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  • Unaudited Condensed Interim Financial Statements of

    SONA NANOTECH INC. (formerly “Stockport Exploration Inc.”)

    July 31, 2019

    (Expressed in Canadian Dollars)

  • September 27, 2019 Management’s Report The accompanying unaudited condensed interim financial statements of Sona Nanotech Inc. (formerly “Stockport Exploration Inc.”) are the responsibility of management and have been approved by the Board of Directors. The unaudited condensed interim financial statements have been prepared by management in accordance with International Financial Reporting Standards (“IFRS”). The unaudited condensed interim financial statements include certain amounts and assumptions that are based on management’s best estimates and have been derived with careful judgment. In fulfilling its responsibilities, management has developed and maintains a system of internal accounting controls. These controls are designed to provide reasonable assurance that the financial records are reliable for the preparation of the financial statements. The Audit Committee of the Board of Directors reviewed and approved the Company’s unaudited condensed interim financial statements and recommended their approval by the Board of Directors. These unaudited condensed interim financial statements have not been reviewed by the external auditors of the Company. (signed) “Darren Rowles” (signed) “Robert Randall”

    Chief Executive Officer Chief Financial Officer Halifax, Canada Halifax, Canada

  • Sona Nanotech Inc. (formerly “Stockport Exploration Inc.”) Unaudited Interim Statements of Financial Position As at July 31, 2019 and October 31, 2018

    1

    Expressed in Canadian dollars

    July 31, 2019

    October 31, 2018

    $ $

    Assets

    Current assets

    Cash 623,792 1,803,549

    Amounts receivable and other (note 6) 570,771 291,037

    Marketable securities 6,000 5,500

    1,200,563 2,100,086

    Resource properties (note 7) - 940,500

    Property and equipment (note 8) 206,755 136,994

    Total assets 1,407,318 3,177,580

    Liabilities

    Current liabilities

    Accounts payable and accrued liabilities (note 9) 968,774 1,886,820

    Current portion of long-term debt (note 10) - 129,093

    Convertible notes and accrued interest (note 11) 479,505 419,409

    1,448,279 2,435,322

    Long-term debt (note 10) 723,836 543,184

    Total liabilities 2,172,115 2,978,506

    Equity

    Shareholders’ equity (764,797) 199,074

    Total liabilities and equity 1,407,318 3,177,580

    Basis of presentation and going concern (note 2) Commitments and contingencies (note 20) Subsequent events (note 22)

    Approved on behalf of the Board of Directors on September 27, 2019.

    “Daniel Whittaker” “Robert McKay” Director Director

    The accompanying notes are an integral part of these unaudited condensed interim financial statements.

  • Sona Nanotech Inc. (formerly “Stockport Exploration Inc.”) Unaudited Interim Statements of Loss and Comprehensive Loss For the three and nine-months ended July 31, 2019 and 2018

    2

    Expressed in Canadian dollars

    Three-months

    ended July 31,

    2019

    Three-months ended

    July 31, 2018

    Nine-months

    ended July 31,

    2019

    Nine-months ended

    July 31, 2018

    $ $ $ $ Expenses

    Salaries and employee benefits 130,817 92,671 403,074 226,044

    Professional and consulting fees (note 18) 91,554 119,680 285,345 242,213

    Management services (note 18) 57,000 54,000 171,000 162,000

    Research and development 14,122 12,387 43,660 34,322

    Travel 25,746 20,392 50,605 57,862

    Sales and marketing 7,357 15,605 20,669 28,592

    Share based compensation 82,744 - 186,749 -

    Administrative 15,664 3,525 35,358 12,964

    Depreciation expense 13,238 7,592 35,518 19,040

    Securities and regulatory 16,290 - 35,622 -

    Rent and related costs (note 18) 11,323 - 36,229 11,573

    (465,855) (325,852) (1,303,829) (794,610)

    Other income (expenses)

    Repayable government loans fair value adjustment 14,236 37,038 118,544 122,386

    Scientific research and experimental development tax credits 49,816 - 74,816 1,627

    Accreted interest on convertible notes (note 11) (9,000) - (27,000) -

    Interest expense (13,154) (3,000) (41,097) (9,519)

    Accreted interest on repayable government loans (note 10) (8,903) (15,000) (41,813) (33,376)

    Loss on disposal of resource properties (909,037) - (909,037) -

    (876,042) 19,038 (825,587) 81,118

    Net loss for the period (1,341,897) (306,814) (2,129,416) (713,492) Items that will be subsequently reclassified to the statement of loss

    Unrealized gain (loss) on available-for-sale securities (1,000) - 500 -

    Comprehensive loss for the period (1,342,897) (306,814) (2,128,916) (713,492)

    Loss per share – basic and diluted (0.02) (0.01) (0.04) (0.03)

    Weighted-average number of common shares

    outstanding - basic and diluted 54,253,907 22,036,237 53,723,292 21,437,839

    The accompanying notes are an integral part of these unaudited condensed interim financial statements.

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