Cost Balance at December 31, 2024 640,750 1,617,734 2,258,484 Additions - - - Balance at September 30, 2025 640,750 1,617,734 2,258,484 Accumulated amortization Balance at December 31, 2024 640,750 834,361 1,475,111 Amortization - 80,883 80,883 Balance at September 30, 2025 640,750 915,244 1,555,994 Carrying amounts At December 31, 2024 - 783,373 783,373 At September 30, 2025 - 702,490 702,490 Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 13 of 19 7. PROMISSORY NOTES Promissory notes payable bear interest at 10% per annum, are unsecured and due on June 11, 2026. All promissory notes payable are provided by related parties which are existing shareholders. The continuity of the promissory notes payable is presented in the table below: 8. EQUITY (a) Authorized Unlimited Common shares. Unlimited First Preference Shares, voting, non-cumulative, issuable in series with rights, privileges, restrictions and conditions determined by the directors and officers of the Company. Unlimited First Preference Shares, non-voting, non-cumulative, issuable in series with rights, privileges, restrictions and conditions determined by the directors and officers of the Company. (b) Issued and outstanding Amount $ Balance at December 31, 2024 - Additions 50,000 Interest expense 1,524 Balance at June 30, 2025 51,524 Interest payable 1,524 Promissory notes payable 50,000 51,524 Number of shares Amount # $ Balance, December 31, 2023 47,051,275 10,188,250 Private placement 2,500,000 105,000 Debt conversion 3,155,000 157,750 Expiry of warrants - 1,170,902 Balance, September 30, 2024 52,706,275 11,621,902 Balance, December 31, 2024 52,706,275 10,451,000 Debt conversion 11,369,000 341,070 Financing fee (Note 4(a)) 1,000,000 50,000 Balance, September 30, 2025 65,075,275 10,842,070 Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month peri --- ods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 14 of 19 8. EQUITY (CONT’D) (b) Issued and outstanding (cont’d) On March 8, 2023, the Company issued shares to acquire EAFdigital Inc. for $941,534, at $892,450 for all of EchoDigital’s shares, and a $49,084 finder’s fee. On March 28, 2024, the Company entered into debt settlement agreements with certain of its creditors (together, the “Creditors”) to issue 3,155,000 common shares (the “Settlement Shares”) to such Creditors in exchange for outstanding accounts payable totaling $157,750 (the “Shares for Debt Transaction”) owing to the Creditors. The Settlement Shares were issued at a price of $0.05, in accordance with the policies of the Canadian Securities Exchange (the “CSE”). The Shares for Debt Transaction included $107,350 settled for amounts owed to management. On the same date, the Company also announced that it had closed its non-brokered private placement by issuing 2,500,000 units (the “Units”) at a price of $0.042 per Unit for aggregate proceeds to the Company of $105,000. Each Unit consisted of one common share in the capital of the Company (each, a "Common Share"), and one common share purchase warrant (each a "Warrant"), with each Warrant entitling the holder to acquire an additional Common Share for a period of 24 months from closing at an exercise price of $0.065. The private placement included 595,238 units issued to management. As of July 17, 2024, a letter of indemnity was filed for an extension of the hold periods for 8,825,335 common shares issued for the acquisition of EchoDigital. As of that date, 4,908,472 common shares remained in escrow until February 7, 2025, and 3,916,863 common shares will remain in escrow until July 7, 2025. On January 22, 2025 the escrow dates were extended to August 7, 2025 and January 7, 2026. On March 10, 2025, the Company entered into debt settlement agreements with certain of its creditors (together, the “Creditors”) to issue 11,369,000 common shares (the “Settlement Shares”) to such Creditors in exchange for outstanding accounts payable totaling $341,070 (the “Shares for Debt Transaction”) owing to the Creditors. The Settlement Shares were issued at a price of $0.03, in accordance with the policies of the Canadian Securities Exchange (the “CSE”). During the three months ended September 30, 2025, the Company entered into debt settlement agreements with certain of its creditors to issue 1,000,000 common shares in exchange for outstanding accounts payable totaling $50,000. The Settlement Shares were issued at a price of $0.05, in accordance with the policies of the CSE. Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 15 of 19 8. EQUITY (CONT’D) (c) Warrants As at September 30, 2025, the Company had the following warrants outstanding with the corresponding average exercise prices: In connection with the TLA Facility (Note 4(b)), the Company issued 1,000,000 warrants with each warrant exercisable for $0.50 per common share and expiring in 24 months from the date of issuance. The Company calculated the fair value of warrants issued to be $Nil based on the following inputs: Current stock price of $0.005; Exercise price of $0.05; Number of periods to exercise of 1.75; Compound risk-free rate of 2.62%; and standard deviation of 6.13%. (d) Options The outstanding stoc --- k options as at September 30, 2025 are as follows: On January 5, 2023, the Company issued 1,820,000 incentive stock options (the “Options”) pursuant to its Stock Option Plan. The Options had been granted to several of the Company’s directors, officers, consultants, and advisory board members. The Options have a strike price of $0.09 per share with expiry date on January 5, 2028. Number of warrants Weighted-avg. exercise price # $ Balance, December 31, 2023 1,361,929 3.88 Granted - - Expired (1,361,929) - Balance, September 30, 2024 - - Balance, December 31, 2024 - - Granted 1,000,000 0.05 Expired - - Balance, September 30, 2025 1,000,000 0.05 September 30, 2025 December 31, 2024 # # Opening number of options 1,820,000 1,820,000 Granted during the year - - Exercised during the year - - Cancelled/forfeited during the year - - Closing number of options 1,820,000 1,820,000 Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 16 of 19 8. EQUITY (CONT’D) (e) Maximum share dilution The following table presents the maximum number of shares that would be outstanding if all outstanding warrants and options were exercised as at September 30, 2025 and December 31, 2024. 9. RELATED PARTY TRANSACTIONS AND BALANCES (a) Key management personnel transactions Key management includes the Company’s directors, officers and any consultants with the authority and responsibility for planning, directing, and controlling the activities of an entity, directly or indirectly. Management of the Company appointed by the board of directors as follows: Chief Executive Officer, Chief Financial Officer. During the three and nine-month periods ended September 30, 2025 and 2024, key management personnel compensation consisting exclusively of short-term benefits as follows: (b) EchoDigital The Company has entered into a management agreement with Carnance Inc., under which it earns all its revenues. The terms of the agreement stipulate that the Company is entitled to royalties based on certain sales metrics achieved by EchoDigital. Revenue is recognized on royalties earned from sales generated by EchoDigital. As of September 30, 2025, the total amount receivable from EchoDigital was $125,255, which is presented on the statement of financial position. This balance includes accrued royalty revenues. The balance is unsecured, interest free and due to be recovered in the next 12 months after September 30, 2025. September 30, 2025 December 31, 2024 # # Common shares outstanding 65,075,275 52,706,275 Options to purchase common shares 1,820,000 1,820,000 Maximum share dilution 66,895,275 54,526,275 For the 3 months ended 30-Sep-25 For the 9 months ended 30-Sep-25 For the 3 months ended 30-Sep-24 For the 9 months ended 30-Sep-24 $ $ $ $ Management and consulting fees incurred 57,000 157,274 57,000 171,000 Public filing fees and professional fees 13,281 42,147 41,075 166,011 70,281 199,421 98,075 337,011 Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 17 of 19 9. RELATED PARTY TRANSACTIONS AND BALANCES (CONT’D) (b) EchoDigital (cont’d) All transactions and outstanding balances with EchoDigital are conducted in accordance with terms negotiated at arm's length, which include payment t --- erms and other conditions. The Company acknowledges a significant economic dependence on EchoDigital, from which it currently derives all its revenues. This dependence is continually assessed as part of the Company's broader risk management and strategic planning processes. 10. LOSS PER SHARE Basic and diluted loss per share are presented on the face of the consolidated statement of profit or loss and other comprehensive income. Basic loss per share is calculated by dividing the loss attributable to ordinary equity holders of the Company by the weighted average number of ordinary shares outstanding during the period. In accordance with IAS 33 Earnings per Share, diluted loss per share is equal to basic loss per share for all periods presented, as the Company has no outstanding warrants and the outstanding share options are anti-dilutive in the current and comparative periods. Potential ordinary shares in respect of these share options have therefore been excluded from the calculation of diluted loss per share. The Company had no other instruments outstanding that could potentially dilute basic loss per share. 11. FINANCIAL INSTRUMENTS (a) Accounting classifications and fair values All financial instruments on the statement of financial position are held at amortized cost as at September 30, 2025 and December 31, 2024. (b) Transfers For periods ended September 30, 2025 and 2024, there have been no transfers between Level 1, Level 2, and Level 3. Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 18 of 19 11. FINANCIAL INSTRUMENTS (CONT’D) (c) Financial risk management The Company has exposure to credit risk, liquidity risk, and market risk arising from financial instruments. Management considers credit risk and market risk to be low. i) Risk management framework The Company's board of directors has overall responsibility for the establishment and oversight of the Company's risk management framework. The board of directors has established the risk management committee, which is responsible for developing and monitoring the Company's risk management policies. The committee reports regularly to the board of directors on its activities. The Company's risk management policies are established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company's activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations. ii) Liquidity risk Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company's approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company's reputation. The Company aims to maintain the level of its cash and cash equivalents at an amount in excess of expected cash outflows on liab --- ilities (other than trade payables) over the next 60 days. The Company also monitors the level of expected cash inflows on trade and other receivables, together with the expected outflows on trade and other payables. The Company's exposure to liquidity risk is $327,198 as at September 30, 2025 (December 31, 2024 – $536,915), for which the Company has cash of $14,536 on hand to satisfy its liabilities as at September 30, 2025 (December 31, 2024 – $34,446). There have been no changes to the method for managing liquidity risk. iii) Credit risk Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. In order to reduce its credit risk, the Company reviews a new customer's credit history before extending credit and conducts regular reviews of its existing customers' credit performance. An allowance for doubtful accounts is established based upon factors surrounding the credit risk of specific accounts, historical trends and other information. iv) Market risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency rate risk, interest rate risk and other price risk. The Company is mainly exposed to interest rate and currency risk. Xigem Technologies Corporation Notes to the Interim Condensed Consolidated Financial Statements For the three and nine-month periods ended September 30, 2025 and 2024 (Expressed in Canadian dollars) Page 19 of 19 12. CAPITAL MANAGEMENT The Company defines capital as its equity. The Company's objective when managing capital is: (i) to safeguard the ability to continue as a going concern so that it can continue to provide returns to shareholders and benefits to other stakeholders; and (ii) to provide an adequate return to shareholders by obtaining an appropriate amount of financing commensurate with the level of risk. The Company sets the amount of capital in proportion to the risk. The Company manages its capital structure and adjusts in light of the changes in economic conditions and the characteristic risk of underlying assets. To maintain or adjust the capital structure, the Company may repurchase shares, return capital to shareholders, issue new shares, or sell assets to reduce debt. The Company’s objective is met by retaining adequate liquidity to provide for the possibility that cash flows from assets will not be sufficient to meet operational, investing, and financing requirements. There have been no changes to the Company's capital management policies during the periods ended September 30, 2025 and 2024. 13. SEGMENTED INFORMATION In measuring its performance, the Company does not distinguish or group its operations on a geographical or any other basis and accordingly has a single reportable operating segment. Management has applied judgment by aggregating its operating segments into one single reportable segment for disclosure purposes. Such judgment considers the nature of the operations and an expectation of operating segments within a reportable segment with similar long-term economic characteristics. The Company's Chief Executive Officer is the chief operating decision-maker and regularly reviews The Company’s operations and performance on an aggregate basis. The Company does not have any significant customers or any significant groups of customers. 14. CONTINGENCIES AND COMMI --- TMENTS (a) Civil action On March 8, 2022, the Company was served with a statement of claim in the Ontario Superior Court of Justice. Lumbermens Credit Group Ltd. ("Lumbermens") has commenced a civil action against Xigem Technologies Corporation as well as 2747524 Ontario Inc. o/a Cylix Data, 997322 Ontario Inc., Roy Murad, Jacob Murad, Aaron Murad, Noah Murad and Monica Murad (the "Action"). The Action seeks, among other things, damages of $32,350,000 for alleged unlawful competition, misuse of confidential information, conversion and copyright infringement. In addition, the Action seeks certain declaratory relief, punitive damages of $1,000,000, interest and legal costs. The Company has formally delivered its statement of defense on April 20, 2022. As of the date of these interim condensed consolidated financial statements, Lumbermens’ civil action against Xigem has been dormant for over 36 months. Management still intends to vigorously defend the Action and seek the costs for so doing from the plaintiff. The Company has a continuing agreement with Nexus Tradco International that is a related party related through common ownership to provide professional consulting services for $10,000 per month on a month-to-month basis.