Financial statements
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PAN AMERICAN ENERGY CORP. CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR THE THREE MONTHS ENDED JUNE 30, 2026 and 2025 In Canadian Dollars, unless noted (Unaudited)
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NOTICE TO READER Under National Instrument 51-102, Part 4, subsection 4.3(3)(a), if an auditor has not performed a review of the condensed consolidated interim financial statements, they must be accompanied by a notice indicating that the condensed consolidated interim financial statements have not been reviewed by an auditor. The accompanying unaudited condensed consolidated interim financial statements of Pan American Energy Corp. ( the “Company”) have been prepared by and are the responsibility of management. These condensed consolidated interim financial statements for the three months ended June 30, 2026, have not been reviewed or audited by the Company’s independent auditors. All amounts are stated in Canadian Dollars unless otherwise stated.
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Pan American Energy Corp. Condensed Consolidated Interim Statements of Financial Position As at June 30, 2026 and March 31, 2026 In Canadian Dollars, unless noted (unaudited) The accompanying notes are an integral part of these condensed consolidated interim financial statements. Going concern (Note 2) and Commitments (Note 8) Approved on behalf of the Board of Directors on August 28, 2026: “Adrian Lamoureux”, Director “Sean Kingsley”, Director As at Notes June 30, 2026 March 31, 2026 $ $ ASSETS Cash 694,835 1,226,542 Accounts receivable 162,986 147,304 Prepaid expenses 4 10,302 102,867 TOTAL CURRENT ASSETS 868,123 1,476,713 Exploration and evaluation assets 5,6 7,704,534 7,504,533 TOTAL ASSETS 8,572,657 8,981,246 LIABILITIES Accounts payable and accrued liabilities 7 271,264 496,120 TOTAL LIABILITIES 271,264 496,120 EQUITY Share capital 6 35,609,668 35,609,668 Reserves 6 2,669,453 2,669,453 Deficit (29,977,728) (29,793,995) TOTAL EQUITY 8,301,393 8,485,126 TOTAL LIABILITIES AND EQUITY 8,572,657 8,981,246
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Pan American Energy Corp. Condensed Consolidated Interim Statements of Loss and Comprehensive Loss For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) For the Three Months Ended Notes June 30, 2026 June 30, 2025 $ $ EXPENSES Advertising and marketing 98,615 29,424 Consulting fees 7 66,000 91,000 Filing fees 15,419 14,278 Office and miscellaneous 5,643 4,709 Professional fees 3,070 4,095 OPERATING EXPENSES (188,747) (143,506) OTHER EXPENSES Interest income 5,014 5,242 Gain/(Loss) on debt settlement 6 - (175,519) NET AND COMPREHENSIVE LOSS (183,733) (313,783) Loss per share, basic and diluted (0.01) (0.02) Weighted average number of common shares outstanding – Basic and diluted 28,627,932 20,538,777 The accompanying notes are an integral part of these condensed consolidated interim financial statements.
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Pan American Energy Corp. Condensed Consolidated Interim Statements of Changes in Equity For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) The accompanying notes are an integral part of these condensed consolidated interim financial statements. Common Shares Share Capital Reserves Deficit Total Equity (Deficiency) Number (#) $ $ $ $ Balance, March 31, 2025 19,950,424 31,844,839 2,237,893 (28,417,062) 5,665,670 Shares issued – settlement of debt (Note 6) 2,205,841 617,636 - - 617,636 Shares issued – Tharsis Project (Note 5,6) 100,000 33,000 - - 33,000 Net loss and comprehensive loss for the period - - - (313,783) (313,783) Balance, June 30, 2025 22,256,265 32,495,475 2,237,893 (28,730,845) 6,002,523 Balance, March 31, 2026 28,627,932 35,609,668 2,669,453 (29,793,995) 8,485,126 Net loss and comprehensive loss for the period - - - (183,733) (183,733) Balance, June 30, 2026 28,627,932 35,609,668 2,669,453 (29,977,728) 8,301,393
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Pan American Energy Corp. Condensed Consolidated Interim Statement of Cash Flows For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) For the Three Months Ended June 30, 2026 June 30, 2025 $ $ OPERATING ACTIVITIES Net loss for the period (183,733) (313,783) Items not affecting cash (Gain)/Loss on debt settlement (Note 6) - 175,519 Net changes in non-cash working capital items: Accounts receivable (15,682) 281,819 Prepaid expenses 92,565 3,463 Accounts payable and accrued liabilities (224,856) (214,189) Net cash provided by (used in) operating activities (331,706) (67,171) INVESTING ACTIVITIES Property option agreement payments (Note 5) - (50,000) Exploration and evaluation expenditures (Note 5) (200,001) (585) Net cash used in investing activities (200,001) (50,585) Net change in cash (531,707) (117,756) Cash, beginning of period 1,226,542 1,258,976 Cash, end of period 694,835 1,141,220 Supplemental cash flow information Shares issued for purchase of exploration and evaluation assets - 33,000 Interest received 5,014 5,242 Interest paid - - Taxes paid - - The accompanying notes are an integral part of these condensed consolidated interim financial statements.
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) 1. NATURE OF OPERATIONS a. Corporate information Pan American Energy Corp. (the “Company”) was incorporated under the laws of British Columbia on March 14, 2007. The Company's corporate office and principal place of business is 505 3 rd Street SW, Suite 1515, Calgary, Alberta T2P 3E6. On May 19, 2022, the Company listed its common shares on the Canadian Securities Exchange (the “CSE”) under the symbol “GSU”. On June 29, 2022, the Company changed its name to “Pan American Energy Corp.” from “Golden Sun Mining Corp.” and began trading under the symbol “PNRG”. The Company also has its shares listed on the Frankfurt Stock Exchange (the “FSE”) and the OTCQB under the symbols “SS60” and “PAANF” respectively. The Company is a Canadian corporation that is in the business of exploration and evaluation of mineral properties. These condensed consolidated interim financial statements (the “financial statements”) were approved for issuance by the Board of Directors on August 28, 2026. 2. GOING CONCERN These condensed consolidated interim 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 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 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 consolidated 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. Basis of preparation In these condensed consolidated interim financial statements, unless otherwise indicated, all amounts are expressed in Canadian dollars, which is the Company’s functional and presentation currency. These condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard ( “IAS”) 34 Interim Financial Reporting using accounting policies consistent with IFRS Accounting 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 consolidated financial statements for the year ended March 31, 2026.
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) b. Basis of consolidation These condensed consolidated interim financial statements include the operations of the Company and its wholly owned subsidiaries as follows: - 1328012 B.C. Ltd. which is incorporated in British Columbia, Canada (Holding Company) - 1279613 BC Ltd., which is incorporated in British Columbia, Canada (Holding Company) Subsidiaries are entities which the Company controls, either directly or indirectly, where control is defined as power over the investee, exposure, or rights, to variable returns from its involvement with the investee, and the ability to use its power over the investee to affect the amount of the returns. Subsidiaries are fully consolidated from the date on which control is transferred to the Company and they are deconsolidated from the date on which control ceases. All significant intercompany transactions and balances have been eliminated upon consolidation. c. Foreign currencies Items included in the condensed consolidated interim financial statements of each of the Company’s subsidiaries are measured using the currency of the primary economic environment it which the entity operates and then translated into the presentation currency. 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 profit or loss, or other comprehensive loss, consistent with where the gain or loss on the underlying non-monetary asset or liability has been recognized. d. Significant accounting judgments and estimates The timely preparation of these condensed consolidated interim 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 June 30, 2026 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.
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) In the preparation of these condensed consolidated interim 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 condensed consolidated interim financial statements: i. E xploration 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-from successful development of the project or by sale. ii. Flow-through expenditures The Company is required to spend proceeds received from the issuance of flow -through shares on qualifying resources expenditures. Differences in judgment between management and regulatory authorities with respect to qualified expenditures may result in disallowed expenditures by the tax authorities. Any amount disallowed may result in the Company’s required expenditures not being fulfilled. e. Accounting standards and amendments adopted Classification and Measurement of Financial Instruments (Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures) In May 2024, the IASB issued narrow-scope amendments to the recognition, derecognition and classification requirements in IFRS 9 – Financial Instruments (“IFRS 9”) and introduced additional disclosure requirements in IFRS 7 – Financial Instruments: Disclosure (“IFRS 7”). Key changes include clarification on the timing of recognition and derecognition of financial assets and liabilities, introduction of additional disclosure for certain financial instruments with contractual terms that could change the timing or amount of contractual cash flows due to contingent events that are not directly related to changes in basic lending risks and costs, and additional guidance for assessing whether the contractual cash flows of financial assets represent solely payments of principal and interest and updated disclosures for equity instruments designated at fair value through other comprehensive income. The adoption of this amendment on April 1, 2026 did not result in a material impact for the Company. f. Upcoming accounting standards and interpretations The Company has not yet adopted certain new standards, amendments and interpretations to existing standards, which have been published but are only effective for accounting periods beginning on or after January 1, 2025 or later periods. The new and amended standards are not expected to have a material impact on the Company’s financial statements, and include the following: Presentation and Disclosure in Financial Statements (IFRS 18) In April 2024, the IASB issued IFRS 18 Presentation and Disclosure in Financial Statements. This standard aims to improve the consistency and clarity of financial statement presentation and disclosures by providing updated guidance on the structure and content of financial statements. Key changes include enhanced requirements for the presentation of financial performance, financial position, and cash flows, as well as additional disclosures to improve transparency and comparability. IFRS 18 is effective for annual reporting periods beginning on or after January 1, 2027. The Company is currently assessing the impact that the adoption of IFRS 18 will have on its financial statements.
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) 4. PREPAID EXPENSES As at June 30, 2026 and March 31, 2026, the Company’s prepaid expenses were as follows: June 30, 2026 March 31, 2026 $ $ Advertising and marketing 4,337 91,615 Insurance 2,965 8,287 Legal 3,000 2,965 Total 10,302 102,867 5. EXPLORATION AND EVALUATION ASSETS As at June 30, 2026 and March 31, 2026, the Company’s exploration and evaluation assets were as follows: Big Mack Tharsis Total $ $ $ Balance, March 31, 2025 5,645,127 - 5,645,127 Option agreement – cash payments - 100,000 100,000 Option agreement – share issuance - 141,000 141,000 Expenditures 87,961 1,530,445 1,618,406 Balance, March 31, 2026 5,733,088 1,771,445 7,504,533 Expenditures 9,525 190,476 200,001 Balance, June 30, 2026 5,742,613 1,961,921 7,704,534 The following table summarizes the Company’s exploration and evaluation expenses by property and type of expense, for the three months ended June 30, 2026 and 2025: Big Mack Tharsis Total $ $ Geological & Geophysics 9,000 190,476 199,476 Reporting and administration 525 - 525 Balance, June 30, 2026 9,525 190,476 200,001 Big Mack Tharsis Total $ $ Reporting and administration 585 - 585 Balance, June 30, 2025 585 - 585 Big Mack Lithium Property On August 22, 2022, the Company entered into a property option agreement (“Big Mack Option Agreement”), with Magabara Resources Corporation (the “Big Mack Vendor”), pursuant to which the Company has been granted the right to acquire up to a 90% interest in and to the Big Mack Lithium Property, which consists of a single mining lease (LEA - 110010) in the Paterson Lake Area located approximately 80 kilometres north of Kenora, Ontario, Canada (the “Big Mack Lithium Property”). Pursuant to the terms of the Big Mack Option Agreement, the Company has the option to acquire a 90% interest in the Big Mack Property from the Big Mack Vendor, in consideration for completing a series of cash payments and issuances of common shares in accordance with the following schedule:
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) Milestones Cash Payments Common Shares Issuances(1) Exploration Expenditures Phase 1: Acquire 51% Within thirty (30) days following the “Effective Date” (August 22, 2022) (paid) $80,000 - - Within ninety ( 90) days following the Effective Date (issued) - $200,000 - Within twelve (12) months following the Effective Date (subsequently extended by nine (9) months) (incurred) - - $1,000,000 Phase 2: Acquire Additional 24% (Total 75%) Within twenty-four (24) months following the Effective Date (issued) (incurred) - $400,000 $1,120,000 Phase 3: Acquire Additional 15% (Total 90%) Within thirty -six (36) months following the Effective Date - $100,000 $1,000,000 Note: 1) Common Shares to be valued based on the Canadian Securities Exchange price on the day of issuance. During the three months ended June 30, 2026, the Company has capitalized $9,525 in costs related to the exploration and evaluation of the Big Mack Lithium Property (2025 - $585). As at June 30, 2026, the Company is currently in discussion with the Big Mack Vendor to amend the common share issuance requirements for Phase 3 and is not in default of the option agreement. Tharsis Project On June 16, 2025, the Company entered into a property option agreement (“Tharsis Option Agreement”), with Northern Critical Minerals Corp. (“NCM”), under which the Company has the right to acquire an up to 100% interest in the Tharsis project (the “Project”), located in the Northwest Territories, Canada. The Project consists of seven mineral claims totaling 8,750 hectares and encompasses the prospective Squalus Lake Alkaline Complex ( SLAC). Under the terms of the agreement, the Company may earn up to a 100% interest in the Project in consideration for completing a series of cash payments and issuances of common shares in accordance with the schedule below. During the earn-in period, NCM remains the project operator. Upon completion, NCM will retain a 2% net-smelter royalty, with 1% available for repurchase for $1 million. Milestones Cash Payments Common Share Issuances Exploration Expenditures Phase 1: Acquire 25% Initial Payment (Due on signing) (paid) (issued) $50,000 100,000 $nil December 31, 2025 (paid) (issued) $50,000 100,000 $500,000 Phase 2: Acquire additional 25% (Total 50%) December 31, 2026 $100,000 200,000 $1,500,000 Phase 3: Acquire additional 25% (Total 75%) December 31, 2027 $100,000 200,000 $1,500,000 Phase 4: Acquire additional 25% (Total 100%) December 31, 2028 $100,000 200,000 $1,500,000 During the three months ended June 30, 2026, the Company capitalized $190,476 (2025 - $nil) in costs related to the exploration and evaluation of the property.
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) 6. SHARE CAPITAL a) Authorized and Issued Share Capital The authorized share capital consists of an unlimited number of common shares without par value. Escrow shares: As at June 30, 2026, there were nil (March 31, 2026 – nil) common shares held in escrow. For the Three Months Ended June 30, 2026 The Company did not have any common share transactions for the three month period ended June 30, 2026. For the year ended March 31, 2026 On June 6, 2025, the Company issued 2,205,841 common shares, fair valued at $617,636, as settlement for certain accounts payable. The Company recognized a loss of $175,519 upon the extinguishment of the payables. On June 24, 2025, the Company issued 100,000 common shares, fair valued at $33,000, in accordance with the Tharsis Option Agreement. On October 14, 2025, the Company completed a non- brokered private placement of 1,333,333 Charity Flow - through (“FT”) units at a price of $0.75 per Charity FT unit for proceeds of $1,000,000. Each Charity unit consists of one flow-through share and one common share purchase warrant entitling the holder to one common share of the Company at a price of $0.85 for a period of 24 months from issuance. The warrants are subject to a 60- day hold period. The Company allocated $186,667 to flow -through premium, “Other Liability” on the Consolidated Statement of Financial Position, and $nil to warrants. (Note 8). Concurrent with the above, the Company also issued 2,000,000 units of the Company at a price of $0.50 per unit, for proceeds of $1,000,000. Each unit consists of one common share and one share purchase warrant entitling the holder to one common share at a price of $0.65 for a period of 24 months from the date of issuance. Each warrant is subject to a 60-day hold period. In connection with the offering the Company paid $15,261 in finder’s fees. Under the residual method, 100% of the proceeds were allocated to the value of the common shares, as their fair value at the time of issuance was in excess of total proceeds received. As a result, the fair value of the warrants is $nil. On October 14, 2025, the Company completed an additional non-brokered private placement of 2,000,000 units of the Company at a price of $0.50 per unit for gross proceeds of $1,000,000. Each unit consists of one common share and one common share purchase warrant, with each warrant entitling the holder to acquire one common share at a price of $0.65 for a period of 24 months from the date of issuance. In connection with the offering, the Company issued 30,520 finder’s warrants fair valued at $16,306. Under the residual method, 100% of the proceeds were allocated to the value of the common shares, as their fair value at the time of issuance was in excess of total proceeds received. As a result, the fair value of the warrants is $nil. On January 15, 2026, the Company issued 100,000 common shares, fair valued at $108,000, in accordance with the Tharsis Option Agreement. At March 31, 2026, the Company derecognized $ 401,675 of the flow -through premium as the renouncement occurred and eligible expenditures were incurred subsequently. The amount is recognized on the statement of loss and comprehensive loss as a “Flow-through share recovery”. The remaining flow-through obligation is recorded as “Other Liability” on the Statement of Financial Position and has a balance of $nil at March 31, 2026 (Note 8).
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) b) Share Purchase Warrants A summary of the Company’s purchase warrants (“warrants”) is as follows as at June 30, 2026 and March 31, 2026: June 30, 2026 March 31, 2026 Balance, opening 14,275,519 11,023,889 Granted - 5,363,853 Exercised - (938,334) Expired - (1,173,889) Balance, closing 14,275,519 14,275,519 At June 30, 2026, the following warrants were outstanding: Exercise Price Issued Exercised Remaining Expiry Date Granted – Private Placement $0.12 5,000,000 (325,000) 4,675,000 January 13, 2027 Granted – Private Placement $0.18 4,850,000 (443,334) 4,406,666 March 18, 2027 Granted - Private Placement $0.65 4,030,520 (170,000) 3,860,520 October 14, 2027 Granted - Private Placement $0.85 1,333,333 - 1,333,333 October 14, 2027 Balance, June 30, 2026 $0.44 15,213,853 938,334 14,275,519 During the three months ended June 30, 2026, the Company had nil ( March 31, 2026 – 938,334) warrants exercised, with a weighted average exercise price of $nil (March 31, 2026 - $0.24) per warrant, for total proceeds of $nil (March 31, 2026 - $229,300). The weighted average fair value of the Company’s shares at the time the warrants were exercised in the prior year was $0.92. The share purchase warrants have a weighted average remaining life of 0.87 years (March 31, 2026 – 1.12 years). c) Share Purchase Options The Company has established an omnibus equity incentive plan (the “Plan”), contemplating the grant of equity - based incentive awards, in the form of options, restricted share units, preferred shared units (“PSUs”) and deferred share units, to employees, officers, directors and consultants of the Company. The Plan is a 10% rolling plan, pursuant to which share awards may be granted by the Company not exceeding 10% of the issued and outstanding common shares at the time of grant. A summary of the Company’s share purchase options (“options”) is as follows: Number of Options Weighted Average Exercise Price Balance, March 31, 2025 60,000 $6.80 Granted 1,050,000 $0.41 Expired (15,000) $5.60 Balance, March 31, 2026 1,095,000 $0.68 Expired (20,000) $6.40 Balance, June 30, 2026 1,075,000 $0.57
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) At June 30, 2026, the following options were outstanding: Grant Date Number of Options Expired / Canceled Exercisable Exercise Price Expiry Date Weighted Average Remaining Life November 10, 2022 20,000 - 20,000 $7.10 November 10, 2027 1.36 December 1, 2022 5,000 - 5,000 $8.00 December 1, 2027 1.42 May 15, 2023 20,000 (20,000) - $6.40 May 15, 2026 - July 7, 2025 1,050,000 - 1,050,000 $0.41 July 7, 2027 1.02 1,095,000 (20,000) 1,075,000 $0.57 1.03 The fair value of each option granted was determined using the Black -Scholes option pricing model with the weighted average assumptions as follows: June 30, 2026 March 31, 2026 Exercise price n/a $0.41 Risk-free interest rate n/a 2.71% Volatility n/a 241% Dividend yield n/a 0.00% Expected life (years) n/a 2.00 Forfeiture rate n/a 0.00% During the three months ended June 30, 2026, the Company recorded $ nil ( 2025 - $ nil) as share-based compensation expense related to the vesting of the options. d) Restricted Share Rights A summary of the Company’s restricted share rights (“RSRs”) is as follows: Time Vesting Performance Vesting Total Balance, March 31, 2025 270,834 188,750 459,584 Granted 300,000 - 300,000 Balance, March 31, 2026 and June 30, 2026 570,834 188,750 759,584 Time Based Vesting For the three months ended June 30, 2026, the Company recorded $nil (2025 - $nil) related to the vesting of RSRs.
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) 7. RELATED PARTY TRANSACTIONS AND BALANCES Key management personnel are those personnel having the authority and responsibility for planning, directing, and controlling the Company and include both executive and non- executive directors, and entities controlled by such persons. The Company considers all directors and officers of the Company to be key management personnel. The aggregate value of transactions relating to key management personne l during the three months ended June 30, 2026 and 2025 were as follows: For the Three Months Ended June 30, 2026 June 30, 2025 $ $ Consulting fees (to company owned by CEO) 18,000 18,000 Consulting fees (to company owned by CFO) 22,500 22,500 Total 40,500 40,500 As at June 30, 2026, a $14,175 balance 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 (March 31, 2026 – $25,503). The amounts payable are non-interest bearing, are unsecured, and have no specific terms of repayment. 8. COMMITMENTS As of June 30, 2026, the Company has a contract with a company controlled by the CEO and Director of the Company to perform the services of the Company’s Chief Executive Officer, for monthly payments of $6,000 until March 2027. As a result of the flow -through financing structure (see Note 6(a)), the Company is committed to expend flow -through share proceeds related to flow -through shares issued during the year on qualifying exploration expenditures. The Company must incur eligible expenditures within 24 months from issuing the flow-through shares. As at June 30, 2026, the Company has $nil remaining in committed flow-through proceeds to be expended. A summary of the Company’s commitment to expense flow-through proceeds and amortization of the corresponding Flow-through premium is as follows as at June 30, 2026 and March 31, 2026: Commitment to expense flow-through proceeds For the Years Ended June 30, 2026 March 31, 2026 $ $ Balance, opening - 595,496 Flow-through share proceeds - 1,000,000 Eligible expenses incurred - (1,595,496) Balance, closing - - Amortization of the flow-through premium For the Years Ended June 30, 2026 March 31, 2026 $ $ Balance, opening - 215,008 Flow-through share proceeds - 186,667 Eligible expenses incurred - (401,675) Balance, closing - -
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) 9. GEOGRAPHICAL SEGMENT INFORMATION The Company’s operations comprise one reportable segment, exploration and evaluation of mineral properties. The Company undertakes these activities only within Canada representing only one geographical segment. The net and comprehensive loss for the three months ended June 30, 2026, and the total assets attributable to geographical locations, as at June 30, 2026, relate only to operations in Canada. 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. The management of these risks has not changed materially from that of the prior period. i. Credit Risk Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation. Management’s assessment of the Company’s exposure to credit risk on its $694,835 in cash (March 31, 2026 - $1,226,542) 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 will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. As at June 30, 2026 the Company’s working capital surplus is $596,859 (March 31, 2026 – surplus of $ 980,593), and it does not have any long- term monetary liabilities. 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 inter ests of the Company’s shareholders and may result in dilution to the value of such interests. iii. Market Risk Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises currency risk, interest rate risk and other price risk. Management believes the Company is not exposed to significant interest rate or tother price risk. b) Fair Values The carrying values of cash, accounts payable and accrued liabilities and loan payable 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).
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Pan American Energy Corp. Notes to the Condensed Consolidated Interim Financial Statements For the Three Months Ended June 30, 2026 and 2025 In Canadian Dollars, unless noted (unaudited) 11. CAPITAL MANAGEMENT The Company defines the capital that it manages as its shareholders’ equity, which was $8,301,393 as at June 30, 2026 (March 31, 2026 - $8,485,126). The Company’s objectives when managing 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 in a manner that provides sufficient funding for operational and capital expenditure activities. Funds are intended to be secured, when necessary, through debt funding or equity capital raised by means of private placements. There can be no assurances that the Company will be able to obtain debt or equity capital in the case of working capital deficits. The Company does not pay dividends and has no long- term debt or bank credit facility. The Company is not subject to externally imposed capital requirements.