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CarbonTech Capital Corp. — Management Reports 2025
Nov 24, 2025
48319_rns_2025-11-24_59f8597e-7395-4216-85ea-bd6209f7c068.pdf
Management Reports
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CARBONTECH CAPITAL CORP.
MANAGEMENT'S DISCUSSION AND ANALYSIS
NINE MONTHS ENDED SEPTEMBER 30, 2025 AND YEAR ENDED DECEMBER 31, 2024
Basis of Presentation
The following management discussion and analysis ("MD&A") of the results of the operations and financial position of CarbonTech Capital Corp. (the "Company") provides a summary of the financial results for the nine months ended September 30, 2025. This MD&A should be read in conjunction with the Company's audited financial statements and the accompanying notes thereto for the year ended December 31, 2024 and the Company's unaudited condensed interim financial statements and the accompanying notes thereto for the nine months ended September 30, 2025. These condensed interim financial statements of the Company have been prepared by management in accordance with International Accounting Standard ("IAS") 34, Interim Financial Reporting. As a result, certain information and note disclosures normally included in annual financial statements prepared in accordance with International Financial Reporting Standards ("IFRS") have been omitted or condensed. These interim financial statements should be read in conjunction with the Company's audited annual financial statements for the year ended December 31, 2024. Unless otherwise stated, all dollar amounts referred to in this MD&A, including tabular amounts, are expressed in Canadian dollars.
This MD&A was approved by the Board of Directors on November 24, 2025.
Cautionary Statement Regarding Forward-Looking Information
Certain statements contained in this MD&A constitute forward-looking information and forward-looking statements within the meaning of securities laws ("FLI"). In some cases, FLI can be identified by terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or other similar expressions concerning matters that are not historical facts. Examples of such statements include, but are not limited to, the Company's anticipated business strategy and outlook and the Company's ability to complete future acquisitions, including the Transaction, and financings including the Concurrent Financing.
FLI is also subject to certain factors, including risks and uncertainties, which could cause actual results to differ materially from what the Company currently expects. These factors include the ability of the Company to complete future acquisitions and the ability of the Company to obtain necessary financing.
More information on these risks and uncertainties is set forth in the Prospectus (as hereinafter defined) which is available under the Company's profile on SEDAR+ at www.sedarplus.ca. FLI contained in this MD&A is based on the Company's current estimates, expectations and projections, which the Company believes are reasonable as of the date of this MD&A. Readers should not place undue importance on FLI and should not rely upon this information as of any other date. While the Company may elect to, it is under no obligation and does not undertake to update this information at any particular time except as may be required by applicable securities laws.
Company Overview
CarbonTech Capital Corp. (the "Company") was incorporated on July 15, 2021, pursuant to a Certificate of Incorporation issued under the provisions of the Business Corporations Act (Ontario) under the name "CarbonTech Capital Corp.". The Company is a Capital Pool Company ("CPC") as defined in Policy 2.4 of the TSX Venture Exchange (the "Exchange"). The principal undertaking of the Company is to identify and evaluate assets or businesses with a view to potentially acquire them or an interest therein by completing a purchase transaction. The purpose of such an acquisition is to satisfy the related conditions of a qualifying transaction under the Exchange rules.
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On June 9, 2022, the Company completed its initial public offering (the "IPO") under the Exchange rules and the final prospectus of the Company dated April 7, 2022, pursuant to which it issued an aggregate of 5,000,000 Common Shares at a price of $0.10 per share for total proceeds of $500,000 (before transaction costs). The Common Shares began trading on the Exchange on June 9, 2022 under the symbol "CT.P". As at the closing of the Offering, the Company had 17,308,439 shares issued and outstanding (12,308,439 of which are subject to escrow restrictions).
The registered office of the Company is located at 77 King Street West, Suite 400, Toronto, Ontario, M5K 0A1. The head office of the Company is located at 161 Bay Street, 27th Floor, Toronto, Ontario M5J 2S1.
Summary of selected financial information
| Nine months ended September 30, 2025 and for the Year ended December 31, 2024 | 2025 ($) | 2024 ($) |
|---|---|---|
| Statement of Financial Position | ||
| Total Assets | 345,093 | 380,023 |
| Total Liabilities | 72,485 | 77,103 |
| Shareholders' Equity | 272,608 | 302,920 |
| Total Liabilities and shareholders' equity | 345,093 | 380,023 |
| Statement of Loss and Comprehensive Loss | ||
| Expenses | 30,312 | 240,073 |
| Net loss and comprehensive loss | (30,312) | (240,073) |
The decrease in the total value of assets of the Company was mainly due to payments of general and administrative expenses for the current period.
The decrease of total liabilities of the Company was mainly due to the payment of accrued professional services for the prior period.
Results of Operations
For the nine months ended September 30, 2025
The Company recorded a net loss of $30,312. The expenses primarily reflect the quarterly accrual of professional services.
Quarterly financial information
| 2025 | 2024 | |||||
|---|---|---|---|---|---|---|
| Q3 | Q2 | Q1 | Q3 | Q2 | Q1 | |
| Expenses | $6,688 | $9,196 | $14,427 | $5,634 | $13,183 | $6,379 |
| Net loss | (6,688) | (9,196) | (14,427) | (5,634) | (13,183) | (6,379) |
The fluctuations in quarterly expenses are primarily due to the timing of professional service accruals.
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Liquidity and Capital Resources
As at September 30, 2025, the Company had $345,093 in cash as a result of net proceeds derived from the issuance of Common Shares, current liabilities of $72,485, and working capital of $272,608.
| Nine months ended Sept 30, 2025 ($) | Nine months Sept 30, 2024 ($) | |
|---|---|---|
| CASH FLOWS | ||
| Operating activities | (34,930) | (60,596) |
| (Decrease) in cash | (34,930) | (60,596) |
| Cash – beginning of period | 380,023 | 445,310 |
| Cash – end of period | 345,093 | 384,714 |
Cash used in operating activities is primarily related to professional service payments.
Additional Disclosure for Venture Issuers without Significant Revenue
Since the Company has no revenue from operations, the following is a breakdown of the costs incurred in the nine months ended September 30, 2025:
| Expense Category | |
|---|---|
| General and administrative | $ 7,645 |
| Professional services | $ 22,667 |
Capital Structure
As of September 30, 2025, the Company had 17,308,439 Common Shares issued and outstanding and 2,140,000 options to acquire Common Shares, of which 1,230,000 options have an exercise price of $0.05 per Common Share and an expiry of November 1, 2026 and 910,000 have an exercise price of $0.10 per Common Share and an expiry of June 9, 2027.
Significant Accounting Policies and Accounting Estimates
The interim financial statements follow the same accounting policies and methods of application as the Company's most recent annual financial statements. Accordingly, they should be read in conjunction with the Company's most recent annual financial statements.
Financial Instruments
The Company, as part of its operations, carries financial instruments consisting of cash and accounts payable and accruals. It is management's opinion that the Company is not exposed to significant credit, interest, or currency risks arising from these financial instruments except as otherwise disclosed. The applicable significant accounting policies and recognition of financial assets and financial liabilities are discussed in detail in Note 3 to the accompanying financial statements for the year ended December 31, 2024.
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Credit Risk
Credit risk is the risk of loss associated with the counterparty's inability to fulfill its payment obligations. The Company believes it has no significant credit risk.
Liquidity Risk and Capital Availability Risk
The Company's approach to managing liquidity risk and capital availability risk is to ensure that it will have sufficient liquidity to meet liabilities when due.
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. The Company has no market risks.
Off-Balance Sheet Arrangements
As of September 30, 2025, the Company does not have any off-balance sheet arrangements.
Qualifying Transaction
On June 11, 2025, the Company entered into a non-binding letter of intent (the "LOI") with Royal Queensway General Partner Inc. ("RQGP"), a corporation incorporated under the laws of Ontario. RQGP is the general partner of the Royal Queensway Limited Partnership, which has invested in three residential development projects in the Mimico neighbourhood of Toronto, Ontario.
The proposed transaction (the "Transaction") contemplates the Company acquiring all of the issued and outstanding securities of RQGP for a purchase price of approximately $400,000, to be satisfied by the issuance of units of the Company, each unit comprised of one common share and one common share purchase warrant. The units will be issued at the maximum discounted market price permitted under TSX Venture Exchange ("Exchange") policies.
The Transaction is subject to the approval of the Exchange and is intended to constitute the Company's Qualifying Transaction under Policy 2.4 – Capital Pool Companies. Upon completion of the Transaction, the Company, as the resulting issuer, will continue to list its common shares on the Exchange as a Tier 2 Investment Issuer.
The Transaction is considered a related party transaction under National Instrument 61-101 – Take-over Bids and Special Transactions, as a director and officer of the Company is also a director and shareholder of one of the shareholders of RQGP. The Transaction is expected to be exempt from the valuation and minority approval requirements of NI 61-101.
As at September 30, 2025, the non-binding LOI remains in effect and the parties are in the process of negotiating a definitive agreement. Completion of the Transaction remains subject to customary conditions, including Exchange approval. No amounts have been recorded in these financial statements as the Transaction has not yet closed.
Risks and Uncertainties
The Company's operations could be adversely affected by global or regional events beyond its control, including pandemics, epidemics, or other public health crises. Such events may cause disruptions to financial markets, delay regulatory or transactional approvals, and restrict the ability of counterparties or the Company itself to conduct normal business operations. Prolonged or severe disruptions could adversely
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affect the Company's ability to identify, evaluate, or complete a Qualifying Transaction and to obtain necessary financing on acceptable terms.
The Company's overall performance and results of operations are subject to a number of risks and uncertainties. Please refer to the risk factors outlined in the Prospectus available under the Company's profile at www.sedarplus.ca.
Additional Information
Additional information relating to the Company is available under the Company's profile on SEDAR+ at www.sedarplus.ca.