SEDAR Interim Financial Statements

DEFIANCE SILVER CORP. (an exploration stage company) CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 (Unaudited – Prepared by Management) (Expressed in Canadian dollars) 2 NOTICE OF NO AUDITOR REVIEW OF INTERIM FINANCIAL STATEMENTS Under National Instrument 51-102, Part 4, subsection 4.3(3) (a), if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor. The accompanying unaudited interim financial statements of the Company have been prepared by and are the responsibility of the Company’s management. The Company’s independent auditor has not performed a review of these financial statements in accordance with standards established by the Chartered Professional Accountants of Canada for a review of interim financial statements by an entity’s auditor. 3 DEFIANCE SILVER CORP. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION (Unaudited – Prepared by Management) (Expressed in Canadian dollars) Notes December 31, 2025 June 30, 2025 ASSETS Current assets Cash and cash equivalents 10,196,214 $ 14,750,256 $ Receivables 4 129,273 207,216 Prepaid expenses 178,822 59,341 Total current assets 10,504,309 15,016,813 Value added tax 4 4,209,860 3,793,216 Other assets 5 41,296 41,221 Property and equipment 215,789 175,595 Exploration and evaluation assets 7 47,959,727 43,268,044 Total assets 62,930,981 $ 62,294,889 $ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable and accrued liabilities 8 1,154,501 $ 847,990 $ Total current liabilities 1,154,501 847,990 Non-current liabilities Deferred income tax liabilities 36,000 36,000 Total non-current liabilities 36,000 36,000 Total liabilities 1,190,501 883,990 Shareholders' equity Share capital 9 78,908,722 77,497,090 Share-based payment reserve 9 9,292,645 9,037,654 Deficit (26,460,887) (25,123,845) Total shareholders' equity 61,740,480 61,410,899 Total liabilities and shareholders' equity 62,930,981 $ 62,294,889 $ Nature and continuance of operations (Note 1) Subsequent events (Note 13) The accompanying notes are an integral part of these condensed consolidate interim financial statements. 4 DEFIANCE SILVER CORP. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF LOSS AND COMPREHENSIVE LOSS (Unaudited – Prepared by Management) (Expressed in Canadian dollars) Notes 2025 2024 2025 2024 EXPENSES Marketing and investor relations 91,232 $ 39,285 $ 226,652 $ 252,613 $ Legal and audit 117,459 88,744 235,410 110,440 Management and consulting fees 10 257,853 132,707 404,476 253,986 Office and administration 170,225 18,771 254,470 190,768 Share-based compensation 9,10 141,872 131,261 283,744 262,522 Transfer agent and filing fees 70,942 66,258 82,198 72,525 Travel 49,544 52,207 73,649 63,530 Total expenses (899,127) (529,233) (1,560,599) (1,206,384) Interest income 82,095 4,763 142,276 7,115 Loss on foreign exchange (280,318) (106,747) 81,281 (413,091) (198,223) (101,984) 223,557 (405,976) Loss and comprehensive loss for the period (1,097,350) $ (631,217) $ (1,337,042) $ (1,612,360) $ Basic and diluted loss per common share - $ - $ - $ (0.01) $ 363,942,044 273,731,383 363,423,473 271,948,094 Weighted average number of common shares outstanding - basic and diluted Six months ended December 31, Three months ended December 31, The accompanying notes are an integral part of these condensed cons --- olidate interim financial statements. 5 DEFIANCE SILVER CORP. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS (Unaudited – Prepared by Management) (Expressed in Canadian dollars) 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES Net loss for the year (1,337,042) $ (1,612,360) $ Items not affecting cash: Share-based compensation 283,744 262,522 Foreign exchange loss on non-monetary items (75) (835) Changes in non-cash working capital items: Receivables 77,943 (1,087) Value added tax (416,644) 210,206 Prepaid expenses and other assets (119,481) (1,078) Accounts payable and accrued liabilities 334,732 121,073 Net cash used in operating activities (1,176,823) (1,021,559) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property and equipment (54,896) - Exploration and evaluation assets expenditures (3,389,436) (2,588,912) Net cash used in investing activities (3,444,332) (2,588,912) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of share capital, net of issuance costs - 3,056,321 Proceeds from stock options exercised 38,113 - Proceeds from warrants exercised 29,000 405,921 Net cash provided by financing activities 67,113 3,462,242 Change in cash during the period (4,554,042) (148,229) Cash, beginning of the period 14,750,256 265,834 Cash, end of the period 10,196,214 $ 117,605 $ Six months ended December 31, The accompanying notes are an integral part of these condensed consolidate interim financial statements. DEFIANCE SILVER CORP. CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Unaudited – Prepared by Management) (Expressed in Canadian dollars) Number of Shares Share Capital Share-based Payment Reserves Deficit Total Balance at June 30, 2024 256,137,862 56,817,608 $ 6,790,570 $ (22,199,357) $ 41,408,821 $ Share issuance – financing and private placement 98,452,075 22,000,415 990,000 - 22,990,415 Issuance costs - (1,458,962) - - (1,458,962) Issuance costs - broker warrants - (637,299) 637,299 - - Share issuance – warrants exercise 3,315,970 660,285 (4,363) - 655,922 Share issuance – for debt 85,823 15,960 - - 15,960 Other compensatory awards settled 495,417 99,083 (99,083) - - Share-based compensation - - 723,231 - 723,231 Net loss - - - (2,924,488) (2,924,488) Balance at June 30, 2025 358,487,147 77,497,090 9,037,654 (25,123,845) 61,410,899 Shares issued pursuant to the acquisition of Green Earth Metals 4,954,613 1,263,426 - - 1,263,426 Shares issued to the Minera Tepal for exploration rights 201,452 44,319 - - 44,319 Share issuance – stock options exercise 230,833 66,866 (28,753) - 38,113 Share issuance – for debt 33,845 8,021 - - 8,021 Share issuance – warrants exercise 145,000 29,000 - - 29,000 Share-based compensation - - 283,744 - 283,744 Net loss - - - (1,337,042) (1,337,042) Balance at December 31, 2025 364,052,890 78,908,722 9,292,645 (26,460,887) 61,740,480 The accompanying notes are an integral part of these condensed consolidate interim financial statements. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 7 1. NATURE AND CONTINUANCE OF OPERATIONS Defiance Silver Corp (“the Company” or “Defiance”) was incorporated on July 19, 2007, under the Business Corporations Act of the Province of British Columbia. The Company’s principal business is the acquisition and exploration of exploration and evaluation assets. The Com --- pany’s registered and records office is at Suite 2900 - 550 Burrard Street, Vancouver, BC, V6C 0A3. The Company is listed on the TSX Venture Exchange under the symbol “DEF”. The Company’s condensed consolidated interim financial statements are presented in Canadian dollars which is the functional currency. At the date of these condensed consolidated interim financial statements, the Company has not been able to identify a known body of commercial grade ore on any of its exploration and evaluation assets. The ability of the Company to realize the costs it has incurred to date on these exploration and evaluation assets is dependent upon the Company being able to identify a commercial ore body, to finance its exploration costs and to resolve any environmental, regulatory or other constraints which may hinder the successful development of the exploration and evaluation asset. To date, the Company has not earned revenues and is considered to be in the exploration stage. Going Concern of Operations These condensed consolidated interim financial statements have been prepared assuming the Company will continue on a going concern basis. The Company has incurred losses since inception and the ability of the Company to continue as a going concern depends upon its ability to develop profitable operations and to continue to raise adequate financing. Management is actively targeting sources of additional financing through other business and financial transactions which would assure continuation of the Company’s operations and exploration programs. At December 31, 2025, the Company had cash and cash equivalents of $10,196,214 (June 30, 2025 - $14,750,256) and a working capital of $9,349,808 (June 30, 2025 - $14,168,823). The Company’s continuation as a going concern is dependent upon the successful results from its exploration activities and its ability to attain profitable operations and generate funds therefrom and/or raise equity capital or borrowings sufficient to meet current and future obligations. The Company estimates it has sufficient working capital to continue operations for the upcoming year. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 8 2. BASIS OF PREPARATION Statement of Compliance These condensed consolidated interim financial statements, including comparatives have been prepared using accounting policies consistent with IFRS Accounting Standards as issued by the International Accounting Standards Board (“IASB”). These condensed consolidated interim financial statements were authorized for issue by the Audit Committee and Board of Directors on February 19, 2026. The condensed consolidate interim financial statements have been prepared on a historical cost basis, except for financial instruments measured at fair value. In addition, these financial statements have been prepared using the accrual basis of accounting except for cash flow information. The preparation of these condensed consolidated interim financial statements requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of expenses during the period. Actual results could differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revi --- sions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Critical Accounting Estimates Significant assumptions about the future and other sources of estimation uncertainty that management has made at the financial position reporting date, that could result in a material adjustment to the carrying amounts of assets and liabilities, in the event that actual results differ from assumptions made, relate to, but are not limited to, the following: 1. Recoverability of receivables and value added tax: which are included in the consolidated statements of financial position. Management has determined that receivables are recoverable given management’s experience in realizing receivables and refunds of value added tax. 2. Estimating useful life of equipment: Depreciation of equipment is charged so as to write down the value of those assets to their residual value over their respective estimated useful lives. Management is required to assess the useful economic lives and residual values of the assets such that depreciation is charged on a systematic basis to the current carrying amount. The useful lives are estimated having regard to such factors such as asset maintenance, rate of technical and commercial obsolescence, and asset usage. The useful lives of key assets are reviewed annually. 3. Carrying value and the recoverability of exploration and evaluation assets: Management has determined that exploration, evaluation and related costs incurred which have been capitalized may have future economic benefits and may be economically recoverable. Management uses several criteria in its assessments of economic recoverability and probability of future economic benefits including geologic and other technical information, scoping and prefeasibility studies, accessibility of facilities and existing permits. 4. Valuation of share-based compensation and brokers’ warrants: Management uses the Black-Scholes Pricing Model for valuation of share-based compensation and brokers’ warrants, which requires the input of subjective assumptions including expected price volatility, interest rate and forfeiture rate. Changes in the input assumptions can materially affect the fair value estimate and the Company’s results and equity reserves. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 9 2. BASIS OF PREPARATION (Cont’d) Critical Accounting Estimates (Cont’d) 5. Income Taxes: In assessing the probability of realizing deferred tax assets, management makes estimates related to the expectation of future taxable income, applicable tax opportunities, expected timing of reversals of existing temporary differences and the likelihood that the tax position taken will be sustained upon examination by applicable tax authorities. In making its assessments, management gives additional weight to positive and negative evidence that can be objectively verified. While management believes that these estimates are reasonable, actual results could differ from those estimates and could impact future results of operation and cash flows. Critical Accounting Judgements The following are key assumptions concerning the future and other key sources of estimation uncertainty that have significant risk of resulting in a material adjustment to the carrying amou --- nts of assets and liabilities within the next financial year: 1. Going concern of operations: The financial statements have been prepared on a going concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The assessment of the Company’s ability to source future operations and continue as a going concern involves judgement. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. If the going concern assumption is not appropriate for the financial statements, then adjustments would be necessary in the carrying value of assets and liabilities, the reported revenue and expenses and the statement of financial position classifications used (Note 1). 2. Determination of functional currency: The Company determines the functional currency through the analysis of several indicators such as expenses and cash flow, financing activities, and frequency of transactions with the reporting entity. 3. MATERIAL ACCOUNTING POLICY INFORMATION The condensed consolidate interim financial statements have been prepared in accordance with the accounting policies adopted in the Company’s most recent annual financial statements for the year ended June 30, 2025. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 10 4. RECEIVABLES The Company’s receivables primarily arise from refundable sales tax receivable from government taxation authorities in Canada and Mexico. December 31, 2025 June 30, 2025 VAT receivable 4,209,860 $ 3,793,216 $ GST receivable 129,273 57,216 Loan receivable - 150,000 129,273 $ 207,216 $ 5. OTHER ASSETS December 31, 2025 June 30, 2025 Investments 25,000 $ 25,000 $ Reclamation bond 16,296 16,221 41,296 $ 41,221 $ Investments These represent guaranteed investment certificates held with the bank as collateral for the Company’s credit cards issued to key personnel. Reclamation bond The Company has a deposit in place with a United States bank as security for a reclamation bond on former exploration and evaluation assets located in the United States. The reclamation bond is required by local jurisdictions at the time exploration activities commenced on the properties and do not represent a rehabilitation provision. Interest on the certificates of deposit with the United States bank is paid on a periodic basis to the Company. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 11 6. ACQUISITION Effective July 15, 2025, the Company and Green Earth Metals Inc. (“GEMS”) signed a Definitive Agreement to complete a transaction whereby the Company acquired all of the issued and outstanding common shares of GEMS. Former GEMS shareholders received 1 common share of the company for every 4.25 common shares of GEMS. As consideration, the Company issued 4,954,613 common shares at a price $0.255 per share at a value of $1,263,426 (Note 9). The Company incurred $102,012 in transaction costs. The acquisition of GEMS was accounted as an acquisition of exploration and evalua --- tion assets. The assets and liabilities of GEMS assumed on acquisition were as follows: Cash 3,080 $ Prepaid expenses 3,906 GST receivable 39,799 Property, plant & equipment 685 Exploration and evaluation assets 1,349,242 Accounts payable (31,274) 1,365,438 $ Total consideration for the acquisition was as follows: Value of shares issued 1,263,426 $ Transaction costs 102,012 1,365,438 $ DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 12 7. EXPLORATION AND EVALUATION ASSETS Title to exploration and evaluation assets involves certain inherent risks due to the difficulties of determining the validity of certain claims as well as the potential for problems arising from the frequently ambiguous conveyancing history characteristic of many mineral claims. The Company has investigated title to all of its exploration and evaluation assets, and, to the best of its knowledge, all of its interests are in good standing. San Acacio Lagartos Lucita Minerva Tepal GEMS Total Balance at Jun 30, 2024 $ 24,211,738 $ 1,880,082 $ 4,539,142 $ 23,248 $ 7,366,002 $ - $ 38,020,212 Acquisition costs Property Acquisition costs - - - - 1,584,373 - 1,584,373 Exploration costs Claim Fees 99,081 24,463 82,140 - 430,935 - 636,619 Consulting Fees 1,354,819 - 137,698 - 403,149 - 1,895,666 Camp 216,544 14,100 - - 41,378 - 272,022 Equipment 40,058 - - - 232 - 40,290 Geology and mapping 444,394 - - - 51,687 - 496,081 Professional fees 12,474 - - - - - 12,474 Travel 284,007 - 5,105 - 21,195 - 310,307 2,451,377 38,563 224,943 - 948,576 - 3,663,459 Balance at Jun 30, 2025 26,663,115 1,918,645 4,764,085 23,248 9,898,951 - 43,268,044 Acquisition costs Property Acquisition costs - - - - 665,587 1,349,242 2,014,829 Exploration costs Claim Fees 55,753 13,265 44,538 - 78,326 51,537 243,419 Consulting Fees 741,171 - 19,012 - 225,158 37,271 1,022,612 Camp 117,046 7,680 - - 20,029 2,366 147,121 Equipment 18,321 - - - - - 18,321 Geology and mapping 216,637 - - - - - 216,637 Professional fees 10,711 - - - - 11,379 22,090 Travel 95,275 - 18,785 - 47,119 1,525 162,704 2,098,864 20,945 82,335 - 370,632 104,078 2,676,854 Balance at Dec 31, 2025 28,761,979 1,939,590 4,846,420 23,248 10,935,170 1,453,320 47,959,727 San Acacio Project The Company entered into an option agreement on October 24, 2011, subsequently the subject of several amendments, with the Mexican owners (“the Vendors”) for an option to purchase a 100% interest in the San Acacio property consisting of 10 mining concessions and associated surface rights and tailings. The San Acacio property is located near the city of Zacatecas, Mexico. During the year ended June 30, 2020, the Company renegotiated and extended the terms of its San Acacio Silver Project option agreement by three years from September 27, 2020, to September 27, 2023. In addition, 80% of the option payments due before March 27 and June 27, 2020, were deferred as a part of this extension. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 13 7. EXPLORATION AND EVALUATION ASSETS (Cont’d) During the year ended June 30, 2024, the Company has restructured the option to acquire 100% of the San Acacio property in the Zacatecas district. The pro --- ject vendor has agreed to extend the option agreement terms by one year from September 27, 2023, to September 27, 2024. The Company made quarterly payments to the property vendor totalling US$539,722, with the final option payment of US$2,300,000 due September 27, 2024. In accordance with the original agreement, the vendor retains a 2.5% NSR which may be purchased for US$2,500,000. During the year ended June 30, 2025, the Company and the Vendors mutually agreed and extended the term of its San Acacio property option agreement. As a result of this amendment, the scheduled payment due by September 27, 2024, was moved to June 30, 2026. Below is the schedule of payments as at December 31, 2025: Letter Of Intent Payment Option Payment Lease Payment Interest Payment Total By September 27, 2012 USD 25,000 - USD - USD - USD USD 25,000 (paid) By September 27, 2013 - 250,000 250,000 (paid) By September 27, 2014 - - 150,000 150,000 (paid) By September 27, 2015 - - 225,000 225,000 (paid) By September 27, 2016 - 100,000 150,000 250,000 (paid) By September 27, 2017 - 200,000 150,000 350,000 (paid) By September 27, 2018 - 600,000 150,000 750,000 (paid) By September 27, 2019 - 600,000 200,000 107,600 907,600 (paid) By September 27, 2020 - 500,000 100,000 - 600,000 (paid) By September 27, 2021 - 400,000 283,334 86,063 769,397 (paid) By September 27, 2022 - 400,000 283,333 76,063 759,396 (paid) By September 27, 2023 - 400,000 283,333 66,063 749,396 (paid) By December 27, 2023 - - 137,500 185,661 323,161 (paid) By March 27, 2024 - - 68,750 39,530 108,280 (paid) By June 27, 2024 - - 68,750 39,530 108,280 (paid) On June 30, 2026 - 2,300,000 - 2,300,000 Total USD 25,000 USD 5,750,000 USD 2,250,000 USD 600,510 USD 8,625,510 The property is subject to a 2.5% NSR payable to the vendors on production from the property. The Company will have the right to purchase the NSR at any time for US$2,500,000 which will escalate with the official Mexican Inflation Index after a five-year period. Following the first anniversary of the purchase of the San Acacio Project, the Company must make minimum annual royalty payments of US$125,000. The minimum royalty commitment terminates in the event that the production royalty paid is equal to or higher than the equivalent to the minimum that would have been due during six consecutive months. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 14 7. EXPLORATION AND EVALUATION ASSETS (Cont’d) Lagartos Project In June 2018, the Company completed its acquisition of a group of assets from MAG Silver Corp (“MAG”) by issuing 5,000,000 common shares (valued at $1,600,000) of the Company. The Company received a 100% interest in MAG’s Lagartos project along with a regional exploration database and cash of $10,000. Lucita Project In November 2020, the Company entered into a definitive option agreement with Pan American Silver Corp. (“Pan American”) to acquire a 100% interest in Pan American’s Lucita property consisting of 28 mining concessions, located adjacent to the Company’s San Acacio project. The property is subject to a 2% NSR payable to the vendors on production from the property. The payment terms are as follows: Payment November 30, 2020 100,000 USD (paid) November 30, 2021 100,000 (paid) November 30, 2022 500,000 (paid) November 30, 2023 800,000 (paid) Total 1,500,000 --- USD During the year ended June 30, 2024, the Company acquired 100% ownership of the Lucita Property from Pan American Silver Corp. (“Pan American”), while Pan American retains a 2% NSR. Minerva property During the year ended June 30, 2012, the Company applied for a mining claim located in Coahuila State, Mexico, known as the Minerva property. As of December 31, 2025, the application was still pending approval by the Mexican mining authorities. Surface rights agreements In August 2014, the Company obtained authorization to temporarily occupy and explore certain land holdings on the San Acacio property. In order to keep the agreement in good standing, the Company is required to make semi-annual payments during the exploration phase and the development phase. The agreement will be valid for twenty years with the option to extend in the future. During the year ended June 30, 2022, the Company entered into a land purchase agreement to purchase the certain land holdings on the San Acacio property. The Company acquired the land for $385,057 (6,183,000 Mexican peso). On February 27, 2015, the Company entered into a Surface Rights Agreement with the Ejido called "Sauceda de la Borda", Municipality of Vetagrande, State of Zacatecas, for the right to occupy and perform exploration work on common use lands of such Ejido. The Company had the authorization to explore the surface of the property for a term of three years which could be extended for an additional three years at the Company’s choice, by making annual advance payments and by paying a one-time fee on the execution of the agreement. On February 26, 2018, the Company exercised its right to extend the term of the agreement above mentioned for an additional three years by making a one-time payment and was required to make semi-annual payments. All required payments have been made. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 15 7. EXPLORATION AND EVALUATION ASSETS (Cont’d) On March 30, 2021, the Company entered into an Agreement to extend the Surface Rights Agreement with the Ejido called "Sauceda de la Borda", Municipality of Vetagrande, State of Zacatecas, where it was agreed that the Company could continue with its exploration works exclusively in the Ejido's lands for three additional years, being the Surface Rights Agreement valid until March 12, 2024. During the year ended June 30, 2024, the Company extended the Surface Rights Agreement for a term of three additional years. On August 13, 2021, the Company entered into a Temporary Occupancy and Right of Way Agreement in common use lands for exploration with the Rural Fractioning “Fraccionamiento Sauceda de la Borda”, Municipality of Vetagrande, State of Zacatecas, in which the Company is authorized to temporarily use a certain part of its land, exclusively for mining exploration works. This agreement is valid until August 13, 2026. On March 31, 2023, the Company entered into a Surface Rights Agreement with the Ejido called "Panuco", Municipality of Panuco, State of Zacatecas, for the right to occupy and perform exploration work on common use lands of such Ejido. The Company had the authorization to explore the surface of the property for a term of five years which could be extended for an additional five years at the Company’s choice, by making annual advance payments --- and by paying a one-time fee on the execution of the agreement. Tepal Project As a result of the acquisition of Valoro Resources Inc. (“Valoro”) in fiscal 2019, the Company acquired a 100% right, title and interest in mining claims located in the state of Michoacán, Mexico (the “Tepal Project”). In 2009, Valoro and Arian Silver Corp. (“Arian”) entered into an agreement whereby Valoro was granted the exclusive rights to purchase Arian’s 100% interest in the Tepal Gold-Copper Project. Under the terms of the agreement, Valoro completed the purchase of 100% of the property, by delivering to Arian US$3.0 million in staged payments. Valoro also assumed the balance of Arian’s obligations under the terms of an underlying property option agreement with Minera Tepal SA de CV (“Minera Tepal”) subject to a 2.5% Net Smelter Return royalty (“NSR”) and has completed staged payments to the underlying property vendor of US$3,200,000. During the year ended June 30, 2021, the Company entered into an option agreement to repurchase the existing 2.5% NSR on the Tepal Project from Minera Tepal, S.A. de C.V (“Minera Tepal”) over four years for total consideration of US$4.85 million. During the year ended June 30, 2023, the Company renegotiated and extended the terms of its Tepal NSR repurchase option agreement by a year and a half from December 16, 2024, to June 30, 2026, and an additional option payment of US$100,000 was paid on January 15, 2023, bringing the total consideration over the term of the agreement to US$4.95 million. During the year ended June 30, 2025, the Company and the Minera Tepal amended the option agreement to acquire the NSR associated with its Tepal Project. The remaining balance of the NSR option agreement, totaling US$2,850,000, is payable in monthly installments of US$75,000 from July 1, 2025 to February 1, 2026, and US$150,000 from June 1, 2026 to August 1, 2027. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 16 7. EXPLORATION AND EVALUATION ASSETS (Cont’d) As a result of the amending agreement, the payment terms are as follows: Option Payment January 10, 2021 150,000 USD (paid) June 16, 2021 150,000 (paid) December 16, 2021 300,000 (paid) June 16, 2022 300,000 (paid) January 15, 2023 100,000 (paid) June 30, 2024 550,000 (paid) March 31, 2025 550,000 (paid) July 1, 2025 - February 1, 2026 600,000 (paid part.) June 1, 2026 - August 1, 2027 2,250,000 Total 4,950,000 USD During the year ended June 30, 2021, the Company entered into an option agreement with Minera Tepal to acquire certain claims surrounding the Tepal Project. The Company will pay the annual concession fees on these claims until a production decision has been made, upon which time the Company will pay the vendor US$2 million for 100% ownership of the mining concessions. The Company has not made any payments to the vendor under this option agreement to date. During the year ended June 30, 2024, the Company decided not to pursue such claims, and the agreement lapsed. During the year ended June 30, 2022, the Company became aware that certain mineral concessions from its Tepal Project had been transferred to a third-party individual without the Company’s knowledge or consent. On February 13, 2024, the Company received the favourable ruling of the Mexican Court to restore its rightful ownership to the mining --- concessions forming part of the Tepal Project. In its judgement, the Court confirmed the nullity of the transfer of the concessions, ordered the cancellation of such transfer title and recognized Geologix Explorations Mexico, S.V de C.A, a subsidiary of the Company, as legitimate and the rightful owner of the concessions. During the year ended June 30, 2025, the Company entered into a six-year agreement that grants the Company the rights to conduct surface exploration, drilling, and engineering studies in support of its Tepal Project. The agreement also enables the Company to collect essential data required for the submission of permit applications to advance the development of the project. As consideration for these rights, the Company will make annual cash payments of US$200,000, indexed to the annual rate of inflation in Mexico, and issue common shares with a total annual value of US$40,000/year to the surface rights holder. Over the six-year term, the total number of shares issued shall not exceed 1,400,000. During the year ended June 30, 2025, the Company paid US$200,000. During the six months ended December 31, 2025, the Company issued 201,452 shares (Note 9). During the year ended June 30, 2025, the Company entered into an agreement of assignment of rights with Minera Tepal to acquire six claims surrounding the Tepal Project. The Company paid US$20,000 and acquired the claims. GEMS Project As a result of the acquisition of GEMS in July 2025, the Company acquired a 100% right, title and interest in mining claims located in the state of Sonora, Mexico (the “GEMS Project”). GEMS holds rights to three copper-gold-silver projects in Mexico’s Sonoran Desert, covering a total of 6,795.22 hectares. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 17 8. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES Payables and accrued liabilities for the Company are comprised as follows: December 31, 2025 June 30, 2025 Trade payables 1,065,587 $ 789,076 $ Accrued liabilities 88,914 58,914 1,154,501 $ 847,990 $ All payables and accrued liabilities for the Company fall due within the next 12 months. 9. SHARE CAPITAL Authorized Unlimited number of common shares without par value. All issued shares are fully paid. During the six months ended December 31, 2025, the Company: i) Issued 230,833 common shares pursuant to exercise of stock options for gross proceeds of $38,113. ii) Issued 33,845 common shares to settle debt of $8,021. iii) Issued 201,452 common shares to Minera Tepal for exploration rights (note 7). iv) Issued 4,954,613 common shares pursuant to the acquisition of GEMS (note 6). v) Issued 145,000 common shares pursuant to exercise of warrants for gross proceeds of $29,000. During the year ended June 30, 2025, the Company: i) Completed a private placement (the “Brokered Offering”) by issuing 60,000,000 units at a price of $0.25 per unit for gross proceeds of $15,000,000. Each unit consists of one common share and one-half of one common share purchase warrant. Each warrant is exercisable to purchase one common share at a price of $0.35 per share for a period of two years following the date of issuance of the warrants. Using the residual value method, the private placement warrants were valued at $900,000. The Company paid finder’s fees comprised of a cash commission of $806,470 and recogn --- ized $391,990 for share issuance costs related to the issuance of 3,299,800 broker warrants. Each broker warrant is exercisable to purchase one common share at a price of $0.25 per share for a period of two years. ii) completed, concurrently with the Brokered Offering, a non-brokered private placement by issuing 6,000,000 units at a price of $0.25 per unit for gross proceeds of $1,500,000. Each unit consists of one common share and one-half of one common share purchase warrant. Each warrant is exercisable to purchase one common share at a price of $0.35 per share for a period of two years following the date of issuance of the warrants. Using the residual value method, the private placement warrants were valued at $90,000. The Company paid finder’s fees comprised of a cash commission of $90,000 and recognized $42,765 for share issuance costs related to the issuance of 360,000 finder warrants. Each finder warrant is exercisable to purchase one common share at a price of $0.25 per share for a period of two years. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 18 9. SHARE CAPITAL (Cont’d) iii) completed a non-brokered private placement by issuing 16,339,000 units at a price of $0.20 per unit for gross proceeds of $3,267,800. Each unit consists of one common share and one-half of one common share purchase warrant. Each warrant is exercisable to purchase one common share at a price of $0.35 per share for a period of two years following the date of issuance of the warrants. The Company paid finder’s fees comprised of a cash commission of $162,602 and recognized $101,724 for share issuance costs related to the issuance of 831,840 finder warrants. Each finder warrant is exercisable to purchase one common share at a price of $0.20 per share for a period of two years. iv) completed a non-brokered private placement by issuing 16,113,075 units at a price of $0.20 per unit for gross proceeds of $3,222,615. Each unit consists of one common share and one-half of one common share purchase warrant. Each warrant is exercisable to purchase one common share at a price of $0.35 per share for a period of two years following the date of issuance of the warrants. The Company paid finder’s fees of $131,114 and recognized $100,820 for share issuance costs related to the issuance of 748,453 finders warrants, each finder warrant entitles the holder thereof to purchase common shares of the Company at a price of $0.20 per common share for a period of two years. v) issued 3,315,970 common shares pursuant to exercise of warrants for gross proceeds of $655,922. vi) issued 85,823 common shares to settle debt of $15,960. vii) issued 45,000 shares pursuant to the settlement of performance share units. viii) issued 450,417 shares pursuant to the settlement of restricted share units. Omnibus Equity Incentive Plan On December 8, 2021, and amended on November 3, 2022 (“Effective date”), the Company adopted an Omnibus Equity Incentive Plan (“Omnibus Plan”) to amend and restate the Company’s stock option plan (“Predecessor Plan”). Under the terms of the plan the Company may grant share-based compensation to employees, consultants, persons performing investor relations activities and directors. The maximum aggregate number of Shares issuable under this plan in respect of stock options shall not exceed ten (10%) --- percent of the Company’s issued and outstanding Shares at any point in time. The number of common shares reserved for issuance to consultant or persons performing Investor Relations activities will not exceed two (2%) of the issued and outstanding common shares in any twelve (12) month period. All outstanding stock options granted under the predecessor plan shall continue to be outstanding as stock options granted under and subject to the terms of this Omnibus Plan. The maximum aggregate number of shares issuable under this plan in respect of deferred share units (DSUs), restricted share units (RSUs) and performance share units (PSUs) shall not exceed 22,775,243 at any point in time, representing 10% of the issued and outstanding shares of the Company at the effective date. The total number of DSUs, RSUs, and PSUs issuable to any participant under this plan shall not exceed one (1%) percent of the issued and outstanding Shares at the time of the award. The maximum term of an option, DSU, RSU or PSU is 10 years after the date of grant. Vesting terms are under the discretion of the Board of Directors at each grant. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 19 9. SHARE CAPITAL (Cont’d) Stock options A summary of the Company’s outstanding share purchase options at December 31, 2025, and the changes during the period are presented below: Number of Options Weighted Average Exercise Price Balance, June 30, 2024 13,872,150 0.20 $ Granted 2,888,500 0.35 Forfeited (33,750) 0.20 Balance, June 30, 2025 16,726,900 0.32 Expired (833,400) 0.59 Exercised (230,833) 0.17 Balance, September 30, 2025 15,662,667 0.34 $ The following weighted average assumptions were used for the Black-Scholes valuation of the stock options: December 31, June 30, 2025 2025 Annualized volatility 0.00% 97.52% Risk-free interest rate 0.00% 2.70% Dividend rate 0% 0% Expected life of options - 4.79 years Forfeiture rate 0% 0% Fair value per stock option - $ 0.16 $ DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 20 9. SHARE CAPITAL (Cont’d) Stock options (Cont’d) The following incentive stock options were outstanding to directors, officers and employees at December 31, 2025: Number of Options Outstanding Expiry Date Number of Options Exercisable Exercise Price ($) 1,035,000 June 30, 2026 1,035,000 0.66 1,202,500 January 31, 2027 1,202,500 0.41 200,000 February 27, 2027 66,667 0.22 822,500 January 31, 2028 822,500 0.16 530,417 April 12, 2029 322,499 0.18 550,000 May 29, 2029 550,000 0.20 200,000 July 23, 2029 200,000 0.31 2,688,500 February 27, 2030 896,167 0.22 605,000 May 29, 2030 605,000 0.23 1,012,500 November 5, 2030 1,012,500 0.59 1,175,000 June 30, 2031 1,175,000 0.90 1,513,750 January 31, 2032 1,513,750 0.41 1,572,500 January 31, 2033 1,572,500 0.16 2,555,000 April 12, 2034 1,703,332 0.18 15,662,667 12,677,415 0.34 Deferred share units (DSUs) A summary of the Company’s outstanding DSUs at December 31, 2025, and the changes during the year are presented below: Number of DSUs Weighted Average Grant Date Fair Value per DSU Balance, June 30, 2024 715,000 0.18 $ Granted 643,500 0.22 Balance, June 30 and December 31, 2025 1,358,500 0.20 $ T --- he DSUs granted during the year ended June 30, 2025 will vest on February 27, 2026. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 21 9. SHARE CAPITAL (Cont’d) Performance share units (PSU) A summary of the Company’s outstanding PSUs as at December 31, 2025, and the changes during the year are presented below: Number of PSUs Weighted Average Grant Date Fair Value per PSU Balance, June 30, 2024 45,000 0.18 $ Granted 55,000 0.22 Settled (45,000) 0.18 Balance, June 30 and December 31, 2025 55,000 0.22 $ The PSUs granted during the year ended June 30, 2025 will vest on February 27, 2026. Restricted share units (RSU) A summary of the Company’s outstanding RSUs as at December 31, 2025, and the changes during the year are presented below: Number of RSUs Weighted Average Grant Date Fair Value per RSU Balance, June 30, 2024 945,002 0.21 $ Granted 514,500 0.22 Settled (450,417) 0.24 Balance, June 30 and December 31, 2025 1,009,085 0.20 $ At December 31, 2025, the following RSUs were outstanding: Number of RSUs Outstanding Number of RSUs Available for Settlement Expiry Date 30,000 - April 12, 2029 514,500 - February 27, 2030 135,418 - January 31, 2033 329,167 - April 12, 2034 1,009,085 - DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 22 9. SHARE CAPITAL (Cont’d) Share-based compensation The Company recognizes compensation for all omnibus awards granted using the fair value-based method of accounting. During the six months ended December 31, 2025, the Company recognized $141,872 (December 31, 2024 - $131,261) in share-based compensation expense for omnibus awards. Warrants A summary of the Company’s outstanding warrants at December 31, 2025, and the changes during the year are presented below: Number of Warrants Weighted Average Exercise Price Balance, June 30, 2024 13,513,680 0.20 $ Granted 54,466,130 0.35 Exercised (3,315,970) 0.20 Expired - - Balance, June 30, 2025 64,663,840 0.32 Exercised (145,000) 0.20 Balance, December 31, 2025 64,518,840 0.32 $ At December 31, 2025, the following warrants and finder warrants were outstanding: Number of Warrants Exercise Price ($) Expiry Date 143,400 0.10 February 27, 2026 3,900,000 0.20 February 27, 2026 75,810 0.10 March 14, 2026 5,933,500 0.20 March 14, 2026 446,670 0.20 July 12, 2026 6,534,750 0.35 July 12, 2026 301,783 0.20 July 26, 2026 1,521,787 0.35 July 26, 2026 90,660 0.20 January 14, 2027 30,000 0.20 January 16, 2027 1,830,500 0.35 January 16, 2027 394,680 0.20 February 7, 2027 3,901,500 0.35 February 7, 2027 316,500 0.20 February 11, 2027 2,437,500 0.35 February 11, 2027 3,659,800 0.25 June 20, 2027 33,000,000 0.35 June 20, 2027 64,518,840 0.32 During the six months ended December 31, 2025, the Company did not have any recognized compensation for finders warrants granted using the Black-Scholes option pricing model and included in the share issuance costs. (December 31, 2024 - $114,597). The following weighted average assumptions were used for the Black-Scholes valuation of the warrants: DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SI --- X MONTHS ENDED DECEMBER 31, 2025 AND 2024 23 December 31, June 30, 2025 2025 Annualized volatility - 93.47% Risk-free interest rate - 2.77% Dividend rate - 0% Expected life of options - 2 years Forfeiture rate - 0% Fair value per stock option - $ 0.120 $ 10. RELATED PARTY TRANSACTIONS Related party personnel are those who have the authority and responsibility for planning, directing, and controlling activities of the Company directly or indirectly. Related parties include the board of directors, officers, close family members and entities that are controlled by these individuals. At December 31, 2025, accounts payable and accrued liabilities included $224,020 (June 30, 2024 - $275,594) payable to directors, officers and companies controlled or related to directors and/or officers. Amounts payable to related parties have no specific terms of repayment, are unsecured and do not bear interest. During the six months ended December 31, 2025, related party transactions include the following payments: 2025 2024 Management and consulting fees (1) 646,365 $ 647,185 $ Share-based payments (2) 182,930 201,990 829,295 $ 849,175 $ Six months ended December 31, (1) Included in management and consulting fees was $438,765 (December 31, 2024 - $447,185) capitalized as exploration and evaluation assets. (2) Share-based compensation expense is the fair value of options, RSUs, DSUs, and PSUs granted which have been calculated as disclosed in Note 9. 11. SEGMENTED INFORMATION The Company operates in one reportable operating segment, being the acquisition and exploration of exploration and evaluation assets in Mexico. All of the long-lived assets at December 31, 2025 and 2024 were for exploration and evaluation assets in Mexico. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 24 12. FINANCIAL AND CAPITAL RISK MANAGEMENT Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputs used to estimate the fair values. The three levels of the fair value hierarchy are: Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities; Level 2 – Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and Level 3 – Inputs that are not based on observable market data. The fair value of the Company’s cash and cash equivalents, receivables, accounts payable and accrued liabilities, approximates carrying value, due to their short-term nature. Fair value of other assets approximates the carrying value as they are recorded at market interest rate. The Company is exposed to varying degrees to a variety of financial instrument related risks: Credit risk Credit risk is the risk of an unexpected loss if a customer or third party to a financial instrument fails to meet its contractual obligations. The Company’s cash and cash equivalents are held at large Canadian financial institutions in interest bearing accounts. The Company has no investment in asset backed commercial paper. The Company’s receivables consist mainly of GST/VAT due from the governments of Canada and Mexico. As such, the Company does not believe it is subject to significant credit risk. Liquidity risk The Company’s approach to managing liquidity risk is to ensure tha --- t it will have sufficient liquidity to meet liabilities when due. At December 31, 2025, the Company had cash and cash equivalents of $10,196,214 (June 30, 2025 - $14,750,256) to settle current liabilities of $1,154,501 (June 30, 2025 - $847,990). The Company is considered to be in the exploration and evaluation stage. Thus, it is dependent on obtaining regular financings in order to continue its exploration and evaluation programs. Despite previous success in acquiring these financings, there is no guarantee of obtaining future financings. The Company’s cash is invested in business accounts with quality financial institutions, is available on demand for the Company’s programs, and is not invested in any asset backed commercial paper. Foreign currency risk The Company’s operations are in Canada, the United States and Mexico. The international nature of the Company’s operations results in foreign exchange risk as transactions are denominated in foreign currency. The operating results and the financial position of the Company are reported in Canadian dollars. The fluctuations of the operating currencies in relation to the Canadian dollar will, consequently, have an impact upon the reported results of the Company and may also affect the value of the Company’s assets and liabilities. The Company has not entered into any agreements or purchased any instruments to hedge possible currency risks at this time. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 25 12. FINANCIAL AND CAPITAL RISK MANAGEMENT (Cont’d) Based on the Company’s net exposures at December 31, 2025, and assuming that all other variables remain constant, a 10% depreciation or appreciation of the Canadian dollar against the US dollar would result in a decrease/increase of approximately $360,000 in the Company’s net earnings. Likewise, a 10% depreciation or appreciation of the Canadian dollar against the Mexican peso would result in a decrease/increase of approximately $350,000 in the Company’s net earnings. Price risk The Company is exposed to price risk with respect to commodity prices. Commodity price risk is defined as the potential adverse impact on earnings and economic value due to commodity price movements and volatility. The Company closely monitors the commodity prices of precious metals, and the stock market to determine the appropriate course of action to be taken by the Company. Based on management’s knowledge and experience of the financial markets, management does not believe that the Company’s current financial instruments will be affected by interest rate risk, currency risk and credit risk. Market risk Market risk is the risk of loss that may arise from changes in market factors such as interest rates, foreign exchange rates, and commodity and equity prices. Interest rate risk The Company has cash and cash equivalents balances and has no debt instruments that bear variable interest rates. The interest earned on the cash and cash equivalents approximates fair value rates, and the Company is not at a significant risk to fluctuating interest rates. The Company’s current policy is to invest excess cash and cash equivalents in investment-grade short-term deposit certificates issued by its financial institutions. The Company periodically monitors the investments it makes and is satisfied with the credi --- t ratings of its banks. Capital management The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern in order to pursue the exploration of its exploration and evaluation assets, acquire additional exploration and evaluation assets and to maintain a flexible capital structure which optimizes the costs of capital at an acceptable risk. In the management of capital, the Company includes components of shareholders’ equity. The Company manages the capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust the capital structure, the Company may attempt to issue new shares, issue debt, acquire or dispose of assets or adjust the amount of cash. The Company is not subject to any externally imposed capital requirements. There were no changes in the Company’s approach to capital management. DEFIANCE SILVER CORP. NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS (Unaudited – Prepared by Management) (Expressed in Canadian Dollars) FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2025 AND 2024 26 13. SUBSEQUENT EVENTS Subsequent to December 31, 2025, the following events occurred: i. Issued 4,988.812 common shares pursuant to exercise of warrants for gross proceeds of $993,742. ii. Issued 50,000 common shares pursuant to exercise of stock options for gross proceeds of $7,750. iii. The Company issued incentive stock options to purchase of an aggregate of 2,720,000 common shares of the Company at an exercise price of $0.35, 289,000 DSUs, 458,000 PSUs, and 314,000 RSUs in accordance with the terms of the Company’s Omnibus Equity Incentive Plan.