Applied Graphite Technologies Corp. — Interim / Quarterly Report 2026

May 20, 2026

APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

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NOTICE OF NO AUDITOR REVIEW OF CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

Under National Instrument 51-102, Part 4, subsection 4.3(3)(a), if an auditor has not performed a review of the condensed interim consolidated financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.

The accompanying unaudited condensed interim consolidated financial statements 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.

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

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION
Condensed interim consolidated statements of financial position
(Expressed in Canadian dollars, unaudited)

	Note	March 31, 2026	December 31, 2025
ASSETS
Current assets
Cash		$ 30,485	$ 7,259
Amounts receivable		7,488	5,955
Prepaid expenses		57,592	59,364
		95,565	72,578
Non-current assets
Deposit	5	132,206	132,369
Equipment	4	17,138	17,159
Mineral properties	5	2,074,480	2,075,034
		2,223,824	2,224,562
Total assets		$ 2,319,389	$ 2,297,140
LIABILITIES AND EQUITY
Current liabilities
Accounts payable and accrued liabilities	8	$ 407,004	$ 158,042
Total liabilities		407,004	158,042
EQUITY
Share capital	6(a), 6(b)	$ 3,479,789	$ 3,441,332
Share-based reserves	6(d)	419,419	404,483
Warrant reserves	6(e)	187,621	187,621
Deficit		(2,265,743)	(1,986,764)
Accumulated other comprehensive loss		(7,323)	(6,463)
Total equity attributable to the parent company		$ 1,813,763	$ 2,040,209
Non-controlling interest	7	98,622	98,889
Equity		1,912,385	2,139,098
Total liabilities and equity		$ 2,319,389	$ 2,297,140

Subsequent event (Note 1)

Approved for issue by the Board of Directors on May 20, 2026:

Signed on the Company's behalf by:

"Ian Slater"
Ian Slater, Director

"Lindsay Nagle"
Lindsay Nagle, Director

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

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Condensed interim consolidated statements of loss and comprehensive loss

(Expressed in Canadian dollars, unaudited)

	Note	Three months ended March 31
		2026	2025
Expenses
Exploration		$ -	$ 1,253
Filing fees		3,028	9,082
Foreign exchange loss (gain)		(2,522)	33
General and administrative		40,972	37,634
Investor relations		2,370	16,622
Professional fees		28,399	8,528
Share-based compensation	6(d)	14,936	-
Wages and benefits		192,063	61,434
		$ (279,246)	$ (134,586)
Other Income
Interest income		-	6
		$ -	$ 6
Loss for the period		$ (279,246)	$ (134,580)
Loss attributed to:
Non-controlling interests		(267)	(200)
Shareholders of the Company		(278,979)	(134,580)
Loss for the period		$ (279,246)	$ (134,580)
Other comprehensive loss
Foreign currency translation differences for foreign operations		(7,323)	55,884
Comprehensive loss for the period		$ (286,569)	$ (78,696)
Attributed to:
Non-controlling interests	7	(267)	(200)
Shareholders of the Company		(286,302)	(78,496)
Comprehensive loss for the period		$ (286,569)	$ (78,496)
Basic and diluted loss per common share		$ (0.01)	$ (0.01)
Weighted average number of common shares outstanding		27,860,508	15,845,415

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

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION
Condensed interim consolidated statements of cash flows
(Expressed in Canadian dollars, unaudited)

	Note	Three months ended March 31
		2026	2025
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss for the period		$ (279,246)	$ (134.580)
Adjustment for Items not involving cash:
Share-based compensation	6(d)	14,936	-
Depreciation		-	1,253
Foreign exchange		(125)	45
		(264,435)	(133,282)
Net changes in non-cash working capital items:
Prepaid expenses		1,772	2,000
Amounts receivable		(1,533)	3,321
Accounts payable and accrued liabilities		248,965	134,187
Net cash outflows from operating activities		(15,231)	6,226
CASH FLOWS FROM FINANCING ACTIVITIES
Shares issued		38,457	-
Net cash inflows from financing activities		38,457	-
Change in cash in the period		23,226	6,226
Cash, beginning of the period		7,259	34,090
Cash, end of the period		$ 30,485	$ 40,316

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

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION
Condensed interim consolidated statements of changes in shareholder's equity
(Expressed in Canadian dollars, unaudited)

	Number of Shares	Share Capital	Share-Based Reserves	Warrant Reserves	Accumulated other comprehensive income	Deficit	Non-controlling interest	Total
Balance, December 31, 2024	23,533,938	$ 2,802,848	$ 318,684	$ 187,621	$ 62,835	$ (1,317,504)	$ 114,642	$ 2,169,216
Foreign currency translation adjustment	-	-	-	-	(6,951)	-	-	(6,951)
Loss for period to Non-controlling interest (Note 7)	-	-	-	-	-	200	(200)	-
Loss for the period	-	-	-	-	-	(134,580)	-	(134,580)
Balance, March 31, 2025	23,533,938	$ 2,802,848	$ 318,684	$ 187,621	$ 55,884	$ (1,451,884)	$ 114,442	$ 2,027,595
Balance, December 31, 2025	34,878,939	$ 3,441,332	$ 404,483	$ 187,621	$ (6,463)	$ (1,986,764)	$ 98,889	$ 2,139,098
Common shares issued (Note 7(b))	640,962	38,457	-	-	-	-	-	38,457
Share-based payments	-	-	14,936	-	-	-	-	14,936
Foreign currency translation adjustment	-	-	-	-	(860)	-	-	(860)
Loss for period to Non-controlling interest (Note 7)	-	-	-	-	-	267	(267)	-
Loss for the period	-	-	-	-	-	(279,246)	-	(279,246)
Balance, March 31, 2026	35,519,901	$ 3,497,789	$ 419,419	$ 187,621	$ (7,323)	$ (2,265,743)	$ 98,622	$ 1,912,385

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

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

1. CORPORATE INFORMATION AND CONTINUANCE OF OPERATIONS

The Company's predecessor, Audrey Capital Corporation, was incorporated on March 9, 2021, under the Business Corporations Act of British Columbia. Audrey Capital Corporation's Initial Public Offering (the "IPO") was completed on November 26, 2021, and was classified as a Capital Pool Company ("CPC") as defined in the TSX Venture Exchange ("TSX-V") Policy 2.4. On March 7, 2024, the Company completed a qualifying transaction with Applied Graphite Technologies Corporation ("AGT"), a private company incorporated under the Business Corporations Act (British Columbia), pursuant to which the Company acquire all of the issued and outstanding securities of AGT. The Company's common shares are traded on the TSX-V under the symbol "AGT".

These condensed interim consolidated financial statements have been prepared in accordance with IFRS Accounting Standards ("IFRS") applicable to a going concern, 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.

As at March 31, 2026, the Company had cash of $30,485 and deficiency in working capital of $311,439. For the three months March 31, 2026, the Company incurred a net loss of $279,246 and had inflow cash in operations of $15,231.

The Company has not generated revenue from operations to date and will require additional financing or outside participation to undertake further exploration and subsequent development of its mineral properties. There can be no assurance that the Company will be able to raise sufficient financing on acceptable terms. Future operations of the Company are dependent upon its ability to raise additional equity financing, maintain sufficient working capital and upon future production or proceeds from the disposition of its mineral property interests. These factors represent material uncertainties that give rise to significant doubt as to whether the Company will be able to continue as a going concern.

These condensed interim financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue its existence.

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

2. BASIS OF PRESENTATION

a) Statement of Compliance

These condensed interim consolidated financial statements have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board ("IASB"). The policies applied in these consolidated financial statements are based on the IFRS issued and outstanding as at December 31, 2025.

These condensed interim consolidated financial statements were authorized for issue by the Board of Directors on May 20, 2026.

b) Basis of Measurement

These condensed interim consolidated financial statements have been prepared using the historical cost basis, except for certain financial instruments that are measured at fair value, using the accrual basis of accounting, except for cash flow information.

c) Functional and presentation currency

The presentation currency of the Company is the Canadian dollar.

Items included in the financial statements of each entity in the Company are measured using the currency of the primary economic environment in which the entity operates (the "functional currency"), which has been determined for each entity within the Company using an analysis of the consideration factors identified in IAS 21, The Effects of Changes in Foreign Exchange Rates.

d) Use of estimates and judgments

The preparation of the consolidated financial statements in conformity with IFRS requires management to make estimates, judgments and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income, and expenses. Actual results may differ from these estimates.

Estimates

Significant assumptions about the future and other sources of estimation uncertainty that management has made at the end of the reporting period, 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, are as follows:

The carrying value and recoverability of mineral properties, and equipment requires management to make certain estimates, judgments and assumptions about its project. Management considers the economics of the project, including the latest resource prices and the long-term forecasts, and the overall economic viability of the project.

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

2. BASIS OF PRESENTATION (continued)

The determination of income tax is inherently complex and requires making certain estimates and assumptions about future events. While income tax filings are subject to audits and reassessments, the Company has adequately provided for all income tax obligations. However, changes in facts and circumstances as a result of income tax audits, reassessments, jurisprudence and any new legislation may result in an increase or decrease in the Company's provision for income taxes.

Share-based payments are subject to estimation of the value of the award at the date of grant using pricing models such as the Black-Scholes option valuation model. The option valuation model requires the input of highly subjective assumptions including the expected share price volatility. Where such valuations are applied, such as the time of a stock option grant or issuance of shares from trust, management provides detailed valuation assumptions.

Judgments

Functional currency

The functional currency of each of the subsidiaries and the Company were assessed to determine the economic substance of the currency in which each entity performed its operations. The functional currency of the Company and its Canadian subsidiary is the Canadian dollar. The functional currency of the Company's subsidiary in Sri Lanka is the Sri Lankan rupee.

Acquisition of a business

The determination of whether a corporate entity or set of assets acquired, and liabilities assumed, constitute a business may require the Company to make certain judgements, taking into account all facts and circumstances. A business is presumed to be an integrated set of activities and assets capable of being conducted and managed for the purpose of providing a return in the form of dividends, lower costs, or economic benefits. The acquisition of AGT was determined to constitute an acquisition of assets. The excess of consideration paid over the net assets of AGT received was allocated on a proportional basis to the mineral properties acquired, which constitutes management's determination of the relative importance of the properties to the Company.

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

3. MATERIAL ACCOUNTING POLICY INFORMATION

Principles of Consolidation

These consolidated financial statements include the accounts of the Company, and its subsidiaries and branch operations from the date control was acquired. Control exists when the Company possesses power over an investee, has exposure to variable returns from the investee, and has the ability to use its power over the investee to affect its returns. Intercompany balances and transactions, and any income and expenses arising from intercompany transactions, are eliminated in preparing the consolidated financial statements.

Name of Subsidiary	Place of Incorporation	Ownership Interest	Principal Activity
AGT Resources Corporation	Province of British Columbia	100%	Holding company
C-Tech Ceylon (Private) Limited	Sri Lanka	90%	Mineral exploration

Determination of control by one entity over another

Subsidiaries include entities which are controlled by the Company and are accounted for through consolidation. Investments in associates and joint ventures include entities in which the Company has significant influence, but not control or joint control, and are accounted for using the equity method.

Mineral exploration and evaluation expenses

Upon acquiring the legal right to explore a property, all direct costs related to the acquisition of mineral property interests are capitalized. Exploration expenses incurred prior to the determination of the feasibility of mining operations and a decision to proceed with development are charged to operations as incurred. The Company will perform an impairment test on transition from the exploration stage to the development stage.

Expenditures incurred subsequent to a development decision, and to increase or extend the life of existing production, are capitalized and will be transferred to property, plant and equipment and amortized using the unit-of-production method based upon proven and probable reserves. When there is little prospect of further work on a property being carried out by the Company, the remaining deferred costs associated with that property will be assessed for impairment.

The Company assesses mineral properties for impairment at the end of each reporting period or when facts and circumstances suggest that the carrying amount may exceed its recoverable amount.

Acquisitions

Asset acquisitions are accounted for using the acquisition method. The cost of the acquisition is measured at the aggregate of the fair values at the date of acquisition of assets transferred, liabilities incurred or assumed, and equity instruments issued by the Company, if any. The acquiree's identifiable assets and liabilities assumed are recognized at their fair value at the

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

3. MATERIAL ACCOUNTING POLICY INFORMATION (continued)

acquisition date, or if the fair values exceed the consideration paid, then the consideration paid is allocated on a pro rata basis to the identifiable assets acquired based on their relative fair values.

Equipment

Equipment is recorded at cost less accumulated amortization and accumulated impairment losses, if any. Amortization is recognized in pproject evaluation costs on a declining balance basis at the following rates:

• Field Equipment – 20% per annum

A straight-line basis over the estimated useful lives of each asset or component part of an item or equipment, may be applied depending on which method (and rate) most closely reflects the expected pattern of consumption of the future economic benefits embodied in the asset.

Foreign currency translation

The functional currency for each of the Company's subsidiaries is the currency of the primary economic environment in which the entity operates. Transactions in foreign currencies are translated to the functional currency of the entity at the exchange rate in existence at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the statement of financial position date are retranslated at the period end date exchange rates. Non-monetary items which are measured using historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.

Foreign operations are translated from their functional currencies into Canadian dollars on consolidation as follows:

(i) Assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of the statement of financial position;

(ii) Income and expenses for each statement of comprehensive income (loss) are translated at an average exchange rate (unless this rate is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and

(iii) All resulting exchange differences are recognized in other comprehensive income as cumulative translation adjustments.

Exchange differences that arise relating to long-term intercompany balances that form part of the net investment in a foreign operation are also recognized in this separate component of equity through other comprehensive income (loss).

On disposition or partial disposition of a foreign operation, the cumulative amount of related exchange differences recorded in a separate component of equity is recognized in the consolidated statement of income (loss).

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

3. MATERIAL ACCOUNTING POLICY INFORMATION (continued)

New standards issued and not yet effective

The following new standards, amendments to standards and interpretations have been issued but are not effective during the period ended March 31, 2026.

On April 9, 2024, the IASB issued a new standard – IFRS 18, “Presentation and Disclosure in Financial Statements” with a focus on updates to the statement of profit or loss. The key new concepts introduced in IFRS 18 relate to:

• the structure of the statement of profit or loss;
• required disclosures in the financial statements for certain profit or loss performance measures that are reported outside an entity’s financial statements (that is, management-defined performance measures); and
• enhanced principles on aggregation and disaggregation which apply to the primary financial statements and notes in general.

IFRS 18 will replace IAS 1; many of the other existing principles in IAS 1 are retained, with limited changes. IFRS 18 will apply for reporting periods beginning on or after January 1, 2027 and also applies to comparative information. Adoption of IFRS 18 will not impact the recognition or measurement of items in the financial statements, but it might change what an entity reports as its ‘operating profit or loss’. The Company is currently assessing the impact the new standard will have on its financial statements.

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

4. EQUIPMENT

	Field Equipment
Cost
Balance at December 31, 2024	$ 25,347
Additions	-
Foreign exchange	(2,468)
Balance at December 31, 2025	$ 22,879
Additions	-
Foreign exchange	(28)
Balance at March 31, 2026	$ 22,851
Accumulated Depreciation
Balance at December 31, 2024	$ 1,267
Depreciation	4,809
Foreign exchange	(356)
Balance at December 31, 2025	$ 5,720
Depreciation	-
Foreign exchange	(7)
Balance as of March 31, 2026	$ 5,713
Net book value, December 31, 2024	$ 24,080
Net book value, December 31, 2025	$ 17,159
Net book value, March 31, 2026	$ 17,138

5. MINERAL PROPERTY

Queen's Mine Complex

The D1 and Q2 properties and mineral rights, located in the Dodangaslanda district of Sri Lanka, were acquired with AGT on March 7, 2024. On March 26, 2024, the Company completed the purchase of the past producing Queen's Mine adjacent to the Company's D1 and Q2 properties. The Queen's Mine previously produced high grade vein graphite for direct shipping. During 2025, the Company acquired additional adjacent properties, consolidating the district. Collectively, the properties are known as the Queen's Mine Complex.

AGT has a 90% ownership interest in C-Tech, a corporation incorporated pursuant to the laws of Sri Lanka. The remaining 10% is owned by the Company's Sri Lankan representative. C-Tech owns 100% of the mineral rights to the Queen's Mine Complex. The properties were purchased outright by C-Tech and accordingly, there is no expiry on the titles.

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

5. MINERAL PROPERTY (continued)

Mineral Properties as at March 31, 2026:

	December 31, 2025	Effect of movement in exchange rates	March 31, 2026
Queen’s Mine Complex	$ 2,075,034	$ (554)	$ 2,074,480
TOTAL	$ 2,075,034	$ (554)	$ 2,074,480

Mineral Properties as at March 31, 2025:

	December 31, 2024	Effect of movement in exchange rates	March 31, 2025
Queen’s Mine Complex	$ 2,160,606	$ (5,459)	$ 2,155,147
TOTAL	$ 2,160,606	$ (5,459)	$ 2,155,147

Exploration Expenditures

Exploration and evaluation expenditures incurred during the period ended March 31, 2026 and 2025 are as follows:

	For the three months ended
	March 31, 2026	March 31, 2025
Depreciation	$ -	$ 1,253
TOTAL	$ -	$ 1,253

6. SHAREHOLDERS' EQUITY

a) Authorized Share Capital

The Company is authorized to issue an unlimited number of common shares without par value.

b) Share Issuance

At March 31, 2026, the Company had 35,519,901 (2025 – 23,533,938) common shares issued and outstanding.

2,765,505 common shares were held in escrow as at March 31, 2026, and are being released quarterly through March 8, 2027. The balance of shares held in escrow as at March 31, 2025 was 5,402,256 common shares.

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

6. SHAREHOLDERS' EQUITY (continued)

c) Stock Options

On March 16, 2023, the Board of Directors approved an amended option plan of the Company (the "Stock Option Plan"), which provides that the Board of Directors of the Company may, from time to time in its discretion and in accordance with TSX-V regulations, grant to directors, officers, employees, or Management Company employees and consultants to the Company, non-transferrable options to purchase common shares, provided that the number of common shares reserved for issuance will not exceed 10% of the issued and outstanding common shares. Such options are exercisable for a period of up to 10 years from the date of the grant. Vesting terms will be determined at the time of grant by the Board of Directors.

During the period ended March 31, 2026, the Company granted 2,350,000 stock options to directors, officers, and consultants of the Company, exercisable at a price of $0.07 for a five-year period following the date of the grant.

The stock option continuity for the period ended March 31, 2026, is as follows:

Number Outstanding Dec 31, 2025	Expired / Cancelled	Number Outstanding Mar 31, 2026	Exercise Price per Share ($)	Expiry Date	Weighted Avg Remaining Contractual Life (in years)
200,000	-	200,000	0.15	Nov 26, 2026	0.66
400,000	-	500,000	0.15	Mar 23, 2029	2.98
200,000	200,000	-	0.15	-	-
2,300,000	-	2,200,000	0.07	Aug 13,2030	4.37
3,100,000	200,000	2,900,000	0.09		3.88
	Exercisable	2,350,000	0.09		3.76

As at March 31, 2026, a total of 2,350,000 outstanding stock options were vested and exercisable, with a weighted average exercise price of $0.09.

The stock option continuity for the three months ended March 31, 2025, is as follows:

Number Outstanding Dec 31, 2024	Expired / Cancelled	Number Outstanding Mar 31, 2025	Exercise Price per Share ($)	Expiry Date	Weighted Avg Remaining Contractual Life (in years)
1,133,333	1,133,333	-	0.15	Mar 07, 2025	-
200,000	-	200,000	0.15	Nov 26, 2026	1.66
700,000	-	700,000	0.15	Mar 23, 2029	3.98
200,000	-	200,000	0.15	Mar 23, 2029	3.98
2,233,333	1,133,333	1,100,000	0.15		3.56
	Exercisable	1,100,000	0.15		3.56

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

6. SHAREHOLDERS' EQUITY (continued)

As at March 31, 2025, a total of 1,100,000 outstanding stock options were vested and exercisable, with a weighted average exercise price of $0.15.

d) Share-Based Compensation

The fair value of each option granted to employees, officers, and directors was estimated on the date of the grant using the Black-Scholes Option-Pricing Model.

The assumptions used in the Black-Scholes Option-Pricing Model for the relative fair value allocation were an expected life of 5 years, expected dividend of $nil, and:

	Aug 13, 2025	May 23, 2024	Mar 25, 2024
Share price on grant date	$0.065	$0.17	$0.15
Risk-free interest rate	2.93%	3.68%	3.51%
Expected volatility	88.00%	88.00%	88.00%
Fair value	$0.06	$0.12	$0.11

During the period ended March 31, 2026, the Company recognized share-based compensation of $14,936 (2025 - $nil).

e) Share Purchase Warrants

In conjunction with its qualifying transaction, the Company issued 1,366,454 transferable warrants to purchase AGT shares at a price of $0.15 per share with an expiry date of March 7, 2029. The warrants were valued using the Black-Scholes option pricing model with the following assumptions: risk free interest rate 3.44%; dividend yield of 0%; expected volatility of 88% and expected life of 5 years.

The share purchase warrant continuity for the three months ended March 31, 2026 is as follows:

| Number Outstanding
Dec 31, 2025 | Number Outstanding
Mar 31, 2026 | Exercise Price
per Share ($) | Expiry Date | Weighted Avg
Remaining Contractual
Life (in years) |
| --- | --- | --- | --- | --- |
| 333,333 | 333,333 | 0.15 | Nov 26, 2026 | 0.66 |
| 1,366,454 | 1,366,454 | 0.15 | Mar 07, 2029 | 2.92 |
| 1,699,787 | 1,699,787 | 0.15 | | 2.48 |

The share purchase warrant continuity for the three months ended March 31, 2025 is as follows:

| Number Outstanding
Dec 31, 2024 | Number Outstanding
Mar 31, 2025 | Exercise Price
per Share ($) | Expiry Date | Weighted Avg
Remaining Contractual
Life (in years) |
| --- | --- | --- | --- | --- |
| 333,333 | 333,333 | 0.15 | Nov 26, 2026 | 1.66 |
| 1,366,454 | 1,366,454 | 0.15 | Mar 07, 2029 | 3.92 |
| 1,699,787 | 1,699,787 | 0.15 | | 3.48 |

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

7. NON-CONTROLLING INTEREST

As of March 31, 2026, non-controlling interest includes a 10% interest in AGT Resources Corporation's subsidiary C-Tech Cylon. The following is a continuity schedule of the Company's non-controlling interests:

	C-Tech Ceylon
Non-controlling interest December 31, 2025	$ 98,889
Share of comprehensive loss – C-Tech Cylon	(267)
Non-controlling interest March 31, 2026	$ 98,622

As of March 31, 2025, non-controlling interest includes a 10% interest in AGT Resources Corporation's subsidiary C-Tech Cylon. The following is a continuity schedule of the Company's non-controlling interests:

	C-Tech Ceylon
Non-controlling interest December 31, 2024	$ 114,642
Share of comprehensive loss – C-Tech Cylon	(200)
Non-controlling interest March 31, 2025	$ 114,442

The table below discloses selected financial information of C-Tech Cylon on a 100% basis:

As at	March 31, 2026	March 31, 2025
Non-controlling percentage	10%	10%
Total assets	$ 2,267,765	$ 2,303,203
Total liabilities	(997,429)	(814,458)
Net assets	$ 1,270,336	$ 1,491,745
Summarized income statement
Loss and comprehensive loss	2,669	2,000
Comprehensive loss allocated to non-controlling interest	267	200

8. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

As at	March 31, 2026	December 31, 2025
Trade payables	$ 197,004	$ 113,042
Accrued liabilities	210,000	45,000
TOTAL	$ 407,004	$ 158,042

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

9. RELATED PARTY TRANSACTIONS

The Company's related parties consist of directors and officers in common and companies owned in whole or in part by executive officers and directors as follows:

Related Party Name	Nature of Transactions
Farris LLP (“Farris”), a company in which former Director Jay Sujir is a partner (1),(3)	Legal services
FT Management Ltd (“FT”), a company owned by a close family member of Rob Scott, CFO.	CFO services
Slater Corporate Services Corporation (“SCSC”), a company controlled by Ian Slater, Chairman and CEO(2)	Cost reimbursement, Corporate Secretary, corporate compliance services, accounting, and financial reporting
1163863 ON Ltd (“1163863”), a company controlled by Don Baxter, Director	Wages and benefits
C R Abeyratne (“CRA”), a company controlled by former Director Chaanaka Abeyratne(3)	Wages and benefits

(1) Jay Sujir became a director on June 16, 2025
(2) Ian Slater became a director on February 27, 2026
(3) Jay Sujir, Ian Harris and Chaanaka Abeyratne ceased to be directors on March 10, 2026

The Company incurred the following fees in connection with companies owned or partially owned by key management and/or directors. Expenses have been measured at the exchange amount, which is determined on a cost recovery basis.

	Three months ended
	March 31, 2026	March 31, 2025
Cost reimbursement - SCSC	$ 10,000	$ -
Legal fees – Farris	12,529	-
Consulting fees - FT	7,500	-
Share-based compensation	8,898	-
Wages and benefits - 1163863	175,000	45,000
Wages and benefits – CRA	11,177	15,099
Total	$ 225,104	$ 60,099

Related party transactions for the period ended March 31, 2026, are as follows:

a) A company owned by Director Don Baxter provided professional services to the Company in the amount of $20,000 for the period ended March 31, 2026 (2025 – $45,000). Don Baxter was terminated as CEO on February 27, 2026, and a payout amount of $155,000 was accrued. A balance of $251,942 was due to 1163863 ON Limited as at March 31, 2026.

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

9. RELATED PARTY TRANSACTIONS (continued)

b) A company owned by a Director, Chaanaka Abeyratne, provided professional services to the Company in the amount of $11,177 (2025 - $15,099). The balance owing to C R Abeyratne was $6,332 as at March 31, 2026. Chaanaka Abeyratne ceased to be a Director on March 10, 2026.

c) A company owned by a Director, Ian Slater, recharged costs in the amount of $10,000 (2025 - $nil) for the three months ended March 31, 2026. A balance of $32,304.28 was due to SCSC as at March 31, 2026 (2025 – $nil). Ian Slater became a director on February 27, 2026.

d) A company owned by a Director, Jay Sujir provided legal services to the Company in the amount of $12,529 (2025 - $nil) through to March 10, 2026. A balance of $12,809 was due to Farris LLP as at March 31, 2026 (2025 - $Nil). Jay Sujir ceased to be a Director on March 10, 2026.

e) For the three months ended March 31, 2026, the Company incurred a total of $7,500 (2025 - $nil) in consulting fees from a company owned by a close family member of the CFO.

Compensation of directors and members of key management personnel through stock option.

Related party transactions for the three months March 31, 2025, are as follows:

a) A company owned by a Director, Don Baxter, provided professional services to the Company in the amount of $45,000 for the three months ended March 31, 2025 (2024 - $10,000). A balance of $73,450 was due to 1163863 ON Limited as at March 31, 2025.

b) A company owned by a Director, Chaanaka Abeyratne, provided professional services to the Company in the amount of $15,099 (2024 - $Nil). A balance of $20,019 was due to C R Abeyratne as at March 31, 2025.

Amounts owing to related parties are unsecured, with no specific terms of repayment.

10. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

The Company has designated its cash and cash equivalent, amounts receivable and accounts payable as financial instruments at amortized cost.

a) Fair Value

Management has assessed that the fair values of cash and cash equivalent, amounts receivable and accounts payable approximate their carrying amounts, largely due to the short-term maturity of these instruments. Fair values of financial instruments are classified in a fair value hierarchy based on the inputs used to determine fair values.

The levels of the fair value hierarchy are as follows:

Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities;

Page 19 of 21

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

10. FINANCIAL INSTRUMENTS AND RISK MANAGEMENT (continued)

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.

b) Financial Risk Management

Credit Risk

Credit risk is the risk of loss arising from a customer or third party to a financial instrument failing to meet its contractual obligations. The Company’s credit risk is attributable to its liquid financial assets including cash. The Company limits exposure to credit risk by maintaining its cash with a major Canadian financial institution. Credit risk surrounding the Company’s receivables is limited due to the nature of the receivables as they are primarily due from governmental agencies.

Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company has a planning and budgeting process in place to determine the funds required to support the Company’s normal operating requirements on an ongoing basis.

Historically, the Company’s primary source of funding has been the issuance of equity securities for cash, primarily through private placements. The Company’s access to equity financing is dependent upon market conditions and market risks. There can be no assurance of continued access to equity funding. As at March 31, 2026, the Company had a cash balance of $30,485 to settle current liabilities of $407,004.

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 equity prices. The Company does not currently hold and does not expect to hold interest-bearing financial instruments other than cash. The Company is exposed to currency risk to the extent that monetary assets and liabilities held by the Company are not denominated in Canadian dollars. The Company has not entered into any foreign currency contracts to mitigate this risk.

Commodity Price Risk

While the value of the Company’s mineral properties is related to the market price of based metals, the Company does not currently have any operating mines and therefore does not have any hedging or other commodity-based risks with respect to its operating activities.

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APPLIED GRAPHITE TECHNOLOGIES CORPORATION

Notes to the Condensed Interim Consolidated Financial Statements

For the three months ended March 31, 2026 and 2025

(Expressed in Canadian dollars, unaudited)

11. CAPITAL MANAGEMENT

Capital is composed of the Company's equity and any debt that it may issue. As at March 31, 2026 the Company's equity was $1,912,385 and it had current liabilities of $407,004. The Company's objectives when managing capital are to maintain financial viability and to protect its ability to meet its ongoing liabilities, to continue as a going concern, to maintain creditworthiness, and to maximize returns for shareholders over the long term. Protecting the ability to pay current and future liabilities includes maintaining capital above minimum regulatory levels, current financial strength rating requirements, and internally determined capital guidelines and calculated risk management levels.

12. SEGMENTED INFORMATION

The Company operates in one industry segment, the mineral exploration industry. All of the Company's non-current assets are located in Sri Lanka.

13. SUBSEQUENT EVENT

On April 21, 2026, the Company completed a non-brokered private placement offering of 5,750,000 common shares at a price of $0.10 per share for gross proceeds of $575,000.

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