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Reflex Advanced Materials Corp. Interim / Quarterly Report 2026
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Interim / Quarterly Report
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ADVANCED MATERIALS
CONDENESED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED OCTOBER 31, 2025 and 2024
(Unaudited)
NOTICE OF NO AUDITOR REVIEW OF INTERIM FINANCIAL STATEMENTS
Under National Instrument 51-102, if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the interim financial statements have not been reviewed by an auditor.
The accompanying condensed interim financial statements of Reflex Advanced Materials Corp. (formerly Freedom Battery Metals Inc.) have been prepared by and are the responsibility of the Company's management. The Company's independent auditors have not performed a review or audit of these interim financial statements.
Reflex Advanced Materials Corp.
Condensed Consolidated Interim Statements of Financial Position
As at October 31, 2025 and January 31, 2025
In Canadian Dollars, unless noted (unaudited)
| As at | Notes | October 31, 2025 | January 31, 2025 |
|---|---|---|---|
| ASSETS | $ | $ | |
| Cash | 2,159 | 2,387 | |
| Accounts receivable | 179,136 | 160,033 | |
| Prepaid expenses | 4 | - | 17,037 |
| TOTAL CURRENT ASSETS | 181,295 | 179,457 | |
| Reclamation deposits | 5 | 292,725 | 292,725 |
| Exploration and evaluation assets | 5,8 | - | - |
| Investments | 6 | 200,000 | 200,000 |
| TOTAL ASSETS | 674,020 | 672,182 | |
| LIABILITIES | |||
| Accounts payable and accrued liabilities | 9 | 1,375,120 | 930,646 |
| Notes payable | 7 | 570,370 | 469,966 |
| TOTAL LIABILITIES | 1,945,490 | 1,400,612 | |
| EQUITY (DEFICIENCY) | |||
| Share capital | 8 | 10,252,419 | 10,239,919 |
| Reserves | 8 | 948,890 | 948,829 |
| Deficit | (12,472,779) | (11,917,178) | |
| TOTAL EQUITY (DEFICIENCY) | (1,271,470) | (728,430) | |
| TOTAL LIABILITIES AND EQUITY (DEFICIENCY) | 674,020 | 672,182 |
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
Going concern (Note 2)
Approved on behalf of the Board of Directors:
"David Bowen" Director
"Eli Dusenbury" Director
Reflex Advanced Materials Corp.
Condensed Consolidated Interim Statements of Net Loss and Comprehensive Loss
For the Three and Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
| For the Periods Ended October 31, | Notes | Three Months Ended | Nine Months Ended | ||
|---|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | ||
| $ | $ | ||||
| EXPENSES | |||||
| Advertising and marketing | - | - | 15,000 | 15,000 | |
| Consulting fees | 9 | 45,000 | 75,000 | 210,000 | 292,500 |
| Director fees | 9 | 9,000 | 9,000 | 27,000 | 27,000 |
| Exploration and evaluation costs | 5 | - | - | 97,557 | 145,605 |
| Filing fees | 10,879 | 24,791 | 27,107 | 32,889 | |
| Interest expense | 7 | 17,796 | 13,989 | 50,408 | 32,190 |
| Office and miscellaneous | 97 | 3,581 | 5,082 | 18,149 | |
| Professional fees | 97,010 | - | 110,886 | 76,313 | |
| Share-based compensation | 8,9 | - | 13,404 | 61 | 61,255 |
| Foreign exchange gain | - | (9) | - | (45) | |
| (179,782) | (139,756) | (543,101) | (700,856) | ||
| OTHER ITEMS | |||||
| Impairment expense | 5 | - | - | (12,500) | - |
| NET AND COMPREHENSIVE LOSS | (179,782) | (139,756) | (555,601) | (700,856) | |
| Loss per share, basic and diluted | (0.03) | (0.02) | (0.09) | (0.11) | |
| Weighted average number of common shares outstanding – Basic and diluted | 6,131,117 | 6,106,117 | 6,124,803 | 6,103,234 |
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
Reflex Advanced Materials Corp.
Condensed Consolidated Interim Statements of Changes in Shareholders' Equity
For the Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
| Common Shares Number (#) | Share Capital $ | Reserves $ | Deficit $ | Total Equity (Deficiency) $ | |
|---|---|---|---|---|---|
| Balance, January 31, 2024 | 6,096,117 | 10,226,919 | 884,722 | (8,584,411) | 2,527,230 |
| Shares issued for exploration and evaluation assets | 10,000 | 13,000 | - | - | 13,000 |
| Vesting of options and restricted share rights (Note 8) | - | - | 61,255 | - | 61,255 |
| Net and comprehensive loss for the period | - | - | - | (700,856) | (700,856) |
| Balance, October 31, 2024 | 6,106,117 | 10,239,919 | 945,977 | (9,285,267) | 1,900,629 |
| Balance, January 31, 2025 | 6,106,117 | 10,239,919 | 948,829 | (11,917,178) | (728,430) |
| Shares issued for exploration and evaluation assets | 25,000 | 12,500 | - | - | 12,500 |
| Vesting of options and restricted share rights (Note 8) | - | - | 61 | - | 61 |
| Net and comprehensive loss for the period | - | - | - | (555,601) | (555,601) |
| Balance, October 31, 2025 | 6,131,117 | 10,252,419 | 948,890 | (12,472,779) | (1,271,470) |
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
Reflex Advanced Materials Corp.
Condensed Consolidated Interim Statements of Cash Flows
For the Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
| For the Nine Months Ended | Note | October 31, 2025 | October 31, 2024 |
|---|---|---|---|
| $ | $ | ||
| OPERATING ACTIVITIES | |||
| Net loss for the period | (555,601) | (700,856) | |
| Items not affecting cash | |||
| Share-based compensation | 8 | 61 | 61,255 |
| Impairment expense | 5 | 12,500 | - |
| Interest expense | 7 | 50,408 | 32,190 |
| Net changes in non-cash working capital items: | |||
| Accounts receivable | (19,103) | (15,063) | |
| Prepaid expenses | 17,037 | (4,500) | |
| Accounts payable and accrued liabilities | 444,470 | 334,767 | |
| Cash used in operating activities | (50,228) | (292,207) | |
| INVESTING ACTIVITIES | |||
| Property option agreement payments | 5 | - | (136,127) |
| Cash used in investing activities | - | (136,127) | |
| FINANCING ACTIVITIES | |||
| Proceeds from issuance of notes payable | 7 | 50,000 | 370,000 |
| Cash received from financing activities | 50,000 | 370,000 | |
| Net change in cash | (228) | (58,334) | |
| Cash, beginning of year | 2,387 | 65,100 | |
| Cash, end of period | 2,159 | 6,766 | |
| Supplemental cash flow information | |||
| Shares issued for mineral property acquisition | 5 | 12,500 | 13,000 |
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
Reflex Advanced Materials Corp.
Notes to the Condensed Consolidated Interim Financial Statements
For the Three and Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
1. NATURE OF OPERATIONS
Reflex Advanced Materials Corp., formally Freedom Battery Metals Inc., (the "Company") was incorporated under the BC Business Corporations Act on June 10, 2021. The principal business of the Company is the acquisition, exploration and evaluation of resource properties. The Company's registered and records office address is 6th Floor, 905 West Pender Street, Vancouver, BC, V6C 1L6. Its principal place of business is 915 – 700 West Pender Street, Vancouver, BC, V6C 1G8.
On July 25, 2022, the Company obtained a receipt for its final long form prospectus (the "Prospectus") from the British Columbia Securities Commission, Alberta Securities Commission, Manitoba Securities Commission and Ontario Securities Commission. The Prospectus qualified the distribution of 294,567 common shares and 294,567 common share purchase warrants of the Company upon the exercise of 294,567 issued and outstanding special warrants. On August 3, 2022, the Company's common shares began trading on the Canadian Securities Exchange (the "CSE") under the symbol "FBAT" and the Company's special warrants were converted into 294,567 common shares and 294,567 common share purchase warrants.
These condensed consolidated interim financial statements (the "financial statements") were approved by the Board of Directors on December 29, 2025.
2. GOING CONCERN
These financial statements have been prepared on a going concern basis which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company incurred a let loss of $555,601 (2024 - $700,856) during the nine months ended October 31, 2025 and has an accumulated deficit of $12,472,779 as of October 31, 2025 (January 31, 2025 - $11,917,178). The Company does not generate cash flow from operations to fund its exploration activities and has therefore relied upon the issuance of securities for financing. The Company intends to continue relying upon the issuance of securities to finance its future operations and exploration activities to the extent such instruments are issuable under terms acceptable to the Company. While the Company has been successful in raising funds in the past, it is uncertain whether it will be able to raise sufficient funds in the future.
These events and conditions create a material uncertainty that may cast significant doubt upon the Company's ability to continue as a going concern. If the Company is unable to secure additional financing, repay liabilities as they come due, negotiate suitable joint venture agreements, and/or continue as a going concern, then material adjustments may be required to the carrying value of assets and liabilities and the statement of financial position classifications used. These financial statements do not include any adjustments that may arise should the Company be unable to continue as a going concern.
3. BASIS OF PRESENTATION
a. Statement of compliance
In these financial statements, unless otherwise indicated, all amounts are expressed in Canadian dollars, which is the Company's functional and presentation currency.
These financial statements have been prepared in accordance with International Accounting Standard ("IAS") 34 Interim Financial Reporting using accounting policies consistent with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). These financial statements are condensed as they do not include all of the information required by IFRS for annual financial statements and therefore should be read in conjunction with the Company's audited financial statements for the year ended January 31, 2025.
b. Basis of consolidation
Reflex Advanced Materials Corp.
Notes to the Condensed Consolidated Interim Financial Statements
For the Three and Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
These consolidated financial statements include the accounts of the Company and its wholly-owned Canadian and Montana subsidiaries, 1377838 B.C. Ltd. ("Subco") and Reflex Advanced Montana LLC. A subsidiary is an entity in which the Company has control, where control requires exposure or rights to variable returns and the ability to affect those returns through power over the investees. All intercompany transactions and balances have been eliminated on consolidation.
c. Foreign currencies
The Company's functional and presentation currency is the Canadian dollar.
Monetary assets and liabilities are translated into Canadian dollars using the exchange rate in effect at the date of the statement of financial position.
Non-monetary assets and liabilities that are measured at historical cost are translated into Canadian dollars using the exchange rate in effect at the date of the initial transaction and are not subsequently restated. Non-monetary assets and liabilities that are measured at fair value or a revalued amount are translated into Canadian dollars by using the exchange rate in effect at the date the value is determined, and the related translation differences are recognized in net income or other comprehensive loss consistent with where the gain or loss on the underlying non-monetary asset or liability has been recognized.
d. Material accounting judgments and estimates
The timely preparation of these financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities and expenses, and the disclosure of contingent assets and liabilities. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to estimates are recognized prospectively. As at October 31, 2025 the following have been identified as material estimates:
i. Share-based compensation
Management determines fair value for share-based payments using market-based valuation techniques. The fair value of the market-based and performance-based share awards are determined at the date of grant using valuation techniques. Assumptions are made and judgment used in applying valuation techniques.
These assumptions and judgments include estimating the future volatility of the stock price, expected dividend yield, future employee turnover rates and future employee stock option exercise behaviors and corporate performance. Similar calculations are made to value warrants. Such judgments and assumptions are inherently uncertain. Changes in these assumptions affect the fair value estimates.
In the preparation of these financial statements, management has made judgments, aside from those that involve estimates, in the process of applying the accounting policies. The following critical judgments can have an effect on the amounts recognized in the financial statements:
i. Exploration and evaluation assets
The Company is required to make certain judgments in assessing indicators of impairment of exploration and evaluation assets. Judgment is required to determine if the right to explore will expire in the near future or is not expected to be renewed.
Judgment is required to determine whether substantive expenditures on further exploration for and evaluation of mineral resources in specific areas will not be planned or budgeted. Judgment is required to determine if the exploration for and evaluation of mineral resources in specific areas have not led to the commercially viable quantities of mineral resources and the Company will discontinue such activities. Judgment is required to determine whether there are indications that the carrying amount of an exploration and evaluation property is unlikely to be recovered in full of successful development of the project or by sale.
Reflex Advanced Materials Corp.
Notes to the Condensed Consolidated Interim Financial Statements
For the Three and Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
4. PREPAID EXPENSES
As at October 31, 2025 the Company has $nil (January 31, 2025 - $17,037) in prepaid expenses and consists of the following:
| October 31, 2025 | January 31, 2025 | |
|---|---|---|
| $ | $ | |
| Insurance | - | 1,125 |
| Filing fees | - | 15,912 |
| Total | - | 17,037 |
5. EXPLORATION AND EVALUATION ASSETS AND EXPENSES
The following table summarizes the Company's exploration and evaluation assets by property at October 31, 2025 and January 31, 2025:
| Ruby Graphite | |
|---|---|
| $ | |
| Balance, January 31, 2024 | 1,604,920 |
| Option agreement – cash | 136,127 |
| Option agreement - share issuance | 13,000 |
| Impairment | (1,754,047) |
| Balance, January 31, 2025 | - |
| Option agreement – share issuance | 12,500 |
| Impairment | (12,500) |
| Balance, October 31, 2025 | - |
The following table summarizes the Company's exploration and evaluation expenses by property and type of expense, for the nine months ended October 31, 2025 and 2024:
| Ruby Graphite | |
|---|---|
| $ | |
| Geophysics and geology | 28,391 |
| Drilling | 23,183 |
| Project management and equipment | 60,000 |
| Permitting | 34,031 |
| Balance, October 31, 2024 | 145,605 |
| Project management and equipment | 56,191 |
| Permitting | 33,186 |
| Balance, October 31, 2025 | 97,557 |
a) Ruby Graphite Property, Montana, USA
On October 7, 2022, pursuant to a securities exchange agreement among the Company, Broadstone Resources Inc. ("Broadstone") and a subsidiary of Broadstone ("Subco"), the Company acquired all the issued and outstanding shares of Subco. Subco held an option to acquire a 100% interest in the Ruby Graphite project (the "Ruby Option"), a project area covering approximately 2,000 acres and 96 federal lode mining claims located in Beaverhead County, Montana, U.S.A.
On April 7, 2025, the Company entered into an amending agreement with the optionor to extend the due date of the certain cash payments payable by the Company under the Ruby Option in consideration for the issuance of an additional 25,000 common shares of the Company to the optionor (issued on April 12, 2025).
Reflex Advanced Materials Corp.
Notes to the Condensed Consolidated Interim Financial Statements
For the Three and Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
In May 2025, the Company received a notice of option termination from the optionor, thereby terminating the Ruby Option. The Company considered this an indicator of impairment and impaired the Ruby Graphite asset to $nil, recognizing an impairment expense of $1,754,047 in the consolidated statement of net loss and comprehensive loss for the year ended January 31, 2025.
During the nine months ended October 31, 2025, the Company made no cash payments (2024 - US$100,000 or CA$136,127) and issued 25,000 common shares valued at $12,500 (2024 - 10,000 common shares valued at $13,000), in connection with the Ruby Option. Due to the notice of option termination discussed above, the Company recognized an impairment expense of $12,500 in the consolidated statement of net loss and comprehensive loss.
During the nine months ended October 31, 2025, the Company paid a $nil (2024 - $nil) deposit to the United States Office of Environmental Quality ("DEQ"), which is a requirement to obtain drilling permits. The amounts will be returnable to the Company upon completion of drilling activities and approval of closure of the drilling site.
6. INVESTMENTS
The Company's investment balance comprises the following private company investments:
| October 31, 2025 | January 31, 2025 | |
|---|---|---|
| $ | $ | |
| Bio Graphene Solutions Inc. | 200,000 | 200,000 |
| Total | 200,000 | 200,000 |
a) Bio Graphene Solutions Inc.
On April 1, 2023, the Company entered into a subscription agreement to make a strategic investment in Bio Graphene Solutions Inc. ("BGS") by purchasing 571,428 common shares of BGS for $200,000.
The investment in BGS was recorded at fair value on the statement of financial position, with changes in fair value being recorded through the statement of loss.
7. NOTES PAYABLE
The following table summarizes the Company's notes payable as at October 31, 2025 and January 31, 2025:
| Issue Date | Interest Rate | October 31, 2025 | January 31, 2025 |
|---|---|---|---|
| % | $ | $ | |
| March 26, 2024 | 15 | 124,000 | 112,781 |
| April 5, 2024 | 15 | 333,690 | 303,398 |
| August 28, 2024 | 15 | 59,631 | 53,787 |
| May 28, 2025 | 15 | 53,205 | - |
| Total | 570,527 | 469,966 |
a) March 26, 2024 Issuance
On March 26, 2024 the Company issued a $100,000 promissory note which accrues interest at 15% per annum, calculated annually, not in advance. The principal sum and all accrued interest may become immediately due and payable upon the written demand of the Lender and may be settled in either cash or common shares valued at the market price of the common shares on the settlement date at the option of the lender.
As the conversion feature does not meet the definition of a derivative, the Company accounts for the note as a liability using amortized cost.
Reflex Advanced Materials Corp.
Notes to the Condensed Consolidated Interim Financial Statements
For the Three and Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
b) April 5, 2024 Issuance
On April 5, 2024 the Company issued a $270,000 promissory note which accrues interest at 15% per annum, calculated annually, not in advance. The principal sum and all accrued interest may become immediately due and payable upon the written demand of the Lender and may be settled in either cash or common shares valued at the market price of the common shares on the settlement date at the option of the Lender.
As the conversion feature does not meet the definition of a derivative, the Company accounts for the note as a liability using amortized cost.
c) August 28, 2024 Issuance
On August 28, 2024, the Company issued a US$ 35,000 ($50,694) promissory note which accrues interest at 15% per annum, calculated annually, not in advance. The principal sum and all accrued interest may become immediately due and payable upon the written demand of the lender and may be settled in either cash or common shares valued at the market price of the common shares on the settlement date at the option of the lender.
As the conversion feature does not meet the definition of a derivative, the Company accounts for the note as a liability using amortized cost.
d) May 28, 2025 Issuance
On May 28, 2025, the Company issued a $50,000 promissory note which accrues interest at 15% per annum, calculated annually, not in advance. The principal sum and all accrued interest may become immediately due and payable upon the written demand of the lender and may be settled in either cash or common shares valued at the market price of the common shares on the settlement date at the option of the lender.
As the conversion feature does not meet the definition of a derivative, the Company accounts for the note as a liability using amortized cost.
During the nine months ended October 31, 2025, the Company accrued $50,404 (2024 - $32,190) of interest related to its outstanding notes payable.
- SHAREHOLDERS' EQUITY
(a) Authorized and Issued Share Capital
Unlimited number of common shares without par value. At October 31, 2025, the Company had 6,131,117 common shares outstanding.
On October 15, 2025, the Company completed a consolidation of its Shares at a ratio of ten pre-consolidation shares to one post-consolidation common share.
Prior to the consolidation, the Company had 61,311,169 shares issued and outstanding and had 6,131,117 shares issued and outstanding upon completion.
No fractional shares were issued under the consolidation. Any fractional common share equal to or more than one-half resulting from the consolidation was rounded up to the nearest whole common share, and any fractional shares less than one-half resulting from the consolidation was rounded down to the nearest whole common share. Proportionate adjustments were made to the Company's outstanding stock options and share purchase warrants.
All of the Company's outstanding share purchase options, share purchase warrants, and restricted share units were also adjusted by the consolidation ratio and the respective exercise prices of those outstanding instruments were adjusted accordingly. All historical share and per share data presented in the Company's financial statements have been retrospectively adjusted to reflect the consolidation, unless otherwise noted.
Reflex Advanced Materials Corp.
Notes to the Condensed Consolidated Interim Financial Statements
For the Three and Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
i) Nine months ended October 31, 2025
On April 12, 2025, the Company issued 25,000 common shares to the optionor of the Ruby Graphite Project, in accordance with the Ruby option agreement (Note 5).
ii) Year-ended January 31, 2025
On April 19, 2024, the Company issued 10,000 common shares valued at $13,000 in connection with the Ruby option agreement (Note 5).
(b) Warrants
A summary of the movement in warrants during the nine months ended October 31, 2025 and year ended January 31, 2025 is as follows:
| Number of Warrants for the periods ended | October 31, 2025 | January 31, 2025 |
|---|---|---|
| Balance, Opening | 1,918,003 | 2,552,734 |
| Issued | - | - |
| Exercised | - | - |
| Expired | (1,318,003) | (634,731) |
| Balance, Ending | 600,000 | 1,918,003 |
The warrants outstanding as at October 31, 2025 are as follows:
| Date Granted | Exercise Price | Warrants Issued | Warrants Exercised | Warrants Expired | Warrants Remaining | Expiry Date | Remaining Life |
|---|---|---|---|---|---|---|---|
| $ | |||||||
| February 8, 2023 | $4.00 | 1,000,000 | (18,750) | (981,250) | - | February 8, 2025 | - |
| February 8, 2023 | $5.50 | 53,399(a) | - | (53,399) | - | February 8, 2025 | - |
| February 8, 2023 | $6.50 | 45,455 | - | (45,455) | - | February 8, 2025 | - |
| October 13, 2023 | $3.50 | 106,500(b) | - | (106,500) | - | October 13, 2025 | - |
| October 18, 2023 | $3.50 | 131,400(c) | - | (131,400) | - | October 18, 2025 | - |
| November 17, 2023 | $3.50 | 25,000 | - | - | 25,000 | November 17, 2025 | 0.05 |
| January 4, 2024 | $1.50 | 575,000 | - | - | 575,000 | January 4, 2026 | 0.18 |
| Balance, October 31, 2025 | $1.58 | 1,936,754 | (18,750) | (1,318,004) | 600,000 | 0.17 |
Notes:
a) Finder's warrants.
b) Includes 4,000 of finder's warrants
c) Includes 16,400 of finder's warrants
(c) Share purchase options
On November 20, 2022, the Company adopted a stock option plan (the "Plan") to grant share purchase options ("options") to directors, senior officers, employees and consultants of the Company. The aggregate outstanding options are limited to 10% of the outstanding common shares. The option exercise price under each option shall be not less than the Market Value on the Grant Date.
During the nine months ended October 31, 2025, the Company did not grant options (2024 – nil) to officers and employees of the Company.
Reflex Advanced Materials Corp.
Notes to the Condensed Consolidated Interim Financial Statements
For the Three and Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
A summary of the Company's options at October 31, 2025 is as follows:
| Date Granted | Exercise Price | Options Issued | Options Exercised | Options Cancelled | Options Remaining | Expiry Date | Remaining Life |
|---|---|---|---|---|---|---|---|
| $ | |||||||
| November 20, 2022 | 4.30 | 105,000 | - | (15,000) | 1,05,000 | November 20, 2027 | 2.05 |
| June 13, 2023 | 3.80 | 5,000 | - | - | 5,000 | June 13, 2028 | 2.62 |
| Balance, October 31, 2025 | 4.28 | 110,000 | - | (15,000) | 95,000 | 2.08 |
During the nine months ended October 31, 2025, the Company recorded share-based compensation expense of $nil (2024 - $42,763) pursuant to options vesting. A remaining share-based compensation expense of $nil (2024 - $2,031) is expected to be recognized as the remaining options vest.
(d) Restricted share units
On November 20, 2022, the Company adopted a restricted share unit plan (the "RSU Plan") to grant restricted share units ("RSUs") to directors, senior officers, employees and consultants of the Company. The aggregate outstanding RSUs are limited to 10% of the outstanding common shares.
A summary of the Company's restricted share units at October 31, 2025 is as follows:
| RSUs | Fair Value | |
|---|---|---|
| Balance, January 31, 2023 | 280,000 | $4.30 |
| Grant – February 16, 2023(d) | 17,500 | $7.80 |
| Grant – June 13, 2023(e) | 45,000 | $3.80 |
| Exercised | (275,000) | $4.50 |
| Balance, January 31, 2024, 2025 and October 31, 2025 | 67,500 | $4.00 |
Notes:
d) On February 16, 2023, the Company awarded an aggregate of 17,500 RSUs to consultants of the Company's under the Company's restricted share unit plan. The RSUs shall vest immediately following approval of the Plan and the grant of such RSUs in accordance with the policies of the Canadian Securities Exchange ("CSE"). Each vested RSU entitles the holder to receive one common share of the Company.
e) On June 13, 2023, the Company awarded an aggregate 45,000 RSUs to employees and consultants of the Company under the Company's restricted share unit plan. The RSUs shall vest immediately following approval of the Plan and the grant of such RSUs in accordance with the policies of the Canadian Securities Exchange ("CSE"). Each vested RSU entitles the holder to receive one common share of the Company.
During the nine months ended October 31, 2025, the Company recorded share-based compensation expense of $61 (2024 - $18,492) pursuant to RSUs vesting. A remaining share-based compensation expense of $nil (2024 - $821) is expected to be recognized as the remaining RSUs vest.
(e) Escrow shares
As at October 31, 2025, the Company had 25,502 (2024 - 51,003) common shares subject to escrow. Under the escrow agreement, 10% of the total common shares to be released upon listing with the Canadian Securities Exchange and 15% of the remaining shares are to be released every six months following listing. The Company was listed on the Canadian Securities Exchange on August 3, 2022.
- RELATED PARTY TRANSACTIONS
Key management personnel include persons having the authority and responsibility for planning, directing and controlling the activities of the Company as a whole. The Company has determined that key management personnel consist of members of the Board of Directors and corporate officers.
The aggregate value of transactions relating to key management personnel during the nine months ended October 31, 2025 and 2024 were as follows:
Reflex Advanced Materials Corp.
Notes to the Condensed Consolidated Interim Financial Statements
For the Three and Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
| Nine Months Ended | October 31, 2025 | October 31, 2024 |
|---|---|---|
| $ | $ | |
| Management fees (to company owned by CEO) | 75,000 | 100,000 |
| Management fees (to company owned by CFO) | 67,500 | 75,000 |
| Director fees | 27,000 | 27,000 |
| Share-based compensation (to directors and officers) | 61 | 59,004 |
| Total | 169,561 | 261,004 |
All related party transactions are in the normal course of operations and are measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties.
As at October 31, 2025, $408,358 (January 31, 2025 - $306,283) was owing to key management personnel for fees and expenses incurred on behalf of the Company with these amounts all included in accounts payable and accrued liabilities. The amounts payable are non-interest bearing, are unsecured, and have no specific terms of repayment.
10. RISK MANAGEMENT
a) Financial Risk Management
The Company may be exposed to risks of varying degrees of significance which could affect its ability to achieve its strategic objectives. The main objectives of the Company's risk management processes are to ensure that risks are properly identified and that the capital base is adequate in relation to those risks. The principal risks to which the Company is exposed are described below.
i. Credit Risk
Credit risk is the risk that a counter party will be unable to pay any amounts owed to the Company. Management's assessment of the Company's exposure to credit risk on its $2,159 in cash (January 31, 2025 - $2,387) is low as the Company's cash is held with major Canadian financial institutions.
ii. Liquidity Risk
Liquidity risk is the risk that the Company is not able to meet its financial obligations as they fall due. As at October 31, 2025 the Company's working capital deficit is $1,193,825 (January 31, 2025 - $1,221,155). The Company may seek additional financing through debt or equity offerings, but there can be no assurance that such financing will be available on terms acceptable to the Company or at all. Any equity offering will result in dilution to the ownership interests of the Company's shareholders and may result in dilution to the value of such interests.
iii. Market Risk
Market risk incorporates a range of risks. Movements in risk factors, such as currency risk, price risk and interest rate risk, affect the fair values of financial assets and liabilities. The Company is not exposed to these risks.
iv. Currency Risk
The operating results and financial position of the Company are reported in Canadian dollars. As the Company is exploring opportunities in an international environment, some of the Company's financial instruments and transactions are denominated in currencies other than the Canadian dollar. The results of the Company's operations are subject to minimal currency risk and is nominal to the financial statements.
The Company has not entered into any agreements or purchased any foreign currency hedging instruments to hedge possible currency risks at this time. Management believes the foreign exchange risk derived from currency conversions is not significant, and therefore, does not hedge its foreign exchange risk.
b) Fair Values
Reflex Advanced Materials Corp.
Notes to the Condensed Consolidated Interim Financial Statements
For the Three and Nine Months Ended October 31, 2025 and 2024
In Canadian Dollars, unless noted (unaudited)
The carrying values of cash, accounts payable and accrued liabilities approximate their fair values due to their short-term to maturity.
Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.
Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
Level 2 – Quoted prices in markets that are not active, or inputs that are not observable, either directly or indirectly, for substantially the full term of the asset or liability.
Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).
c) Capital Management
The Company considers its shareholders’ equity as capital. The Company’s objectives when maintaining capital are to maintain a sufficient capital base in order to satisfy its capital obligations and ongoing operational expenses, and at the same time preserve investor’s confidence required to sustain future development and production of the business.
The Company manages its capital structure and makes adjustments as necessary in light of economic conditions. The Company, upon approval from its Board of Directors, intends to balance its overall capital structure through new share issues or by undertaking other activities as deemed appropriate under the specific circumstances. To maintain its capital structure the Company may, from time to time, issue equity or debt, repay debt or sell assets.
The Company is not exposed to any externally imposed capital requirements. There has been no change in the Company’s approach to capital management during the nine months ended October 31, 2025.