First Hydrogen Corp. — Audit Report / Information 2025

Jul 29, 2025

FIRST HYDROGEN

FIRST HYDROGEN CORP.

CONSOLIDATED FINANCIAL STATEMENTS

For the Years Ended March 31, 2025 and 2024

(Expressed in Canadian Dollars)

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FIRST HYDROGEN CORP.

CONTENTS

Independent Auditor's Report 1 – 3
Consolidated Statements of Financial Position 4
Consolidated Statements of Loss and Comprehensive Loss 5
Consolidated Statements of Cash Flows 6
Consolidated Statements of Changes in Shareholders' Equity 7
Notes to the Consolidated Financial Statements 8 – 28

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SAM S. MAH INC.
Chartered Professional Accountant
Unit 114B-8988 Fraserton Court
Burnaby, B.C. V6E 3X2
Tel: (604) 617-8858
Fax: (604) 239-0866
E-Mail: sam_mah@telus.net

INDEPENDENT AUDITOR'S REPORT

To: The Shareholders of
First Hydrogen Corp.

Opinion

I have audited the consolidated financial statements of First Hydrogen Corp. (the "Company"), which comprise the consolidated statements of financial position as at March 31, 2025 and March 31, 2024, and the consolidated statement of loss and comprehensive loss, consolidated statement of cash flows and consolidated statement of changes in shareholders' equity for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In my opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at March 31, 2025 and 2024, and its financial performance and its cash flows for the years then ended in accordance with International Financial Reporting Standards (IFRSs).

Basis for Opinion

I conducted my audit in accordance with Canadian generally accepted auditing standards. My responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated financial statements section of my report. I am independent of the Company in accordance with the ethical requirements that are relevant to my audit of the consolidated financial statements in Canada, and I have fulfilled my other ethical responsibilities in accordance with these requirements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Material Uncertainty Related to Going Concern

I draw attention to Note 1 in the consolidated financial statements, which indicates that the Company incurred a net loss of $5,066,816 during the year ended March 31, 2025 and, as of that date, the Company had not yet achieved profitable operations, had accumulated losses of $42,479,912 since its inception, and expects to incur further losses in the development of its business. As stated in Note 1, these events or conditions, along with other matters as set forth in Note 1, indicate that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. My opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in my professional judgment, were of most significance in my audit of the consolidated financial statements for the year ended March 31, 2025. These matters were addressed in the context of my audit of the consolidated financial statements as a whole, and in forming my opinion thereon, and I do not provide a separate opinion on these matters.

Going Concern Assessment

As disclosed in Note 1, the Company is subject to a number of capital and operating requirements, which are a key determinant of the Company's ability to continue as a going concern. I identified that the most significant assumption in assessing the Company's ability to continue as a going concern was the expected future profitability of the Company, as the key determinant of the forecasted capital position. The calculations supporting the assessment require management to make highly subjective judgments and require adjustment to accounting figures to reflect capital and operating requirements to continue as a going concern. The calculations are based on estimates of future performance and are fundamental to assessing the suitability of the basis adopted for the preparation of the financial statements. I have therefore spent significant audit effort in assessing the appropriateness of this assumption.

In addition to the Going Concern Assessment, I have determined the other matter described below to be a key audit matter to be communicated in this report.

Assessment of Impairment Indicators of Acquired-in-progress Research & Development.

As described in Note 7 to the financial statements, the Acquired-in-progress Research & Development was $693,789 as at March 31, 2025. As more fully described in Note 2 Impairment of Long-lived Assets to the financial statements, management assesses

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the asset impairment for indicators of impairment at each reporting period and many of the factors used in assessing fair value are outside the control of management and it is reasonably likely that assumptions and estimates will change from period to period.

The principal considerations for my determination that the assessment of impairment indicators of asset impairment is a key audit matter are that there was judgment made by management when assessing whether there were indicators of impairment for the assets, specifically relating to the assets' carrying amount which is impacted by the Company's intent and ability to continue to operate and hold these assets. This in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures to evaluate audit evidence relating to the judgments made by management in their assessment of indicators of impairment that could give rise to the requirement to prepare an estimate of the recoverable amount of the asset.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. My audit procedures included, among others:

• Evaluating management's assessment of impairment indicators;
• Evaluating the intent for the assets through discussion and communication with management;
• Reviewing the Company's recent R&D activity.

Other Information

Management is responsible for the other information. The other information comprises the Management Discussion and Analysis.

My opinion on the consolidated financial statements does not cover the other information and I do not express any form of assurance conclusion thereon.

In connection with my audit of the consolidated financial statements, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or my knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work I have performed, I conclude that there is a material misstatement of this other information, I am required to report that fact. I have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRSs, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the Consolidated financial statements

My objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements. As part of an audit in accordance with Canadian generally accepted auditing standards, I exercise professional judgment and maintain professional skepticism throughout the audit. I also:

• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

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• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I are required to draw attention in my auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. I am responsible for the direction, supervision and performance of the group audit. I remain solely responsible for my audit opinion.

I communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.

I also provide those charged with governance with a statement that I have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on my independence, and where applicable, related safeguards.

The engagement practitioner on the audit resulting in this independent auditor’s report is Sam S. Mah, CPA, CA.

“Sam S. Mah Inc.”

Chartered Professional Accountant

Burnaby, BC, Canada
July 29, 2025

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FIRST HYDROGEN CORP.
Consolidated Statements of Financial Position
As at March 31, 2025, and 2024

	Note	2025	2024
ASSETS
Current Assets
Cash	$	11,507	$ 87,475
Other receivables	3	639,283	641,157
Prepaid expenses		127,436	287,037
Inventories	4	235,772	188,298
		1,013,998	1,203,967
Deposit on land purchase	5	100,000	100,000
Equipment	5	16,360	55,678
Acquired-in-progress Research & Development	7	693,789	792,901
TOTAL ASSETS	$	1,824,147	$ 2,152,546

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIENCY)

Current Liabilities
Accounts payable & accrued liabilities	11, 19	3,681,043	1,844,561
Accrued interest		112,951	182,261
Current portion of convertible debentures	8	2,462,677	-
Income taxes payable		25,000	25,000
Short-term loans	11	720,750	-
		7,002,421	2,051,822
Non-current Liabilities
CEBA loan	9	42,154	40,102
Convertible debentures	8	458,633	2,192,472
		7,503,208	4,284,396
Shareholders' Equity
Share capital	10	31,713,892	30,883,383
Contributed surplus		5,086,959	4,397,863
Deficit		(42,479,912)	(37,413,096)
		(5,679,016)	(2,131,850)
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	1,824,147	$ 4,240,129

The accompanying notes are an integral part of these audited consolidated financial statements

Nature of Operations and Ability to Continue as a Going Concern – Note 1

Subsequent Events – Note 20

APPROVED BY THE DIRECTORS:

"Balraj Mann" Director "Nancy Zhao" Director
Balraj Mann Nancy Zhao

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FIRST HYDROGEN CORP.

Consolidated Statements of Loss and Comprehensive Loss

For the Years Ended March 31, 2025 and 2024

	Note	For the year ended March 31,
		2025	2024
Expenses
Advertising and marketing	$	329,451	$ 2,595,334
Amortization	5,6	118,063	117,356
Consulting and management fees	11	636,459	1,301,460
General and administrative	11,16	194,757	330,973
Insurance		36,356	22,763
Professional fees		333,035	158,960
Research and development		237,420	1,028,554
Salaries and benefits		1,471,896	4,143,296
Stock-based compensation	10	862,042	1,020,944
Travel		8,926	66,291
		4,228,405	10,785,931
Loss before other items		(4,228,405)	(10,785,931)
Other income (expense)
Finance cost	8,9	(308,292)	(81,612)
Foreign exchange loss		(127,418)	(107,116)
Loss on disposal of equipment		(20,992)	-
Government grant		-	322,172
Interest income		59	-
Interest expense		(271,999)	(84,226)
		(728,642)	49,218
Net loss from continuing operations	$	(4,957,047)	$ (10,736,713)
Net loss from discontinued operations	6	(109,769)	(173,156)
Net loss and comprehensive loss for the year	$	(5,066,816)	(10,909,869)
Basic and diluted gain (loss) per share	$	(0.06)	$ (0.15)
Weighted average number of shares outstanding		72,536,578	70,099,278

The accompanying notes are an integral part of these audited consolidated financial statements

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FIRST HYDROGEN CORP.

Consolidated Statements of Cash Flows

For the Years Ended March 31, 2025 and 2024

	For the Year Ended March 31,
	2025	2024
Cash Flows Used in Operating Activities
Net loss for the year	$ (5,066,816)	$ (10,909,869)
Items not affecting cash
Stock-based compensation	862,042	1,020,944
Accretion	310,344	90,916
Amortization	118,063	117,356
Loss on disposal of equipment	20,992	-
Changes in non-cash working capital
Items related to operations:
Interest payable	271,999	84,226
Other receivables	1,874	1,919,304
Inventory	(47,474)	54,077
Prepaid expenses	159,601	(145,017)
Accounts payable and accrued liabilities and provisions	1,835,857	(1,152,464)
	(1,533,518)	(8,920,529)
Cash Flows Used in Investing Activities
Deposit on Land Purchases	-	(100,000)
Equipment	-	(65,478)
	-	(165,478)
Cash Flows Provided by Financing Activity
Shares issued for cash	-	4,032,720
Convertible debenture, net of issuance costs	496,800	2,459,896
Shares issuance cost	-	(450,277)
Exercise of warrants	-	2,553,175
Exercise of stock options	240,000	183,150
Short-term loans	720,750	-
	1,457,550	8,778,664
Increase (decrease) in cash during the year	(75,968)	(307,341)
Cash, beginning of the year	87,475	394,816
Cash, end of the year	$ 11,507	$ 87,475

The accompanying notes are an integral part of these audited consolidated financial statements

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FIRST HYDROGEN CORP.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

For the Years Ended March 31, 2025 and 2024

(Expressed in Canadian Dollars)

	Note	Number of Shares	Common Shares	Contributed Surplus	Deficit	Total Shareholders' Equity
Balance, March 31, 2024		72,031,815	$ 30,883,383	$ 4,397,863	$ (37,413,096)	$ (2,131,850)
Shares issued for debt	10 (f)	948,080	341,309	-	-	341,309
Stock options exercised	10 (d)	700,000	489,200	(249,200)	-	240,000
Convertible debenture – equity portion	8	-	-	57,515	-	57,515
Convertible debentures – broker warrants	10 (i)	-	-	18,739	-	18,739
Stock-based compensation	10 (h)	-	-	862,042	-	862,042
Net loss for the year		-	-	-	(5,066,816)	(5,066,816)
Balance, March 31, 2025		73,679,895	$ 31,713,892	$ 5,086,959	$ (42,479,912)	$ (5,679,061)
Balance, March 31, 2023		67,526,165	$ 24,720,831	$ 2,871,666	$ (26,503,227)	$ 1,089,270
Shares issued for cash	10 (b)	1,680,300	4,032,720	-	-	4,032,720
Shares issuance costs - cash	10 (b)	-	(450,276)	-	-	(450,276)
Shares issuance costs – broker’s warrants	10 (i)	-	(350,217)	350,217	-	-
Warrants exercised	10 (c)	1,715,350	2,553,175	-	-	2,553,175
Stock options exercised	10 (d)	1,110,000	377,150	(194,000)	-	183,150
Convertible debenture – equity portion	8	-	-	242,702	-	242,702
Convertible debentures – broker warrants	10 (i)	-	-	106,334	-	106,334
Stock-based compensation	10 (h)	-	-	1,020,944	-	1,020,944
Net loss for the year		-	-	-	(10,909,869)	(10,909,869)
Balance, March 31, 2024		72,031,815	$ 30,883,383	$ 4,397,863	$ (37,413,096)	$ (2,131,850)

The accompanying notes are an integral part of these audited consolidated financial statements

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 1 Nature of Operations

First Hydrogen Corp. (the "Company") is a publicly listed company incorporated under the Business Corporations Act of British Columbia on June 20, 2007, as "Fitch Street Capital Corp". On June 13, 2008, the Company was classified and listed as a Capital Pool Company as defined by Policy 2.4 (the "CPC Policy") of the TSX Venture Exchange (the "Exchange"). On June 12, 2020, the Company changed its name to Pure Extraction Corp., and again on October 7, 2021, to First Hydrogen Corp. The Company's trading symbol is "FHYD" trading on the Exchange. The address of the Company's corporate office and principal place of business is Suite 1540 – 1100 Melville Street, Vancouver, British Columbia V6E 4A6.

The Company is a Vancouver Canada and London UK-based company focused on zero-emission vehicles, green hydrogen production, and distribution and supercritical carbon dioxide extractor systems in UK, EU, and North America.

Going Concern

While the Company's consolidated financial statements have been prepared using International Financial Reporting Standards ("IFRS") applicable to a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business as they come due, certain conditions and events cast significant doubt on the validity of this assumption. For the year ended March 31, 2025, the Company reported a net loss of $5,066,816 (2024 - $10,909,869) and as at that date had an accumulated deficit of $42,479,912 (2024 - $37,433,357). As of March 31, 2025, the Company has a working capital deficit of $5,988,423 (2024 - $847,855). The Company expects to incur further losses in the development of its business, all of which casts substantial doubt about the Company's ability to continue as a going concern. The Company's ability to continue as a going concern is dependent on its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they become due.

These consolidated financial statements do not reflect the adjustments to the carrying values of assets and liabilities and the reported expenses and balance sheet classifications that would be necessary were the going concern assumption deemed to be inappropriate. These adjustments could be material. The directors of the Company have approved these consolidated financial statements.

Note 2 Material Accounting Policies

(a) Statement of Compliance

These consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards ("IFRS").

These consolidated financial statements were authorized for issue on July 29, 2025 by the directors of the Company.

(b) Basis of Measurement and Consolidation

These consolidated financial statements have been prepared on a historical cost basis using the accrual basis accounting, except for cash flow information.

These consolidated financial statements include the accounts the Company and its wholly-owned and controlled subsidiaries, First Nuclear Corp. (formerly First Hydrogen Corp.), First Hydrogen Limited (a UK corporation), 1063136 BC Ltd. (formerly Pure Extraction Inc.), Pure Extraction Ltd., NetzeroH2 Inc., ZeronetH2 Inc. First Hydrogen Energy (USA) Inc., First Hydrogen Automotive (USA) Inc., both in the State of Delaware, USA, First Hydrogen (Quebec) Corp. in the province of Quebec, Canada and First Hydrogen GmbH (a German corporation).

Control exists when the Company has the power, directly or indirectly, to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The consolidated financial statements of the subsidiaries are

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 2 Material Accounting Policies (continued)

(b) Basis of Measurement and Consolidation (continued)

including the consolidated financial statements from the date of the control commences until the date that control ceases. Control is achieved when the Company is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Company gains control until the date the Company ceases to control the subsidiary. Intercompany balances and transactions, and unrealized gains arising from intercompany transactions are eliminated in preparing the consolidated financial statements.

(c) Critical Accounting Estimates, Judgments and Uncertainties

The Company makes estimates about the future that affect the reported amounts of assets and liabilities. Estimates and judgments are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions.

Critical Accounting Estimates and Assumptions

Critical accounting estimates are estimates and assumptions made by management that may result in material adjustments to the carrying amount of assets and liabilities within the next financial year.

Critical Accounting Judgments

Critical accounting judgments are accounting policies that have been identified as being complex or involving subjective judgments or assessments.

Recovery of deferred tax assets

Judgment is required in determining whether deferred tax assets are recognized in the statement of financial position. Deferred tax assets, including those arising from unutilized tax losses, require management to assess the likelihood that the Company will generate taxable earnings in future periods, in order to utilize recognized deferred tax assets. Estimates of future taxable income are based on forecast cash flows from operations and the application of existing tax laws in each jurisdiction. To the extent that future cash flows and taxable income differ significantly from estimates, the ability of the Company to realize the net deferred tax assets recorded at the date of the statement of financial position could be impacted.

Additionally, future changes in tax laws in the jurisdictions in which the Company operates could limit the ability of the Company to obtain tax deductions in future periods.

The Company has not recorded any deferred tax assets.

(d) Functional and Presentation Currency

The Company's functional currency is the Canadian Dollar ("CAD"). The consolidated financial statements are presented in CAD which is the Company's presentation currency, unless otherwise noted.

All amounts in these consolidated financial statements are rounded to the nearest dollar.

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 2 Material Accounting Policies (continued)

(e) Cash and Cash Equivalents

Cash and cash equivalents consist of cash on hand and short-term, highly liquid investments with original maturities of three months or less that is readily convertible to known amounts of cash and subject to insignificant risk of change in value.

(f) Revenue Recognition

FRS 15 – Revenues from contracts with customers

IFRS 15 was issued with the intent of significantly enhancing consistency and comparability of revenue recognition practices across entities and industries. IFRS 15 replaces IAS 18 Revenue, IAS 11 Construction Contracts and related interpretation. The new standard establishes a single, principles-based five-step model to be applied to all contracts with customers and introduces new and enhanced disclosure requirements. Changes in accounting policies resulting from the adoption of IFRS 15 had no impact on the Company's consolidated financial statements or the reported amounts of revenues.

The Company's revenue is comprised of equipment sales. Revenue is recognized when the equipment has been commissioned as operational, systems control has been transferred to the purchaser and collectability is reasonably assured. This is generally when commissioning has been completed, which is also when the performance obligations have been fulfilled under the terms of the related sales contract. Revenues are recorded net of discounts and incentives but inclusive of freight in the sale of goods.

Customer deposits (i.e. contract liabilities) represent deposits received from customers on uncompleted contracts.

(g) Inventories

Inventories are recorded at the lower of cost and net realizable value. The cost of inventories is based on the first- in first-out principle. In the case of manufactured inventories and work in progress, cost includes materials and labor based on normal operating capacity.

Net realizable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses. In establishing any impairment of inventory, management estimates the likelihood that inventory carrying values will be affected by changes in market demand, technology and design, which would impair the value of inventory on hand.

(h) Income Taxes

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantially enacted at the reporting date, and any adjustment to tax payable in respect of previous years.

Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit and loss, and differences relating to investments in subsidiaries and jointly controlled entities to the extent that it is probable that they will not reverse in the foreseeable future.

In addition, deferred tax is not recognized for taxable temporary differences arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on the laws that have been enacted or substantially enacted by the reporting date.

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 2 Material Accounting Policies (continued)

(h) Income Taxes (continued)

Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax assets and liabilities, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realized simultaneously.

A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

(i) Property and Equipment

Equipment is stated at cost and is amortized on a straight-line basis over management’s estimate of the useful life and residual value:

Asset	Basis	Rate
Right of use asset		determined by lease term
Machinery and equipment	Straight-line	5-10 years
Computer equipment and software	Straight-line	3 years

(j) Acquired-in-progress Research & Development

Acquired-in-progress Research & Development assets consist of the costs associated with the assignment of the two non-binding letters of intent acquired from an arm’s length company which were ratified into definitive agreements to design and develop a hydrogen fuel-cell powered light commercial vehicle. Intangible assets with a finite life are state at cost less accumulated amortization and accumulated write-downs for impairment. Amortization is provided over the estimated useful lives of the assets using the following methods and annual rates:

Asset	Basis	Rate
Non-binding letter of intent	Straight-line	10 years

(k) Financial Instruments

The Company has adopted IFRS 9, Financial Instruments. A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

Financial assets

Classification

The Company classifies its financial assets in the following measurement categories:

• Those to be measured subsequently at fair value (either through Other Comprehensive Income (“OCI”), or through profit or loss), and
• Those to be measured after initial recognition at amortized cost.

The classification depends on the Company’s business model for managing the financial assets and contractual terms of the cash flows. For assets measured at fair value, gains or losses are recorded in profit or loss or OCI. The Company has classified its cash at fair value through profit or loss. The company’s advances and receivables are held at amortized cost.

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 2 Material Accounting Policies (continued)

(k) Financial Instruments (continued)

Measurement

At initial recognition, the Company measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss ("FVTPL"), the transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at FVTPL are expensed in profit or loss. Financial assets are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.

Subsequent measurement of financial assets depends on their classification. There are the measurement categories under which the Company classifies its debt instruments:

• Amortized cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortized cost. A gain or loss on a debt investment that is subsequently measured at amortized cost is recognized in profit or loss when the asset is derecognized or impaired. Interest income from these financial assets is included in finance income using the effective interest rate method.
• Fair value through OCI ("FVOCI"): Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets' cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains and losses, interest revenue, and foreign exchange gains and losses which are recognized in profit or loss. When the financial asset is derecognized, the cumulative gain or loss previously recognized in OCI is reclassified from equity to profit or loss and recognized in other gains (losses). Interest income from these financial assets is included as finance income using the effective interest rate method.
• Fair value through profit or loss: Assets that do not meet the criteria for amortized cost or FVOCI are measured at FVTPL. A gain or loss on an investment that is subsequently measured at FVTPL is recognized in profit or loss and presented net as revenue in the Statement of Loss and Comprehensive Loss in the period which it arises.

Impairment of Financial Assets at amortized cost

The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at amortized cost. At each reporting date, the Company measures the loss allowance for the financial asset at an amount equal to the lifetime expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition. If at the reporting date, the financial risk has not increased significantly since initial recognition, the Company measures the loss allowance for the financial asset at an amount equal to the twelve month expected credit losses. The Company shall recognize in the statements of income (loss), as an impairment gain or loss, the amount of expected credit losses (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognized.

Financial Liabilities

The Company classifies its financial liabilities into the following categories: financial liabilities at FVTPL and amortized cost.

A financial liability is classified as FVTPL if it is classified as held-for-trading or is designated as such on initial recognition. Directly attributable transaction costs are recognized costs are recognized in profit or loss as incurred. The fair value changes to financial liabilities at FVTPL are presented as follows: the amount of change in fair value that is attributable to changes in the credit risk of the liability is presented in OCI; and the remaining amount of the change in the fair value is presented in profit or loss. The Company does not designate any financial liabilities at FVTPL.

12 | Page

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 2 Material Accounting Policies (continued)

(k) Financial Instruments (continued)

Other non-derivative financial liabilities are initially measured at fair value less any directly attributable transaction costs. Subsequent to initial recognition, these liabilities are measured at amortized cost using the effective interest rate method. The Company classifies its accounts payable and accrued liabilities, loans payable and due to related parties are classified as financial liabilities held at amortized cost.

(l) Leases

IFRS 16 introduces a single lessee accounting model and requires lessees to recognize assets and liabilities for all leases, except when the term is 12 months or less or when the underlying asset has a low value. The Company will apply the standard retrospectively with the cumulative effect of initially applying the standard recognized as an adjustment to the opening balance of retained earnings or deficit at that date, subject to permitted practical expedients. Therefore, the Company will not restate comparative information.

The Company recognizes a right-of-use asset and a lease liability for its leases with lease terms greater than one year. The right-of-use asset is measured at cost and depreciated over its estimated useful life. At the commencement date, the lease liability is measured as the present value of the lease payments that are not paid at that date. The lease payments are discounted using the interest rate implicit in the lease or if that rate cannot readily be determined, the Company's incremental borrowing rate. If the lease terms are subsequently changed, the present value of the lease liability is remeasured using the revised lease terms and applying the appropriate discount rate to the remaining lease payments.

The Company recognizes the amount of the remeasurement of the lease liability as an adjustment to the right-of-use asset. However, of the carrying amount of the right-of-use asset is reduced to zero and there is a further reduction in the measurement of the lease liability, the Company recognizes any remaining amount of the remeasurement in profit or loss. The new standard is effective for annual periods beginning on or after January 1, 2019 and has been adopted without material effect to these consolidated financial statements.

(m) Impairment of Long-Lived Assets

The Company tests long-lived assets for recoverability when events or changes in circumstance indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset, significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that asset will more likely than not be sold or disposed significantly before the end of its estimated useful life.

The recoverable amount of an asset is the higher of fair value less costs to sell and value in use. Fair value is determined as the amount that would be obtained from the sale of the asset in an arm's length transaction between knowledgeable and willing parties. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. If the recoverable amount of an asset or cash generating unit is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount and the impairment loss is recognized in profit or loss.

(n) Government grants

Loans received from government are recognized initially at fair value, with the difference between the fair value of the loan based on prevailing market interest rates and the amount received, being recorded as government grant gain in the statements of loss and comprehensive loss.

13 | Page

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 2 Material Accounting Policies (continued)

(o) Provisions

A provision is recognized if, as a result of a past event, the Corporation has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risk specific to the liability. The unwinding of the discount is recognized as a finance expense.

(p) Share Capital

Financial instruments issued by the Company are classified as equity only to the extent that they do not meet the definition of a financial liability or financial asset. The Company's common shares and share purchase warrants are classified as equity instruments. Incremental costs directly attributable to the issue of new shares or warrants are shown in equity as a deduction, net of tax, from the proceeds.

The Company engages in equity financing transactions to obtain the funds necessary to continue operations. These equity financing transactions may involve issuance of common shares or units. Each unit comprises a certain number of common shares and a certain number of warrants. Depending on the terms and conditions of each equity financing transaction, the warrants are exercisable into additional common shares at a price prior to expiry as stipulated by the transaction.

The Company has adopted a residual value method with respect to the measurement of shares and warrants issued as private placement units. The residual value method first allocates value to the more easily measurable component based on fair value and then the residual value, if any, to the less easily measurable component. The fair value of the common shares issued in the private placements was determined to be the more easily measurable component and were valued at their fair value, as determined by the closing price on the measurement date. The balance, if any, was allocated to the attached warrants. Any fair value attributed to the warrants is recorded in contributed surplus.

(q) Share-based Payments

The cost of incentive share options and other equity-settled share-based compensation and payment arrangements with employees, directors, officers and consultants are recorded based on the estimated fair-value at the grant date and charged to earnings over the vesting period. Where incentive share options are subject to vesting, each vesting tranche is considered a separate award with its own vesting period and grant date fair value. The fair value of each tranche is measured at the date of grant using the Black-Scholes option pricing model. Compensation expense is recognized over the tranche's vesting period by a charge to earnings, with a corresponding increase to contributed surplus based on the number of awards expected to vest. The number of awards expected to vest is reviewed at least annually, with any impact being recognized immediately.

(r) Earnings/Loss per Share

Basic earnings/loss per share is computed by dividing the net income or loss attributable to common shareholders of the Company by weighted average number of common shares outstanding for the relevant period. Diluted earnings/loss per share is computed by adjusting the net income or loss attributable to common shareholders dividing by the sum of the weighted average number of common shares outstanding and all additional common shares that would have been outstanding, if potentially dilutive instruments such as warrants and options were exercised.

14 | Page

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 2 Material Accounting Policies (continued)

(s) Research & Development

Research and Development (“R&D”) expenditures are expensed while the Company establishes its “proof of concept” with the hydrogen-powered-fuel-cell vehicles. Until probably economic benefits will flow to the Company and the costs of the asset can be measured reliably (IAS 38) costs will continue to be expensed.

(t) SR &ED Investment Tax Credits

The Company is eligible to claim federal and provincial (British Columbia) investment tax credits as a result of incurring scientific research and experimental development (“SR&ED”) expenditures. Federal and provincial SR&ED investment tax credits are recognized when the related expenditures are incurred and there is reasonable assurance of their realization.

Federal and provincial SR&ED investment tax credits are accounted for as a reduction of research and development expense on the statement of comprehensive loss. Management has made a number of estimates and assumptions in determining the expenditures eligible for the federal and provincial SR&ED investment tax credit claim. It is possible that the allowed amount of the federal and provincial SR&ED investment tax credit claim could be materially different from the recorded amount upon assessment by the Canada Revenue Agency.

First Hydrogen Limited, the Company’s wholly owned subsidiary, is eligible to claim the Research and Development Tax Credit (the “RDTDC”) for research and development activities in the United Kingdom. The government schemes are designed to boost innovation by supporting business.

(u) Future accounting pronouncements

A number of new standards, amendments to standards and interpretations are not yet effective as at the date of issuing these statements and have not been applied in preparing these financial statements. The Company has not early adopted any of these standards and is currently evaluating the impact, if any, that these standards might have on its financial statements.

Note 3 Other Receivables

	March 31, 2025		March 31, 2024
HST/GST receivable	$	4,872	$ 33,659
Value-Added Tax (“VAT”)		11,725	33,116
R&D tax credit (a)		622,686	574,382
	$	639,283	$ 641,157

(a) During the year ended March 31, 2025, the Company filed a RDTC claim to the UK government for GBP335,300 ($573,832) for the UK tax year ended March 31, 2024 (2024 – GBP886,117 ($851,317)).

The Company Harmonized Sales Tax (HST) input tax credits, VAT and R&D tax credits may change pursuant to an audit by the taxation authorities.

Note 4 Inventories

The inventory consists of spare parts for the Company’s hydrogen-powered-fuel-cell vehicles:

	March 31, 2025		March 31, 2024
Parts inventory	$	235,772	$ 188,298

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FIRST HYDROGEN CORP.

Notes to Consolidated Financial Statements

March 31, 2025 and 2024

(Expressed in Canadian Dollars)

Note 5 Property and Equipment

Deposit on land purchase		Equipment
Cost
Balance, March 31, 2024	$	77,831
Disposal – Office equipment		(30,790)
Balance, March 31, 2025		47,041
Accumulated amortization
Balance, March 31, 2024		22,153
Adjustments due to disposal		(10,423)
Amortization - 2025	$	18,951
Balance, March 31, 2025		30,681
Carrying amounts
As at March 31, 2024	$	55,678
As at March 31, 2025	$	16,360

Pursuant to a Promise to Purchase dated May 25, 2023, the Company, through First Hydrogene (Québec) S.A., a wholly owned subsidiary, paid a non-refundable deposit of $100,000 on two plots of land for a total purchase price of $2,442,591 to the City of Shawinigan. The Company's plan is to produce up to 35MW of green hydrogen in a production facility and vehicle assembly factory on these two plots of land.

Note 6 Discontinued operations

On June 12, 2020, the Company completed its Qualifying Transaction (the "Transaction") with Pure Extraction Inc. and Pure Extraction Ltd. (collectively, "Pure Extraction"). The Company acquired all of the issued and outstanding Pure Extraction shares from the shareholders of Pure Extraction for the following consideration.

During the year ended March 31, 2024, the Company decided to exit the $\mathrm{CO}_{2}$ extraction equipment business and effectively closed the operation. No further write-downs were required.

Net loss from discontinued operations for the years ended March 31, 2025 and 2024 is comprised of the following:

	March 31, 2025	March 31, 2024
Revenue	$ -	$ -
Costs of Sales	-	-
Gross Profit	-	-
Expenses
Accounting and legal	-	-
Advertising and marketing	1,048	1,009
Consulting and management fees	54,000	60,000
General and administrative	52,670	98,062
Research and development	-	4,781
	107,718	163,852

16 | Page

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 6 Discontinued operations (continued)

	March 31, 2025	March 31, 2024
Other income (expense)
Finance cost	(2,051)	(9,304)
	(9,304)	(9,304)
Net loss from discontinued operations	109,769	$ 173,156

Net loss from discontinued operations for the years ended March 31, 2025 and 2024 is comprised of the following:

	March 31, 2025	March 31, 2024
Cash used in operating activities	$ -	$ (120,366)
Cash used in discontinued operations	$ (58,205)	$ (135)

Note 7 Acquired-in-progress Research & Development

On June 11, 2021, the Company entered into definitive agreements with AVL Powertrain UK Limited and Ballard Power Systems Inc. The definitive agreements, with the Company's wholly owned subsidiaries 1300492 BC Ltd. and First Hydrogen Limited will assist in the design and development of a fuel-cell powered vehicle that the Company will own the commercial rights for the vehicle design. The Company currently does not own any patents.

The Company was assigned two non-binding letters of intent from Nova Light Capital Limited ("Nova Light"), an arm's length company, which have been ratified into the definitive agreements. Nova Light was issued 3,000,000 shares of the Company for the assignment of the two non-binding letters of intent. These shares are subject to a voluntary escrow and pooling agreement released over a 36-month period. Finder's fees of 249,590 shares of the Company were issued to an arm's length party.

The Company has recorded the fair value of the shares at a price of $0.305 per share.

		March 31, 2025
Cost
Balance, March 31, 2023	$	892,013
Depreciation		(99,112)
Balance, March 31, 2024	$	792,901
Depreciation		(99,112)
Balance, March 31, 2025	$	693,789

Note 8 Convertible Debentures

On July 9, 2024, the Company closed its private placement (the "Offering") of convertible debenture units (each a "Debenture") for gross proceeds of $540,000 (the "Principal"). Each Debenture consists of $1,000 in principal and is convertible into 1,851.85 common shares and 1,851.85 share purchase warrants, with each share purchase warrant exercisable to acquire one common share at an exercise of $0.80 per warrant for a period of two years from the closing date of the Offering. The Debentures will mature on the second anniversary of the date of issuance (July 9, 2026) and bear interest at a rate of 8.00% per annum, commencing on the date of issuance. The Debenture Units are unsecured. On initial recognition, the Company bifurcated $57,515 to equity and $482,485 to the carrying value of the debentures.

The Company incurred transaction costs of $61,939. Transactions costs consisted of the following:

• broker's fees to arm's length third parties consisting of $43,200 cash;

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 8 Convertible Debentures (continued)

• issued 80,000 finder's warrants. Each finder's warrant is exercisable at $0.54 into one common share for a period of two years. The finders' warrants are fair valued at $18,739 based on Black-Scholes Option Pricing Model valuation using the following assumptions: 3.74% risk-free interest rate, expected life of 2 years, 121% annualized volatility and 0% dividend rate.

On November 24, 2023, the Company closed its private placement (the "Offering") of convertible debenture units (each a "Debenture") for gross proceeds of $2,673,800 (the "Principal"). Each Debenture consists of $1,000 in principal and is convertible into 689.65 common shares and 689.65 share purchase warrants, with each share purchase warrant exercisable to acquire one common share at an exercise of $3.00 per warrant for a period of two years from the closing date of the Offering. The Debentures will mature on the second anniversary of the date of issuance (November 24, 2025) and bear interest at a rate of 9.00% per annum, commencing on the date of issuance. The Debenture Units are unsecured. On initial recognition, the Company bifurcated $275,725 to equity and $2,398,075 to the carrying value of the debentures.

The Company incurred transaction costs of $320,238. Transactions costs consisted of the following:

• broker's fees to arm's length third parties consisting of $213,904 cash;
• issued 147,520 finder's warrants. Each finder's warrant is exercisable at $1.45 into one common share for a period of two years. The finders' warrants are fair valued at $106,334 based on Black-Scholes Option Pricing Model valuation using the following assumptions: 0.31% risk-free interest rate, expected life of 2 years, 121% annualized volatility and 0% dividend rate.

	March 31, 2025	March 31, 2024
Opening balance	$ 2,192,472	$ -
Additions from Principal amounts	540,000	2,673,800
Fair value of Finder's Warrants (Note 10(i))	(18,739)	(106,334)
Equity component	(57,515)	(242,702)
Transaction costs	(43,200)	(213,904)
Accretion	308,292	81,612
	$ 2,921,310	$ 2,192,472
Current portion	$ 2,462,677	$ -
Non-current portion	458,633	2,192,472
	$ 2,921,310	$ 2,192,472

Note 9 Loan Payable and Government Grants

On April 20, 2020, the Company obtained a Canada Emergency Business Account (the "CEBA") loan in the amount of $40,000 (face value) from the TD Canada Trust bank guaranteed by the Canadian government. This loan was non-interest bearing until December 31, 2023.

After January 11, 2024, the full amount of original loan if not repaid is converted into a 3-year term loan at a fixed annual interest rate of 5% per annum with an interest payment frequency determined by the financial institution and the full principal amount is due on December 31, 2026.

For the year ended March 31, 2025, the accretion expense of $2,051 (2024 - $9,304) was recorded on the loan. At March 31, 2025, the balance of the loan is $42,154 (2024 - $40,102).

18 | Page

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 10 Share Capital

a) Authorized, Issued and Outstanding

Unlimited number of common voting shares without par value.

A summary of changes in share capital is contained on the statement of changes in shareholders’ equity for the years ended March 31, 2025 and 2024.

b) Share Issuance - Private Placement

Year Ended March 31, 2025

• No shares were issued from private placements.

Year Ended March 31, 2024

The Company completed a non-brokered private placement of units for:

• gross proceeds of $3,012,720 The private placement consisted of 1,255,300 units at $2.40 per unit, where each unit consisted of one common share and one common share purchase warrant. Each full warrant is exercisable at $2.85 into one common share, for a period of two years. In connection with the financing, the Company paid finder’s fees to arm’s length third parties consisting of $241,018 cash and issued 100,424 broker’s warrants. Each broker’s warrant is exercisable at $2.85 into one common share for a period of two years on May 26, 2025.
• gross proceeds of $1,020,000 The private placement consisted of 425,000 units at $2.40 per unit, where each unit consisted of one common share and one common share purchase warrant. Each full warrant is exercisable at $2.85 into one common share, for a period of two years. In connection with the financing, the Company paid finder’s fees to arm’s length third parties consisting of $81,600 cash and issued 34,000 broker’s warrants. Each broker’s warrant is exercisable at $2.85 into one common share for a period of two years on June 22, 2025.

c) Share Issuance – Warrants exercised

Year Ended March 31, 2025

• No warrants were exercised.

Year Ended March 31, 2024

• 797,750 share purchase warrants exercised at $0.90 per share, for proceeds of $717,975.
• 917,600 share purchase warrants exercised at $2.00 per share, for proceeds of $1,835,200.

d) Share Issuance – Stock Options exercised

Year Ended March 31, 2025

• 400,000 stock options exercised at $0.30 per share, for the proceeds of $120,000.
• 300,000 stock options exercised at $0.40 per share, for the proceeds of $120,000.

Year Ended March 31, 2024

• 1,110,000 stock options exercised at $0.165 per share, for the proceeds of $183,150.

19 | Page

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 10 Share Capital (continued)

e) Share Issuance - Finder's Warrants Exercised

Year Ended March 31, 2025
- No finders' warrants were exercised.

Year Ended March 31, 2024
- No finders' warrants were exercised.

f) Share Issuance – Convertible Debenture Conversion

Year Ended March 31, 2025
- There were no conversions of debenture principal in 2025.

Year Ended March 31, 2024
- There were no conversions of debenture principal in 2024.

g) Share Issuance – interest payable

Year Ended March 31, 2025
- The Company issued 948,080 common shares to settle $351,309 of interest due from convertible debentures.

Year Ended March 31, 2024
- No shares were issued.

h) Issuance - Share Purchase Warrants

During the year ended March 31, 2025, the Company issued:
- No share purchase warrants were issued.
- Share purchase warrants expiring April 29, 2024 were extended to April 29, 2025, and the exercise price of these shares purchase warrants were lowered to $1.10.

During the year ended March 31, 2024, the Company issued:
- 1,255,300 share purchase warrants were issued, exercisable at $2.85 per warrant, expiring on May 26, 2025.
- 425,000 share purchase warrants were issued, exercisable at $2.85 per warrant, expiring on June 22, 2025.

20 | Page

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FIRST HYDROGEN CORP.

Notes to Consolidated Financial Statements

March 31, 2025 and 2024

(Expressed in Canadian Dollars)

Note 10 Share Capital (continued)

h) Issuance - Share Purchase Warrants (continued)

During the year ended March 31, 2024 and 2022, warrant transactions were summarized as follows:

	Number of Warrants	Weighted Average Exercise Price ($)	Years to Expiry
Balance at March 31, 2023	5,223,022	2.56	0.65
Issued	1,255,300	2.85	2.00
Issued	425,000	2.85	2.00
Exercised	(797,750)	0.90	-
Expired	(6,250)	0.90	-
Exercised	(917,600)	2.00	-
Expired	(1,256,200)	2.00	-
Balance at March 31, 2024	3,925,522	3.34	0.55
Balance at March 31, 2025	3,925,522	3.34	0.12

As at March 31, 2025, the following share purchase warrants were outstanding:

Number of Warrants	Exercise Price ($)	Expiring
2,245,222	1.10	April 29, 2025
1,255,300	2.85	May 26, 2025
425,000	3.70	June 22, 2025
3,925,522

i) Long-term Incentive Plan ("LTIP")

The Company has a LTIP that provides for the issuance of restricted share units ("RSUs"), performance share units ("PSUs"), deferred share units ("DSUs") and stock options ("Options") (collectively the "Awards") to its directors, officers, employees and consultants. The aggregate maximum number of outstanding Awards is 10% of the issued and outstanding common shares at any point in time. The exercise price of each Award equals the market price of the Company's shares on the date of the grant. The maximum term of the stock options is ten years. The fair value of each Award granted is estimated on the date of grant using the Black-Scholes option pricing model. Stock options granted to consultants engaged in investor activities will vest in stages over a minimum period of twelve months. No RSUs, RSUs, PSUs or DSUs were outstanding at March 31, 2025 (2024 - nil).

During the year ended March 31, 2025, the Company:

• granted 2,050,000 incentive stock options exercisable at $0.40 per share, with an expiry of 5 years.
• 400,000 incentive stock options were exercised at a price of $0.30.
• 300,000 incentive stock options were exercised at a price of $0.40.
• 1,605,000 incentive stock options were cancelled.

During the year ended March 31, 2024, the Company:

• granted 295,000 stock options, exercisable at $3.00 per share, with an expiry of 5 years.
• Cancelled 130,000 stock options.
• 1,100,000 stock options were exercised at a price of $0.165.

During the year ended March 31, 2025, the Company recorded the share-based compensation of $862,042 (2024 - $1,020,944) was recorded in net loss based on the grant date fair value of the awards recognized over the vesting period.

21 | Page

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FIRST HYDROGEN CORP.

Notes to Consolidated Financial Statements

March 31, 2025 and 2024

(Expressed in Canadian Dollars)

Note 10 Share Capital (continued)

i) Long-term Incentive Plan ("LTIP") (continued)

	2025	2024
Risk-free interest rate	2.75%	3.28%
Expected life	5 years	5 years
Volatility	95%	93%
Expected dividend yield	Nil	Nil

During the year ended March 31, 2025, the stock option transactions are summarized as below:

	Number of Options	Weighted Average Exercise Price ($)
Balance at March 31, 2023	2,520,000	1.89
Granted	295,000	3.00
Cancelled	(130,000)	3.00
Exercised	(1,100,000)	0.165
Balance at March 31, 2024	2,520,000	1.89
Granted	2,050,000	0.40
Cancelled	(1,6055,000)	1.66
Exercised	(700,000)	0.34
Balance at March 31, 2025	2,265,000	0.69

As at March 31, 2025, the following stock options were outstanding and exercisable:

(1)	Expiry Date	Weighted Average Exercise price	Number of options outstanding	Number of Options Exercisable	Weighted Average Remaining Years
S	March 3, 2026	$ 0.40	100,000	100,000	0.92
t	June 11, 2026	$ 2.35	120,000	620,000	1.20
o	November 18, 2026	$ 1.70	265,000	265,000	1.64
c	July 1, 2027	$ 3.00	15,000(1)	10,000	2.25
k	June 1, 2028	$ 3.00	15,000(1)	5,000	3.17
o	September 9, 2029	$ 0.40	1,750,000(2)	1,200,000	4.45
p		$ 0.97	2,265,000	2,300,000	3.77
ti
o

s vest over a three-year period.
(2) 250,000 stock options vest over a one-year period and 300,000 vest over a three-year period.

j) Finder's fee – cash and warrants

Year ended March 31, 2025

The Company incurred a cash fee of $43,200 and issued 80,000 finder's warrants at an exercisable price of $0.54 relating to the convertible debentures issued on July 9, 2024 (Note 8).

Year ended March 31, 2024

Issued Finder's fee - Early Warrant Exercise Program

The Company entered into several agreements with Canaccord Genuity Corp. ("CGC") to assist in the exercise of the Company's outstanding share purchase warrants during the year ended March 31, 2024. Under the term of agreements,

22 | Page

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FIRST HYDROGEN CORP.

Notes to Consolidated Financial Statements

March 31, 2025 and 2024

(Expressed in Canadian Dollars)

Note 10 Share Capital (continued)

i) Finder's fee – cash and warrants (continued)

CGC will receive a cash fee equal to 5% of the total gross proceeds raised from the exercise of the share purchase warrants, as well as an agent’s warrant that is exercisable at $4.50 into one common share for a period of two years from issuance.

The last of the agreements ended on August 30, 2024. CGC assisted the Company in exercising a total of 1,715,350 warrants. The Company has incurred a cash fee of $127,658 and issued 132,126 finder’s warrants relating to the Early Warrant Exercise Program.

Issued Finder's fee – Private Placement

During the year ended March 31, 2024, the Company made cash payments of $322,618 and issued 134,424 finder’s share purchase warrants exercisable at $2.85 per warrant, with an expiry of 24 months (Note 10 (b)).

Issued Finder's fee – Convertible debenture

During the year ended March 31, 2024, the Company issued 147,520 finders’ share purchase warrants exercisable at $1.40 with an expiry of two years.

During the years ended March 31, 2025, the Company recorded the fair value of finder’s warrant of $18,739 (2024 - $456,551). The fair value of each finder’s warrant is estimated on the date of issuance using the Black-Scholes option pricing model in the table below:

	2025	2024
Risk-free interest rate	3.74%	4.24% - 4.63%
Expected life	24 months	24 months
Volatility	85.5%	82% - 116.18%
Expected dividend yield	Nil	Nil

During the year ended March 31, 2025, finder’s warrants transactions were summarized as follows:

	Number of Finder’s warrants outstanding	Weighted Average Price
Number outstanding at March 31, 2023	266,123	$ 4.50
Issued	100,424	$ 2.85
Issued	45,764	$ 4.50
Issued	34,000	$ 2.85
Issued	86,362	$ 4.50
Issued	147,520	$ 1.45
Number outstanding at March 31, 2024	680,193	$ 3.51
Issued	80,000	$ 0.54
Expired	(266,123)	$4.50
Number outstanding at March 31, 2025	494,070	$ 2.50

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FIRST HYDROGEN CORP.

Notes to Consolidated Financial Statements

March 31, 2025 and 2024

(Expressed in Canadian Dollars)

Note 10 Share Capital (continued)

j) Finder's fee – cash and warrants (continued)

As at March 31, 2025, the following stock finder's warrants were outstanding and exercisable:

Expiry Date	Exercise Price	Number of Finder’s warrants outstanding	Weighted Average Remaining Years
May 26, 2025	$ 2.85	100,424	0.15
June 14, 2025	$ 4.50	45,764	.21
June 22, 2025	$ 2.85	34,000	0.23
September 22, 2025	$ 4.50	86,362	0.48
November 23, 2025	$ 1.45	147,520	0.65
July 9, 2026	$ 0.54	80,000	1.27
		494,070	0.55

k) Escrow Shares

As at March 31, 2025, no common shares (2024 – 450,000) were subject to a voluntary escrow and pooling agreement release over a 36-month period (see Note 7).

Note 11 Related Party Transactions

During the year ended March 31, 2025, the Company incurred $72,000 (2024 - $72,000) in rent expense to a company owned by a director and CEO. These transactions have been recorded at the fair value which is the amount of consideration established and agreed to by the related parties.

As of March 31, 2025, the Company has $513,050 (2024 - $40,000) owing to a company owned by a director and CEO of the Company for management fees and rent. The balance has no set terms of repayment and does not bear interest.

As of March 31, 2025, the Company has $216,900 (2024 - $27,000) owing to company owned by an officer of the Company for management fees. The balance has no set terms of repayment and does not bear interest.

During the year ended March 31, 2025, the Company incurred a total of $30,000 in directors’ fees (2024 – $33,000). As at March 31, 2025, an amount of $28,950 is due to directors (2024 - $nil).

As at March 31, 2025, the Company has received, from the CEO and CFO short-term loans, of $720,750 (March 31, 2024 – nil). The balance has no set terms of repayment and does not bear interest.

Key management personnel are persons responsible for planning, directing and controlling the activities of an entity and include executive and non-executive directors. Key management personnel compensation disclosed above comprised the following:

Key Management Compensation

	March 31, 2025	March 31, 2024
CEO	$ 420,000	$ 480,000
Former CFO	-	28,000
Interim CFO	144,000	54,000
Director fees	30,000	33,000
Director	-	173,525
Consulting fees	42,500	-

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FIRST HYDROGEN CORP.
Notes to Consolidated Financial Statements
March 31, 2025 and 2024
(Expressed in Canadian Dollars)

Note 11 Related Party Transactions (continued)

Key Management Compensation - continued
Salaries	-	250,029
Rent	72,000	72,000
Stock-based compensation	234,531	119,880
	$ 943,031	$ 1,210,434

Note 12 Financial Instruments and risk

The Company's risk exposures and the impact on the Company's financial instruments are summarized below:

a) Capital Risk

The Company's policy is, if permitted by market conditions, to ensure that there are adequate capital resources to support investor and creditor confidence and support future development of the business. The capital structure of the Company consists primarily of cash and equity, comprising share capital and reserves net of accumulated deficit. The Company is not subject to any externally imposed capital requirements.

b) Credit Risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. The Company's cash is exposed to credit risk. The Company reduces its credit risk on cash by placing these instruments with institutions of high creditworthiness. As at March 31, 2025, the Company is not exposed to any significant credit risk.

c) Liquidity Risk

Liquidity risk is the risk that the Company is not able to meet its financial obligations as they fall due. There can be no assurance that the Company will be able to obtain adequate financing in the future or that the terms of such financing will be favorable. The Company may seek additional financing through equity offerings, but there can be no assurance that such financing will be available on terms acceptable to the Company or at all.

d) Market Risk

Market risk incorporates a range of risks. Movements in risk factors, such as market price risk and currency risk, affect the fair values of financial assets and liabilities.

i) Interest Rate Risk

The Company's interest rate risk mainly arises from changes in the interest rates on cash. Cash generates interest based on market interest rates. At March 31, 2025, the Company was not subject to significant interest rate risk.

ii) Foreign Currency Risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company is exposed to foreign currency risk to the extent that monetary assets and liabilities held by the Company are not denominated in its functional currency. The Company does not manage currency risk through hedging or other currency management tools.

As at March 31, 2025, the Company's exposure to foreign currency risk on its financial instruments is as follows:

	March 31, 2025		Canadian dollar equivalent
Cash	GBP	15	28
Other receivables	GBP	335,300	634,411
Accounts payable and accrued liabilities	GBP (857,252)		(1,592,003)
Net exposure	GBP (521,937)		(957,564)

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FIRST HYDROGEN CORP.

Notes to Consolidated Financial Statements

March 31, 2025 and 2024

(Expressed in Canadian Dollars)

Note 12 Financial Instruments and risk (continued)

ii) Foreign Currency Risk (continued)

A 10% change in the British Pound against the Canadian dollar at March 31, 2025, would impact the Company's net liabilities by approximately $70,000.

iii) Price Risk

The Company is not exposed to price risk with respect to commodity pricing.

The Company provides information about financial instruments that are measured at fair value, grouped into Level 1 to 3 based on the degree to which the inputs used to determine the fair value are observable.

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 following table presents the financial instruments recorded at fair value in the statement of financial position, classified using the fair value hierarchy:

	Level 1		Level 2		Level 3		Total – March 31, 2025
Financial Assets
Cash	$	11,507	$	-	$	-	$ 11,507
Receivables		-		639,283		-	639,283
Prepaid		-		127,436		-	127,436
Inventories		-		235,772		-	235,772
Deposit on land		100,000		-		-	100,000
Equipment		-		16,360		-	16,360
Acquired WIP		-		693,789		-	693,789
	Level 1		Level 2		Level 3		Total – March 31, 2025
Financial Liabilities
Accounts pay.	$	-	$	3,681,043	$	-	$3,681,043
Accrued int.		-		112,951		-	112,951
Current portion				2,462,677		-	2,462,677
Income taxes		-		25,000		-	25,000
Short -term loans		-		720,750		-	720,750

Note 13 Capital Risk Management

The Company's objectives when managing capital are: to safeguard the Company's ability to continue as a going concern; to maintain optimal capital structure, while ensuring the Company's strategic objectives are met and to provide an appropriate return to shareholders relative to the risk of the Company's underlying assets.

The capital structure of the Company consists of equity attributable to common shareholders, comprised of issued capital, stock options and deficit.

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FIRST HYDROGEN CORP.

Notes to Consolidated Financial Statements

March 31, 2025 and 2024

(Expressed in Canadian Dollars)

Note 13 Capital Risk Management (continued)

The Company maintains and adjusts its capital structure based on changes in economic conditions and the Company's planned requirements. The Company may adjust its capital structure by issuing new equity, selling and/or acquiring assets, and controlling its capital expenditures program.

Management reviews its capital management approach on an ongoing basis. The Company is not subject to any externally imposed capital requirements.

Note 14 Income Taxes

	First Hydrogen (Canada)	First Hydrogen (UK)	2025	2024
Income (Loss) for the year	$ (1,519,258)	$ (3,547,558)	$ (5,066,816)	$ (10,909,869)
Tax rate	27.0%	19.0%
Tax based on statutory tax rate	(410,200)	(674,036)	(1,084,236)	(2,545,345)
Unrecognized benefit of non-capital losses	410,200	674,036	1,084,236	2,545,345
Total income taxes	$ -	$ -	$ -	$ -

First Hydrogen Corp. (Canada) has available non-capital losses of approximately $16,415,000 which may be carried forward to apply against future income for tax purposes. These losses will expire on varies dates up to 2045.

Pure Extraction Lid. (Canada) has available non-capital losses of approximately $1,793,000 which may be carried forward to apply against future income for tax purposes. These losses will expire on varies dates up to 2045.

Pure Extraction Inc. (Canada) has available non-capital losses of approximately $10,000 which may be carried forward to apply against future income for tax purposes. These losses will expire on varies dates up to 2045.

First Hydrogen (Quebec) Corp. has available non-capital losses of approximately $332,000 which may be carried forward to apply against future income for tax purposes. These losses will expire on varies dates up to 2045.

First Hydrogen Limited (UK) has available non-capital losses of approximately $21,232,000 which may be carried forward to apply against future income for tax purposes. These losses will expire on 2045.

The Company's tax – effected deferred tax assets are estimated as follows:

		March 31, 2025	March 31, 2024
Potential future tax assets
Non-capital losses carried forward	$	39,772,000	34,203,000
Tax value of equipment in excess of book value		308,000	297,000
		40,080,000	34,500,000
Potential tax recovery at substantially enacted
Rate 19% - 27.0% (2025 – 27.0%)		9,134,000	7,884,000
Net potential future income tax assets		9,134,000	7,884,000
Valuation allowance (100%)		(9,134,000)	(7,884,000)
Net future tax assets	$	-	-

These losses are unconfirmed subject to assessment of the Company's annual tax return by the tax authorities.

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FIRST HYDROGEN CORP.

Notes to Consolidated Financial Statements

March 31, 2025 and 2024

(Expressed in Canadian Dollars)

Note 15 General and administrative

	For the Year ended March 31,
	2025	2024
Office and administration	$ 22,217	$ 26,948
Computer and internet	41,363	11,100
Rent	74,396	209,979
Transfer agent and regulatory fees	56,781	82,946
	$ 194,757	$ 330,973

Note 16 Segmented information

	Assets		Expenditures
	2025	2024	2025	2024
U.K.	$ 909,610	$ 1,044,007	$ 2,032,075	$ 4,809,024
Canada	914,537	1,108,539	3,019,742	6,100,245
	$ 1,824,147	$ 2,152,546	$ 5,066,816	$ 10,909,869

The Company operates in one segment, being the engineering, research & development, , in two geological areas, the U.K. and Canada.

Note 17 Supplemental Cash Flow

	March 31, 2025	March 31, 2024
Share issued from convertible debenture conversion	$ -	$ -
Shares issued for interest payable	948,080	-
Unearned revenue transferred to earned revenue	-	-

Note 18 Lawsuit Contingency

The Company and two of its subsidiaries are contesting an Origination Application filed on November 22, 2024 with the Superior Court of Québec, district of Montréal, by a consultant for services in the amount of $230,664 in purported service fees. The Company firmly rejects both the validity and amount of the claim, and intends to vigorously defend against what it regards as an unfounded demand for fees not properly performed. A crossclaim was filed on May 6, 2025, by the Company in the amount of $387,007 seeking previously paid fees. The outcome of legal proceedings is not presently determinable.

Note 19 Provisions

During the year ended March 31, 2025, the Company recorded wage and benefits provisions related to ongoing settlement negotiations.

Note 20 Subsequent Events

a) 180,188 broker warrants with exercise prices of $2.85 and $4.50, expired unexercised.
b) 3,925,522 share purchase warrants, with exercise prices of $1.10, $2.85 and $3.70, expired unexercised.
c) 450,000 incentive stock options were granted to consultants with an expiry date of May 20, 2030 and an exercise price of $0.50 per option.
d) 400,000 incentive stock options were granted to consultants with an expiry date of June 30, 2030 and an exercise price of $0.70 per option.
e) The Company received proceeds of $202,500 from the exercise of 425,000 incentive stock options.
f) The Company received two RDTC claims from the UK Government in the amount of £335,300.

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