RJK Explorations Ltd. — Audit Report / Information 2025

Apr 2, 2026

RJK EXPLORATIONS

CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 2025 & 2024
EXPRESSED IN CANADIAN DOLLARS

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Management's Responsibility for Financial Reporting

The accompanying financial statements of RJK Explorations Ltd. included in this Annual Report are the responsibility of management and have been approved by the Board of Directors.

The financial statements have been prepared by management in accordance with IFRS Accounting Standards, as issued by the International Accounting Standards Board. When alternative accounting methods exist, management has selected those it deems to be most appropriate in the circumstances.

The significant accounting policies used are described in Note 3 to the financial statements. The financial statements include estimates based on the experience and judgment of management in order to ensure that the financial statements are presented fairly, in all material respects. Financial information presented elsewhere in the annual report is consistent with that in the financial statements.

The management of the Company developed and continues to maintain systems of internal accounting controls and management practices designed to provide reasonable assurance that the financial information is relevant, reliable and accurate and that the Company's assets are appropriately accounted for and adequately safeguarded.

The Board of Directors exercises its responsibilities for ensuring that management fulfils its responsibilities for financial reporting and internal control with the assistance of its Audit Committee. The Audit Committee is appointed by the Board and all of its members are Directors who are not officers or employees of RJK Explorations Ltd. The Committee meets periodically to review quarterly financial reports and to discuss internal controls over the financial reporting process, auditing matters and financial reporting issues. The Committee reviews the Company's annual financial statements and recommends their approval to the Board of Directors.

These financial statements have been audited by McGovern Hurley LLP, Chartered Professional Accountants, the independent auditor, on behalf of the shareholders. McGovern Hurley LLP, Chartered Professional Accountants, has full and free access to the Audit Committee and may meet with or without the presence of management.

(signed) "Glenn C. Kasner"
President and Chief Executive Officer

(signed) "Marco Guidi"
Chief Financial Officer

Kirkland Lake, Canada
April 1, 2026

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Horizon Assurance LLP

INDEPENDENT AUDITOR'S REPORT

To the Shareholders of
RJK Explorations Ltd.

Report on the Audit of the Consolidated Financial Statements

Opinion

We have audited the consolidated financial statements of RJK Explorations Ltd. and its subsidiaries (the "Company"), which comprise the consolidated statements of financial position as at December 31, 2025, and the consolidated statements of operations and comprehensive loss, changes in equity, and cash flows for the year then ended, and notes to the consolidated financial statements, including material accounting policy information.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at December 31, 2025, and its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board (IASB).

Basis of Opinion

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

Material Uncertainty Related to Going Concern

We draw attention to note 2 in the consolidated financial statements, which describes the events or conditions that indicate the existence of a material uncertainty that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

219 - 7100 Woodbine Ave., Markham, ON L3R 5J2

info@horizonllp.ca

www.horizonllp.ca

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Horizon Assurance LLP

Key Audit Matter

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Except for the matter of the Material Uncertainty Related to Going Concern described above, we have determined that there are no other key audit matters to communicate in our report.

Other Matter

The consolidated financial statements of the Company for the year ended December 31, 2024, were audited by another auditor who expressed an unmodified opinion on those statements on April 15, 2025.

Other Information

Management is responsible for the other information. The other information comprises the Management's Discussion and Analysis for the year ended December 31, 2025, which we obtained prior to the date of this auditor's report.

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

In connection with our audit of the consolidated financial statements, our 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 our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We 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 IFRS Accounting Standards as issued by the IASB, 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

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Horizon Assurance LLP

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

Our 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 our 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, we exercise professional judgment and maintain professional skepticism throughout the audit. We 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 our 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.
• 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 we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our 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.

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Horizon Assurance LLP

• Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business units within the Company as a basis for forming an opinion on the group financial statements. We are responsible for the direction, supervision and review of the audit work performed for purposes of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings that we identify during our audit, including any:

• Significant deficiencies in internal control;
• Identified fraud or suspected fraud; and
• Other matters related to fraud that are, in our judgment, relevant to the responsibilities of those charged with governance.

We also provide those charged with governance with a statement that we 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 our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditor's report is Julia Zhou.

April 1, 2026
Markham, Ontario

Horizon Assurance LLP
Chartered Professional Accountant
Licensed Public Accountant

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RJK EXPLORATIONS LTD.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

AS AT DECEMBER 31, 2025 and 2024

EXPRESSED IN CANADIAN DOLLARS

| | DECEMBER 31
2025 | DECEMBER 31
2024 |
| --- | --- | --- |
| ASSETS | | |
| CURRENT ASSETS | | |
| Cash (Note 6) | $ 22,350 | $ 210,780 |
| Accounts receivable (Note 7) | 7,863 | 11,501 |
| Prepaid expenses | 1,860 | - |
| TOTAL CURRENT ASSETS | 32,073 | 222,281 |
| Equipment (Note 8) | 21,415 | 28,090 |
| TOTAL ASSETS | $ 53,488 | $ 250,371 |
| LIABILITIES | | |
| CURRENT LIABILITIES | | |
| Accounts payable and accrued liabilities (Notes 7 and 11) | $ 232,341 | $ 178,102 |
| Due to related parties (Note 11) | 50,000 | - |
| Liability component of Class B preferred shares (Note 9) | - | 170,828 |
| TOTAL CURRENT LIABILITIES | 282,341 | 348,930 |
| TOTAL LIABILITIES | 282,341 | 348,930 |
| SHAREHOLDERS' DEFICIENCY (Note 9) | | |
| Common stock (Class A shares) | 31,059,818 | 31,059,818 |
| Royalty preferred shares (Class C shares) | 19,020 | 19,020 |
| Equity component of Class B preferred shares | 256,242 | 256,242 |
| Contributed surplus and reserves | 4,898,827 | 4,898,827 |
| Deficit | (36,462,760) | (36,332,466) |
| TOTAL SHAREHOLDERS' DEFICIENCY | (228,853) | (98,559) |
| TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIENCY | $ 53,488 | $ 250,371 |

Description of business (Note 1)
Going concern (Note 2c)
Commitments and contingencies (Note 10)
Events after the reporting period (Note 16)

APPROVED ON BEHALF OF THE BOARD:

Signed "Glenn C. Kasner"
DIRECTOR

Signed "Robert Mackay"
DIRECTOR

The accompanying notes are an integral part to these consolidated financial statements.

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RJK EXPLORATIONS LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

	December 31,
	2025	2024
Expenses
Shareholder information	$ 27,489	$ 24,322
Professional fees	88,912	96,357
Office and general expenses	30,658	38,548
Depreciation (Note 8)	6,675	6,675
Exploration and evaluation expenditures (Note 5)	148,830	207,247
Share-based payments (Note 9)	-	140,000
Loss before other items	(302,564)	(513,149)
Interest income	1,442	7,885
Interest accretion (Note 7)	-	(18,000)
Write Down of Liability component of Class B preferred shares	170,828	-
NET AND COMPREHENSIVE LOSS	(130,294)	(523,264)
Net Loss per share
Basic and diluted loss per share	$ (0.001)	$ (0.006)
Weighted average number of shares outstanding - basic and diluted	97,290,982	81,121,904

The accompanying notes are an integral part to these consolidated financial statements.

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RJK EXPLORATIONS LTD.

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

	December 31,
	2025	2024
OPERATING ACTIVITIES
NET LOSS	$ (130,294)	$ (523,264)
ADJUSTMENTS FOR NON-CASH ITEMS AND OTHER ADJUSTMENTS
Depreciation of property, plant and equipment	6,675	6,675
Interest accretion	-	18,000
Share-based payments	-	140,000
Write down of liability component of Class B preferred shares	(170,828)	-
CHANGES IN NON-CASH WORKING CAPITAL ITEMS
Accounts receivable	3,638	(10,777)
Prepaid expenses	(1,860)	-
Accounts payable	54,239	135,475
CASH FLOWS (USED IN) OPERATING ACTIVITIES	(238,430)	(233,891)
FINANCING ACTIVITIES
Private placements	-	424,000
Share issue costs	-	(11,000)
Advances received from related parties	50,000	-
Repayment of promissory note	-	(349,240)
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES	50,000	63,760
CHANGE IN CASH DURING THE PERIOD	(188,430)	(170,131)
CASH, beginning of year	210,780	380,911
CASH, end of year	$ 22,350	$ 210,780

The accompanying notes are an integral part to these consolidated financial statements.

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RJK EXPLORATIONS LTD.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

| | COMMON STOCK
CLASS A SHARES | | CLASS B
PREFERRED
SHARES | CLASS C
PREFERRED
SHARES | CONTRIBUTED
SURPLUS AND
RESERVES | DEFICIT | TOTAL |
| --- | --- | --- | --- | --- | --- | --- | --- |
| | # OF
SHARES | AMOUNT | | | | | |
| Balance, December 31, 2023 | 78,876,697 | $ 30,227,688 | $ 256,242 | $ 618,150 | $ 4,578,827 | $ (35,809,202) | $ (128,295) |
| Private placements | 12,114,285 | 424,000 | - | - | - | - | 424,000 |
| Fair value of warrants issued
with private placements | - | (185,000) | - | - | 185,000 | - | - |
| Share issue costs | - | (6,000) | - | - | (5,000) | - | (11,000) |
| Conversion of Class C
preferred shares to
Class A common shares | 6,300,000 | 599,130 | - | (599,130) | - | - | - |
| Share-based payments | - | - | - | - | 140,000 | - | 140,000 |
| Loss and comprehensive
loss for the year | - | - | - | - | - | (523,264) | (523,264) |
| Balance, December 31, 2024 | 97,290,982 | $ 31,059,818 | $ 256,242 | $ 19,020 | $ 4,898,827 | $ (36,332,466) | $ (98,559) |
| Balance, December 31, 2024 | 97,290,982 | $ 31,059,818 | $ 256,242 | $ 19,020 | $ 4,898,827 | $ (36,332,466) | $ (98,559) |
| Loss and comprehensive
loss for the year | - | - | - | - | - | (130,294) | (130,294) |
| Balance, December 31, 2025 | 97,290,982 | $ 31,059,818 | $ 256,242 | $ 19,020 | $ 4,898,827 | $ (36,462,760) | $ (228,853) |

The accompanying notes are an integral part to these consolidated financial statements.

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

1. DESCRIPTION OF BUSINESS

RJK Explorations Ltd. (the "Company" or "RJK") is a mineral exploration company originally formed in 1922 and is engaged in the acquisition and exploration of early stage exploration and evaluation properties. The Company's current focus is on diamond exploration in Northern Ontario. The Company continues to evaluate its exploration and evaluation properties and may acquire additional properties as venture capital and opportunities present themselves. The Company is a reporting issuer in Ontario, Alberta and British Columbia and trades on the TSX Venture Exchange as a Tier II reporting issuer under the symbol "RJX.A".

The address of the Company's corporate office and principal place of business is 4 Al Wende Avenue, Kirkland Lake, Ontario, Canada.

The Company is in the process of exploring its exploration and evaluation property interests and has not yet determined whether its exploration and evaluation interests contain mineral deposits that are economically recoverable. The Company will periodically have to raise additional funds to continue its exploration activities and, while it has been successful in doing so in the past, there can be no assurance it will be able to do so in the future.

The business of mining and exploring for minerals involves a high degree of risk and there can be no assurance that current exploration programs will result in profitable mining operations. Company's continued existence is dependent upon the preservation of its interests in the underlying properties, the discovery of economically recoverable reserves, the achievement of profitable operations, or the ability of the Company to raise additional financing, if necessary, or alternatively upon the Company's ability to dispose of its interests on an advantageous basis. The Company's property interests may also be subject to increases in taxes and royalties, renegotiation of contracts, currency exchange fluctuations and restrictions, and political uncertainty.

Although the Company has taken steps to verify title to the properties on which it is conducting exploration and in which it has an interest in accordance with industry standards for the current stage of exploration of such properties, these procedures do not guarantee the Company's title. Property title may be subject to government licensing requirements or regulations, unregistered prior agreements, unregistered claims, indigenous claims, and non-compliance with regulatory and environmental requirements.

These consolidated financial statements include the financial statements of the Company and its wholly-owned subsidiary, RJK Metals Inc. RJK has incorporated RJK Metals Inc. to look at gold, silver, cobalt and base metal opportunities.

2. BASIS OF PRESENTATION AND GOING CONCERN

(a) Statement of Compliance

The consolidated financial statements of the Company have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board ("IASB"). For these purposes, IFRS comprise the standards issued by the International Accounting Standards Board and Interpretations issued by the IFRS Interpretations Committee ("IFRICs").

The consolidated financial statements were authorized for issue by the Board of Directors on April 1, 2026.

(b) Basis of Presentation

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

The preparation of consolidated financial statements in compliance with IFRS requires management to make certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies. The areas involving a higher degree of judgment and complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5.

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RJK EXPLORATIONS LTD.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024
EXPRESSED IN CANADIAN DOLLARS

2. BASIS OF PRESENTATION AND GOING CONCERN (continued)

(c) Going Concern of Operations

The Company has not generated revenue from operations. The Company incurred a net and comprehensive loss of $130,294 during the year ended December 31, 2025 (Year ended December 31, 2024 - $523,264) and, as at that date the Company's deficit was $36,462,760 (December 31, 2024 - $36,332,466). The Company has a working capital deficiency of $250,268 (December 31, 2024 - $126,649 working capital deficiency). The Company expects to incur further losses in the development of its business, all of which indicate that material uncertainties exist that cast significant doubt upon the Company's ability to continue as a going concern. The Company is in the exploration stage and has no proven reserves or production relating to its operations. The application of the going concern assumption is dependent upon the Company's ability to generate future profitable operations and obtain necessary financing to do so.

These consolidated financial statements have been prepared on the basis of accounting principles applicable to a "going concern", which assume that the Company will continue in operation for the foreseeable future and will be able to realize its assets and discharge its liabilities in the normal course of operations. The business of mining and exploring for minerals involves a high degree of risk and there is no guarantee that the Company's exploration programs will yield positive results or that the Company will be able to obtain the necessary financing to carry out the exploration and development of its exploration and evaluation property interests.

Management believes the going concern assumption to be appropriate for these consolidated financial statements. If the going concern assumption was not appropriate, adjustments might be necessary to the carrying value of the assets and liabilities, reported revenues and expenses, and the statement of financial position classifications used in the consolidated financial statements.

The future profitability of exploration properties and the Company's continued existence are dependent upon the preservation of its interests in the underlying properties, the development of economically recoverable reserves, the achievement of profitable operations, or the ability of the Company to raise additional financing, if necessary, or alternatively upon the Company's ability to dispose of its interests on an advantageous basis. As the Company is in the exploration stage, the recoverability of the costs incurred to date on exploration properties is dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete the exploration and development of its properties and upon future profitable production or proceeds from the disposition of the properties. The Company will periodically have to raise funds to continue operations and, although it has been successful in doing so in the past, there is no assurance it will be able to do so in the future.

(d) Basis of Consolidation

Subsidiaries consist of entities over which the Company is exposed to, or has rights to, variable returns as well as the ability to affect these returns through the power to direct the relevant activities of the entity. Subsidiaries are fully consolidated from the date control is transferred to the Company and are deconsolidated from the date control ceases. The consolidated financial statements include all the assets, liabilities, revenues, expenses and cash flows of the Company and its subsidiary after eliminating inter-entity balances and transactions.

3. MATERIAL ACCOUNTING POLICIES

(a) Foreign Currencies

The consolidated financial statements are presented in Canadian dollars, which is also the Company's functional currency.

Transactions in currencies other than the functional currency are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at the period end exchange rates are recognized in the statement of loss. Non monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

(b) Cash

Cash includes cash on hand and deposits held at financial institutions.

RJK EXPLORATIONS

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RJK EXPLORATIONS LTD.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024
EXPRESSED IN CANADIAN DOLLARS

3. MATERIAL ACCOUNTING POLICIES (continued)

(c) Exploration and Evaluation Expenditures

All expenditures on exploration and evaluation activities, including costs incurred to acquire and secure exploration property licenses, are recorded as exploration expenses until it has been established that a mineral property is commercially viable and a decision has been made to proceed with development, after which, development costs are capitalized as construction in progress within property, plant and equipment.

(d) Equipment

On initial recognition, equipment are valued at cost, being the purchase price and directly attributable cost of acquisition or construction required to bring the asset to the location and condition necessary to be capable of operating in the manner intended by the Company, including appropriate borrowing costs and the estimated present value of any future unavoidable costs of dismantling and removing items. The corresponding liability is recognized within provisions.

Equipment is subsequently measured at cost less accumulated depreciation, less any accumulated impairment losses, with the exception of land which is not depreciated. Depreciation is provided at rates calculated to write off the cost of the equipment, less their estimated residual value, using the straight line method at various useful lives:

Equipment
10 years

When parts of an item of equipment have different useful lives, they are accounted for as separate items (major components) of equipment.

Subsequent costs are included in the asset's carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the statement of operations during the financial period in which they are incurred.

Gains and losses on disposal of an item of equipment are determined by comparing the proceeds from disposal with the carrying amount, and are recognized net within other income in the statement of operations.

Right of Use Assets ("ROU")

Contracts that convey the right to the Company to control the use of an identified asset for a period of time in exchange for consideration is accounted for as a lease, resulting in the recognition of a right-of-use ('ROU') asset at the commencement of the lease. The ROU asset is measured at cost and includes the following:

(i) the amount of the initial measurement of the lease liability;
(ii) any lease payments made at or before the commencement dates, less any lease incentives received;
(iii) any initial direct costs; and
(iv) an estimate of costs to restore the underlying asset, and any site upon which it is located, to the condition required by the terms and conditions of the lease.

ROU assets are depreciated on a straight-line basis over the shorter of the asset's useful life and the lease term.

(e) Impairment of Non-Financial Assets

Impairment tests on intangible assets with indefinite useful economic lives are undertaken annually at the financial year-end. Other non-financial assets, including plant and equipment are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset exceeds its recoverable amount, which is the higher of value in use and fair value less costs to sell, the asset is written down accordingly.

RJK EXPLORATIONS

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RJK EXPLORATIONS LTD.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024
EXPRESSED IN CANADIAN DOLLARS

3. MATERIAL ACCOUNTING POLICIES (continued)

Where it is not possible to estimate the recoverable amount of an individual asset, the impairment test is carried out on the asset's cash-generating unit, which is a group of assets for which there are separately identifiable cash inflows that are largely independent of the cash inflows from other assets.

An impairment loss is charged to the statement of operations, except to the extent they reverse gains previously recognized in other comprehensive loss/income.

(f) Financial Instruments

Financial assets and liabilities are classified into one of the following categories based on the purpose for which the asset was acquired or for which the liability was incurred.

Cash	Amortized cost
Accounts receivable	Amortized cost
Accounts payable and accrued liabilities	Amortized cost
Liability Component of Class B preferred shares	Amortized cost
Due to related parties	Amortized cost

Financial assets at amortized costs

A financial asset is measured at amortized cost if it is held within a business model whose objective is to hold assets to collect contractual cash flows and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets classified as amortized cost are measured subsequent to initial recognition at amortized cost using the effective interest method.

Financial liabilities

Financial liabilities, including accounts payable and accrued liabilities are recognized initially at fair value, net of transaction costs. After initial recognition, other financial liabilities are subsequently measured at amortized cost using the effective interest method. Gains and losses are recognized in operations when the liabilities are derecognized as well as through the amortization process. Borrowing liabilities are classified as current liabilities unless the Company has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

Compound financial instruments

Compound financial instruments issued by the Company are classified separately as financial liabilities and equity components or derivative liability components at the date of issue, based on the substance of the contractual agreement. On the date of issue, the fair value of the liability component is measured using the effective market rate of interest for a similar non-convertible instrument. This amount is accounted for as a liability at amortized cost using the effective interest method until the instrument is extinguished. The equity component is determined by deducting the amount of the liability component from the total fair value of the compound instrument. This amount is recognized in equity, net of any tax effects, and is not subsequently remeasured.

(g) Leases

The Company recognizes contracts that convey the right to control the use of an identified asset for a period of time in exchange for consideration as a lease, with an ROU asset and corresponding lease liability recognized at the commencement date of the lease. ROU assets are recognized as discussed in note 3(d) whereas lease liabilities are initially measured at the present value of the remaining lease payments, discounted using the interest rate implicit in the lease or, if not readily determinable, the Company's incremental borrowing rate. Lease payments included in the measurement of a lease liability include:

RJK EXPLORATIONS

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RJK EXPLORATIONS LTD.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024
EXPRESSED IN CANADIAN DOLLARS

3. MATERIAL ACCOUNTING POLICIES (continued)

• fixed payments, including in-substance fixed payments;
• variable lease payments that depend on an index or a rate;
• amounts expected to be payable under a residual value guarantee; and
• the exercise price of a purchase option if the Company is reasonably certain to exercise that option, lease payments in an optional renewal period if the Company is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Company is reasonably certain it will not terminate early.

Lease liabilities are measured at amortized cost using the effective interest method. Lease liabilities are subsequently remeasured when there is a change in future lease payments arising from a change in an index or rate, if there is a change in the estimate of the amount expected to be payable under a residual value guarantee, or if the Company changes its assessment of whether it is reasonably certain that it will exercise a purchase, extension or termination option. Finance charges are recorded as finance costs within net earnings, unless they are attributable to qualifying assets, in which case they are capitalized.

(h) Income Taxes

Income tax expense is comprised of current and deferred tax. Current tax and deferred tax are recognized in consolidated statements of operations and comprehensive loss except to the extent that it relates to a business combination or items recognized directly in equity or in other comprehensive loss/income.

Current income taxes are recognized for the estimated income taxes payable or receivable on taxable income or loss for the current year and any adjustment to income taxes payable in respect of previous years. Current income taxes are determined using tax rates and tax laws that have been enacted or substantively enacted by the year-end date.

Deferred tax assets and liabilities are recognized where the carrying amount of an asset or liability differs from its tax base, except for taxable temporary differences arising on the initial recognition of goodwill and temporary differences arising on the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction affects neither accounting nor taxable profit or loss.

Recognition of deferred tax assets for unused tax losses, tax credits and deductible temporary differences is restricted to those instances where it is probable that future taxable profit will be available against which the deferred tax asset can be utilized. At the end of each reporting period the Company reassesses unrecognized deferred tax assets. The Company recognizes a previously unrecognized deferred tax asset to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

(i) 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 Class A common shares, Class C preferred shares, share warrants and flow-through shares are classified as equity instruments. The Company's Class B shares are a compound financial instrument having both equity and liability characteristics.

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

Flow-through Shares

The Company will from time to time, issue flow-through common shares to finance a significant portion of its exploration program. Pursuant to the terms of the flow-through share agreements, these shares transfer the tax deductibility of qualifying resource expenditures to investors. On issuance, the Company bifurcates the flow-through share into i) a flow-through share premium, equal to the estimated premium, if any, investors pay for the flow-through feature, which is recognized as a liability, and ii) share capital. Upon expenses being incurred, the Company derecognizes the liability and recognizes a deferred tax liability for the amount of tax reduction renounced to the shareholders. The premium is recognised as other income and the related deferred tax is recognized as a tax provision.

RJK EXPLORATIONS

---

RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

3. MATERIAL ACCOUNTING POLICIES (continued)

The Company may also be subject to a Part XII.6 tax on flow-through proceeds renounced under the look-back rule, in accordance with Government of Canada flow-through regulations. When applicable, this tax is accrued as a financial expense until paid.

Loss Per Share

Basic loss per share is computed by dividing the net loss applicable to common shares of the Company by the weighted average number of common shares outstanding for the relevant period. Diluted loss per share is calculated by assuming that any proceeds from the exercise of dilutive stock options and warrants would be used to repurchase common shares at the average market price during the year, with the incremental number of shares being included in the denominator of the diluted loss per share calculation. As at and for the years ended December 31, 2025 and 2024, all options, warrants and convertible instruments were excluded from the calculation of diluted loss per share as they were anti-dilutive.

(j) Share-Based Payments

The fair value of share options granted to employees are recognized as an expense over the vesting period with a corresponding increase in equity. An individual is classified as an employee when the individual is an employee for legal or tax purposes (direct employee) or provides services similar to those performed by a direct employee, including directors of the Company.

The fair value is measured at the grant date and recognized over the period during which the options vest. The fair value of the options granted is measured using the Black Scholes option pricing model, taking into account the terms and conditions upon which the options were granted. At each financial position reporting date, the amount recognized as an expense is adjusted to reflect the actual number of share options that are expected to vest.

Options issued to non-employees, are measured based on the fair value of the goods or services received, at the date of receiving those goods or services. If the fair value of the goods or services received cannot be estimated reliably, the options are measured by determining the fair value of the options granted, using a valuation model.

(k) Provisions

Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event and it is probable that a future outflow of resources will be required to settle the obligation, provided that a reliable estimate can be made of the amount of the obligation. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risk specific to the obligation. The increase in the provision due to the passage of time is recognized as interest expense. As at December 31, 2025 and 2024, the Company has no obligations that require provisions.

(l) Decommissioning liability ("Asset retirement obligation" or "ARO")

A legal or constructive obligation incurred to pay for restoration, rehabilitation and environmental costs may arise when environmental disturbance is caused by the Company's exploration and evaluation activities in the past, the resulted amount is probable to be settled by a future outflow of resources and a reliable estimate can be made of the obligation. Discount rates using a pre-tax rate that reflects the risk and the time value of money are used to calculate the net present value. The present value of the future costs is capitalized to the carrying amount of the asset as soon as the obligation to incur such costs arises. The related liability is adjusted for each period for the unwinding of the discount rate and for changes to the current market-based discount rate, amount or timing for the underlying cash flows needed to settle the obligation. The periodic unwinding of the discount is recognized in operations as an accretion expense. Changes in estimates of decommissioning costs are accounted for as adjustments to the carrying value of the asset. The Company has no significant decommissioning liability as at December 31, 2025 and 2024.

---

RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

4. NEW ACCOUNTING STANDARDS AND CRITICAL ACCOUNT ESTIMATES AND JUDGEMENTS

New Standards Issued and Adopted

Standards and Amendments Issued But Not Yet Effective

Certain pronouncements were issued by the IASB or the International Financial Reporting Interpretations Committee ("IFRIC") that are mandatory for accounting periods on or after January 1, 2025 or later periods. Many are not applicable or do not have a significant impact to the Company and have been excluded. The following have not yet been adopted and are being evaluated to determine their impact on the Company: Standards issued, but not yet effective or adopted include:

IFRS 18 Presentation and Disclosure in Financial Statements

In April 2024, the IASB issued IFRS 18 Presentation and Disclosure in Financial Statements, which is intended to give investors more transparent and comparable information about companies' financial performance, thereby enabling better investment decisions. IFRS 18 introduces new sets of requirements to improve companies' reporting of financial performance and give investors a better basis for analyzing and comparing companies through

• Improved comparability in the statement of profit or loss or income statement;
• Enhanced transparency of management-defined performance measures; and
• More useful grouping of information in the financial statements.

IFRS 18 also requires companies to provide more transparency about operating expenses, helping investors to find and understand the information they need. IFRS 18 is effective for annual reporting periods beginning on or after January 1, 2027, but companies can apply it earlier. IFRS 18 replaces IAS 1. It carries forward many requirements from IAS 1 unchanged.

Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures

In May 2024, the IASB issued amendments to the classification and measurement requirements in IFRS 9. The amendments will address diversity in accounting practice by making the requirements more understandable and consistent. These include:

• Clarifying the classification and assessment of contractual cash flows of financial assets with environmental, social and corporate governance ("ESG").
• Settlement of liabilities through electronic payment systems - the amendments clarify the date on which a financial asset or financial liability is derecognized. The IASB also decided to develop an accounting policy option to allow a company to derecognize a financial liability before it delivers cash on the settlement date if specified criteria are met.

With these amendments, the IASB has also introduced additional disclosure requirements to enhance transparency for investors regarding investments in equity instruments designated at fair value through other comprehensive income and financial instruments with contingent features, for example features tied to ESG-linked targets. The amendments are effective for annual reporting periods beginning on or after January 1, 2026.

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

4. NEW ACCOUNTING STANDARDS AND CRITICAL ACCOUNT ESTIMATES AND JUDGEMENTS (continued)

Critical Account Estimates and Judgements

RJK Explorations Ltd. makes estimates and assumptions 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.

The effect of a change in an accounting estimate is recognized prospectively by including it in income in the period of the change, if the change affects that period only, or in the period of the change and future periods, if the change affects both.

Information about critical judgments in applying accounting policies that have the most significant risk of causing material adjustment to the carrying amounts of assets and liabilities recognized in the consolidated financial statements within the next financial year are discussed below:

Title to Exploration and Evaluation Property Interest

Although the Company has taken steps to verify title to mineral properties in which it has an interest, these procedures do not guarantee the Company's title. Such properties may be subject to prior agreements or transfers and title may be affected by undetected defects.

Income, Value Added, Withholding, and Other Taxes

The Company is subject to income, value added, withholding and other taxes. Significant judgment is required in determining the Company's provision for taxes. There are many transactions and calculations undertaken during the ordinary course of business for which the ultimate tax determination is uncertain. The Company recognizes liabilities and contingencies for anticipated tax audit issues based on the Company's current understanding of the tax law. For matters where it is probable that an adjustment will be made, the Company records its best estimate of the tax liability including the related interest and penalties in the current tax provision. Management believes they have adequately provided for the probable outcome of these matters; however, the final outcome may result in a materially different outcome than the amount included in the tax liabilities.

In addition, the Company recognizes deferred tax assets relating to tax losses carried forward to the extent there are sufficient taxable temporary differences (deferred tax liabilities) relating to the same taxation authority and the same taxable entity against which the unused tax losses can be utilized. However, utilization of the tax losses also depends on the ability of the taxable entity to satisfy certain tests at the time the losses are recouped.

Share-Based Payment Transactions

The Company measures the cost of equity-settled transactions with employees by reference to the fair value of the equity instruments at the date at which they are granted. Estimating fair value for share-based payment transactions requires determining the most appropriate valuation model. This estimate also requires determining the most appropriate inputs to the Black-Scholes valuation model including the expected life of the share option, volatility and dividend yield and making assumptions about them. The assumptions and models used for estimating fair value for stock-based payment transactions are disclosed in Note 9.

Contingencies

See Note 10.

Discount rate used on promissory note

The determination of the Company's amortized cost of its promissory note depends on certain assumptions, which include the selection of the discount rate. The discount rate is set by reference to the estimated market rate of a similar loan. Significant assumptions are required to be made when determining which borrowing rates to apply in this determination. Changes in the assumptions used may have a significant effect on the Company's financial statements.

---

RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

5. EXPLORATION AND EVALUATION PROPERTIES

All exploration and evaluation expenses incurred in 2025 and 2024 are on the Cobalt diamond properties. The following are a breakdown of the expenses incurred:

	December 31, 2025	December 31, 2024
Acquisition costs – cash	$ 4,589	$ 31,564
Drilling	-	64,289
Assaying	-	3,897
Geo reporting	47,305	-
Other	96,936	107,497
Total	$ 148,830	$ 207,247

The Company's mineral property interests consist of various early stage exploration projects, with the Company's full focus on the multiple Cobalt diamond properties optioned.

Property Agreement:

On October 2, 2024, the Company signed an option agreement with an arm's-length family to explore its patented claims in Bucke township, Northern Ontario. The Company made a cash payment totalling $20,000 (paid during year ended December 31, 2024) to the five family members for the right to drill test the target with up to four diamond drill holes.

Should RJK wish to proceed with further exploration, RJK will enter into a prearranged and approved option agreement, subject to TSX Venture Exchange approval which provides for the following cash payments and share issuances:

$10,000 and 100,000 class A common shares within six months of the signed option agreement.

On the first anniversary of the agreement, $15,000 and 200,000 class A common shares,

On the second anniversary of the agreement, $25,000 and 300,000 class A common shares,

On the third anniversary of the agreement, $50,000.

RJK has the right to accelerate the payment schedule at any time. Upon completion of these payments, RJK will have earned a 100-per-cent interest in the mineral rights.

RJK will also grant royalties on the patents, comprising a 2-per-cent GORR (gross overriding royalty rate) concerning diamonds and a 2-per-cent NSR (net smelter return) concerning precious or base metals. One-half of the GORR and/or NSR (1 per cent) can be repurchased from the vendors for a payment of $500,000, with a further 0.5 per cent repurchased for an additional payment of $1-million.

Additionally, the surface rights may be purchased at a rate of $10,000 per acre, or five times the appraised value of similar lands within the area, whichever is greater.

Should the property enter commercial production or RJK undergo a takeover, the vendors will be entitled to an additional one million class A common shares of RJK.

During the year ended December 31, 2025, the Company dropped the option.

6. CASH

Cash at banks and on hand earn interest at floating rates based on daily bank deposit rates.

As at December 31, 2025 and December 31, 2024, there were no unspent flow through funds to be spent.

	December 31, 2025		December 31, 2024
Unrestricted cash	$	22,350	$ 210,780
Total Cash	$	22,350	$ 210,780

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

7. ACCOUNTS RECEIVABLE, ACCOUNTS PAYABLE AND PROMISSORY NOTES PAYABLE

Accounts receivable is comprised solely of goods and services tax receivable from the Federal Government of Canada as at December 31, 2025 and December 31, 2024.

Accounts payable consists of the following:

	December 31, 2025	December 31, 2024
Trade accounts payable	$ 33,341	$ 52,802
Accrued liabilities	199,000	125,300
Total	$ 232,341	$ 178,102

Promissory Note Payable from Great Lakes Nickel Ltd.:

As at December 31, 2025, the Company had a promissory note payable to Great Lakes Nickel Ltd., in the amount of $Nil (December 31, 2024 - $Nil). The promissory note payable is non interest bearing and was originally repayable in full on May 25, 2023. The repayment date was extended to May 25, 2024 and was fully repaid during the year ended December 31, 2024.

As the interest is below the market rate for such a loan, which is estimated at 15%, based on consideration of comparable loans of other companies, there is a deemed benefit to the Company. As such the portion of the promissory loan considered to represent that benefit is recorded in equity (deficit) as a shareholder contribution. The amount of the benefit is then recognized over the life of the promissory note as an accretion expense. During the year ended December 31, 2025, the Company recorded accretion expenses of $Nil (2024 – $18,000).

Balance, December 31, 2023	$ 331,240
Accretion	18,000
Repayment	(349,240)
Balance, December 31, 2024 and December 31, 2025	$ -

8. EQUIPMENT

Equipment

Cost
Balance, December 31, 2023, December 31, 2024 and December 31, 2025	$ 66,750
Accumulated Depreciation
Balance, December 31, 2023	$ 31,985
Depreciation	6,675
Balance, December 31, 2024	$ 38,660
Depreciation	6,675
Balance, December 31, 2025	$ 45,335
Carrying value, December 31, 2024	$ 28,090
Carrying value, December 31, 2025	$ 21,415

Depreciation expense for the year ended December 31, 2025 amounted to $6,675 (2024 - $6,675).

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

9. SHAREHOLDERS' (DEFICIENCY)

i) COMMON SHARES

The Company is authorized to issue an unlimited number of Class A common shares.

ii) ISSUED

	Number of Shares	Amount
Balance, December 31, 2023	78,876,697	30,227,688
Private placement	12,114,285	424,000
Warrants issued	-	(185,000)
Share issuance costs	-	(6,000)
Conversion Class C preferred shares to Class A common shares (iii)	6,300,000	599,130
Balance, December 31, 2024 and December 31, 2025	97,290,982	31,059,818

Private placement:

On November 7-2024, the Company closed a non-brokered private placement offering of units. Pursuant to this closing, the company raised a total of $424,000 for the issuance of 12,114,285 units of the company at a price of $0.035 per unit.

Each unit consists of one Class A common share of the company and one Class A common share purchase warrant. Each warrant entitles the holder to purchase one class A common share in the capital of the company at a price of $0.07 for a period of five years from the date of issuance.

Related parties to the company subscribed for $142,500 of the placement. The Company incurred share issue costs of $11,000 which were allocated $6,000 to share capital and $5,000 to contributed surplus.

iii) CLASS C PREFERRED SHARES (ROYALTY SHARES)

In a non-brokered private placement in December 2019, the Company issued 8,000,000 units to raise $1,000,000. Each unit consisted of 1 Class C preferred share ("Royalty Share"), and one share purchase warrant exercisable for 1 Class A common share at an exercise price of $0.20 for up to 12 months. The purchasers of the units ("Royalty Share Purchasers") have entered into an agreement with the Company to which the Company has granted the Royalty Share Purchasers the option to purchase a 2.5% gross overriding royalty on the Company's Bishop claims subject to the publication by the Company of a "bankable" feasibility study on the Bishop claims. This option has been valued at $NIL. Pursuant to the terms of the Royalty Shares and the Royalty Shareholders Agreement, the Royalty Shares include a voluntary conversion right with 25% of each Royalty Share Purchaser's Royalty Shares being convertible into Class A Shares beginning six (6) months after the Initial Closing, an additional 25% being convertible into Class A Shares beginning twelve (12) months after the Initial Closing, an additional 25% being convertible into Class A Shares beginning eighteen (18) months after the Initial Closing and the remaining 25% being convertible into Class A Shares beginning twenty-four (24) months after the Initial Closing. The voluntary conversion period for all Royalty Shares ends five (5) years after the Initial Closing. Each Royalty Share shall be a voting share. Up to December 31, 2025, 7,800,000 Class C preferred shares were exercised, leaving the balance of 200,000 Class C preferred shares outstanding as at December 31, 2025 (December 31, 2024 - 200,000).

iv) CLASS B PREFERRED SHARES

There are currently 85,414 Class B preferred shares outstanding, which were recorded at $256,242 (2024 - $256,242). At any time, a holder of Class B preferred shares may require the Company to redeem, in whole or any part of the Class B preferred shares so held upon the payment of $2.00 for each share redeemed. Any holder of Class B preferred shares is entitled, at the holder's option, to convert any number of the Class B preferred shares into Class A subordinate voting shares on a 1:1 basis. The Class B preferred shares will be deemed to be converted into Class A subordinate voting shares under a take-over bid that is at a price above the market price of the Class A subordinate voting shares.

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

9. SHAREHOLDERS' (DEFICIENCY) (continued)

WARRANTS

	Number of Warrants	Amount	Weighted Average Exercise Price
Balance, December 31, 2023	12,724,029	$ 533,405	$ 0.25
Warrants issued	12,114,285	$ 180,000	$ 0.07
Balance, December 31, 2024	24,838,314	$ 713,405	$ 0.16
Warrants expired	(3,766,666)	$ (163,074)	$ 0.25
Balance, December 31, 2025	21,071,648	$ 550,331	$ 0.12

The value of the 12,114,285 warrants issued as part of the November 2024 Private Placement was estimated using the Black-Scholes pricing model, using the following assumptions: risk-free rate of 3.03%, annualized volatility of 133%, expected life of three years, and expected dividend of 0%.

The warrants expire as follows:

Number of Warrants	Exercise price	Expiry Date
5,110,264	0.25	May 2027(ii)
2,947,099	0.12	May 2027(ii)
590,000	0.10	December 2026(i)
310,000	0.25	December 2026(i)
12,114,285	0.07	November 7 2029
21,071,648	0.12

(i) On December 20, 2024 the Company extended the expiry date of warrants issued pursuant to a private placement of 900,000 units which closed on December 31, 2021 from December 31, 2024 to December 31, 2026. Out of the 900,000 warrants originally issued, 590,000 were also amended to reduce the exercise price to $0.10 per warrant.
(ii) On May 13, 2025, the Company extended the expiry date of warrants issued pursuant to a private placement of 8,057,363 units which closed on May 20, 2022 and June 15, 2022 from May 20, 2025 and June 15, 2025 to May 20, 2027. Out of the 8,057,363 warrants originally issued, 2,947,099 were also amended to reduce the exercise price to $0.12 per warrant.

STOCK OPTIONS

RJK has a stock option plan pursuant to which options to purchase Class A Subordinate Voting Shares may be granted to certain officers, directors and employees. The plan allows for the issuance of a rolling 10% of common shares outstanding.

The change in stock options issued during the year ended December 31, 2025 and 2024 are as follows:

		Weighted average exercise price	Amount
Options outstanding - December 31, 2023	5,510,000	$ 0.12	$ 664,292
Granted	4,100,000	$ 0.05	$ 140,000
Expired	(3,450,000)	$ 0.09	$ (318,348)
Options outstanding - December 31, 2024	6,160,000	$ 0.09	$ 485,944
Expired	(660,000)	$ 0.19	$ (44,103)
Options outstanding - December 31, 2025	5,500,000	$ 0.08	$ 441,841

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

9. SHAREHOLDERS' (DEFICIENCY) (continued)

The following table summarizes information about stock options outstanding and exercisable at December 31, 2025:

Exercise Price	Number of Options	Number of Options Vested	Expiry Date
0.24	500,000	500,000	February 2026
0.13	900,000	900,000	December 2026
0.10	100,000	100,000	January 2029
0.05	4,000,000	4,000,000	October 2029
	5,500,000	5,500,000

OPTION ISSUANCES

The fair value at issue date is determined using a Black-Scholes pricing model that takes into account the exercise price, the term of the option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the expected dividend yield (0% for all grants) and the risk free interest rate for the term of the option. The company grants all employee stock options with an exercise price equal to or greater than the market value of the underlying common shares on the date of grant.

Compensation expense recorded for the year ended December 31, 2025 was $Nil (December 31, 2024 was $140,000).

Number of options granted on January 17, 2024	100,000
Risk-free rate:	3.51%
Expected life (in years):	5 years
Volatility:	129%
Exercise price:	$0.10
Market price:	$0.04
Vesting:	immediate
Number of options granted on October 2, 2024	4,000,000
---	---
Risk-free rate:	2.80%
Expected life (in years):	5 years
Volatility:	134%
Exercise price:	$0.05
Market price:	$0.04
Vesting:	immediate

Option pricing models require the input of highly subjective assumptions. Changes in the subjective input assumptions can materially affect the fair value estimate, and therefore, the existing models do not necessarily provide a reliable measure of the fair value of the Company's purchase options.

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

9. SHAREHOLDERS' (DEFICIENCY) (continued)

CONTRIBUTED SURPLUS AND RESERVES

Contributed surplus and reserves are made up of the following amounts:

	Amount
Options reserve	$ 441,841
Warrants reserve	550,331
Contributed surplus	3,906,655
Total contributed surplus	$ 4,898,827

The following events have impacted contributed surplus and reserves during the years ended December 31, 2025 and 2024:

	Amount
Balance, December 31, 2023	$ 4,578,827
Options issued during the year	140,000
Warrants issued during the year	180,000
Balance, December 31, 2024 and December 31, 2025	$ 4,898,827

NATURE AND PURPOSE OF EQUITY AND RESERVES

The reserves recorded in equity on the Company's statement of financial position include 'Contributed Surplus and Reserves'.

The options reserve and warrants reserve are used to recognize the value of stock option grants and share warrants, respectively, prior to their exercise. Contributed surplus is used to recognize the value of stock option grants and share warrants upon expiry, and other contributions from shareholders.

10. COMMITMENTS AND CONTINGENCIES

a) Environmental Contingencies

The Company's exploration activities are subject to various laws and regulations governing the protection of the environment. These laws and regulations are continually changing and generally becoming more restrictive. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations.

b) Management Contracts

The Company is party to a management contract. Minimum contract commitments remaining under the agreement are approximately $90,000, all due within one year. Upon the occurrence of certain events such as a change in control, the contract requires payment of up to $150,000. As a triggering event has not taken place, the contingent payment has not been reflected in these financial statements.

c) Flow-Through Shares

Pursuant to the issuance of flow through shares, the Company has renounced qualified exploration expenditures in prior years. As of December 31, 2025 and December 31, 2024, the Company has spent all required flow-through funds on qualifying exploration and evaluation expenditures. The Company has indemnified the subscribers of current and previous flow-through share offerings against any tax related amounts that may become payable by the subscribers as a result of the Company not meeting the expenditure commitment

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

11. RELATED PARTY TRANSACTIONS

The Company defines its officers (CEO and CFO) and directors as Key Management Personnel ("KMP"). During the year ended December 31, 2025, officers and companies controlled by officers charged or accrued consulting fees totaling $128,500 ($116,500 in 2024). At the end of the period, there was $185,510 remaining payable to KMP ($101,538 as at December 31, 2024). Amounts owing are unsecured, non-interest bearing and with no fixed terms of repayment.

Directors' fees paid during the year ended December 31, 2025 totaled $NIL ($NIL in 2024). KMP, directors and officers received $nil in stock based compensation during the year ended December 31, 2025 ($NIL in 2024).

85,414 Class B preferred shares outstanding are held by KMP; no change from the prior year.

There are no post-employment benefits.

Advances from Related Parties

From July to December 2025, aggregate advances of $50,000 were made to the Company by related parties and were outstanding at December 31, 2025 (December 31, 2024 - $nil). The advances, which are unsecured, non-interest bearing and have no fixed terms for repayment, were made to fund the Company's ongoing operations until an alternate source of funding becomes available.

12. CAPITAL MANAGEMENT

The Company manages its capital structure and makes adjustments to it, based on the funds available to the Company, in order to support the acquisition, exploration and development of exploration and evaluation properties.

The Company considers its capital to be shareholders' equity, which is comprised of common stock, contributed surplus and reserves, and deficit.

The Company's objective when managing capital is to obtain adequate levels of funding to support its exploration activities, to obtain corporate and administrative functions necessary to support organizational functioning and obtain sufficient funding to further the identification and development of precious metals deposits. The Company raises capital, as necessary, to meet its needs and take advantage of perceived opportunities and, therefore, does not have a numeric target for its capital structure. Funds are primarily secured through equity capital raised by way of private placements. There can be no assurance that the Company will be able to continue raising equity capital in this manner.

Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. The Company invests all capital that is surplus to its immediate operational needs in short term, liquid and highly rated financial instruments, such as cash, and short term guarantee deposits, all held with major Canadian financial institutions. The Company is not subject to externally imposed capital requirements imposed by a lending institution or regulatory body, other than the TSX Venture Exchange ("TSXV") which requires adequate working capital or financial resources of the greater of (i) $50,000 and (ii) an amount required in order to maintain operations and cover general and administrative expenses for a period of 6 months. As of December 31, 2025, the Company may not be compliant with the policies of the TSXV. The impact of any such violation is not known and is ultimately dependent on the discretion of the TSXV. There were no significant changes in the Company's approach to capital management during the years ended December 31, 2025 and 2024.

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

EXPRESSED IN CANADIAN DOLLARS

13. SEGMENTAL REPORTING

The Company is organized into business units based on exploration and evaluation properties and has one reportable operating segment, being that of acquisition and exploration and evaluation activities in Canada.

14. FINANCIAL INSTRUMENTS AND FINANCIAL RISK FACTORS

The Company is exposed through its operations to the following financial risks:

• Market Risk
• Credit Risk
• Liquidity Risk

In common with all other businesses, the Company is exposed to risks that arise from its use of financial instruments. This note describes the Company's objectives, policies and processes for managing those risks and methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

There have been no substantive changes in the Company's exposure to financial instrument risks, its objectives, policies and processes for managing those risks or the methods used to measure them from previous years unless otherwise stated in the note.

General Objectives, Policies and Processes

The Board of Directors has overall responsibility for the determination of the Company's risk management objectives and policies, and whilst remaining ultimate responsibility for them, it has delegated the authority for designing and operating processes that ensure the effective implementation of the objectives and policies for the Company's finance function.

Market Risk

Risk that the fair value of future cash flows of a financial instrument will fluctuate because of the changes in market prices. Market prices are comprised of four types of risk: foreign currency risk, interest rate risk, commodity price risk and equity price risk.

Foreign Currency Risk

Foreign currency risk is the risk that a variation in exchange rates between the Canadian dollar and the US dollar or other foreign currencies will affect the Company's operations and financial results. The Company does not have significant exposure to foreign exchange rate fluctuation.

Interest Rate Risk

Interest rate risk is the risk that future cash flows will fluctuate as a result of changes in market interest rates. The Company does not have any borrowings. Interest rate risk is limited to potential decreases on the interest rate offered on cash and cash equivalents held with chartered Canadian financial institutions. The Company considers this risk to be immaterial.

Commodity Price Risk

The ability of the Company to develop its mining properties and the future profitability of the Company is directly related to the market price of gold, silver and other base metals.

Equity Price Risk

Equity risk is the uncertainty associated with the valuation of assets arising from changes in equity markets. The Company is exposed to this risk through its equity holdings. The Company does not hold any equity investments at this time.

Credit Risk

Credit risk is the risk that a third party will be unable to pay or receive any amounts owed or owing by the Company. Management's assessment of the Company's risk is low as it is primarily attributable to goods and services tax due from the Federal Government of Canada.

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023

EXPRESSED IN CANADIAN DOLLARS

14. FINANCIAL INSTRUMENTS AND FINANCIAL RISK FACTORS (continued)

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 favourable. 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. Should the Company be unable to secure such financing, it may have to, at any time, cease its operations. 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. The Company intends on fulfilling its obligations.

As at December 31, 2025 and 2024, the carrying value and fair value amounts of the Company's financial instruments are the same.

Based on management's knowledge and experience of the financial markets, the Company believes the following movements are reasonably possible over a twelve month period.

(i) The Company currently has no cash equivalents, short-term investments as at December 31, 2025; therefore, percentage change in interest rates will not have a significant impact on the Company.

(ii) The Company does not hold foreign currencies to give rise to exposure to foreign exchange risk. Therefore, a percentage change in certain foreign exchange rates will not have a significant impact on the Company.

(iii) The Company has no interest bearing loans as at December 31, 2025. Therefore, percentage change in interest rates will not have a significant impact on the Company.

Determination of Fair Values

As at December 31, 2025 and December 31, 2024, the Company does not have any financial instruments recorded at fair value.

15. INCOME TAXES

A reconciliation of income taxes at the rates expected to apply when the asset is realized of approximately 26.5% (2024 - 26.5%) with the reported taxes is as follows:

	December 31, 2025	December 31, 2024
Loss before income taxes	$ (130,294)	$ (523,264)
Expected income tax recovery based on statutory rate	$ (35,000)	$ (139,000)
Adjustment to expected income tax recovery:
Share-based compensation	-	37,000
Other	(8,000)	27,000
Change in benefit of deferred tax assets not recognized	43,000	75,000
	$ -	$ -

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RJK EXPLORATIONS LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2025 AND 2024

EXPRESSED IN CANADIAN DOLLARS

15. INCOME TAXES (continued)

Deferred income tax assets have not been recognized in respect of the following deductible temporary differences:

	December 31, 2025	December 31, 2024
Unrecognized deferred tax assets:
Exploration and evaluation property interests	$ 14,962,000	$ 14,813,000
Share issue costs	13,000	29,000
Other temporary differences	133,000	133,000
Non-capital losses carried forward	1,788,000	1,626,000
	16,896,000	16,601,000

The tax losses expire from 2027 to 2045. The other temporary differences do not expire under current legislation.

Deferred tax assets have not been recognized in respect of these items because it is not probable that the future taxable profit will be available against which the Company can use the benefits.

No deferred taxes are recognized on the temporary differences related to the investment in subsidiaries to the extent that the Company controls the timing of the reversal of the temporary differences and it is probable that these differences will not reverse in the foreseeable future.

16. EVENTS AFTER THE REPORTING PERIOD

On January 30, 2026, the Company announced a private placement to raise aggregate gross proceeds of up to $160,000. The Company will offer 5,200,000 units of the company at a price of $0.025 per unit and 1,000,000 units at a price of $0.03. All units will be composed of one common share of the company and one common share purchase warrant. Each warrant entitles the holder to purchase one common share at a price of five cents for a period of five years from the date of issuance. The company intends to use 80% of the gross proceeds for working capital and general corporate purposes, and 20% to finance its exploration program on its exploration properties.