SEDAR Interim Financial Statements

Condensed Interim Consolidated Financial Statements December 31, 2025 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) NOTICE OF NO AUDITOR REVIEW OF THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS In accordance with National Instrument 51-102 Part 4, subsection 4.3(3)(a), if an auditor has not performed a review of these condensed interim consolidated financial statements, they must be accompanied by a notice indicating that the condensed interim consolidated financial statements have not been reviewed by an auditor. The accompanying unaudited condensed interim consolidated financial statements of the Company for the six months ended December 31, 2025 have been prepared by and are the responsibility of the Company’s management, and have not been reviewed by the Company’s auditors. FALCON GOLD CORP. Condensed Interim Consolidated Statements of Financial Position As at December 31, 2025 and June 30, 2025 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) (The accompanying notes are an integral part of these condensed interim consolidated financial statements) 3 | P a g e December 31, June 30, 2025 2025 ASSETS Current Cash $ 20,425 $ 42,723 Amounts receivable (Note 9) 228,456 77,569 Marketable securities (Note 5) 222,716 175,216 Prepaid expenses (Note 9) 35,000 26,773 $ 506,597 $ 322,281 LIABILITIES Current Accounts payable and accrued liabilities (Note 9) $ 2,851,919 $ 1,360,046 Loan payable (Note 7) 115,000 - Premium on flow-through (Note 11) - 135,447 2,966,919 1,495,493 SHAREHOLDERS’ EQUITY (DEFICIENCY) Share capital (Note 8) 13,212,877 13,200,377 Share subscriptions (receivable) (26,276) (51,276) Reserves (Note 8) 2,298,455 2,307,540 Deficit (17,945,378) (16,629,853) (2,460,322) (1,173,212) $ 506,597 $ 322,281 Nature of operations and going concern (Note 1) Subsequent events (Note 12) Approved and authorized for issuance on behalf of the Board of Directors on February 18, 2026: /s/ Karim Rayani /s/ Michelle Suzuki Karim Rayani Michelle Suzuki FALCON GOLD CORP. Condensed Interim Consolidated Statements of Operations and Comprehensive Loss For the six months ended December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) (The accompanying notes are an integral part of these condensed interim consolidated financial statements) 4 | P a g e For the three months ended December 31, For the six months ended December 31, 2025 2024 2025 2024 Administrative expenses Consulting fees $ 1,500 $ 41,500 $ 4,750 $ 46,000 Exploration expenditures (Note 6) 375,239 147,382 1,316,994 363,944 Filing fees and communications 5,272 62,614 14,909 101,101 General and administration costs (Note 9) 7,486 10,744 12,670 29,128 Management fees (Note 9) 45,000 45,000 90,000 90,000 Professional fees (Note 9) 32,097 34,093 54,510 58,637 Share-based payments (Notes 8 and 9) 1,049 20,553 3,415 24,494 Travel and promotion 711 848 1,224 5,573 468,354 362,734 1,498,472 718,877 Loss before other items (468,354) (362,734) (1,498,472) (718,877) Other items Other income (Note 11) - - 135,447 4,000 Unrealized gain on marketable securities (Note 5) 27,500 48,692 47,500 2,385 27,500 48,692 182,947 6,385 Net loss and comprehensive loss for the period $ (440,854) $ (314,042) $ (1,315,525) $ (712,492) Basic and diluted loss per share $ (0.00) $ (0.00) $ (0.01) $ (0.00) Weighted average number of common shares outstanding 177,809,130 162,230,664 177,621,630 156,788,455 FALCON GOLD CORP. Condensed Inte --- rim Consolidated Statements of Changes in Shareholders’ Equity (Deficiency) For the six months ended December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) (The accompanying notes are an integral part of these condensed interim consolidated financial statements) 5 | P a g e Number of Shares Share Capital Share subscriptions received (receivable) Contributed Surplus Deficit Total Shareholders’ Equity Balance, June 30, 2024 148,831,028 $ 12,330,899 $ (25,000) $ 2,228,490 $ (15,248,387) $ (713,998) Cash Private placement 25,316,660 1,070,750 - - - 1,070,750 Exercise of warrants 150,000 7,500 - - - 7,500 Exercise of stock options 300,000 24,000 - (9,000) - 15,000 Share issue costs - (75,250) - 12,600 - (62,650) Flow-through premium (151,000) (151,000) Share-based compensations - - - 24,494 - 24,494 Net loss for the period - - - - (712,492) (712,492) Balance, December 31, 2024 174,597,688 $ 13,206,899 $ (25,000) $ 2,256,584 $ (15,960,879) $ (522,396) Balance, June 30, 2025 177,434,130 $ 13,200,377 $ (51,276) $ 2,307,540 $ (16,629,853) $ (1,173,212) Share subscription received - 25,000 - - 25,000 RSUs vested to shares 500,000 12,500 - (12,500) - - Share-based payments - - - 3,415 - 3,415 Net loss for the period - - - - (1,315,525) (1,315,525) Balance, December 31, 2025 177,934,130 $ 13,212,877 $ (26,276) $ 2,298,455 $ (17,945,378) $ (2,460,322) FALCON GOLD CORP. Condensed Interim Consolidated Statements of Cash Flows For the six months ended December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) (The accompanying notes are an integral part of these condensed interim consolidated financial statements) 6 | P a g e For the six months ended December 31, 2025 2024 Operating Activities Net loss for the period $ (1,315,525) $ (712,492) Items not affecting cash Unrealized loss (gain) on marketable securities (47,500) (2,385) Share-based payment 3,415 24,494 Other income (135,447) (4,000) Changes in non-cash working capital items related to operations: Amount receivable (150,887) 14,117 Prepaid expenses and deposits (8,227) (17,586) Accounts payable and accrued liabilities 1,491,873 105,679 Cash used in operating activities (162,298) (592,173) Financing Activities Shares issued for cash - 1,093,250 Share issue costs (62,650) Share subscription receivable 25,000 - Loan payable 115,000 - Cash provided by financing activities 140,000 1,030,600 Change in cash during the period (22,298) 438,427 Cash, beginning of period 42,723 55,748 Cash, end of the period $ 20,425 $ 494,175 Supplemental Disclosure of Cash Flow Information: Cash paid during the period: Interest $ - $ - Income taxes $ - $ - Non-cash transactions Transfer of fair value on exercise of stock options $ 12,500 $ 9,000 Fair value of broker warrants $ - $ 12,600 FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 7 | P a g e 1. NATURE OF OPERATIONS AND GOING CONCERN Falcon Gold Corp. (the “Company”) was incorporated pursuant to the provisions of the Business Corporations Act (Ontario) on November 24, 2006 and was continued under the Business Corporations Act (British Columbia) on May 2, 2013. The address of the Company and the registered office is Suite 220, 145 Chadwick Court, North Vancouver, British Columbia V7M 3K1. The address of the records office is 200-3310 South Service Road, Burlin --- gton, Ontario L7N 3M6. These condensed interim consolidated financial statements have been prepared on the assumption that the Company will continue as a going concern, meaning it will continue in operation for the foreseeable future and will be able to realize assets and discharge liabilities in the ordinary course of operations. Different bases of measurement may be appropriate if the Company was not expected to continue operations for the foreseeable future. At December 31, 2025, the Company has not achieved profitable operations, has accumulated losses of $17,945,378 since inception and expects to incur further losses in the development of its business. The above material uncertainties cast significant doubt about the Company’s ability to continue as a going concern. The Company’s continuation as a going concern is dependent upon successful results from its exploration and evaluation activities, its ability to attain profitable operations to generate funds and/or its ability to raise equity capital or borrowings sufficient to meet its current and future obligations. Although the Company has been successful in the past in raising funds to continue operations, there is no assurance it will be able to do so in the future. These condensed interim consolidated financial statements do not give effect to any adjustments which would be necessary should the Company be unable to continue as a going concern and therefore be required to realize its assets and discharge its liabilities in other than the normal course of business and at amounts different from those reflected in these consolidated financial statements. Failure to arrange adequate financing on acceptable terms and/or achieve profitability may have an adverse effect on the financial position, results of operations, cash flows, and prospects of the Company. There are many external factors that can adversely affect general workforces, economies and financial markets globally. An example includes, but is not limited to, political conflict in other regions. It is not possible for the Company to predict the duration or magnitude of adverse results of such external factors and their effect on the Company’s business or ability to raise funds. 2. BASIS OF PREPARATION Statement of compliance These condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standards 34, Interim Financial Reporting (“IAS 34”) 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”). The condensed interim consolidated financial statements were authorized for issue by the Board of Directors on February 18, 2026. Basis of Measurement These condensed interim consolidated financial statements have been prepared on a historical cost basis. In addition, these condensed interim consolidated financial statements have been prepared using the accrual basis of accounting except for cash flow information. The presentation currency and the functional currency of the Company and its subsidiaries is the Canadian dollar. FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 8 | P a g e 2. BASIS OF PREPARATION (continued) Basis of Measurement These interim consolidated financial s --- tatements have been prepared on a historical cost basis. In addition, these interim consolidated financial statements have been prepared using the accrual basis of accounting except for cash flow information. The presentation currency and the functional currency of the Company and its subsidiaries is the Canadian dollar. 3. SIGNIFICANT ACCOUNTING POLICIES The preparation of financial data is based on accounting principles and practices consistent with those used in the preparation of the audited consolidated financial statements as at June 30, 2025. Recent accounting pronouncements A number of new standards, and amendments to standards and interpretations, are not yet effective for the fiscal period ended December 31, 2025 and have not been adopted early in preparing these financial statements. These new standards, and amendments to standards and interpretations are either not applicable or are not expected to have a significant impact on the Company’s financial statements. 4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS The Company makes estimates and assumptions about the future that affect the reported amounts of assets and liabilities. Estimates and judgments are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. The effect of a change in an accounting estimate is recognized prospectively by including it in net loss in the year of the change, if the change affects that year only, or in the year of the change and future years, if the change affects both. Determining Amount and Timing of Reclamation Provisions A reclamation provision represents the present value of estimated future costs for the reclamation of the Company’s mineral properties. These estimates include assumptions as to the future activities, cost of services, timing of the reclamation work to be performed, inflation rates and interest rates. The actual cost to reclaim a mine or exploration property may vary from the estimated amounts because there are uncertainties with respect to the extent of required future remediation activities, as studies are currently ongoing, and uncertainties in factors used to estimate the cost and potential changes in regulations or laws governing the reclamation of a mineral property. Management periodically reviews the reclamation requirements and adjusts the liability as new information becomes available and will assess the impact of new regulations and laws as they are enacted. Going Concern The assessment of the Company’s ability to execute its strategy by funding future working capital requirements involves judgement. Management monitors future cash requirements to assess the Company’s ability to meet these future funding requirements. Further information regarding going concern is outlined in Note 1. FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 9 | P a g e 4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (continued) Share-based payment transactions The Company uses the Black-Scholes Option Pricing Model for valuation of share-based compensation and other equity based payments. Option pricing models require the input of subjective assumptions including expected price volatility, interest rate, and forfeitu --- re rate. Changes in the input assumptions can materially affect the fair value estimate and the Company’s earnings and equity reserves. 5. MARKETABLE SECURITIES Marketable securities are fair valued at the end of each reporting period. Number of Fair Value at Number of Fair Value at Investment in marketable securities shares/Units Held Investment Cost December 31, 2025 shares/Units Held Investment Cost June 30, 2025 # $ $ # $ $ Public Companies Portofino Resources Inc. 161,500 18,573 1,615 161,500 18,573 1,615 Marvel Discovery Corp. 1,500,000 75,000 45,000 1,500,000 75,000 45,000 Power One Resources Corp. 300,000 - 15,000 300,000 - 4,500 Carmanah Minerals Corp. 4,000,000 120,000 120,000 4,000,000 120,000 80,000 Carmanah – Warrants 4,000,000 74,500 41,100 4,000,000 74,500 44,100 Private Company Latamark Resources Corp. 5,000,000 15,878 1 5,000,000 15,878 1 Total 14,961,500 303,951 222,716 14,961,500 303,951 175,216 On January 16, 2024, the Company received 4,000,000 common shares and 4,000,000 share purchase warrants pursuant to a property option agreement. The share purchase warrants enables the holder of each warrant to subscribe for one common share of Carmanah at a price of $0.10 for a period of three years from the date of issue. The Carmanah shares were valued at the market price of $0.06 for a value of $120,000 and the warrants were valued at $74,500 using a volatility of 116%, interest rate of 4.10%, share price at the date of issuance of $0.10, expected life of 3 years and dividend yield of 0.00%. The warrants were re-valued at June 30, 2025 using a volatility of 165%, interest rate of 3.15%, share price at the date of $0.0, expected life of 1.55 years and dividend yield of 0.00%. During the six months ended December 31, 2025, the Company recognized an unrealized gain on marketable securities of $47,500 (2024-gain of $2,385). FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 10 | P a g e 6. EXPLORATION AND EVALUATION ASSETS During the six months ended December 31, 2025 and 2024, the following Exploration and Evaluation expenditures were incurred by the Company: 2025 2024 Property payments $ 45,000 $ 7,215 Exploration costs Geophysics 96,590 187,027 Drilling 850 10,144 Surveys & assays 1,047,300 - Reports 141,000 400 Other 13,789 159,158 Amounts recovered (27,535) - Total $ 1,316,994 $ 363,944 Central Canada Property On January 10, 2018, the Company entered into an option agreement to acquire 100% of the Central Canada Property consisting of a claim group located in Ontario. The Central Canada Property consists of various unpatented mining claims. As consideration, the Company issued 325,000 common shares and made cash payments totalling $141,500 and incurred $100,000 in exploration and evaluation expenditures. During the year ended June 30, 2023, the Company earned its 100% interest in the property. The Company made a pre-production advance royalty cash payment of $20,000 and is required to make cash payments of $5,000 on each anniversary of the approval date. The Central Canada Property is subject to a 2.0% net smelter return in favour of the previous owner of the claims. The Company may purchase the one-half of the net smelter return for an aggregate amount of $1,000,000 at any time prior to the commencement of production. Spitfire and Sunny Boy The Company holds a 100% interest in Spitfire and Sunny --- Boy claims in south central British Columbia. The property is subject to a 2% net smelter royalty (NSR). The Company will have the right to purchase 0.5% of the total NSR 1% at any time up to commencement of production for a one-time payment of $400,000. Hope Brook During the year ended June 30, 2021, the Company staked claims in Newfoundland. During year ended June 30, 2022, the Company staked additional claims. During fiscal 2023, it was determined that some of the claims comprising the Hope Brook property would be allowed to lapse. During fiscal 2024, the Company staked additional claims during the year ended June 30, 2024, at a cost of $10,200. FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 11 | P a g e 6. EXPLORATION AND EVALUATION PROPERTIES (continued) Baie Verte Area During the year ended June 30, 2022, the Company staked various claims in Newfoundland for a total cost of $62,045. During the 2023 fiscal year, the Company entered into an option agreement with Carmanah Minerals Corp. (“Carmanah”) with respect to various claims whereby the Company will receive cash payments of $62,000 over a four-year period and 4,000,000 common shares and 4,000,000 common share purchase warrants of Carmanah with each share purchase warrant exercisable for one common share at $0.10 per share for a period of three years from the date of issue. In addition, the Company will retain a 2.5% NSR of which Carmanah may purchase 1% for $1,000,000 at any time. The transaction was subject to approval by the TSX Venture Exchange as the Company and Carmanah are related parties as a result of common officers and directors. (See Note 8). The transaction with Carmanah was completed during the year ended June 30, 2024 and the Company received 4,000,000 common shares and 4,000,000 common share purchase warrants of Carmanah. (See Note 5) During the year ended June 30, 2025 the Company received a cash payment of $5,000 with respect to the option as final payment with respect to the transaction. Springpole West Project On August 25, 2020, the Company staked various mining claims in Ontario at a cost of $11,850. During the period ended December 31, 2025, the claims were allowed to lapse. Great Burnt During the year ended June 30, 2021 the Company staked various claims in Newfoundland at a cost of $5,915. During the year ended June 30, 2025 the Company staked various claims in Newfoundland at a cost of $7,215. Gander South During the year ended June 30, 2022, the Company various staked claims in Gander Newfoundland for a total cost of $37,180. During the period ended December 31, 2025, these claims were allowed to lapse. Stony Lake During October 2025, the Company acquired 543 claim units located in Central Newfoundland at a cost of $45,000. In addition, during October 2025, the Company staked an additional 146 claim units claims in Central Newfoundland at a cost of $9,490. FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 12 | P a g e 6. EXPLORATION AND EVALUATION PROPERTIES (continued) Other properties Gander North During the year ended June 30, 2021, the Company staked various claims in Gander Newfoundland for a total cost of $26,390. During the period ended December 31, 2025, these claims were allowed to lapse --- . Camilleri Project The Company holds a 100% interest in the Camilleri project which is located in Ontario, Canada. The Camilleri project is subject to a 1% net smelter return which the Company may purchase back for $300,000 at any time. Holmstead Project The Company holds a 100% interest in the Holmstead project which is located in Quebec, Canada. The Holmstead project is subject to a 1% net smelter return which the Company may purchase back for $300,000 at any time. HSP Claims The Company holds a 100% interest in the HSP Claims located in Quebec, Canada. The claims are subject to a 1% NSR which the Company may buy back for $400,000 at any time. The Company agreed to give the vendor the first right of refusal on technical work to a maximum of $50,000 for a twelve month term. During the period ended December 31, 2025, these claims were allowed to lapse. Nickel North Project The Company holds a 100% interest in the Nickel North project which is located in Quebec, Canada.The Nickel North project is subject to a 1% net smelter return which the Company may purchase back for $400,000 at any time. Robb & Turnbull Property The Company holds a 100% interest in the Robb & Turnbull Property, located in Ontario. Bruce Lake Property On September 6, 2019, the Company entered into an option agreement to acquire 100% interest in the Bruce Lake Property located in Ontario. The Bruce Lake Property is subject to a 1.5% net smelter return (“NSR”) in favour of the previous owner of the claims. The Company may purchase the one-half of the NSR for an aggregate amount of $400,000 at any time prior to the commencement of production. On June 20, 2020, the Company entered into property assignment agreement with Portofino Resources Inc. (“Portofino”) whereby the Company has assigned 100% of the interest in the Bruce Lake Property. As FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 13 | P a g e 6. EXPLORATION AND EVALUATION ASSETS (continued) Other properties (continued) Bruce Lake Property (continued) consideration, the Company received 650,000 common shares of Portofino valued at $74,750 and Portofino will assume the remaining cash payments of $50,000 commencing on September 6, 2020. The Company will receive an additional 0.5% NSR for a total of 2% NSR of which 1.5% is payable to the previous owner. Burton Property The Burton Property consists of a 49% interest in a claim group located in Ontario, Canada. The Burton Property consists of 16 unpatented mining claims and 6 patented claims in a largely contiguous block. The Burton Property is subject to a 2.5% net smelter return and a 10% net profits interest in favour of the previous owner of the claims. The Company may purchase sixty percent of the net smelter return for an aggregate amount of $1,500,000 at any time. 7. LOAN PAYABLE The loan payable is unsecured, non interest bearing and due on demand. 8. SHARE CAPITAL a) Authorized Unlimited shares without par value. b) Issued During the six months ended December 31, 2025: On October 24, 2025, the Company issued 500,000 common shares at $0.02 per share in connection with the vesting and exercise of RSU’s. During the six months ended December 31, 2024: On July 17, 2024, the Company issued 600,000 flow-through shares for cash proceeds of $30,000. On July 24, 2024, the Company issued 2,600,000 units for total proceeds of $130,000 of whic --- h $70,000 is included in subscription receivable at September 30, 2024. Each unit consists of one common share and one common share purchase warrant exercisable at $0.07 for a period of three years from the date of issue. On August 23, 2024,1,550,000 stock options expired unexercised. FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 14 | P a g e 8. SHARE CAPITAL (continued) On August 29, 2024, the Company issued 300,000 common shares pursuant to the exercise of stock options for cash proceeds of $15,000. In connection with the exercise, the Company transferred $9,000 from contributed surplus to equity. On October 21, 2024, the Company issued 150,000 common shares at $0.05 per share pursuant to the exercise of warrants. On October 28, 2024, the Company issued 5,000,000 flow-through units at $0.04 per unit for gross proceeds of $200,000. Each flow-through unit consists of one common share designated as a flow-through share and one-half share purchase warrant, with each whole share purchase warrant exercisable for one common share at $0.08 for a period of two years from the date of issue. In addition, the Company issued 1,000,000 non-flow-through units at $0.035 per unit for gross proceeds of $35,000. Each non-flow-through unit consists of one common share and one common share purchase warrant exercisable at $0.05 for a period of four years from the date of issue. On November 20, 2024, the Company issued 9,000,000 flow-through units at $0.04 per unit for gross proceeds of $360,000. Each flow-through unit consists of one common share designated as a flow-through share and one-half share purchase warrant, with each whole share purchase warrant exercisable for one common share at $0.08 for a period of two years from the date of issue. On December 9, 2024, the Company issued 6,666,660 flow-through units at $0.045 per unit for gross proceeds of $300,000. Each flow-through unit consists of one common share designated as a flow-through share and one-half share purchase warrant, with each whole share purchase warrant exercisable for one common share at $0.08 for a period of two years from the date of issue. On December 30, 2024, the Company issued 450,000 non-flow-through units at $0.035 per unit for gross proceeds of $15,750. Each unit consists of one common share and one share purchase warrant, with each whole share purchase warrant exercisable for one common share at $0.05 for a period of four years from the date of issue. b) Share purchase warrants The following share purchase warrants entitle the holders thereof the right to purchase one share for each share purchase warrant. Warrant transactions are summarized as follows: Number of Warrants Weighted Average Exercise Price Balance, June 30, 2024 30,770,332 $0.12 Issued 17,736,438 $0.07 Exercised (150,000) $0.05 Expired (8,307,167) $0.22 Balance, June 30, 2025 40,049,603 $0.08 Expired (6,1750,166) $0.10 Balance, December 31, 2025 33,874,437 $0.08 FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 15 | P a g e 8. SHARE CAPITAL (continued) c) Share purchase warrants The following warrants are outstanding at December 31, 2025: Number of Exercise price per warrant warrants Expiry date 6,666,665 $0.12 January 14, 2026 1,694,167 $0.05 December 20 --- , 2028 1,000,000 $0.05 February 8, 2029 70,000 $0.05 February 8, 2026 4,165,167 $0.05 February 16, 2029 250,000 $0.10 March 27, 2026 630,000 $0.10 April 25, 2026 1,662,000 $0.07 May 24, 2027 2,600,000 $0.07 July 24, 2027 2,500,000 $0.08 October 28, 2026 1,000,000 $0.05 October 28, 2028 420,000 $0.08 October 28, 2026 4,500,000 $0.08 November 20, 2026 781,666 $0.08 November 20, 2026 315,000 $0.08 November 20, 2026 3,333,330 $0.08 December 9, 2026 450,000 $0.05 December 30, 2028 1,836,442 $0.05 January 6, 2029 33,874,437 * Expired subsequently, see note 11. c) Stock options The Company has an omnibus security-based compensation plan (“Plan”) in accordance with the policies of the TSX Venture Exchange (the “Exchange”). The plan includes authorization to grant options to directors, officers, employees and consultants to purchase shares of the Company, and to grant restricted share units and deferred share units to officers, directors, employees and consultants to acquire shares of the Company or to be settled in cash. The stock option component of the plan is a rolling plan and the maximum number of authorized but unissued shares available to be granted shall not exceed 10% of its issued and outstanding shares. Each stock option granted is for a term not exceeding five years unless otherwise specified. Outstanding options vest immediately at date of grant. Options granted to investor relations personnel vest in accordance with Exchange regulations. The fixed security based compensation component of the plan is limited to 11,301,778 shares. On September 15, 2023, the Company granted 3,000,000 incentive stock options to directors, officers, and consultants. The options vested on date of grant, have a term of five years and are exercisable at $0.05 per common share. The fair value of the stock options of $60,000 was determined using the Black Scholes option pricing model with the following assumptions – Share price on grant date of $0.025; Risk-free interest rate of 4.33%; Dividend yield of nil; Expected volatility of 125%; Expected life of 5 years and forfeiture rate FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 16 | P a g e 8. SHARE CAPITAL (continued) d) Stock options (continued) of 0%. Volatility was determined based on the Company’s historical data. During the year ended June 30, 2025, the Company recorded share-based payments expense of $nil (2024: $60,000) related to this grant. On March 1, 2024, the Company granted 300,000 incentive stock options to a consultant. The options vest quarterly over the term of two years and are exercisable at $0.05 per common share. The fair value of the stock options of $9,000 was determined using the Black Scholes option pricing model with the following assumptions – Share price on grant date of $0.04; Risk-free interest rate of 4.1%; Dividend yield of nil; Expected volatility of 133%; Expected life of two years and forfeiture rate of 0%. Volatility was determined based on the Company’s historical data. During the year ended June 30, 2025, the Company recorded share based payments expense of $nil (2024: $9,000) related to this grant. On August 29, 2024 the options were exercised and 300,000 common shares were issued with 75,000 having trading restrictions as of June 3, 2025 in accordance with the vesting conditions. The following table summarizes the continuity of the Compan --- y’s stock options: Number of Stock Options Weighted Average Exercise Price Balance, June 30, 2024 10,480,000 $0.07 Exercised (300,000) $0.05 Expired (3,080,000) $0.08 Balance, June 30, 2025 7,100,000 $0.07 Expired (900,000) $0.14 Balance December 31, 2025 6,200,000 $0.06 As at December 31, 2025, the Company had stock options outstanding enabling holders to acquire the following: Number of Exercise price options per option Expiry date 1,700,000 $0.10 August 31, 2026 2,000,000 $0.05 January 31, 2027 2,500,000 $0.05 September 15, 2028 6,200,000 The weighted average remaining contractual life of options outstanding at December 31, 2025 was 1.63 years (June 30, 2025 – 1.89 years). FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 17 | P a g e 8. SHARE CAPITAL (continued) e) Restricted Share Units (RSUs) On September 15, 2023, the Company granted 2,000,000 RSUs to a director. The RSUs have a term of three years and vest as follows: September 15, 2024 1.000,000 (shares issued January 16, 2025) September 15, 2025 500,000 (shares issued October 23, 2025) September 15, 2026 500,000 The fair value of the RSUs at the date of grant was $50,000 which is being charged to expense on a graded vesting basis. Included in share-based compensation expense is an amount of $3,415 (June 30, 2025 - $29,653). 9. RELATED PARTY TRANSACTIONS Related parties include the Board of Directors and officers, close family members and enterprises that are controlled by these individuals as well as certain consultants performing similar functions. Related party transactions conducted in the normal course of operations are measured at the exchange value (the amount established and agreed to by the related parties). The Company had the following transactions in the normal course of operations with related parties: For the six months ended December 31, 2025 2024 Management fees $ 90,000 $ 90,000 General and administration – Rent 7,748 17,606 Professional fees – Accounting 12,000 22,000 Share-based payments 3,415 24,494 $ 113,163 $ 154,100 Accounts payable and accrued liabilities include $4,841 (June 30, 2025 - $4,841) due to the CEO. These amounts are unsecured, non-interest bearing and have no fixed terms of repayment. Accounts payable and accrued liabilities include $87,067 (June 30, 2025 - $44,319) due to a company controlled by the CEO. These amounts are unsecured, non-interest bearing and have no fixed terms of repayment. Accounts payable and accrued liabilities include $33,490 (June 30, 2025 - $24,930) due to a company controlled by the CFO. These amounts are unsecured, non-interest bearing and have no fixed terms of repayment. Included in amounts receivable are as follows: a) During the period ended December 31, 2025, the Company paid an additional $Nil (June 30, 2025 - $Nil) in expenses on behalf of Marvel Discovery Corp., a company with common management. As of December 31, 2025, Marvel Discovery Corp. owes the Company $nil. The balance is unsecured, non-interest bearing and due on demand. FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 18 | P a g e 9. RELATED PARTY TRANSACTIONS b) During the period ended December 31, 2025, the Company paid an additional $Nil (June 30, 2025 - $9,903) in expenses on behalf of Latam --- ark Resources Corp., a company with common management. As of December 31, 2025, Latamark Resources Corp. owes the Company $nil (June 30, 2025 - $nil). The Company recognized a write-off of amounts receivable related to this balance of $9,903 during the year ended June 30, 2025. 10. RISK MANAGEMENT, CAPITAL MANAGEMENT AND FINANCIAL INSTRUMENTS The Company manages its capital structure and makes adjustments to it based on the funds available to the Company in order to support future business opportunities. The Company defines its capital as shareholders’ equity. The Board of Directors does not establish quantitative return on capital criteria for management, but rather relies on the expertise of the Company’s management to manage its capital to be able to sustain the future development of the Company’s business. The Company currently has no source of revenues, and therefore is dependent upon external financings to fund activities. In order to carry future projects and pay for administrative costs, the Company will spend its existing working capital and raise additional funds as needed. Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. There were no changes in the Company’s approach to capital management during the period ended December 31, 2025. The Company is not subject to externally imposed capital requirements. The Company’s risk exposure and the impact on the Company’s financial instruments are summarized below: (a) Credit risk Concentration of credit risk exists with respect to the Company’s cash as all amounts are held at major Canadian financial institutions. The Company’s concentration of credit risk and maximum exposure is as follows: December 31, 2025 June 30, 2025 Cash $ 20,425 $ 42,723 Amounts receivable $ 228,456 $ 77,569 The credit risk associated with cash is minimized by ensuring it is placed with a major Canadian financial institution with a strong investment‐grade rating issued by a primary ratings agency. (b) Liquidity risk Liquidity risk is the risk that the Company will encounter difficulty in satisfying financial obligations as they fall due. The Company’s approach to managing liquidity risk is to provide reasonable assurance that it will have sufficient funds to meet liabilities when due. The Company manages its liquidity risk by forecasting cash flows required for operations and anticipated investing and financing activities. Management and the Board of Directors are actively involved in the review, planning and approval of significant expenditures and commitments. The business of mining and exploration involves a high degree of risk and there can be no assurance that exploration programs will result in profitable mining operations. The Company has insufficient cash to meet its requirements for administrative overhead, to conduct due diligence on mineral property acquisition targets, and to conduct exploration of its mineral properties and mineral properties that may be acquired. FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 19 | P a g e 10. RISK MANAGEMENT, CAPITAL MANAGEMENT AND FINANCIAL INSTRUMENTS (continued) (b) Liquidity risk (continued) The Company does not generate cash flows from operations to fund its activities and therefore relies principally upon the issuance of --- securities for financing. Future capital requirements will depend on many factors including the Company’s ability to execute its business plan. The Company intends to continue relying upon the issuance of securities to finance its future activities but there can be no assurance that such financing will be available on a timely basis under terms acceptable to the Company. (c) Market risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes in market prices. Market risk comprises three types of risk: interest rate risk, foreign currency risk and other price risk. • Interest rate risk The Company’s cash and cash equivalents consist primarily of cash held in bank accounts or in a brokerage account. Due to the short‐term nature of this financial instrument, fluctuations in market rates do not have a significant impact on estimated fair value as of December 31, 2025. The Company manages interest rate risk by maintaining an investment policy that focuses primarily on preservation of capital and liquidity. Accordingly, the Company is not subject to interest rate risk. • Foreign currency risk During the period ended December 31, 2025 the Company was not exposed to material foreign currency risk. • Other price risk Other price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes in market prices, other than those arising from interest rate risk, foreign currency risk or commodity price risk. The Company’s marketable securities are exposed to other price risk. Financial assets and liabilities that are recognized on the statement of financial position at fair value can be classified in a hierarchy that is based on the significance of the inputs used in making the measurements. The levels in the hierarchy are: Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 - inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices); and Level 3 - inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs). The Company’s financial assets include cash and is classified as Level 1. The carrying value of these instruments approximates their fair values due to the relatively short periods of maturity of these instruments. FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 20 | P a g e 10. RISK MANAGEMENT, CAPITAL MANAGEMENT AND FINANCIAL INSTRUMENTS (continued) The Company's financial assets measured at fair values through profit or loss are as follows: December 31, 2025 Level 1 Level 2 Level 3 $ $ $ Marketable securities 222,715 - 1 June 30, 2025 Level 1 Level 2 Level 3 $ $ $ Marketable securities 175,215 - 1 11. INCOME TAXES Flow-through Flow-through common shares require the Company to spend an amount equivalent to the proceeds of the issued flow-through common shares on Canadian qualifying exploration expenditures. The Company may be required to indemnify the holders of such shares for any tax and other costs payable by them in the event the Company has not made the required exploration expenditures. During the year ended June 30, 2024, the Company received $450,000 from the issuance of f --- low-through shares. These amounts will not be available to the Company for future deduction from taxable income. The Company renounced $450,000 to the subscribers. A flow-through premium of $nil was recognized initially, with $nil remaining at June 30, 2024. During fiscal 2024, $207,493 was recognized as other income which included $207,493 from previous year’s flow-through premium. As at December 31, 2025, the Company has a commitment to incur $Nil in exploration expenditures. During the year ended June 30, 2025, the Company received $30,000 from the issuance of flow-through shares. These amounts will not be available to the Company for future deduction from taxable income. The Company renounced $30,000 to the subscribers. A flow-through premium of $6,000 was recognized initially, with $nil remaining at September 30, 2025 and $Nil was recognized as other income during the period (June 30, 2025 - $6,000). As at December 31, 2025, the Company has $nil in exploration expenditures to incur. During the year ended June 30, 2025, the Company received $200,000 from the issuance of flow-through shares. These amounts will not be available to the Company for future deduction from taxable income. The Company renounced $200,000 to the subscribers. A flow-through premium of $25,000 was recognized initially, with $nil remaining at December 31, 2025 and $Nil was recognized as other income during the period (June 30, 2025 - $25,000). As at December 31, 2025, the Company has a commitment to incur $nil in exploration expenditures. During the year ended June 30, 2025, the Company received $360,000 from the issuance of flow-through shares. These amounts will not be available to the Company for future deduction from taxable income. The Company renounced $360,000 to the subscribers. A flow-through premium of $45,000 was recognized initially, with $Nil remaining at December 31, 2025 and $35,447 was recognized as other income during the period (June 30, 2025 - $9,553). As at December 31, 2025, the Company has a commitment to incur $Nil in exploration expenditures. FALCON GOLD CORP. Notes to the Condensed Interim Consolidated Financial Statements December 31, 2025 and 2024 (Expressed in Canadian Dollars) (Unaudited – Prepared by Management) 21 | P a g e 11. INCOME TAXES (continued) Flow-through (continued) During the year ended June 30, 2025, the Company received $300,000 from the issuance of flow-through shares. These amounts will not be available to the Company for future deduction from taxable income. The Company renounced $300,000 to the subscribers. A flow-through premium of $100,000 was recognized initially, with $nil remaining at September 30, 2025 and $100,000 was recognized as other income during the period (June 30, 2025 – $Nil). As at December 31, 2025, the Company has a commitment to incur $nil in exploration expenditures. 12. SUBSEQUENT EVENTS Subsequent to December 31, 2025 On January 16, 2026, 6,666,665 share purchase warrants expired unexercised.