---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 20-F

[   ] REGISTRATION STATEMENT PURSUANT TO SECTION 12(b)
OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

or

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended: December 31, 2017

or

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

or

[   ] SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 333-202600

NATCORE TECHNOLOGY INC.(Exact name of registrant as specified in its charter)

British Columbia, Canada(Jurisdiction
of incorporation or organization)

Natcore Technology Inc., 189 N. Water Street, Suite 700,
Rochester, NY 14504-1163(Address of principal executive
offices)

Charles Provini, 189 N. Water Street, Suite 700, Rochster,
NY 14604-1163,(585) 286-9180info@natcoresolar.com(Name, Telephone, E-mail
and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section
12(b) of the Act: None

Securities registered or to be registered pursuant to Section
12(g) of the Act:

Common Shares, without par value(Title of Class)

Securities for which there is a reporting obligation pursuant
to Section 15(d) of the Act: None

Indicate the number of outstanding shares of each of the
issuers classes of capital or common stock as of the close of the period
covered by the annual report:

At December 31, 2017 the registrant had 78,163,435 common
shares issued and outstanding

---

Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes [   ]      
 No [X]

If this report is an annual or transition report, indicate by
check mark if the registrant is not required to file reports pursuant to Section
13 or 15(d) of the Securities Exchange Act of 1934.

Yes [   ]      
 No [X]

Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.

Yes [X]        No
[   ]

Indicate by check mark whether the registrant has submitted
electronically and posted on its Web site, if any, every Interactive Data File
required to be submitted and posted pursuant to Rule 405 of Regulation S-T
during the preceding 12 months (or for such shorter period that the registrant
was required to submit and post such files).

Yes [   ]      
 No [X]

Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, or a non-accelerated filer. See
definition of accelerated filer and large accelerated filer in Rule 12b-2 of
the Exchange Act. (Check one):

Large Accelerated Filer [  
]       Accelerated Filer [  
]Non-Accelerated
Filer [   ]Emerging
Growth Company[X]

If an emerging growth company that prepares its financial
statements in accordance with U.S. GAAP, indicate by check mark if the
registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards pursuant to Section 13(a)
of the Exchange Act. [   ]

Indicate by check mark which basis of accounting the registrant
has used to prepare the financial statements included in this filing:

|US GAAP [   ] | International Financial
      Reporting        | Other  [   ]
|------------- | ---------------------------------------------- | ------------
|              | Standards as issued by the
      International |             
|              | Accounting Standards
      Board  [X]          |             

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If Other has been checked in response to the previous
question, indicate by check mark which financial statement item the registrant
has elected to follow:

Item 17 [  
]       Item 18 [  
]

If this is an annual report, indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [   ]      
 No[X]

Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Sections 12, 13 or 15(d) of the
Securities Exchange Act of 1934 subsequent to the distribution of securities
under a plan confirmed by a court: N/A.

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TABLE OF CONTENTS

|GENERAL                                                  | 7                                                                 
|-------------------------------------------------------- | ------------------------------------------------------------------
|CAUTIONARY NOTE REGARDING
    FORWARD-LOOKING STATEMENTS | 7                                                                 
|STATUS AS AN
    EMERGING GROWTH COMPANY                 | 7                                                                 
|CURRENCY                                                 | 8                                                                 
|FOREIGN
    PRIVATE ISSUER FILINGS                       | 8                                                                 
|Part I                                                   | 10                                                                
|                                                         | ITEM 1 
    IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
|                                                         | ITEM 2  OFFER STATISTICS
    AND EXPECTED TIMETABLE              
|                                                         | ITEM 3  KEY
    INFORMATION                                      
|                                                         | A.                                                                
|                                                         | B.                                                                
|                                                         | C.                                                                
|                                                         | D.                                                                
|                                                         | ITEM 4  INFORMATION ON THE
    COMPANY                           
|                                                         | A.                                                                
|                                                         | B.                                                                
|                                                         | C.                                                                
|                                                         | ITEM 4A - UNRESOLVED STAFF
    COMMENTS                           
|                                                         | ITEM 5 -
    OPERATING AND FINANCIAL REVIEW AND PROSPECTS         
|                                                         | A.                                                                
|                                                         | B.                                                                
|                                                         | C.                                                                
|                                                         | D.                                                                
|                                                         | E                                                                 
|                                                         | F.                                                                
|                                                         | ITEM 6  DIRECTORS,
    SENIOR MANAGEMENT AND EMPLOYEES           
|                                                         | A.                                                                
|                                                         | B.                                                                
|                                                         | C.                                                                
|                                                         | D.                                                                
|                                                         | E.                                                                
|                                                         | ITEM 7  MAJOR SHAREHOLDERS
    AND RELATED PARTY TRANSACTIONS    
|                                                         | A.                                                                
|                                                         | B.                                                                
|                                                         | C.                                                                
|                                                         | ITEM 8  FINANCIAL
    INFORMATION                                

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|         | A.                                                                                              | Consolidated
      Statements and Other Financial Information                           | 62
|-------- | ----------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------- | --
|         | B.                                                                                              | Significant Changes                                                                     | 63
|         | ITEM9  THE
    OFFERING AND LISTING                                                            | 63                                                                                     
|         | A.                                                                                              | Offering and Listing Details                                                            | 63
|         | ITEM10 
    ADDITIONAL INFORMATION                                                             | 64                                                                                     
|         | A.                                                                                              | Share Capital                                                                           | 64
|         | B.                                                                                              | Articles and
      By-laws                                                              | 64
|         | C.                                                                                              | Material Contracts                                                                      | 64
|         | D.                                                                                              | Exchange
      Controls                                                                 | 64
|         | E.                                                                                              | Taxation                                                                                | 64
|         | F.                                                                                              | Dividends
      and Paying Agents                                                       | 69
|         | G.                                                                                              | Statement by Experts                                                                    | 69
|         | H.                                                                                              | Documents on
      Display                                                              | 69
|         | I.                                                                                              | Subsidiary Information                                                                  | 69
|         | ITEM11 
    QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK                          | 69                                                                                     
|         | ITEM12  DESCRIPTION OF
    SECURITIES OTHER THAN EQUITY SECURITIES                             | 70                                                                                     
|PART II  | 71                                                                                             
|         | ITEM13  DEFAULTS, DIVIDEND
    ARREARS AND DELINQUENCIES                                       | 71                                                                                     
|         | ITEM14 
      MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
    PROCEEDS | 71                                                                                     
|         | ITEM15  CONTROLS AND PROCEDURES                                                                | 71                                                                                     
|         | A.                                                                                              | Disclosure
      Controls and Procedures                                                | 71
|         | B.                                                                                              | Managements Annual Report
      on Internal Control Over Financing Reporting (ICOFR) | 71
|         | C.                                                                                              | Attestation
      Report of Registered Public Accounting Firm                           | 72
|         | D.                                                                                              | Changes in Internal Controls
      Over Financial Reporting                             | 72
|         | ITEM16A  AUDIT
    COMMITTEE FINANCIAL EXPERT                                                  | 72                                                                                     
|         | ITEM16B  CODE OF ETHICS                                                                        | 73                                                                                     
|         | ITEM16C 
    PRINCIPAL ACCOUNTANT FEES AND SERVICES                                            | 73                                                                                     
|         | ITEM16D  EXEMPTIONS FROM THE
    LISTING STANDARDS FOR AUDIT COMMITTEES                        | 73                                                                                     
|         | ITEM16E 
      PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS          | 73                                                                                     
|         | ITEM16F  CHANGE IN REGISTRANTS
    CERTIFYING ACCOUNTANT                                      | 73                                                                                     
|         | ITEM16G 
    CORPORATE GOVERNANCE                                                              | 73                                                                                     
|         | ITEM16H  MINE SAFETY DISCLOSURE                                                                | 74                                                                                     
|PART III | 74                                                                                             
|         | ITEM17  FINANCIAL STATEMENTS                                                                   | 74                                                                                     
|         | ITEM18 
    FINANCIAL STATEMENTS                                                               | 74                                                                                     
|         | ITEM19  EXHIBITS                                                                               | 74                                                                                     

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| | A. | Financial
      Statements and Notes | 74
| | -- | ------------------------------------ | --
| | B. | Exhibit List                         | 74

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GENERAL

As used in this Annual Report, the Company refers to Natcore
Technologies Inc., a company existing under theBusiness Corporations Act(British Columbia).

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 20-F (Annual Report) and the
exhibits attached hereto contain forward-looking statements within the meaning
of the United States Private Securities Litigation Reform Act of 1995 and
applicable Canadian securities legislation that involve risks and uncertainties
relating, but not limited to, Natcores current expectations, intentions, plans,
and beliefs. Forward-looking information can often be identified by
forward-looking words such as anticipate, believe, expect, goal, plan,
target, intend, estimate, could, should, may and will or the
negative of these terms or similar words suggesting future outcomes, or other
expectations, beliefs, plans, objectives, assumptions, intentions or statements
about future events or performance. Examples of forward-looking information in
this Annual Report include: the Companys anticipated future business
strategies, the Companys plans and expectations for its technologies, the
timing and amount of estimated future revenues and sales, costs of goods and
services sold, capital expenditures, costs and timing of the development of new
technologies, future sales of products and technologies produced by the Company,
success of the Companys research and development activities, patenting time
lines and availability, the Companys ability to meet its working capital needs
in the next twelve months and thereafter, requirements for and availability of
additional capital; and growth in the solar industry.

Certain of the Companys expectations concerning the use of and
applications for its technologies, as well as the success of its research and
development programs described herein also contains statements concerning the
Companys proposed use of funds and timing for expenditures as well as general
expectations regarding revenues and the growth of the solar cell market.
Forward-looking statements are subject to a variety of known and unknown risks,
uncertainties and other factors which could cause actual events, results,
performance or achievements to be materially different from any future results,
performance or achievements expressed or implied by such forward looking
statements. Such factors include, among others: risks related to product and
technology development, including product obsolescence and the experimental
nature of the Companys business, limited protections of patents and proprietary
rights, changes in national and local government, legislation, taxation,
controls, regulations and political or economic developments in the Canada and
the United States or other countries in which the Company may carry on business
in the future, including changes in the regulatory environment for the oil and
gas industry, delays in obtaining patents, economic factors including
competition, foreign exchange rate fluctuations, fluctuation of securities
prices and prices of commodities; as well as those factors described in the
section entitled Risk Factors herein below.

Shareholders are cautioned not to place undue reliance on
forward-looking information. By its nature, forward-looking information involves
numerous assumptions, inherent risks and uncertainties, both general and
specific, that contribute to the possibility that the predictions, forecasts,
projections and various future events will not occur. Natcore reviews
forward-looking information for the purposes of preparing each Annual Report,
however Natcore undertakes no obligation to update publicly or otherwise revise
any forward-looking information whether as a result of new information, future
events or other such factors which affect this information, except as required
by law. For the reasons set forth above, investors should not place undue
reliance on forward-looking statements.

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STATUS AS AN EMERGING GROWTH COMPANY

Natcore is an emerging growth company as defined in Section
3(a) of the Securities Exchange Act of 1934, as amended (the Exchange Act) by
the Jumpstart Our Business Startups Act of 2012 (the JOBS Act) and is subject to reduced public reporting requirements.
Natcore has chosen not to take advantage of the extended transition period for
new accounting standards. While the decision to opt out of the extended period
to comply with new or revised accounting standards is irrevocable, the Company
may in the future elect to avail itself of other reduced reporting obligations
available as an emerging growth company. Natcore will continue to qualify as an
emerging growth company until the earliest to occur of: (a) the last day of
the fiscal year during which the Company had total annual gross revenues of
US$1,000,000,000 (as such amount is indexed for inflation every five years by
the SEC) or more; (b) the last day of the Companys fiscal year following the
fifth anniversary of the date of the first sale of common equity securities
pursuant to an effective registration statement under the Securities Act; (c)
the date on which the Company has, during the previous 3-year period, issued
more than US$1,000,000,000 in non-convertible debt; or (d) the date on which the
Company is deemed to be a large accelerated filer, as defined in Exchange Act
Rule 12b-2. Natcore expects to continue to be an emerging growth company for the
foreseeable future.

Generally, a registrant that registers any class of its
securities under section 12 of the Exchange Act is required to include in the
second and all subsequent annual reports filed by it under the Exchange Act, a
management report on internal control over financial reporting and, subject to
an exemption available to registrants that are neither an accelerated filer or
a larger accelerated filer (as those terms are defined in Exchange Act Rule
12b-2), an auditor attestation report on managements assessment of internal
control over financial reporting. However, for so long as the Company continues
to qualify as an emerging growth company, the Company will be exempt from the
requirement to include an auditor attestation report on managements assessment
of internal controls over financial reporting in its annual reports filed under
the Exchange Act, even if the Company were to qualify as an accelerated filer
or a larger accelerated filer. In addition, Section 103(a)(3) of the
Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act) has been amended by the
JOBS Act to provide that, among other things, auditors of an emerging growth
company are exempt from any rules of the Public Company Accounting Oversight
Board requiring mandatory audit firm rotation or a supplement to the auditors
report in which the auditor would be required to provide additional information
about the audit and the financial statements of the company.

CURRENCY

Unless otherwise indicated, all references to ($) dollar
amounts are expressed in the lawful currency of the United States of America.

FOREIGN PRIVATE ISSUER FILINGS

Natcore is considered a foreign private issuer pursuant to
Rule 405 promulgated under the Securities Act of 1933, as amended (the
Securities Act).In its capacity as a foreign private issuer, Natcore is exempt
from certain rules under the Exchange Act that impose certain disclosure
obligations and procedural requirements for proxy solicitations under Section 14
of the Exchange Act. In addition, Natcores officers, directors and principal
shareholders are exempt from the reporting and short-swing profit recovery
provisions of Section 16 of the Exchange Act and the rules under the Exchange
Act with respect to their purchases and sales of the Companys common shares.
Moreover, Natcore is not required to file periodic reports and financial
statements with the SEC as frequently or as promptly as United States companies
whose securities are registered under the Exchange Act. In addition, Natcore is
not required to comply with Regulation FD, which restricts the selective
disclosure of material information.

---

For as long as Natcore is a foreign private
issuer it intends to file its annual financial statements on Form 20-F and
furnish its quarterly financial statements on Form 6-K to the SEC for so long as
it is subject to the reporting requirements of Section 13(g) or 15(d) of the
Exchange Act. However, the information Natcore files or furnishes may not be the
same as the information that is required in annual and quarterly reports on Form 10-K or Form 10-Q for U.S. domestic issuers. Accordingly, there may be less information publicly available concerning Natcore than there is for a company that files as a domestic issuer.

Natcore may take advantage of these exemptions until such time as it is no longer a foreign private issuer. Natcore is required to determine its status as a foreign private issuer on an annual basis at the end of its second fiscal quarter. Natcore
would cease to be a foreign private issuer at such time as more than fifty percent (50%) of its outstanding voting securities are held by United States residents and any of the following three circumstances applies: (1) the majority of its executive
officers or directors are United States citizens or residents; (2) more than fifty percent (50%) of its assets are located in the United States; or (3) its business is administered principally in the United States. If Natcore loses its
“foreign private issuer status” it would be required to comply with Exchange Act reporting and other requirements applicable to U.S. domestic issuers, which are more detailed and extensive than the requirement for “foreign private
issuers.”

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PART I

ITEM 1  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND
ADVISERS

Not Applicable

ITEM 2  OFFER STATISTICS AND EXPECTED TIMETABLE

Not Applicable

ITEM 3  KEY INFORMATION

A.Selected Financial Data

The following tables set forth the Companys selected
consolidated financial data. Investors should read the following selected
consolidated financial data in conjunction with the Companys audited
consolidated financial statements and accompanying notes in Item 18 of this
Annual Report and Operating and Financial Review and Prospects included in
Item 5 of this Annual Report.

Natcores consolidated financial statements have been prepared
in accordance with International Financial Reporting Standards (IFRS) issued
by the International Accounting Standards Board (IASB) and interpreted by the
International Financial Reporting Interpretations Committee (IFRIC). As a
result of the Accounting Standards Board of Canadas decision to adopt IFRS for
publicly accountable entities for financial reporting periods beginning on or
after January 1, 2011, the Company adopted IFRS for the 2011 and 2010 annual
financial statements.

Since Natcore began preparing its financial statements in
accordance with IFRS, having reviewed significant transactions and compared them
to United States generally accepted accounting principles (GAAP), Natcore
concluded that there are no material differences that would impact the users of
the accompanying financial statements other than terminology and headings.

The Company has derived the summary consolidated statements of
comprehensive income data for each of the years ended December 31, 2017, 2016,
2015, 2014, and 2013 from its audited consolidated financial statements
(included elsewhere in this prospectus).

As of December 31,2017
    2016
    2015
    2014
    2013ExpensesConsulting
    132,936
    124,652
    181,589
    229,792
    108,657Depreciation and amortization
    75,272
    146,946
    279,527
    412,492
    359,178Filing fees
    26,278
    45,172
    25,016
    34,090
    32,082Foreign exchange (gain) loss
    1,457
    16,457
    5,159
    41,344
    90,060Interest and bank charges
    7,804
    2,698
    2,383
    1,581
    1,269Marketing
    76,582
    341,104
    268,853
    81,401
    96,641Office and miscellaneous
    191,766
    201,736
    216,811
    273,264
    267,532Professional fees
    81,589
    219,016
    335,762
    213,888
    129,499Research and development
    861,947
    1,137,422
    1,203,716
    1,634,864
    1,480,058Stock-based compensation
    67,599
    869,130
    387,648
    301,732
    325,686


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Travel
    22,231
    37,472
    45,858
    73,922
    126,668Wages
    615,331
    763,223
    778,339
    770,105
    855,853(2,160,792)
    (3,905,028)
    (3,730,661)
    (4,068,475)
    (3,873,183)Other Income (Expenses)Fair value adjustments on warrants
    885,673
    1,880,587
    226,827
    1,842,317
    (79,353)Other Income
    123
    1,932
    14,124
    
    Interest Income
    
    809
    1,581
    32,626
    13,708Net and comprehensive income (loss)
    (1,274,996)
    (2,021,700)
    (3,488,129)
    (2,193,532)
    (3,938,828)Loss per share - basic and diluted
    (0.02)
    (0.03)
    (0.07)
    (0.05)
    (0.10)Weighted average number of shares
      outstanding - basic and diluted
    71,014,878
    60,007,618
    51,329,138
    42,294,310
    41,097,726


As of December 31,2017
    2016
    2015AssetsCurrent AssetsCash and cash equivalents
    56,391
    23,252
    521,521Receivables
    4,084
    12,071
    29,057Prepaid expenses
    7,568
    55,187
    148,07668,043
    90,510
    698,654Non-Current AssetsEquipment
    149,601
    223,325
    366,729Intangibles
    
    
    149,601
    223,325
    366,729TOTAL ASSETS
    217,644
    313,835
    1,065,383Liabilities and EquityCurrent LiabilitiesTrade payables and accrued liabilities
    1,577,483
    1,192,636
    749,985Derivative liability
    267,077
    367,346
    1,135,1571,844,560
    1,559,982
    1,885,142EquityShare-based payment reserve
    4,373,131
    4,275,173
    3,375,710


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|Share subscriptions receivable |             |             | 31,102      
|------------------------------ | ------------ | ------------ | ------------
|Deficit                        | (23,213,638) | (21,938,642) | (19,916,942)
|                              
|TOTAL DEFICIT                  | (1,626,916)  | (1,246,147)  | (819,759)   
|TOTAL LIABILTIES AND DEFICIT   | 217,644      | 313,835      | 1,065,383   

B.Capitalization
and Indebtedness

Not Applicable

C.Reasons
for the Offer and Use of Proceeds

Not Applicable

D.Risk
Factors

An investment in Natcore common shares involves a high degree
of risk. Shareholders should consider carefully the risks described below,
together with the financial and other information contained in this annual
report. The occurrence of the risks described below could have a material
adverse impact on Natcores business, financial condition or results of
operations. In any such case, the trading price of Natcore common stock could
decline and investors may lose part or all of his or her investment. Various
statements in this annual report, including the following risk factors, contain
forward-looking statements.

Risks Related to Natcores Business

There is no assurance that the Company will turn a
profit.

The Company is currently not profitable. There is no assurance
as to whether the Company will be profitable, earn revenues or whether the
Company will be able to return any investment funds, to make cash distributions
or to meet its operating expenses and debt service, if any.

The Companys independent auditors reports on its
financial statements for the years ended December 31, 2017 and 2016 includes a
going concern explanatory paragraph.

The Companys independent auditor has presented the Companys
financial statements on the basis that it is a going concern, which contemplates
the realization of assets and the satisfaction of liabilities in the normal
course of business over a reasonable length of time. However, the Companys
independent auditor has expressed some doubt as to the Companys ability to
continue as a going concern. This means that the Company may not generate enough
funds to pay its general operating expenses and bills from professionals and
other advisors that it is obligated to pay. Since the Company has not generated
any revenues from operations, management intends to finance operating costs over
the next twelve months with existing cash resources and the private placement of
common stock. There may be situations where all sources of revenue described (or
any revenue at all) may not be available given market conditions and customer
requirements. The Company has had net losses in each of the last three fiscal
years and as of December 31, 2017; the Company has had recurring losses from
operations and a cumulative deficit of approximately $23,213,638.

---

There is no assurance that the Company will generate
immediate revenues; the Company projects cash on hand will be insufficient to
fund operations for approximately twelve months.

The Company anticipates that it will incur substantial expenses
relating to the implementation of its business plan and cost overruns may be
incurred. The Company currently expects the initial expenses it incurs to result in operating losses for the Company for the foreseeable future. Furthermore, no assurance can be made that a shareholder will realize any return on his or her investment, or that such shareholder will not lose his or her entire
investment. The Company anticipates its current cash and cash equivalents will not be sufficient to fund operations for approximately twelve months. The Company intends to raise capital through the sale of equity securities in private placements,
through shareholder loans or possibly through a registered public offering (either self-underwritten or through a broker-dealer).  There is no assurance that any financing will e available to the Company, or if available, on terms that will be
acceptable to the Company.

The Company’s ability to obtain the necessary financing to carry out its business plan is subject to a number of factors, including general market conditions and investor acceptance of its business plan. These factors may make the timing,
amount, terms and conditions of such financing unattractive or unavailable to the Company.  If the Company is unable to raise sufficient funds, it will have to significantly reduce its spending, delay or cancel our planned activities or
substantially change its current corporate structure. There is no guarantee that the Company will be able to obtain any funding or that it will have sufficient resources to conduct its business as projected, any of which could mean that the Company
will be forced to discontinue our operations.

Financial projections provided may prove inaccurate.

The Company’s management may prepare financial projections concerning the estimated operating results of the Company. These projections would be based on certain assumptions that may prove to be inaccurate and that are subject to future
conditions be beyond the control of the Company, such as changes in the condition of the national and international financial markets, fluctuations in interest rates, changes in rules and regulations pertaining to the securities markets and market
participants, variations in the local and national economy, acts of terrorism and occurrences of natural disasters or other such disasters. The Company may experience unanticipated costs, or anticipated agreements or contracts may not materialize,
resulting in lower revenues than forecasted. There is no assurance that the results that may be illustrated in financial projections would in fact be realized by the Company. The financial projections would be prepared by Management of the Company
and would not be examined or compiled by independent certified public accountants. Accordingly, neither independent certified public accountants nor counsel to the Company could provide any level of assurance on them.

The Company is in research and development stage.

Substantial corporate resources are currently being expended on the development of the Company’s technologies. These technologies remain in the development stages and have not yet been commercialized. There can be no guarantee that the
Company’s technologies will achieve the objectives which Natcore believes are necessary for successful products in the market. In addition, there are risks associated with commercializing any product, including the risk that full-scale
production may not be achieved at an acceptable cost level. In addition, since the Company’s technologies are in the development stage, there can be no guarantee that technical milestones can be achieved. Failure to successfully commercialize
the Company’s technologies may materially and adversely affect the Company’s financial condition and results of operations.

---

The Company is entirely dependent on its management team.

The Company’s management makes all decisions with respect to the Company’s assets, including investment decisions and the day-to-day operations of the Company. Other than as specified in the Company’s notice of articles and
articles, the shareholders have no right or power to take part in the management of the Company. As a result, the success of the Company for the foreseeable future will depend largely upon the ability of management.

SHAREHOLDERS ARE HEREBY ADVISED THAT THE SUCCESS OF PREVIOUS VENTURES OR PROJECTS UNDERTAKEN BY THE COMPANY’S MANAGEMENT OR THE MANAGEMENT OF ANY ACQUIRED COMPANY CANNOT BE CONSTRUED AS A GUARANTEE OF THE SUCCESS OF THE COMPANY.

The Company’s management may be subject to conflicts of interest.

The Company’s management may in the future become associated with or employed by other companies, which are engaged, or may become engaged, in operations similar to the operations engaged in by the Company. Conflicts of interest between the
Company’s officers and/or directors and the Company may arise by reason of such relationships. Management intends to resolve any conflicts with respect to such operations in a manner equitable to the shareholders of the Company, its
management, and any of the Company’s affiliates. Officers and all employees are required to sign a proprietary inventions agreement which means that anything that is invented while employed at Natcore is owned by Natcore. Additionally all
employees are required annually to complete an outside employment disclosure which allows the registrant to better control if there are any outside interests. Directors are not required to do either and may pursue opportunities independently of the
registrant.

The Company may not achieve its goals and objectives.

All investments in the Company risk the loss of capital. While the Company’s management believes that its experience and relationships will moderate this risk to some degree, no representation is made that the Company’s projects will be
successful.

The Company is subject to the possibility of future litigation that may have a significant adverse effect on the Company’s financial condition, operations and plans for expansion.

There are many risks incident to providing the types of services provided by the Company that may give rise to future litigation. Under such circumstances, the Company may be named as a defendant in a lawsuit or regulatory action. The Company may
also incur uninsured losses for liabilities which arise in the ordinary course of business, or which are unforeseen. There is no assurance that the Company’s shareholders will not lose their entire investment in the Company as a result of
unforeseen litigation.

The Company will indemnify its officers and directors.

The Company’s articles, as amended, provide that the Company will, within the limits of capital contributions and retained assets, hold its directors and officers harmless against certain claims arising from Company activities, other than
losses or damages incurred by it as a result of its gross negligence, fraud or bad faith. If the Company were called upon to perform under its indemnification agreements, then the portion of its assets expended for such purpose would reduce the
amount otherwise available for the implementation of its business plan, or for distributions to its shareholders, if any.

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The enforcement of civil liabilities against the Company and its officers and directors may be difficult to obtain.

The Company incorporated under the laws of the Province of British Columbia, Canada. Service of process upon the Company and upon the Company’s directors and officers, who may reside outside the United States, may be difficult to obtain within
the United States. Furthermore, some of the Company’s assets and some of the Company’s directors and officers are located outside the United States, any judgment obtained in the United States against the Company or any of the
Company’s directors and officers, including one predicated on the civil liability provisions of the U.S. federal securities laws, may not be collectible within the United States.

The Company is subject to certain institutional risks.

The institutions with which the Company (directly or indirectly) does business may encounter financial difficulties that impair or would impair the operational capabilities or the capital position of the Company.

There may be changes in laws applicable to the Company.

The Company must comply with various legal requirements, including requirements imposed by the state and federal securities laws and pension laws. Should any of those laws change over the scheduled term of the Company, the legal requirements to
which the Company and its shareholders may be subject could differ materially from current requirements.

The Company may face adverse tax consequences and may be audited by the Internal Revenue Service or the Canada Revenue Agency.

While the Company is advised in tax matters by its accountants, the Internal Revenue Service (the “IRS”) or the Canada Revenue Agency (“CRA”) may not accept the tax positions taken by the Company. As a result, the IRS or CRA
could audit the Company’s information and adjustments to the Company’s tax returns may result. Any such adjustment could subject the shareholders to additional tax, interest and penalties, as well as incremental accounting and legal
expenses. In addition, an audit of the Company’s tax returns could lead to audits of the individual tax returns of the shareholders, resulting in adjustments and additional tax with respect to non-Company items.

Government Regulation – General.

The Company may be subject to regulation by county, state and federal governments, governmental agencies, and regulatory authorities from several different countries. Failure to obtain regulatory approvals or delays in obtaining regulatory approvals
by the Company, its collaborators, customers, vendors or service providers would adversely affect the marketing of products and services developed by the Company, and the Company’s ability to generate product and service revenues. Further,
there can be no assurance that the Company, its customers, vendors, or service providers will be able to obtain necessary regulatory approvals. Although the Company does not anticipate problems satisfying any of the regulations involved, the Company
cannot foresee the possibility of new regulations, which could adversely affect the business of the Company. While the Company anticipates that all regulatory approvals required will be granted, violations by the Company and/or its customers of,
and/or non-compliance with, such regulations and approvals may adversely affect the Company’s ability to acquire capital, or adversely affect the Company’s ability to conduct its business as intended.

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The Company is subject to various economic risks.

Local, national and international economic conditions may have a substantial adverse effect on the efforts of the Company. The Company cannot guarantee its anticipated results of operations against the possible eventuality of any of these potential
adverse conditions.

The Company is subject to foreign exchange risk

The Company operates in the United States but raises funds in Canadian dollars which creates exposure to changes in exchange rates, primarily as between the US dollar and the Canadian dollar. Changes in the exchange rates faced by the Company may
have a material adverse impact on its future financial performance. In recent years, the Canadian dollar has dropped in value as against the U.S. dollar and has performed with increased volatility relating to general economic conditions.

The Company may suffer uninsured losses.

The Company plans to obtain comprehensive insurance coverage, including liability, fire and extended coverage, as is customarily obtained for businesses similar to the Company. Certain types of losses of a catastrophic nature, such as losses
resulting from floods, tornadoes, thunderstorms and earthquakes, are uninsurable or not economically insurable to the full extent of potential loss. Such Acts of God, work stoppages, regulatory actions or other causes, could interrupt or delay the
Company’s development or expansion, and would adversely affect the Company’s business, results of operations, and profitability.

Dependence on management and absence of Key Man Insurance.

The Company’s business, to date, and for the foreseeable future, will be significantly dependent on the Company’s management team, directors and key consultants, including but not limited to Charles Provini, John C. Calhoun, and Dennis
J. Flood. Each of the foregoing has other engagements that compete for their time.

The loss of any one of these officers could have a material adverse effect on the Company. If the Company lost the services of one or more of its executive officers or key employees, it would need to devote substantial resources to finding
replacements, and until replacements were found, the Company would be operating without the skills or leadership of such personnel, any of which could have a significant adverse effect on the Company’s business. The Company currently does not
carry key-man life insurance policies covering any of these officers.

Risks associated with expansion.

Any expansion plans undertaken by the Company to increase or expand its operations entail risks, which may negatively impact the profitability of the Company. Consequently, shareholders must assume the risk that (i) such expansion may ultimately
involve expenditures of funds beyond the resources available to the Company at that time, and (ii) management of such expanded operations may divert management’s attention and resources away from its existing operations, all of which factors
may have a material adverse effect on the Company’s present and prospective business activities. The Company cannot assure its shareholders that its products, procedures or controls will be adequate to support the anticipated growth of its
operations.

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Inability to protect proprietary and technology rights.

The Companys success will depend in part on its ability to
protect its proprietary rights and technologies, including, but not limited to,
U.S. Patent 7,718,550, U.S. Patent 7,253,014, U.S. Patent 7,682,527, U.S. Patent
7,491,376, U.S. Patent 7,692,218 , U.S. Patent 8,431,818, U.S. Patent 7,999,172,
U.S. Patent 8,433,417, U.S.

Patent 8,716,152 and U.S. Patent 9,093,267 . The Company relies
on a combination of patents, trademark laws, trade secrets, confidentiality
provisions and other contractual provisions to protect its proprietary rights.
However, not all of these measures may apply or may afford only limited
protection. The Companys failure to adequately protect its proprietary rights
may adversely affect the Company. Despite the Companys efforts to protect its
proprietary rights, unauthorized parties may attempt to copy aspects of the
Companys services or to obtain and use trade secrets or other information that
it regards as proprietary. Based on the nature of its business, it may or may
not be able to adequately protect its rights through patent, copyright and
trademark laws. The Companys means of protecting its proprietary rights abroad
may not be adequate, and competitors may independently develop similar
technologies. The Company may become involved in litigation over proprietary
rights. In the event of an adverse result in any future litigation with third
parties relating to proprietary rights, the Company could be required to pay
substantial damages, including treble damages if the Company is held to have
willfully infringed or to expend significant resources to develop non-infringing
technology. In addition, litigation frequently involves substantial expenditures
and can require significant management attention, even if the Company ultimately
prevails. However, there can be no assurance that the Company would be able to
successfully resolve such disputes in the future.

No assurance of profitability.

The Company may experience operating losses as it develops,
produces and distributes its products and services. As a result, the Company may
not be able to achieve profitability in a commercially acceptable time frame, if
ever.

Natcore is an emerging growth company with reduced
reporting requirements.

Natcore is an emerging growth company, as defined in the JOBS
Act. Although the Company has elected not to take advantage of certain reporting
exemptions available it, for so long as Natcore remains an emerging growth
company, it will not be subject to the provision of Section 404(b) of the
Sarbanes-Oxley Act, applicable to non-emerging growth companies, that requires
that an independent registered public accounting firm provide an attestation
report on the effectiveness of the Companys internal control over financial
reporting. This may increase the risk that the Company will fail to detect and
remedy any weaknesses or deficiencies in its internal control over financial
reporting. In general, these reduced reporting requirements may allow the
Company to refrain from disclosing information that investors may find
important. It is also possible that shareholders may generally find Natcores
common shares less attractive due to its status as an emerging growth company
and its limited disclosures. Any of the foregoing could adversely affect the
price and liquidity of the Companys common shares.

Natcore may take advantage
  of these disclosure exemptions until it is no longer an emerging growth
  company however it may still take advantage of certain reduced reporting
  requirements if it remains a small company. The Company will cease to be an
  emerging growth company upon the earliest of:

- the last day of the fiscal year in which the fifth anniversary of the
  offering filed pursuant to the F- 1 Registration Statement declared effective
  on May 26, 2015;
- the last day of the fiscal year in which the Companys annual gross
  revenues are $1 billion or more;



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- the date on which the Company, during the previous three-year period,
  issued more than $1 billion in non-convertible debt securities; or
- the last day of any fiscal year in which the market value of the Companys
  common shares held by non-affiliates exceeds $700 million as of the end of the
  second quarter of that fiscal year.

Risk Factors Associated with the Industry in which the
Company Operates

The demand for solar power products is dependent on
volatile market and industry trends that can affect demand for Natcores
products and negatively impact its revenue.

The global economic downturn that began in the fourth quarter
of 2008 highlighted the volatility associated with the solar power industry. The
capital-intensive nature of implementation requiring access to capital sources
caused an overall reduction in demand for solar power technology. While global
markets have stabilized and access to capital has returned the demand for solar
power products, the potential for soft demand and the trend of reduced cost of
production could again have the effect of an over-supplied market place. The
effects of a supply driven market place due to soft demand would be adverse to
the Companys margins and in turn revenues.

In addition, macroeconomic and geopolitical events influence
the demand for solar power products. Specifically, currency exchange rates and
governmental regulation affect the price of other energy resources like oil,
natural gas and coal. A reduction in the price of these traditional energy
resources, such as the recent significant decrease in the oil and natural gas
markets, could result in a reduction in the demand for alternative energy
sources such as solar power; which in turn could reduce the margins of the
Companys products and result in a decrease in revenue.

Unforeseen technological failings that increase the cost
of adoption of solar products may inhibit widespread implementation of solar
solutions that would result in reduced revenue or the inability for the Company
to maintain its profitability.

The recent discovery of hardware failure and technical issues
related to solar power equipment that occurred earlier in product life that had
been expected could alter the associated cost of implementation of solar power
products that could in turn lead to a drop in demand. Historical data is not as
readily available for the solar industry as it is for the traditional sources of
energy limiting the ability to determine a reliable trend upon which to base
future results. Increased costs associated with implementation could lead to the
failure of solar power technology being widely adopted resulting in the
Companys inability to sustain revenue growth and profitability.

If third parties claim that the Companys products
infringe their intellectual property rights, the Company may be forced to expend
significant financial resources and management time, and operating results would
suffer.

The Companys portfolio of intellectual property is significant
to its financial condition and operations. Third parties may claim that the
Companys products and systems infringe their patents or other intellectual
property rights. Identifying third-party patent rights can be particularly
difficult, especially since patent applications are not published until 18
months after their filing dates. If a competitor were to challenge the Companys
patents, or assert that its products or processes infringe its patent or other
intellectual property rights, the Company could incur substantial litigation
costs, be forced to design around their patents, pay substantial damages or even
be forced to cease operations, any of which could be expensive and/or have an
adverse effect on the Companys operating results. Third-party infringement
claims, regardless of their outcome, would not only drain financial resources,
but also would divert the time and effort of management, and could result in
customers or potential customers deferring or limiting their purchase or use of
the affected products or services until resolution of the litigation.

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The Company is subject to certification requirements and other regulations. Future more stringent regulations may impair the Company’s ability to market its products.

The Company must obtain product certification from governmental agencies, such as the EPA, to sell certain products in the United States, and must comply with other product certification requirements in other countries. A portion of the
Company’s future sales will depend upon  sales  of  solar  power products and technologies that are certified to meet existing and future air quality and energy standards. The Company cannot assure that its products will meet these standards.
The failure to comply with these certification requirements could result in the recall of the Company’s products, or civil or criminal penalties.

Any new government regulation that affects solar power products and technologies, whether at the foreign, federal, state, or local level, including any regulations relating to installation and service of these systems, may increase the
Company’s costs and the price of its systems. As a result, these regulations may have a negative impact on the Company’s revenue and profitability and thereby harm its business, prospects, results of operations, or financial condition.

Changes in tax policies may reduce or eliminate the economic benefits that make the Company’s products attractive to consumers .

In some jurisdictions, such as the United States, governments provide tax benefits for solar cell technologies, including tax credits, rebates and reductions in applicable tax rates. In certain markets of the Company these benefits extend to users
of the Company’s products. From time to time, governments change tax policies in ways that create benefits such as those for the Company’s customers. Reductions or eliminations in these benefits may adversely affect the Company’s
revenue.

New technologies could render the Company’s existing products obsolete.

New developments in technology may negatively affect the development or sale of some or all of the Company’s products or make its products obsolete. The Company’s inability to enhance existing products in a timely manner or to develop
and introduce new products that incorporate new technologies, conform to increasingly stringent emission standards and performance requirements, and achieve market acceptance in a timely manner could negatively impact the Company’s competitive
position. New product development or modification is costly, involves significant research, development, time and expense, and may not necessarily result in the successful commercialization of any new products.

If the Company misses a required performance standard, fails to timely complete, or otherwise fails to adequately perform on a project, the Company may incur a loss on that project which may reduce or eliminate its overall profitability.

The Company may commit to a client that the Company will complete a project by a scheduled date. The Company may also commit that a project, when completed, will achieve specified performance standards. If the project is not completed by the
scheduled date or fails to meet required performance standards, the Company may incur additional costs or be held responsible for damages due to late completion or failure to achieve the required performance standards. The uncertainty of the timing
of a project can present difficulties in planning the amount of personnel and resources needed for the project. If the project is delayed or canceled, the Company may bear the cost of an underutilized workforce. In addition, performance on projects
can be affected by a number of factors beyond its control, including unavoidable delays from the weather conditions, changes in the project scope, unanticipated site conditions or other disruptions. In some cases, should the Company fail to meet the
required schedule or performance standards, the Company may also be subject to agreed upon financial damages which are determined by the contract. To the extent that these events occur, the total costs of the project could exceed its estimates
or, in some cases, cause a loss which may reduce or eliminate its overall profitability or cause a financial loss.

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The Company conducts a portion of its operations through joint venture entities, over which the Company may have limited control.

The Company may partner with its Best of Breed clients or conduct its operations through joint venture entities. As with most joint venture arrangements, differences in views among the joint venture participants may result in delayed decisions or
disputes. The Company cannot control the actions of its joint venture partners, and the Company typically has joint and several liability with its joint venture partners under the applicable contracts for joint venture projects. These factors could
potentially harm the business and operations of a joint venture and, in turn, the Company’s business and operations.

In conducting the Best of Breed Program, the Company depends on other contractors and subcontractors. If these parties fail to satisfy their obligations to the Company or other parties, or if the Company is unable to maintain these
relationships, the Company’s revenue, profitability and growth prospects could be adversely affected.

The Company depends on contractors and subcontractors in conducting the Best of Breed Program. There is a risk that the Company may have disputes with its subcontractors arising from, among other things, the quality and timeliness of work performed
by the subcontractor, customer concerns about the subcontractor, or the Company’s failure to extend existing task orders or issue new task orders under a subcontract. In addition, if any of the subcontractors fail to deliver on a timely basis
the agreed-upon supplies and/or perform the agreed-upon services, the Company’s ability to fulfill its obligations may be jeopardized.

The Company also relies on relationships with other contractors when it acts as their subcontractor or joint venture partner. The Company’s future revenue and growth prospects could be adversely affected if other contractors eliminate or
reduce their subcontracts or joint venture relationships with the Company, or refuses to pay under a contract.

The Company business and operating results could be adversely affected by its inability to accurately estimate the overall risks, revenue or costs on a contract.

The Company may engage in a fixed-price contract which requires the Company to either perform all work under the contract for a specified lump-sum or to perform an estimated number of units of work at an agreed price per unit, with the total payment
determined by the actual number of units performed. Fixed-price contracts expose the Company to a number of risks not inherent in cost-plus and time and material contracts, including underestimation of costs, ambiguities in specifications,
unforeseen costs or difficulties, problems with new technologies, delays beyond the Company’s control, failures of subcontractors to perform and economic or other changes that may occur during the contract period. Losses under fixed-price
construction contracts could be substantial and harm the Company’s results of operations. Under the Company’s cost-plus contracts, some of which are subject to contract ceiling amounts, the Company is reimbursed for allowable costs and
fees which may be fixed or performance based. If the Company’s costs exceed the contract ceiling or are not allowable, the Company may not be able to obtain reimbursement for all such costs. Accounting for a fixed-price contract requires
judgments relative to assessing the contract’s estimated risks, revenue and costs as well as technical issues. The uncertainties inherent in the estimating process make it possible for actual costs to vary from estimates, or estimates to
change, resulting in reductions or reversals of previously recorded revenue and profit. Such variances could be material. Finally, the Company may receive equity or a portion of the revenues generated from a power purchase agreement. The lack of
success of the underlying venture or the failure of the client to generate revenue may adversely affect the Company’s business and operating results.

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The Companys services expose it to significant risks of
liability, and it may be difficult or more costly to obtain or maintain adequate
insurance coverage.

The Companys services involve significant risks that may
substantially exceed the fees the Company derive from its services. The
Companys business activities expose it to potential liability for professional
negligence, personal injury and property damage among other things. The Company
cannot always predict the magnitude of such potential liabilities. In addition,
its ability to perform certain services is dependent on the availability of
adequate insurance. The Company may obtain insurance from insurance companies to
cover a portion of its potential risks and liabilities subject to specified
policy limits, deductibles or coinsurance. It is possible that the Company may
not be able to obtain adequate insurance to meet its needs or may have to pay an
excessive amount for the insurance coverage the Company desires. In addition,
the Company may not be able to acquire any insurance for certain types of
business risks.

Risks Related to the Companys Common Shares

Authorized capital consists of an unlimited number of
shares of one class designated as common shares

The Companys authorized capital consists of an unlimited
number of shares of one class designated as common shares. The directors may
create any class or series of shares by resolution but may not make any
modification to the provisions attaching to the Companys common shares without
the affirmative vote of two- thirds of the votes cast by the holders of the
common shares. The Companys common shares do not have pre-emptive rights to
purchase additional shares. Shareholders should be aware that the exercise of
warrants described herein will dilute the value of current holdings.

Volatility of the market price of the Companys common
shares could adversely affect its shareholders and the Company.

The market price of the Companys common shares could be highly
volatile and could be subject to wide fluctuations in response to numerous
factors, including the following:

- actual or anticipated variations in the Companys operating results or
  those of the Companys competitors,
- technological enhancements or developments by the Company or its
  competitors,
- regulatory changes effecting the Companys industry,
- changes in the roles of key personnel,
- geopolitical events effecting the Companys industry, and
- disputes concerning proprietary rights concerning patents that the Company
  holds.

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The Company has not paid dividends in the past and does
not expect to pay dividends in the future. Any return on an investment could be
limited to the value of the common stock.

The Company has never paid cash dividends on its common shares
and do not anticipate paying cash dividends in the foreseeable future. The
payment of dividends depends on the financial condition of the Company, with
other business and economic factors influencing the decision by the board of
directors in determining the issuance of a dividend. If dividends are not
issued, the Companys common shares may be considered less valuable because a
return on an investment will only occur if the Companys stock price
appreciates.

Stockholder ownership interest in the Company may be
diluted as a result of future financings or additional acquisitions.

The Company may seek to raise funds from time to time in public
or private issuances of equity in the near future or over the longer term. Sales
of the Companys securities offered through future equity offerings may result
in substantial dilution to the interests of the Companys current shareholders.
The sale of a substantial number of securities to investors, or anticipation of
such sales, could make it more difficult for the Company to sell equity or
equity-related securities in the future at a time and at a price that the
Company might otherwise wish to effect sales. In addition, the Company has
issued shares of its common stock for various acquisitions in the past and may
do so in the future, which may also result in substantial dilution to the
interests of the Companys current shareholders.

Shareholders may experience dilution as a result of
future purchases exercised on outstanding options and warrants.

As of December 31, 2017, the Company had 6,105,000 options
outstanding. Each option entitles the holder to purchase one additional common
share at exercise prices ranging from CDN$0.17 to CDN$1.08 and expiring on dates
ranging from January 4, 2018 to December September 20, 2022, some of which have
expired unexercised as of the date hereof.

As of December 31, 2017, the Company had 36,003,203 warrants
outstanding. Each warrant entitles the holder to purchase one additional common
share at an exercise prices ranging from CDN$0.12 to CDN$0.95 and US$0.62 and
with expiration dates ranging from January 21, 2018 to December 27, 2020. To the
extent these options or warrants are ultimately exercised, shareholders will
sustain future dilution.

THE COMPANY CANNOT PREDICT WHETHER IT WILL SUCCESSFULLY
EFFECTUATE ITS CURRENT BUSINESS PLAN. EACH SHAREHOLDER IS ENCOURAGED TO
CAREFULLY ANALYZE THE RISKS AND MERITS OF AN INVESTMENT IN THE COMPANYS COMMON
STOCK AND SHOULD TAKE INTO CONSIDERATION WHEN MAKING SUCH ANALYSIS, AMONG
OTHERS, THE RISK FACTORS DISCUSSED ABOVE.

ITEM 4  INFORMATION ON THE COMPANY

A.History
and Development of the Company

Natcore Technology, Inc. (Natcore or the Company), is a
corporation organized under the laws of British Columbia, Canada organized on
August 9, 2007, is a research and development company pioneering solar cells
with improved efficiency and reduced cost. By combining expertise of the
Companys scientists with a well-equipped research facility, the Company is
developing approaches that will define the next generation of solar cells.
Natcores intellectual property is currently protected by 65 patents granted or
pending. Natcore does not plan to manufacture solar cells, but rather to have
the technology manufactured through partnerships with third parties that will
ultimately yield licensing and royalty revenues.

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Natcore was a capital pool company1 until
it completed a Qualifying Transaction on May 8, 2009. The Qualified Transaction
involved a reverse take-over of Syracuse Capital Corp. by Natcore Technology
Inc., a Delaware company, which is now a wholly owned subsidiary of the Company.
Syracuse Capital Corp. was a company incorporated under the British Columbia
Business CorporationsActand a Capital Pool Company, having its common shares
listed on the TSX Venture Exchange under the trading symbol SYU.P. Natcore
completed its Qualifying Transaction by acquiring all of the issued and
outstanding securities of Natcore Technology, Inc. a private Delaware company in
consideration of the issuance of 12,960,686 common shares of the Company having
a deemed price of CDN$0.40 per share and the issuance of 2,145,000 share
purchase warrants, each warrant exercisable into one additional common share at
a price of CDN$0.40 per share for a period of five years expiring May 9, 2014.
The common shares of the Company are listed for trading on the TSX Venture
Exchange under the symbol NXT. Natcore is currently focused on using its
proprietary nanotechnology discoveries to enable a variety of compelling
applications including laser processing, tandem quantum-dot solar cells and its
Natcore Foil Cell structure, the development of which eliminates the need to
use high-cost silver in mass-manufactured silicon solar cells. Natcores laser
and all-back-contact cell technologies are also aimed at replacing traditional
high cost processes, while also allowing for cell efficiencies well above
todays standard products. This technology combines two traditional steps in the
manufacturing process thus reducing cost.

To protect the Companys exclusive rights in such technologies,
as of December 31, 2017, Natcore had licensed or owns 32 granted and 33 pending
patents.

The addresses (and telephone number) of Natcores principal
offices are:

New York Office 189 N. Water
Street, Suite 700 Rochester, New York 14604-1163(545) 286-9180

Background

Natcore is a research and development company pioneering solar
cells with improved efficiency and reduced cost. Natcores intellectual property
is currently protected by 65 patents granted or pending. More specifically,
Natcore has technologies which (i) enable the controlled deposition of silicon
dioxide and mixed silicon oxides from an aqueous solution at ambient
temperatures and pressures; (ii) create a nanostructured, porous surface called
black silicon on a silicon wafer; (iii) will enable low temperature
manufacturing of silicon solar cells at low cost by means of laser processing;
and (iv) eliminate high-cost silver from mass- manufactured silicon solar cells
through the creation of the Natcore Foil Cell. Natcore does not plan to
manufacture solar cells, but rather to have the technology manufactured through
partnerships with third parties that will ultimately yield licensing and royalty
revenue.

_______________________________________________________
1 The Capital Pool Company program is a two-step listing process offered by the
  TSX Venture Exchange. In step one, a new company (a Capital Pool Company) is
  listed on the TSX Venture Exchange as an initial public offering. In step two
  (the Qualifying Transaction), the Capital Pool Company acquires an asset or
  completes a transaction with a private business which results in the listing of
  the acquired business on the TSX Venture Exchange. If the acquired business can
  meet the minimum listing requirements of the Toronto Stock Exchange (the TSX);
  it can be directly listed on the TSX at the closing of the Qualifying
  Transaction. The listing of a business via the Capital Pool Company program can
  be more cost and time efficient than a listing through a traditional initial
public offering.

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Recent History

R&D Milestones

On October 25, 2012, the Company announced that its scientists
created the worlds first black silicon solar cell using processes amenable to
low-cost mass production. After having previously treated a wafer to make it the
blackest silicon solar cell surface ever recorded, Natcores technicians used
their scalable LPD process to create the black silicon solar cell, from wafer to
finished cell.

On January 27, 2015, Natcore announced that it had used its
proprietary advances in laser technology to produce an all-low-temperature
laser-doped solar cell with all of its electrical contacts on the back of the
cell. Eliminating the contacts from the cell increases output by a similar
amount. While other all-back-contact cells have been produced, those cells use
high-temperature diffusion in their doping steps and
highly complex multi-step patterning processes to apply the electrical contacts. Natcore’s all-back-contact cell, on the other hand, uses only high-speed, inexpensive laser processing to define the doping regions and the contacts.

On February 17, 2015, the Company announced that it had formed a heterojunction solar sell using germanium quantum dots on an ordinary n-type silicon wafer. Quantum-dot solar cells have the potential to be transformational for terrestrial solar
energy, with efficiencies far above anything available commercially as of the date of their formation. One month later, Natcore produced an all-back-contact silicon “SHJ-structure” (heterojunction with intrinsic thin layer) solar cell
using their proprietary laser technology. On July 9, 2015, Natcore developed a new solar cell structure that was expected to completely eliminate high-cost silver from mass-manufactured silicon solar cells. By August 2015 the Company was able to
build an all-back-contact silicon heterojunction cell structure in which the use of silver was eliminated. This substitution was accomplished with no loss of performance and a substantial decrease in the metallization cost of a solar cell and total
raw material cost of a solar module. In March 2016, the Company announced that it had reached an efficiency level of 17.5% for its laser processed cells through further refinement of the Natcore Foil CellTM.

On March 29, 2016, Natcore announced it had achieved commercial level efficiencies for its laser-processed solar cells. Refinement of Natcore’s revolutionary Natcore Foil CellTM, which utilizes low-cost aluminum instead of high-cost
silver, has progressed rapidly; less than 11 months prior, early proof-of-concept cells were delivering 4% efficiencies. As of this announcement, the Company’s cells reached efficiencies of 17.5% (roughly the equivalent of typical commercial
cells being sold). Natcore’s new cell design, which builds upon the basic concept of a silicon heterojunction (SHJ) solar cell, is producing short-circuit currents above 40 mA/cm2 and open-circuit voltages above 0.65V. Anticipated improvements
in these measurements, as well as fill factor, project to efficiencies well above 20%. To quantify the cost advantages of its process and design for potential partners, Natcore has retained an independent laboratory to prepare an analysis comparing
the cost of producing solar cells using Natcore’s breakthrough process with that of making cells using existing manufacturing methods.

On November 15, 2016, the Company announced it had achieved an efficiency of 19.4% in its latest demonstration solar cell by reducing resistance from laser- formed contacts. The laser-formed base contact is critical to the Natcore Foil CellTM,
which is an all-back-contact cell that eliminates the need for high-cost silver in the production process by replacing it with low-cost aluminum. Higher resistance at this contact, as well as damage from the laser process, had been limiting the
performance of the Company’s demonstration cells. Natcore scientists discovered a new laser-based contacting process that overcomes these issues. As a result, device efficiency increased by nearly 2% since June 2016 when the Company announced
an efficiency of 17.5% (17.5% being roughly equivalent to typical commercial cells available as of that date). In 2015, the Company’s early proof-of-concept cells were delivering 4% efficiencies. Solar cells using Natcore’s new approach
have an open-circuit voltage (Voc) of nearly 0.7V, pointing to the potential of significantly higher efficiencies.

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On May 2, 2017, Natcore announced that it had achieved an efficiency of 20.7% in its latest demonstration of the solar cell.

To protect the Company’s exclusive rights in such technologies, as of the date hereof, Natcore had licensed or owns 32 granted and 33 pending patents.

Recent Financings

In January 2015, the Company completed a non-brokered private placement and issued 1,352,062 units at a price of CDN$0.43 per unit for gross proceeds of $471,479 (CDN$581,387). Each unit comprised one common share and one share purchase warrant, with each warrant exercisable at a price of CDN$0.70 per share for a period of three years from the date of closing.

In April 2015, the Company completed a non-brokered private placement and issued 1,200,050 units at a price of CDN$0.70 per unit for gross proceeds of $672,028 (CDN$840,035). Each unit comprised one common share and one share purchase
warrant, with each warrant exercisable at a price of $0.70 per share for a period of three years from the date of closing.

In July 2015, the Company completed a non-brokered private placement and issued 1,822,000 units at a price of CDN$0.54
  per unit for gross proceeds of $982,227 (CDN$1,275,400). Each unit comprised one common share and one purchase warrant, with each warrant exercisable at a price of CDN$0.74 per share for a period of three years from the date of
  closing.

On July 15, 2015, the Company entered into an investment agreement, as amended on August 21, 2015, for the provision of an up to $5 million investment facility by Dutchess Opportunity Fund II. During the 36-month term of the agreement, Dutchess
will be required, at the option of Natcore, to purchase up to $5 million of Natcore common stock. Natcore will control the timing and amount of any share sales to Dutchess and a minimum price of the common stock to be issued. Under the
agreement, Dutchess is required to purchase Natcore shares at a discount of 5% from the market price of the shares on the OTCQB at the time of each transaction. No commissions or compensation is to be paid by Natcore as a result of signing the
agreement. As of the date hereof, the Company has not drawn upon the investment. Due to regulatory restraints resulting from the Company’s Canadian registration, the Company has not, and does not intend to, utilize this investment facility.

In November 2015, the Company completed a non-brokered private placement and issued 1,694,444 units at a price of CDN$0.36 per unit for gross proceeds of $456,018 (CDN$610,000). Each unit comprised one common share and one purchase
warrant, with each warrant exercisable at a price of CDN$0.55 per share for a period of three years from the date of closing.

In December 2015, the Company completed a non-brokered private placement and issued 1,681,189 units at a price of
  CDN$0.36 per unit for gross proceeds of $437,096 (CDN$605,228). Each unit comprised one common share and one purchase warrant, with each warrant exercisable at a price of CDN$0.55 per share for a period of three years from the date
  of closing.

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In February 2016, the Company completed a non-brokered private placement and issued 273,058 units at a price of CDN$0.36 per unit for gross proceeds of $70,908 (CDN$98,301). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.55 per share for a period of three years from the date of closing. The Company had received subscriptions of $31,102 at December 31, 2015 that related to this private
  placement. On issue the fair value of the warrants was determined to be $26,464 and included in derivative liability (Note 8).

In March 2016, the Company completed a non-brokered private placement and issued 2,244,497 units at a price of CDN$0.36 per unit for gross proceeds of $622,166 (CDN$808,019). Each unit comprised one common share and one purchase warrant,
with each warrant exercisable at a price of CDN$0.55 per share for a period of three years from the date of closing. On issue the fair value of the warrants was determined to be $489,252 and included in derivative liability (Note 8).

In June 2016, the Company completed a non-brokered private placement and issued 1,000,000 units at a price of CDN$0.40 per unit for gross proceeds of $311,988 (CDN$400,000). Each unit comprised one common share and one purchase warrant,
with each warrant exercisable at a price of CDN$0.55 per share for a period of three years from the date of closing. On issue the fair value of the warrants was determined to be $167,222 and included in derivative liability (Note 8).

In July 2016, the Company completed a non-brokered private placement and issued 1,000,000 units at a price of CDN$0.40 per unit for gross proceeds of $303,630 (CDN$400,000). Each unit comprised one common share and one purchase warrant,
with each warrant exercisable at a price of CDN$0.55 per share for a period of three years from the date of closing. On issue the fair value of the warrants was determined to be $121,943 and included in derivative liability (Note 8).

In September 2016, the Company completed a non-brokered private placement and issued 650,000 units at a price of CDN$0.36 per unit for gross proceeds of $177,048 (CDN$234,000). Each unit comprised one common share and one purchase
warrant, with each warrant exercisable at a price of CDN$0.55 per share for a period of three years from the date of closing. On issue the fair value of the warrants was determined to be $64,853 and included in derivative liability (Note
8).

In November 2016, the Company completed a non-brokered private placement and issued 1,427,500 units at a price of CDN$0.23 per unit for gross proceeds of $244,966 (CDN$328,325). Each unit comprised one common share and one purchase
warrant, with each warrant exercisable at a price of CDN$0.30 per share for a period of three years from the date of closing. On issue the fair value of the warrants was determined to be $145,612 and included in derivative liability (Note
8).

In December 2016, the Company completed a non-brokered private placement and issued 1,500,000 units at a price of CDN$0.21 per unit for gross proceeds of $238,373 (CDN$315,000). Each unit comprised one common share and one purchase
warrant, with each warrant exercisable at a price of CDN$0.30 per share for a period of three years from the date of closing. On issue the fair value of the warrants was determined to be $112,940 and included in derivative liability (Note
8).

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In connection with the private placements completed during the year ended December 31, 2016, the Company incurred share issued costs of $235,830 consisting of cash finders’ fees, exchange and regulatory fees and legal fees.

In January 2017, the Company completed a non-brokered private placement and issued 1,021,800 units at a price of CDN$0.21 per unit for gross proceeds of $162,030 (CDN$214,578). Each unit comprised one common share and one purchase
warrant, with each warrant exercisable at a price of CDN$0.25 per share for a period of three years from the date of closing.

In January 2017, the Company received $39,610 (CDN$52,000) from the exercise of 130,000 options.

In February 2017, the Company completed a non-brokered private placement and issued 650,000 units at a price of CDN$0.34 per unit for gross proceeds of $169,195 (CDN$221,000). Each unit comprised one common share and one purchase warrant, with each warrant exercisable at a price of CDN$0.40 per share for a period of three years from the date of closing. The Company also issued 45,500
finders warrants with an exercise price of CDN$0.40.

In March 2017, the Company completed a non-brokered private placement and issued 900,000 units at a price of CDN$0.19 per unit for gross proceeds of $128,077 (CDN$171,000). Each unit comprised one common share and one purchase warrant,
each warrant exercisable at a price of CDN$0.25 per share for a period of three years from the date of closing.

In April 2017, the Company completed a non-brokered private placement and issued 1,030,000 units at a price of CDN$0.19 per unit for gross proceeds of$146,186 (CDN$195,700). Each unit comprised one common share and one purchase warrant,
each warrant exercisable at a price of CDN$0.25 for a period of three years from the date of closing.

In May 2017, the Company completed a non-brokered private placement and issued 500,000 units at a price of CDN$0.21 per unit for gross proceeds of $76,603 (CDN$105,000). Each unit comprised one common share and one purchase warrant, with
each warrant exercisable at a price of CDN$0.27 per share for a period of three years from the date of closing.

In June 2017, the Company completed a non-brokered private placement and issued 1,250,000 units at a price of CDN$0.19 per unit for gross proceeds of $179,955 (CDN$237,500). Each unit comprised one common share and one purchase warrant,
with each warrant exercisable at a price of CDN$0.24 per share for a period of three years from the date of closing.

In July 2017, the Company completed a non-brokered private placement and issued 650,000 and 900,000 units at a price of CDN$0.19 per unit for gross proceeds of $95,565 (CDN$123,500) and $136,732 (CDN$171,000). Each unit comprised
one common share and one purchase warrant, with each warrant exercisable at a price of CDN$0.24 per share for a period of three years from the date of closing.

In August 2017, the Company completed a non-brokered private placement and issued 1,000,000 units at a price of CDN$0.15 per unit for gross proceeds of $118,007 (CDN$150,000). Each unit comprised one common share and one purchase
warrant, with each warrant exercisable at a price of CDN$0.19 per share for a period of three years from the date of closing.

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In September 2017, the Company completed a non-brokered private placement and issued 500,000 units at a price of CDN$0.15 per unit for gross proceeds of $61,687 (CDN$75,000). Each unit comprised one common share and one purchase warrant,
  with each warrant exercisable at a price of CDN$0.19 per share for a period of three years from the date of closing.

In October 2017, the Company completed a non-brokered private placement and issued 1,250,000 units at a price of CDN$0.12 per unit for gross proceeds of $119,736 (CDN$150,000). Each unit comprised one common share and one purchase
warrant, with each warrant exercisable at a price of CDN$0.15 per share for a period of three years from the date of closing.

In November 2017, the Company completed a non-brokered private placement and issued 1,449,833 units at a price of CDN$0.12 per unit for gross proceeds of $136,996 (CDN$173,980). Each unit comprised one common share and one purchase
warrant, with each warrant exercisable at a price of CDN$0.15 per share for a period of three years from the date of closing.

In December 2017, the Company completed a non-brokered private placement and issued 1,550,000 units at a price of CDN$0.10 per unit for gross proceeds of $114,688 (CDN$147,250). Each unit comprised one common share and one purchase
warrant, with each warrant exercisable at a price of CDN$0.12 per share for a period of three years from the date of closing.

In January 2018, the Company granted 1,354,000 stock options to
employees and officers with an exercise price of CDN$0.095 per share for a
period of 5 years.

In January 2018, the Company completed a non-brokered private
placement and issued 1,500,000 units at a price of CDN$0.09 per unit for gross
proceeds of $109,221 (CDN$135,000). Each unit comprised one common share and one
purchase warrant, with each warrant exercisable at a price of CDN$0.11 per share
for a period of three years from the date of closing.

In February 2018, the Company completed a non-brokered private
placement and issued 1,250,000 units at a price of CDN$0.07 per unit for gross
proceeds of $68,632 (CDN$87,500). Each unit comprised one common share and one
purchase warrant, with each warrant exercisable at a price of CDN$0.09 per share
for a period of three years from the date of closing.

In March 2018, the Company extended the expiry date of an
aggregate of 1,597,050 outstanding share purchase warrants. The warrants were
originally had expiry dates of April 14, 2018 and April 27, 2018. The expiry
date has been extended by two years.

In April 2018, the Company completed a non-brokered private
placement and issued 7,000,000 units at a price of CDN$0.14 per unit for gross
proceeds of $762,224 (CDN$980,000). Each unit comprised one common share and one
purchase warrant, with each warrant exercisable at a price of CDN$0.21 per share
for a period of three years from the date of closing.

Registration with SEC

On May 26, 2015, the Company became subject to the reporting
obligations pursuant to Section 15(d) of the United States Securities Exchange
Act of 1934, as amended following the filing United States Securities and
Exchange Commission (the SEC) declaring the Companys Form F-1 Registration
Statement effective.

On July 22, 2015, the Company commenced trading on the OTCQB,
an over the counter marketplace organized for venture-stage or early-stage
companies.

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On November 17, 2016, the SEC declared effective the Companys
post-effective amendment deregistering the securities registered pursuant to the
May 26, 2015 registration statement.

On June 22, 2016, the SEC declared effective the Companys Form
F-1 Registration Statement relating to the registration of up to 5,000,000 newly
issued shares of the Companys common stock; the resale of up to 2,661,111
common shares by shareholders whose shares were previously issued in private
placement transactions and/or part of executive compensation; and 400,000 shares
of common stock by LoPresti Law Group (LLG) to be paid to LLG in exchange for
the provision of legal services rendered.

Employees

As of the date of this annual report, the Company has 13
full-time employees all of which are located in the United States.

Significant Acquisitions or Developments

No significant acquisitions or significant dispositions have
been completed by Natcore during the most recently completed financial year or
are contemplated.

B.Business
Overview

Natcore is a research and development company pioneering solar cells with improved efficiency and reduced cost. Natcore’s intellectual property is currently protected by 65 patents granted or pending. Natcore does not plan to manufacture solar
cells, but rather to license its technology to manufacturers through partnerships that will ultimately yield licensing and royalty revenue.

Natcore’s primary technology is Natcore Foil CellTM. The vast majority of solar cells produced today limit cell efficiency to about 19%. This is due to the use of front contact and thermally diffused emitters. Many front contact cells
have a grid of thin metal lines that block light and thus reduce efficiency. In addition, standard solar cells are made using a thermally diffused emitter, which requires very high process temperatures (>800C). The combination of front contact
and thermally diffused emitters limits current cell efficiency.

Recently, a company reported 25.6% efficiency – the highest efficiency ever reached for a silicon solar cell – using only back contact and a silicon heterojunction (SHJ) emitter, eliminating the high-temperature diffusion steps. While
this achievement showed the value of these approaches, the cell was produced using a complicated, high-cost process.

Natcore’s process uses highly defined regions of heavily doped silicon to form a base contact of the solar cell. Natcore then uses a powerful, focused laser beam to melt small regions of the silicon surface, which allows a specially applied
dopant to penetrate the silicon matrix. Natcore has also discovered a method to laser- form the dopant regions without disturbing the high-quality emitter already present on the solar cell. This process is rapid, and thus can be performed with low-
capital equipment at atmospheric conditions.

In addition, Natcore has developed technology which eliminates the need for high-cost silver from mass-manufactured silicon solar cells. Currently, silver is used in the metallization process as it is
  highly conductive and easy to process. However, silver can represent 30% to 50% of the fabrication cost of a solar cell. Natcore’s unique approach to metallization relies on a simple multilayer structure, which uses inexpensive aluminum as its
  main conductor, and thus results in lower production costs. This cell technology may also result in cost savings when incorporated into other modules. Generally, cell-to-module loss is 8%-10%. However, when Natcore’s cells have been
  incorporated into the production of photovoltaic modules the cell-to-module loss was 0%, resulting in cost savings.

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Natcore is, first and foremost, a research and development company. The Company believes that its technology is recognized throughout the solar industry as being among some of the most advanced in photovoltaics. In addition to the Company’s
  technological advances, members of its Scientific Advisory Board have extensive experience in designing and building turnkey solar cell and module fabrication facilities. Natcore’s work on a line of black silicon products, in conjunction with
  its patents (a total of 65, granted and pending), is essential to building the next generation solar cell. As that technology has moved ever closer to commercialization and Natcore has gained a higher profile in the industry worldwide, it has
  received an increasing number of requests from solar cell and panel manufacturers, as well as solar plant developers, who are anxious to have access to Natcore’s technology and to acquire some form of exclusive rights thereto. These cell and
  module manufacturers are willing to give Natcore preferential treatment with regard to purchasing components and equipment, in exchange for access to its technology and applications when they become available. In addition, Natcore has received
  numerous requests from companies and countries/regions to assist in developing their solar projects, including building cell and/or panel manufacturing facilities, as well as solar plants.

In response to these requests, Natcore developed a “Best of Breed” Program through which it serves as a business and technical consultant on the design and construction of solar cell/solar panel fabrication facilities, and solar power
plants. Natcore has several Memoranda of Understanding and other agreements in place in furtherance of these efforts, with more to follow. Current projects are located in Australia, Belize and Vietnam. By leveraging its status and industry
relationships, Natcore can guide its Best of Breed customers in procuring components and equipment of the
highest quality and at highly competitive prices. Natcore is not itself a
manufacturer of any equipment or components, and therefore it has no inherent
biases or conflicts as to which components to buy or which vendors to select or
recommend. Thus, each project can be optimized as to quality and cost.

The Company continues to be in the research and development
stage and its potential products are not yet at the stage of commercial
production. The Company anticipates generation of initial revenues within the
fiscal year 2018, but plans to continue its research and development programs
for the purposes of developing additional applications for its technologies. The
Company is currently conducting its own research and development but does
anticipate subcontracting certain work with joint venture partners, as described
below. The Companys long-term objective is to commercialize its technologies in
order to generate commercial revenues. In order for the Company to meet this
long-term objective, the following events must occur:

Event
    Target Date
    CostResearch and development for the Companys technologies,
      including identifying additional applications
    Ongoing
    Not knownAdditional patent and other intellectual property
      applications
    Ongoing
    Not known


The short-term objectives of the Company over the next twelve
months are to improve the efficiencies of the Companys technologies and
commence licensing of the Companys technologies. In order to the complete same,
the Company anticipates spending between $300,000 and $500,000 outsourcing
certain work with joint developer partners, including use of equipment. At this
stage, it is not anticipated that the Company must expend further funds to
commence licensing, but may consider allocating funds towards marketing in the
future.

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A significant shift is underway in the world-wide silicon solar
cell industry, driven by the rising prices of silicon feedstock material. Cell
producers are now moving to produce thinner solar cells to reduce their
requirements for silicon feedstock. Technologies that reduce or eliminate high
temperatures will be required and will be in demand. Making this long-term shift
will enable the silicon solar cell industry to sustain its historic annual
growth rates well into the future.

New developments in technology may negatively affect the
development or sale of the Companys products or make the Companys technologies
obsolete. Natcore intends to maintain its competitive position and prevent the
impacts of obsolescence by continuing to develop and perfect its technologies
and find additional commercial usages for its technologies.

Natcore is not aware of any material market controls or
regulations within the technology sector which might affect the marketing of its
technologies.

Natcore is not aware of any material regulatory approvals
necessary for its research and development work, other than approval of
appropriate patent applications in the jurisdictions the Company intends to do
business.

Production and Services

Natcore does not plan to manufacture solar cells. Instead,
Natcore plans to license its technologies to manufacturers, receive royalties
from cells manufactured using its technologies and from equipment and chemical sales. Customers will be required to execute non-exclusive license agreements or exclusive license agreements unique to specified jurisdictions. Royalty rights will entitle the Company to benefit from residual income on each product that
utilizes the Company’s technology. In addition, Natcore intends to sub-contract the manufacturing of the equipment necessary for the black silicon process and the lasers. There will be a mark-up, to Natcore’s benefit, on each piece of
equipment. Finally, Natcore intends to produce recurring revenue by engaging third-parties to mix and ship the patented chemical mixture for the various applications.

Specialized Skill and Knowledge

Certain aspects of Natcore’s business, relating to the development and discovery process, require specialized skills and knowledge, including chemical, electrical and mechanical engineering. Increased activity in the technology and research
and development industry may make it more difficult to locate competent employees and consultants in such fields, and may affect Natcore’s ability to grow at the pace it desires. However, Natcore does not anticipate any significant
difficulties in locating appropriate personnel as the employees and consultants it needs to conduct appropriate studies on its technologies are available.

Competitive Conditions

Given the complex nature and cost of the systems now in use by the solar cell industry, Natcore expects to offer value to its customers. Natcore’s black silicon technology is expected to replace an expensive, energy and manpower intensive,
thermal vacuum process with a simple wet chemistry process that will make an improved anti-reflection surface on silicon solar cells. In addition, the Natcore Foil CellTM will increase efficiency and power output without an increase in
manufacturing cost.

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An independent engineering study comparing Natcore’s technology to that now used by the solar cell industry shows conclusively that solar cell manufacturing costs can be reduced by up to 23.5% . The study included both capital and lifecycle
  costs when making the comparison. Other studies completed by the Company have shown that Natcore’s LPD technology can be tailored to solar cell technologies other than silicon, and while costs savings have not been quantified, preliminary
  results indicate they will result in at least single digit percentage cost reductions.

The Company expects to see growing demand for low-temperature, non-vacuum, anti-reflective coating systems for the emerging solar cell market. The Company is unaware of any competing room temperature anti-reflective coating technology in development
or commercial use. While current thermal and vacuum systems are adequate, Natcore’s technology will enable cell producers to improve their profit margins by offering lower cost and higher throughput rates. In addition, while there are some
companies that manufacture high-efficiency HIT cells, those companies use a very complicated and costly process to produce such cells. Typically, the production costs of such companies are twice as expensive as the standard commercial cells
currently available.

Independent industry studies also confirm substantial global growth in the production of monocrystalline silicon (“mono-silicon”) and the oversupply in the market. This is particularly important since Natcore’s technologies are
particularly suited to maximize the efficiencies of mono-silicon, n-type solar cells. In particular, industry studies project global mono-silicon demand will top out at less than 10GW in 2015, but global mono-silicon wafer capacity has already
reached 14GW. This oversupply has led to a substantial price drop in the mono-silicon wafer market. In 2016, wafer manufacturers have been expanding their mono-silicon capacity as they are optimistic about the market prospects. In sum, industry
analysts project that the global mono-silicon capacity will surpass 17GW in 2016, with the annual growth rate exceeding 20%. Nonetheless, oversupply will persist in the mono-silicon wafer market next year unless end-market demand increases
substantially. Therefore, Natcore will be able to maximize the efficiencies of mono-silicon, n-type solar cells at a lower cost.

Given the increasing demand for solar cell technology, competition can be expected to increase substantially.

The Company believes that it is well positioned to provide its Best of Breed Program in a competitive market. Natcore believes it has a significant competitive advantage in offering its Best of Breed Program, components and equipment, including
specifically the ability to offer some level of exclusivity to the Company’s technologies once commercially available. The Company’s technology is recognized as being among the most advanced, giving the Company an advantage in the
consulting services market. In addition, such technology would become part of the project as it is in process, and/or would be incorporated as an upgrade to existing facilities on an ongoing basis.  Natcore’s main competition for revenues
generated through its Best of Breed Program may come from vertically integrated companies, especially if customers prefer such an approach. However, no such company can offer the technology, and limited exclusivity to that technology, that Natcore
offers.

Accordingly, there can be no assurances that the Company will compete successfully with existing or new competitors, or that the competition will not have a material adverse effect on the business, operating results or financial condition of the
Company. At the same time, this increased competition could also benefit Natcore since manufacturers would be anxious to access a technology that would give them cost or efficiency advantages.

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Components

Over the past several years, increased solar cell activity on a global scale has made some services and materials, such as silicon, difficult to procure. It is possible that delays or increased costs may be experienced in order to proceed with
Natcore’s proposed activities during the current period. Such delays could significantly affect Natcore if the delay reduces the opportunity Natcore may have had to develop a particular project had such tests been completed in a timely manner
before the fall of such prices. The balance of the raw materials Natcore requires to carry on its business are available through normal supply or business contracting channels in North America. Natcore has secured personnel and/or consultants to
conduct its currently contemplated programs.

Cycles

Natcore does not expect its business to be cyclical or seasonal.

Economic Dependence and Changes to Contracts

It is not expected that Natcore’s business will be affected in the current financial year by the renegotiation or termination of contracts or sub-contracts.

Natcore’s success will depend in part on its ability to protect its proprietary rights and technologies. Natcore relies on a combination of patents, trademark laws, trade secrets, confidentiality provisions and other contractual provisions to
protect its proprietary rights.

However, not all of these measures may apply or may afford only limited protection. Natcore’s failure to adequately protect its proprietary rights may adversely affect Natcore.

Environmental Protections

The materials used in the Company’s processes have no extraordinary environmental protection requirements. As a result, Natcore does not currently anticipate that any environmental regulations or controls will materially affect the Company or
its processes under development.

Foreign Operations

Natcore currently conducts business and maintains its offices in the United States. Natcore markets its technologies on a world-wide basis, subjecting the Company to the risk that it may not be able to enforce its intellectual property rights in
certain jurisdictions. In jurisdictions in which there is a history of intellectual property infringement, Natcore would seek to obtain a strategic joint venture partner prior to accessing such markets to assist in the protection of its
technologies.

Lending

Natcore does not currently hold any investments or owe any material liabilities.

Natcore has not adopted any specific policies or restrictions regarding investments or lending, but will ensure any investment or debt activities incurred are in the best interests of Natcore and its shareholders. Natcore expects that in the future
in order to develop its technologies it will need to raise additional capital through a combination of debt and equity.

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Bankruptcy and Similar Procedures

There are no bankruptcies, receivership or similar proceedings
against Natcore or any of its subsidiaries, nor is Natcore aware of any such
pending or threatened proceedings. There has not been any voluntary bankruptcy,
receivership or similar proceedings by Natcore or its subsidiaries since its
incorporation.

Reorganization

Since the Companys Qualifying Transaction, Natcore has not
completed any reorganization since its incorporation.

Social or Environmental Policies

Natcore has not adopted any specific social or environmental
policies that are fundamental to its operations (such as policies regarding its
relationship with the environment, with the communities in the vicinity of its
facilities or human rights policies). However, Natcores management, with the
assistance of its contractors and advisors, ensures its ongoing compliance with
local environmental laws in the jurisdictions in which it does business.

Natcore believes that its operations comply in all material
respects with applicable laws and regulations concerning the environment. While
it is impossible to predict accurately the future costs associated with
environmental compliance and potential remediation activities, compliance with
environmental laws is not expected to require significant capital expenditures
and has not had, and is not expected to have, a material adverse effect on the
Companys earnings or competitive position.

C.Organizational
Structure

The consolidated financial statements include the accounts of
the Company and its controlled entities. Details of controlled entities are as
follows:

Percentage Owned1Jurisdiction of Incorporation
    December 30, 2017
    December 30, 2016
    December 30, 2015Natcore Technology, Inc.
    Delaware, United States
    100%
    100%
    100%Vanguard Solar Inc.
    Delaware, United States
    100%
    100%
    100%Netcore Asia Technology, Limited
    Hong Kong
    100%
    100%
    100%NewCyte, Inc.
    Delaware, United States
    100%
    100%
    100%Natcore Technology Zhuzhou Ltd.
    Peoples Republic of China
    55%
    55%
    55%


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Natcore Technology, Inc. is the entity holding a large portion
of the Companys licensing and intellectual property rights and through which
the Company conducts the majority of its active operations.

NewCyte, Inc., holds a portfolio of intellectual property
including issued and pending patents covering the coating of fullerenes
(including carbon nanotubes) with silica, dielectric and semiconducting films
for a variety of potential applications, including photon, chemical and
biomolecule sensing.

Vanguard Solar, Inc. holds intellectual property in the field
of solar energy relating to the development of a flexible, thin-film
photovoltaic material believed to be capable of silicon solar cell-like
efficiency performance.

Natcore Asia Technology Ltd. holds the Companys fifty-five
percent (55%) share of Natcore Technology (Zhuzhou) Ltd., a joint venture formed
with the Zhuzhou Hi-Tech Industrial Development Zone, a government-supported
zone in Hunan province, and Chuangke Silicon Ltd., a polycrystalline silicon
producer.

ITEM 4A - UNRESOLVED STAFF COMMENTS

Not Applicable

ITEM 5 - OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following discussion and analysis of the Companys
financial condition and results of operations should be read in conjunction with
the Companys consolidated financial statements and the related notes thereto
included elsewhere in this annual report on Form 20-F. This discussion may
contain forward- looking statements based upon current expectations that involve
risks and uncertainties. The Companys actual results may differ materially from
those anticipated in these forward-looking statements as a result of various
factors, including those set forth under Item 3. Key InformationD. Risk
Factors or in other parts of this annual report on Form 20-F.

---

A.Operational
Results

Year Ended December 31, 2017 Compared to the Year Ended
December 31, 2016

As the Company is in the development stage, it is expected the
Company will continue to generate losses for the upcoming fiscal year.

During the year ended December 31, 2017, the Company did not
generate any revenue. The principal activity of the Company during the year
ended 2017 and the year ended 2016 was that of research giving rise to normal
recurring costs.

The Company reported a net loss of $1,274,996 for the year
ended December 31, 2017 compared to a net loss of $2,021,700 for the year ended
December 31, 2016. The primary reasons for the change was additional stock-based
compensation in 2016 which was not granted in 2017.

The Companys operational expenses for the year ended December
31, 2017 were $2,160,792 compared to $3,905,028 for the prior year ended
December 31, 2016. Significant expense changes in the year ended December 31,
2017 compared to prior year ended December 31, 2016 are in the table below:

Year Ended 31,2017
    2016
    VarianceExpensesConsulting
    132,936
    124,652
    8,284Depreciation and amortization
    75,272
    146,946
    (71,674)Filing fees
    26,278
    45,172
    (18,894)Foreign exchange (gain
    1,457
    16,457
    (15,000)Interest and bank charges
    7,804
    2,698
    5,106Marketing
    76,582
    341,104
    (264,522)Office and miscellaneous
    191,766
    201,736
    (9,970)Professional fees
    81,589
    219,016
    (137,427)Research and development
    861,947
    1,137,422
    (275,475)Stock-based compensation
    67,599
    869,130
    (801,531)Travel
    22,231
    37,472
    (15,241)Wages and salaries
    615,331
    763,223
    (147,892)2,160,792
    3,905,028
    (1,744,236)Other Income (Expenses)Fair value adjustment on warrants
    885,673
    1,880,587
    (994,914)Other income
    123
    1,932
    (1,809)Interest income
    -
    809
    (809)885,796
    1,883,328
    (997,532)NET INCOME LOSS
    (1,274,996)
    (2,021,700)
    746,704


As a result of the acquisitions of Natcore US and the Companys
operations in the United States, the Company and its financial results are
exposed to fluctuations between the Canadian and United States dollars. The
foreign exchange (gains) or loss present for the periods above, results from
certain monetary items, primarily cash equivalents, being denominated in
Canadian dollars.

Stock-based compensation relates to options granted under the
Companys stock option plan to directors, officers, employees and consultants.
Compensation expense is recorded using the fair value method over the vesting
periods of the options. The fair value of each option granted is estimated as at
the date of grant using the Black-Scholes Option Pricing Model.

---

Selling and Marketing Expenses

The Company did not recognize any revenue, as it was still in the development stage for many of its applications. Natcore does not believe it would require a direct sales force in the foreseeable future. Natcore markets its technology though the
industry with its management staff at the time. As the Company has moved through the proof of concept phase and closer to commercialization for its applications, it began making more presentations to manufacturers and potential customers as well as
equipment builders who would adapt existing machinery to accommodate Natcore’s process.

General and Administrative Expenses

Natcore’s general and administrative expenses consisted primarily of costs associated with marketing activities, outside professional fees, travel costs, facilities costs and other corporate expenses. Its professional and consulting fees for
the year ended December 31, 2017 increased approximately $8,284 over the prior year ended resulting from increased costs relating to patents and accounting, legal fees associated with continuous disclosure obligations and the Company using
additional consultants for marketing purposes. For the year ended December 31, 2017 Natcore’s office and other operational expenses decreased approximately $9,970. Travel expenses decreased approximately $15,241 for the year ended
December 31, 2017 compared to prior year.

Wages and Salaries Expenses

Natcore’s wages and salaries expenses consisted of compensation costs for management, finance and other administrative personnel, these costs also included payroll taxes and benefits associated with its personnel functions. For the year ended
December 31, 2017 compared to the prior year, the changes in wages and salaries expense versus the prior year decreased approximately $147,892.

Research and Development Expenses

Natcore’s research and development expenses consisted of all expenses incurred in research and development activities, including compensation associated with its research staff. The Company’s decrease in R&D expense of approximately
$275,475 over the year ended was primarily due to performing more work internally and less outsourcing.

Stock Based Compensation Expense

Natcore’s stock based compensation expense consisted of fair value costs associated with the issuance of stock, stock options and warrants for services that were preformed or to be performed. The stock based compensation for the year ended
December 31, 2017 decreased approximately $801,531 over the prior year.

Depreciation and Amortization Expenses

Natcore’s depreciation and amortization expenses were costs for the depreciation and amortization of its equipment and intangible assets. Natcore computed depreciation using the straight-line method over the useful lives of the related assets,
which ranged from three to seven years. Intangible assets with finite useful lives were amortized on a straight-line basis over their estimated useful lives. The estimated useful life and amortization method were reviewed at the end of each
reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. For the year ended December 31, 2017 depreciation and amortization expense decreased approximately $71,674 over the prior year because of
intangible assets becoming fully amortized in the prior year.

---

Other Income (Expense)

Other income (expense) primarily consisted of gains and losses
related to Natcores investment activities from its cash equivalent investments
and other non- recurring items.

Operating (Loss)

Natcore did not have any sales revenue, consequently it
generated only operating losses. Natcores operating expenses consisted of
general and administrative expenses, wages and salaries expenses, research and
development expenses, depreciation and amortization costs and stock-based
compensation expenses discussed above.

Year Ended December 31, 2016 Compared to the Year Ended
December 31, 2015

During the year ended December 31, 2016, the Company did not
generate any revenue. The principal activity of the Company during the year
ended 2016 and the year ended 2015 was that of research giving rise to normal
recurringcosts.

The Company reported a net loss of $2,021,700 for the year
ended December 31, 2016 compared to a net loss of $3,488,129 for the year ended
December 31, 2015. The primary reasons for the change were income resulting from
non-cash revaluations of the Companys derivative liabilities resulting from a
decrease in its stock price at the December 31, 2016 compared to December 31,
2015 offset by an increase in operating expenses.

The Companys operational expenses for the year ended December
31, 2016 were $3,905,028 compared to $3,730,661 for the prior year ended
December 31, 2015. Significant expense changes in the year ended December 31,
2016 compared to prior year ended December 31, 2015 are in the table below:

Year Ended 31,2016
    2015
    VarianceExpensesConsulting
    124,652
    181,589
    (56,937)Depreciation and amortization
    146,946
    279,527
    (132,581)Filing fees
    45,172
    25,016
    20,156Foreign exchange (gain
    16,457
    5,159
    11,298Interest and bank charges
    2,698
    2,383
    315Marketing
    341,104
    268,853
    72,251Office and miscellaneous
    201,736
    216,811
    (15,075)Professional fees
    219,016
    335,762
    (116,746)Research and development
    1,137,422
    1,203,716
    (66,294)Stock-based compensation
    869,130
    387,648
    481,482Travel
    37,472
    45,858
    (8,386)Wages and salaries
    763,223
    778,339
    (15,116)(3,905,028)
    (3,730,661)
    (174,367)Other Income (Expenses)Fair value adjustment on warrants
    1,.880,587
    226,827
    1,653,760Other income
    1,932
    14,124
    (12,192)Interest income
    809
    1,581
    (772)1,883,328
    242,532
    1,640,796NET INCOME LOSS
    (2,021,700)
    (3,488,129)
    1,466,429


As a result of the acquisitions of Natcore US and the Companys
operations in the United States, the Company and its financial results are
exposed to fluctuations between the Canadian and United States dollars. The
foreign exchange (gains) or loss present for the periods above, results from
certain monetary items, primarily cash equivalents, being denominated in
Canadian dollars Stock-based compensation relates to options granted under the
Companys stock option plan to directors, officers, employees and consultants.
Compensation expense is recorded using the fair value method over the vesting periods of the options. The fair value
of each option granted is estimated as at the date of grant using the
Black-Scholes Option Pricing Model.

---

Selling and Marketing Expenses

The Company did not recognize any revenue, as it was still in
the development stage for many of its applications. The Company plans to have
its black silicon technology available to the solar industry in the following
18-24 months; Natcore does not believe it would require a direct sales force in
the foreseeable future. Natcore markets its technology though the industry with
its management staff at the time. As the Company has moved through the proof of
concept phase and closer to commercialization for its applications, it began
making more presentations to manufacturers and potential customers as well as
equipment builders who would adapt existing machinery to accommodate Natcores
process.

General and Administrative Expenses

Natcores general and administrative expenses consisted
primarily of costs associated with marketing activities, outside professional
fees, travel costs, facilities costs and other corporate expenses. Its
professional and consulting fees for the year ended December 31, 2016 decreased
approximately $56,937 over the prior year ended resulting from increased costs
relating to patents and accounting, legal fees relating to this filing and the
Company using additional consultants for marketing purposes. For the year ended
December 31, 2016 Natcores office and other operational expenses decreased
approximately $15,075. Travel expenses decreased approximately $8,386 for the
year ended December 31, 2016 compared to prior year.

Wages and Salaries Expenses

Natcores wages and salaries expenses consisted of compensation
costs for management, finance and other administrative personnel, these costs
also included payroll taxes and benefits associated with its personnel
functions. For the year ended December 31, 2016 compared to the prior year, the
changes in wages and salaries expense versus the prior year decreased
approximately $15,116.

Research and Development Expenses

Natcores research and development expenses consisted of all
expenses incurred in research and development activities, including compensation
associated with its research staff. The Companys decrease in R&D expense of
approximately $66,294 over the year ended was primarily due to performing more
work internally and less outsourcing.

Stock Based Compensation Expense

Natcores stock based compensation expense consisted of fair
value costs associated with the issuance of stock, stock options and warrants
for services that were preformed or to be performed. The stock based
compensation for the year ended December 31, 2016 increased approximately
$481,482 over the prior year.

Depreciation and Amortization Expenses

Natcores depreciation and amortization expenses were costs for
the depreciation and amortization of its equipment and intangible assets.
Natcore computed depreciation using the straight-line method over the useful
lives of the related assets, which ranged from three to seven years. Intangible
assets with finite useful lives were amortized on a straight-line basis over
their estimated useful lives. The estimated useful life and amortization method
were reviewed at the end of each reporting period, with the effect of any
changes in estimate being accounted for on a prospective basis. For the year
ended December 31, 2016 depreciation and amortization expense decreased approximately
$132,581 over the prior year because of intangible assets becoming fully
amortized in the prior year.

---

Other Income (Expense)

Other income (expense) primarily consisted of gains and losses
related to Natcores investment activities from its cash equivalent investments
and other non- recurring items.

Operating (Loss)

Natcore did not have any sales revenue, consequently it
generated only operating losses. Natcores operating expenses consisted of
general and administrative expenses, wages and salaries expenses, research and
development expenses, depreciation and amortization costs and stock-based
compensation expenses discussed above.

B.Liquidity and Capital Resources

The following table summarizes the Companys cash flows by
activity and cash on hand for the years ended December 31, 2017 and 2016:

Years Ended December 31,Activity
    2017 (Audited)
    2016 (Audited)Net cash used in operating activities
    (1,545,191)
    (2,346,474)Net cash used in investigating activities
    (1,548)
    (3,542)Net cash used in financing activities
    1,579,878
    1,851,747Net increase (decrease) in cash
    33,139
    (498,269)Cash at the beginning of the period
    23,252
    521,521Cash at the end of the period
    56,391
    23,252


The Company reported working capital (deficit) of ($1,776,517)
as of December 31, 2017 and ($1,469,472) at December 31, 2016. At December 31,
2017, the Company had cash of $56,391 compared to cash of $23,252 as of December
31, 2016. The increase in the deficit is the result of a net loss for
operational expenses which is offset by proceeds of issuances of common stock
shares. The Company is currently pursuing additional financing alternatives,
including completing another private placement, to fund operations. Current
assets excluding cash and cash equivalents at December 31, 2016 consisted of
receivables of $12,071 and prepaid expenses of$55,187.

Current liabilities at December 31, 2017 consisted of accounts
payable and accrued liabilities of $1,577,483 and the derivative financial
liability of $267,077.

The following table summarizes the Companys cash flows by
activity and cash on hand for the years ended December 31, 2016 and 2015:

---

Years Ended December 31,Activity
    2016 (Audited)
    2015 (Audited)Net cash used in operating activities
    (2,346,474)
    (2,588,345)Net cash used in investigating activities
    (3,542)
    (27,185)Net cash used in financing activities
    1,851,747
    2,588,664Net increase (decrease) in cash
    (498,269)
    (26,866)Cash at the beginning of the period
    521,521
    548,387Cash at the end of the period
    23,252
    521,521


The Company reported working capital (deficit) of ($1,469,472)
as of December 31, 2016 and ($1,186,488) as of December 31, 2015. As of December
31, 2016, the Company had cash of $23,252 compared to cash of $521,521 as of
December 31, 2015. The decrease is the result of a net loss for operational
expenses which is offset by proceeds of issuances of common stock shares in
2016. The Company is currently pursuing additional financing alternatives,
including completing another private placement, to fund operations.

Current assets excluding cash and cash equivalents at December
31, 2016 consisted of receivables of $12,071 and prepaid expenses of $55,187.

Current liabilities at December 31, 2016 consisted of accounts
payable and accrued liabilities of $1,192,637 and the derivative financial
liability of $367,345.

The Company may continue to have capital requirements in excess
of its currently available resources. In the event the Companys plans change,
its assumptions change or prove inaccurate, or its capital resources in addition
to projected cash flow, if any, prove to be insufficient to fund operations, the
Company may be required to seek additional financing. There can be no assurance
that the Company will have sufficient financing to meet its future capital
requirements or that additional financing will be available on terms acceptable
to the Company in the future.

In the event the Companys plans change, its assumptions change
or prove inaccurate, or its capital resources in addition to projected cash
flow, if any, prove to be insufficient to fund operations, the Company may be
required to seek additional financing. There can be no assurance that the
Company will have sufficient financing to meet its future capital requirements
or that additional financing will be available on terms acceptable to the
Company in the future.

C.Research
and Development, Patents and Licenses

In 2004, the Company entered into a License Agreement with a
university under which the university is entitled to receive: (i) 2% of the
Companys adjusted gross sales as defined in the License Agreement, and (ii) 2%
of the adjusted gross sales of any sublicensee as defined in the License
Agreement. The License Agreement gives the Company an exclusive license to a
certain United States patent and the related technology for low temperature
growth of inorganic materials from solution using catalyzed growth and
re-growth.

On September 1, 2009, the Company entered into a sponsored
research agreement with Rice University to develop thin films incorporating
silicon quantum dots. The initial term of the agreement is one year and the
proposed budget is $100,000. Both the term and the funding could be extended by
mutual agreement.

---

As of the date of this filing the agreement has not been
extended and no money has been paid to Rice University beyond the original
$100,000.

On December 12, 2011 the Company entered into a Patent License
Agreement with the National Renewable Energy Laboratory (NREL) to use certain
licensed patents for technologies for creating a black silicon antireflection
layer integrated into high efficiency solar cells. The Company agreed to pay a
running royalty of two and one half percent (2.5%) on all Net Sales of Licensed
Products (excluding Licensed Chemicals) sold by or on behalf of Licensee. The
Company also agreed to pay an annual running royalty of ten percent (10%) of Net
Sales of Licensed Chemicals sold by or on behalf of Licensee. Should the running
royalty not achieve $25,000, then the Company would have to pay the difference
up to $25,000. The License Agreement estimates that the Companys
estimated contribution is $100,000 a year. NRELs estimated in-kind contribution is
$50,000, conditioned on available funding. While neither party has an obligation
to continue performance of its work at a contribution in excess of the estimated
amount, each party shall provide at least thirty days notice if complete
performance will exceed the estimated costs. The License Agreement was amended
on July 27, 2012 in order to modify a section of the License pertaining to
Licensed Intellectual Property. The modification entailed the specific titles
and application numbers of the licensed patents. The License Agreement was
further amended on January 30, 2014 to delete and replace Exhibit C, 2) Market
Milestones.

The License Agreement gives the Company an exclusive license to
the aforementioned patents for the development of a commercial manufacturing
process for both multicrystalline and monocrystalline solar cells that combines
the Companys passivation technology. All patent license agreements are for the
duration of the life of the patent as established by the USPTO when the patent
is granted.

The License Agreement is subject to early termination. Either
the Company or NREL has the right to terminate the License Agreement with cause
and without judicial resolution upon written notice to the other in the case of
a breach of the License Agreement. The Company shall provide NREL will
sufficient advance funds to maintain approximately 90-day advance of funds
during the entire period of work. No work shall begin before the receipt of a
sufficient cash-advance. If the Company fails to provide the necessary advance
funds is cause for termination by NREL. Further, the License Agreement shall
terminate automatically upon a final adjudication of invalidity,
unenforceability, or the extinguishment of all Licensed Patents, for any reason.
In addition, NREL may terminate the License Agreement if the Company fails to
satisfy the requirements set forth in Exhibit B and C of the License Agreement,
attempts to transfer the Companys rights under the License Agreement or the
Company becomes a party to a Bankruptcy proceeding. Exhibit B outlines the
financial considerations of the License Agreement: specifically concerning the
Fields of Use, the Upfront Fee of $20,000, the Continuous Royalty Rate Structure
due by the Company, the Subleasing Royalties due by potential Sub-Licensees, and
states the minimum annual payment must be at least $25,000. Exhibit C outlines
the technical and marketing milestones pursuant to this agreement. Specifically,
the agreement also outlines certain market milestones for the parties. The first
milestone stipulates the achievement of cumulative Net Sales of Licensed
Products in excess of $1 million on or before December 1, 2014. This milestone
has not been met by the company. Milestones for cumulative Net Sales of Licensed
Products in excess of $2 million and $3 million are set for December 1, 2015 and
December 1, 2016, respectively. The Company believes, based on conversation with
representatives from NREL, that all such milestones are eligible for
renegotiation as desired by the Company. The License Agreement shall
automatically terminate if the Company attempts to pledge its rights under the
License Agreement as collateral to a third party. The Company may terminate the
License Agreement upon sixty days prior notice to NREL provided that all
outstanding fees, reimbursements and royalties (as detailed in the License
Agreement) are satisfied.

---

In March 2012, the Company opened its Research and Development Center (the “R&D Center”) in Rochester, NY. The R&D Center enables Natcore to develop applications based on the company’s proprietary liquid phase deposition
technology. On June 1, 2013, the Company entered into a new two year lease for its research and development facility in Rochester, New York. The Company will pay a base rent of $103,596 per year in monthly installments of $8,633. The lease
was set to expire on June 30, 2015. On June 26, 2015, the Company extended the lease from July 1, 2015 to June 30, 2017 at a base rent of $105,212 per year in monthly installments of $8,768.

On January 27, 2015, Natcore announced that it had successfully used its proprietary advances in laser technology to produce an all-low-temperature laser-doped solar cell with all of its electrical contacts on the back of the cell. Eliminating the
contacts from the cell increases output by a comparable amount. While other all- back-contact cells had been produced, those cells use high-temperature diffusion in their doping steps and highly complex multi-step patterning processes to apply the
electrical contacts. The Natcore Foil CellTM, on the other hand, uses only high-speed, inexpensive laser processing to define the doping regions and the contacts.

On February 17, 2015, the Company announced that it had successfully formed a heterojunction solar cell using germanium quantum dots on an ordinary n-type silicon wafer. Quantum-dot solar cells have the potential to be transformational for
terrestrial solar energy, with efficiencies far above anything available commercially as of the date of their formation. One month later, Natcore produced an all-back-contact silicon “HIT-structure” (heterojunction with intrinsic thin
layer) solar cell using their proprietary laser technology (the “Natcore Foil CellTM”). Silicon HIT-structure cells have been shown to yield record efficiencies. In addition to further increasing cell efficiency relative to industry
standards, Natcore’s all-back-contact technique could allow production of these high efficiency cells at a low cost.

On July 9, 2015, Natcore developed a new solar cell structure that proposed to simplify the production process, significantly lower costs, and accelerating the path toward ultra high-efficiency cells. Importantly, the new cell structure was expected
to completely eliminate high-cost silver from mass-manufactured silicon solar cells. By August 2015 the Company was able to build the Natcore Foil CellTM in which the use of silver was eliminated. This substitution was accomplished with no loss
of performance and a substantial decrease in the metallization cost of a solar cell and total raw material cost of a solar module.

On March 29, 2016, Natcore announced it had achieved commercial level efficiencies for its laser-processed solar cells. Refinement of Natcore’s revolutionary Natcore Foil CellTM, which utilizes low-cost aluminum instead of high-cost
silver, has progressed rapidly; less than 11 months prior, early proof-of-concept cells were delivering 4% efficiencies. At the time of the announcement, the Company’s cells reached efficiencies of  17.5%  (roughly  the  equivalent  of
typical commercial cells being sold). Natcore’s new cell design, which builds upon the basic concept of a silicon heterojunction (SHJ) solar cell, is producing short-circuit currents above 40 mA/cm2 and open-circuit voltages above 0.65V.
Anticipated improvements in these measurements, as well as fill factor, project to efficiencies well above 20%. To quantify the cost advantages of its process and design for potential partners, Natcore has retained an independent laboratory to
prepare an analysis comparing the cost of producing solar cells using Natcore’s breakthrough process with that of making cells using existing manufacturing methods.

On November 15, 2016, the Company announced it had achieved an efficiency of 19.4% in its latest demonstration solar cell by reducing resistance from laser- formed contacts. The laser-formed base contact is critical to the Natcore Foil CellTM,
which is an all-back-contact cell that eliminates the need for high-cost silver in the production process by replacing it with low-cost aluminum. Higher resistance at this contact, as well as damage from the laser process, had been limiting the
performance of the Company’s demonstration cells. Natcore scientists discovered a new laser-based contacting process that overcomes these issues. As a result, device efficiency increased by nearly 2% since June 2016 when the Company announced an efficiency of 17.5% (17.5% being roughly
equivalent to typical commercial cells available as of that date). In 2015, the
Companys early proof-of-concept cells were delivering 4% efficiencies. Solar
cells using Natcores new approach have an open-circuit voltage (Voc) of nearly
0.7V, pointing to the potential of significantly higher efficiencies.

---

On May 2, 2017, Natcore announced that it had achieved an
efficiency of 20.7% in their latest demonstration solar cell.

As of December 31, 2017, the Company had 32 granted patents and
33 patents pending, including but not limited to the following:

Patent 7,999,176 - Expiration date: 5/18/2029

Nanostructured solar cells

Improved photovoltaic devices and methods are disclosed. In one
embodiment, an exemplary photovoltaic device includes a semiconductor layer and
a light- responsive layer (which can be made, for example, of a semiconductor
material) which form a junction, such as a p-n junction. The light-responsive
layer can include a plurality of carbon nanostructures, such as carbon
nanotubes, located therein. In many cases, the carbon nanostructures can provide
a conductive pathway within the light-responsive layer. In other embodiments,
exemplary photovoltaic devices include semiconductor nanostructures, which can
take a variety of forms, in addition to the carbon nanostructures. Further
embodiments include a wide variety of other configurations and features. Methods
of fabricating photovoltaic devices are also disclosed.

Patent 8,431,818 - Expiration date: 5/5/2030

Solar cells and photodetectors with semiconducting
nanostructures

Improved photovoltaic devices and methods are disclosed. In one
embodiment, an exemplary photovoltaic device includes a semiconductor layer and
a light- responsive layer (which can be made, for example, of a semiconductor
material) which form a junction, such as a p-n junction. The light-responsive
layer can include a plurality of carbon nanostructures, such as carbon
nanotubes, located therein. In many cases, the carbon nanostructures can provide
a conductive pathway within the light-responsive layer. In another embodiment,
an exemplary photovoltaic device can include a light-responsive layer made of a
semiconductor material in which is embedded a plurality of semiconducting carbon
nanostructures (such as p-type single-wall carbon nanotubes). The interfaces
between the semiconductor material and the semiconducting carbon nanostructures
can form p-n junctions. In yet other embodiments, exemplary photovoltaic devices
include semiconductor nanostructures, which can take a variety of forms, in
addition to the carbon nanostructures. Further embodiments include a wide
variety of other configurations and features. Methods of fabricating
photovoltaic devices, as well as nanostructured photodetectors, as also
disclosed.

Patent 8,433,417 - Expiration date: 12/12/2029 Carbon
nanostructure artificial retinal implant

A retinal implant can include an array of photoreceptors
adapted for positioning in the eye. Each photoreceptor can include a core, for
example a carbon nanostructure, and a shell. The shell can include a
light-responsive layer, and in many cases, the light-responsive layer can be
formed of two semiconductor layers forming a heterojunction. The photoreceptors
can be adapted to generate an electric field in response to incident light so as
to stimulate a retinal neuron in its vicinity. The photoreceptors can be
micron-sized or nano-sized, and can be arranged in densities similar to the
density of rods and cones in the human eye. In one embodiment, an exemplary
sensor for an imaging device can include a plurality of photosensors disposed on a substrate. Each photosensor can
include a carbon nanostructure, a light-responsive layer coating at least a
portion of the carbon nanostructure.

---

Patent 7,718,550 - Expiration date: 1/16/2026

Method for Low Temperature Growth of Inorganic Materials from
Solution Using Catalytic Growth and Re-growth

The present invention involves a method and apparatus for
depositing a silicon oxide onto a substrate from solution at low temperatures in
a manner that produces homogeneous growth of the silicon oxide. The method
generally comprises the following steps: (a) chemically treating a substrate to
activate it for growth of the silicon oxide, (b) immersing the treated substrate
into a bath with a reactive solution, (c) regenerating the reactive solution to
allow for continued growth of the silicon oxide. In another embodiment of the
present invention, the apparatus includes a first container holding a reactive
solution, a substrate on which the silicon oxide is deposited, a second
container holding silica, and a means for adding silica to the reactive solution

Patent 7,253,014 - Expiration date: 11/19/2023

Fabrication of light emitting film coated fullerenes and their
application for in-vivo light emission. A nanoparticle coated with a
semiconducting material and a method for making the same. In one embodiment, the
method comprises making a semiconductor coated nanoparticle comprising a layer
of at least one semiconducting material covering at least a portion of at least
one surface of a nanoparticle, comprising: (A) dispersing the nanoparticle under
suitable conditions to provide a dispersed nanoparticle; and (B) depositing at
least one semiconducting material under suitable conditions onto at least one
surface of the dispersed nanoparticle to produce the semiconductor coated
nanoparticle. In other embodiments, the nanoparticle comprises a fullerene.
Further embodiments include the semiconducting material comprising Cadmium
Sulfide (CdS) or Cadmium Selenide (CdSe).

Patent 7,682,527 - Expiration date: 11/19/2023

Fabrication of light emitting film coated fullerenes and their
application for in-vivo light emission

A nanoparticle coated with a semiconducting material and a
method for making the same. In one embodiment, the method comprises making a
semiconductor coated nanoparticle comprising a layer of at least one
semiconducting material covering at least a portion of at least one surface of a
nanoparticle, comprising: (A) dispersing the nanoparticle under suitable
conditions to provide a dispersed nanoparticle; and (B) depositing at least one
semiconducting material under suitable conditions onto at least one surface of
the dispersed nanoparticle to produce the semiconductor coated nanoparticle. In
other embodiments, the nanoparticle comprises a fullerene. Further embodiments
include the semiconducting material comprising Cadmium Sulfide (CdS) or Cadmium
Selenide (CdSe).

Patent 7,491,376 - Expiration date: 3/5/2027

Chemical derivatization of silica coated fullerenes and use of
derivatized silica coated fullerenes

This invention is directed to a new composition of matter in
the form of chemically derivatized silica coated fullerenes, including silica
coated C.sub.60 molecules and silica coated carbon nanotubes, processes for
making the same and to uses for the derivatized silica coated fullerenes.
(Derivatization of silica coated fullerenes refers to chemically modifying
surface of the silica to have a similar chemical structure but different
chemical reactions with specifically chosen reagents.) Included among many uses
in chemical, physical or biological fields of use, but not limited thereto, are
high speed, low loss electrical interconnects for nanoscale electronic devices,
components and circuits. In one embodiment, this invention also provides a
method for preparing silica coated fullerenes having substituents attached to
the surface of silica coated fullerenes by reacting silica coated fullerenes
with a wide range of organic or inorganic chemical species in a gaseous or
liquid state. Preferred substituents include but are not limited to organic
groups and organic groups containing heteroatoms (i.e. non-carbon atoms) such as
oxygen, nitrogen, sulfur, and halogens. The identity of the surface functional
group is chosen to provide desirable properties to the silica coated fullerenes
including but not limited to solubility, miscibility, stickiness, and melting
point. The present invention also describes the application of surface
functionalized silica coated fullerenes as components of polymer blends and
composites (i.e. the surface is treated with certain substances that allow the
silica to react to certain other specific materials).

---

Patent 7,692,218 - Expiration date: 8/21/2025

Method for creating a functional interface between a
nanoparticle, nanotube or nanowire, and a biological molecule or system

A field effect transistor and a method for making the same. In
one embodiment, the field effect transistor comprises a source; a drain; a gate;
at least one carbon nanotube on the gate; and a dielectric layer that coats the
gate and a portion of the at least one carbon nanotube, wherein the at least one
carbon nanotube has an exposed portion that is not coated with the dielectric
layer, and wherein the exposed portion is functionalized with at least one
indicator molecule (i.e. has a specific molecule attached to the nanoparticle
that will attach only to certain desired molecules out of a broad mixture of
molecules). In other embodiments, the field effect transistor is a biochem-FET.

D.Trend
Information

Other than as disclosed elsewhere in this annual report on Form
20-F, the Company is not aware of any trends, uncertainties, demands,
commitments or events that are reasonably likely to have a material adverse
effect on the Companys net revenues, income, profitability, liquidity or
capital resources, or that caused the disclosed financial information to be not
necessarily indicative of future operating results or financial conditions.

E.Off-Balance
Sheet Arrangements

As at December 31, 2017, the Company had not entered into any
off-balance sheet arrangements.

F.Tabular Disclosure of Contractual Obligations

Total ($)
    Less than 1 year
    1-3 years
    > 5 yearsContractual Obligations
                               
      Operating lease
    328,423
    108,312
    109,474
    110,637Contract payment obligations
    440,000
    220,000
    220,000
    -


ITEM 6  DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A.Directors and Senior Management

The following is a list of the Companys directors and officers
as of December 31, 2017. There are no family relationships between the directors
and officers.

---

Name and Jurisdiction of Residence
    Current Positions and Offices
      Held
    Principal Occupations During Last
      Five Years
    Date of Appointment as a Director
      or Officer
    Number of Common
      Shares(1)Charles Provini Florida, USA
    Chief Executive Officer, President, Director
    President and Chief Executive Officer of the
      Company and its predecessors from January 2003 to present; President of
      C.R. Provini & Co. Inc., a private consulting firm from July 1996 to
      present.
    May 8, 2009
    1,198,000Brien Lundin Louisiana, USA
    Director and Chairman
    President of Jeffereon Direct Inc. (private
      consulting company) from November 2003 to present
    May 8, 2009, as a director and September 30,
      2013 as chairman
    3,006,223(2)John Calhoun Louisiana, USA
    Director
    President of Fort Hill Resources LLC (private
      consulting company) from December 1997 to present
    May 8, 2009
    640,900Dennis Flood Ohio, USA
    Chief Technology Officer
    Chief Technology Officer for the Company from
      August 2010 to Present; President and CEO of North Coast Initiatives, Ltd.
      from May 2001 to Present (a private consulting firm providing management
      and technical services to photovoltaic (PV) energy conversion industry)
    August 17, 2010
    960,000(3)Richard Childs New Jersey, USA
    Chief Financial Officer
    Self-employed (forensic accounting practice)
      from 2001 to present;
    November 5, 2015
    NilJohn Meekison(4)British Columbia,
      Canada
    Former Director
    Chief Financial Officer, iCo Therapeutics Inc.,
      a biotech company developing drugs for eye diseases, March 2005 to
      present.
    August 9, 2007
    10,000(5)Shauna Hartman(6) British
      Columbia, Canada
    Former Corporate Secretary6
    Solicitor at Armstrong Simpson from 2003 to
      present.
    May 8, 2009
    Nil


|Notes: |                                                                                                                                                                                                                                                               
|------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1)    | Does not include options or warrants held by directors
      and officers of the Company.                                                                                                                                                                     
|(2)    | This figure includes 1,906,223 shares held directly by
      Mr. Lundin and 1,100,000 shares held by Jefferson Financial Inc., which
      Mr. Lundin has discretionary voting and investment authority over
      securities held by Jefferson Financial Inc.
|(3)    | These shares are held by North Coast Initiatives Ltd.,
      which Mr. Flood has discretionary voting and investment authority over
      securities held by North Coast Initiatives Ltd.                                                                     
|(4)    | Mr. Meekison resigned on May 5, 2017.                                                                                                                                                                                                                         
|(5)    | These shares are held indirectly through Mr. Meekisons
      spouse, Tanya Nundahl.                                                                                                                                                                          
|(6)    | Ms. Hartman resigned on March 1,
2017.                                                                                                                                                                                                                        

There are no loans or debentures due to or from the directors,
management, promoters and principal holders of the Company.

As of the date of this annual report, the Companys directors
and officers, as a group, owned or had control or direction over, directly or
indirectly, 5,815,123 of the Common Shares representing approximately 6.6% of
the outstanding Common Shares.

A brief profile of each of the Directors and the senior
management is given below:

---

Charles Provini, Director, President & Chief Executive Officer

Mr. Provini holds an Engineering degree from The U.S. Naval Academy in Annapolis, Maryland and a Masters from the University of Oklahoma. Previously, he was the President of Ladenburg Thalmann Asset Management and a Director of Ladenburg Thalmann,
Inc., one of the oldest members of the New York Stock Exchange from 11/1997- 10/2000. He served as President of Laidlaw Asset Management as well as Chairman and Chief Investment Officer of Howe & Rusling, Laidlaw’s Portfolio Management
Advisory Group from 11/1995- 09/1997. Prior to this, he served as President of Rodman & Renshaw’s Advisory Services from 02/1994- 08/1995 and President of LaSalle Street Corporation, a wholly-owned subsidiary of Donaldson, Lufkin &
Jenrette from 01/1983-04/1985. Mr. Provini has been a leadership instructor at the U.S. Naval Academy, Chairman of the U.S. Naval Academy’s Honor Board, and is a former Marine Corp. officer. Mr. Provini has been a director, President and Chief
Executive officer of the Company since May 8, 2009.

Brien F. Lundin, Chairman of the Board

Brien Lundin has been a director of the Company since May 8, 2009. He was appointed as Chairman of the Board on September 30, 2013. The president/CEO of Jefferson Financial, Inc. since 2003, Mr. Lundin is a marketer, investor and investment banker
with experience in financing and advising early-stage technology and natural resource enterprises. Mr. Lundin has been the operator of the New Orleans Investment Conference since 2003. Mr. Lundin is also a director and member of the audit committee
for Thunderstruck Resources Ltd. and Sojourn Ventures, Inc

John C. Calhoun, Director

Mr. Calhoun has over 20 years of experience in corporate finance. Mr. Calhoun has served as managing director of Fort Hill Resources since 1997, president/director of North American Water from 1998-2004, president/director of Grammercy Investments
from 2000-presemt, president/director of Vignette Publications, treasurer/director of Computer Wholesale Corporation from 1995-2001, and managing director of the Shadows Bend Court long-term care facility from 2001-present. He is the
founder/director of FNBC Bank (2005-present), the largest, De Novo bank in Louisiana and the founder and managing director of the Suites at Sugar Mill Point and Oak Grove Senior Living (2002-present), long term care facilities. Mr. Calhoun has been
a director of the Company since May 8, 2009.

Richard Childs, Chief Financial Officer

Mr. Childs has a forensic accounting practice that serves more than 100 lawyers across the United States. He is a member of the American Institute of Certified Public Accountants and the Society of Certified Fraud Examiners, as well as a member of
the New Jersey State Society of CPAs. In the private sector, he served for six years as Vice President, Director of Finance and Internal Security for Deak-Perera, the foreign exchange, Swiss banking and precious metals company. In the government
sector, he has served as a fraud investigator for the Office of the (NJ) Attorney General; the Supervising Accountant for the Essex County (NJ) Division of Accounts and Control; and, most recently, as the Chief of the Union County (NJ)
Sheriff’s Department Economic Crime/Inspection Bureau. He has frequently provided expert testimony in economic crime cases in Federal and New Jersey state courts and the New Jersey grand jury. Mr. Childs holds a Bachelor of Science degree in
accounting from Rutgers University.

---

Dennis J. Flood, Chief Technology Officer

Dennis Flood, PhD, is a co-founder of and technical consultant
to Natcore. He is also President and CEO of North Coast Initiatives, Ltd.
(05/2001-present), a consulting firm providing management and technical services
to the photovoltaic (PV) energy conversion industry. Dr. Flood has more than 30
years of experience in developing solar cell and array technology. Prior, Dr.
Flood was Chief of the Photovoltaic and Space Environments Branch at the NASA
Glenn Research Center in Cleveland, Ohio (from 06/1985-06/2000), where he lead
Agency programs in advanced photovoltaic systems development. He served as Chair
of the Institute of Electrical and Electronics Engineers (IEEE) Photovoltaic
Devices Technical Committee from 1998-2005. And he currently serves on the
International Advisory Committees of the European, the U.S., the Japan/Asia and
the World Photovoltaic Conference organizing committees (from 1992-present).

Arrangements, Understandings, etc.

The Company has no arrangements or understanding with any major
shareholders, customers, suppliers or others, pursuant to which any person
referred to above, was selected as a director or member of senior
management.

B.Compensation

Summary Compensation Table

Years Ended December 31, 2017, 2016,
      2015, 2014, and 2013Name and Principal Position
    Period Ended Dec.
      31
    Salary ($)
    Share- based
      awards ($)
    Option- based
      awards ($)
    Annual incentive plans
      ($)
    Long- term
      incentive plans ($)
    Pensions value ($)
    All other compensation
      ($)
    Total CompensationCharles Provini
      President/Chief Executive Officer
    2017
    218,284
    Nil
    Nil
    Nil
    Nil
    Nil
    60,000
    278,2842016
    275,000
    Nil
    65,588
    Nil
    Nil
    Nil
    60,000
    400,5882015
    275,000
    Nil
    102,000
    Nil
    Nil
    Nil
    60,000
    437,0002014
    275,000
    Nil
    Nil
    Nil
    Nil
    Nil
    60,000
    335,0002013
    275,000
    Nil
    Nil
    Nil
    Nil
    Nil
    60,000
    335,000Richard Childs Chief
      Financial Officer
    2017
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    48,000
    48,0002016
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    48,000
    48,0002015
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    6,000
    6,0002014
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    3,000
    3,0002013
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    10,000
    10,000Brian Zucker Former Chief
      Financial Officer
    2017
    40,900
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    40,9002016
    48,000
    Nil
    9,404
    Nil
    Nil
    Nil
    Nil
    57,4042015
    48,000
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    48,0002014
    48,000
    Nil
    18,300
    Nil
    Nil
    Nil
    Nil
    66,3002013
    48,000
    12,450
    Nil
    Nil
    Nil
    Nil
    Nil
    60,4502012
    48,000
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    48,000John Meekison Former
      Director
    2017
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil2016
    Nil
    Nil
    65,588
    Nil
    Nil
    Nil
    Nil
    65,5882015
    Nil
    Nil
    102,000
    Nil
    Nil
    Nil
    40,000
    142,0002014
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    40,000
    48,0002013
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    28,000
    28,000Dennis Flood Chief Technology
      Officer
    2017
    43,273
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    43,2732016
    82,500
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    90,8232015
    82,500
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    142,0002014
    165,000
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    48,0002013
    165,000
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    28,000


The Company has calculated the grant date fair value amounts
in the Option-based Awards column using the Black-Scholes model, a
mathematical valuation model that ascribes a value to a stock option based on a
number of factors in valuing the option-based awards, including the exercise
price of the options, the price of the underlying security on the date the
option was granted, and assumptions with respect to the volatility of the price of the underlying
security and the risk-free rate of return. Calculating the value of stock
options using this methodology is very different from simple in-the-money
value calculation. Stock options that are well out-of-the-money can still have a
significant grant date fair value based on a Black-Scholes valuation.
Accordingly, caution must be exercised in comparing grant date fair value
amounts with cash compensation or an in-the-money option value calculation. The
total compensation show in the last column is total compensation of each NEO
reported in the other columns. The value of the in-the-money options currently
held by each director (based on share price less option exercise price) is set
forth in the Value of Unexercised in-the-money Options column of the
Outstanding Share- Based and Option-Based Awards table below.

---

Incentive Plan Awards

Outstanding share-based awards and option-based awards

The Plan has been established to attract and retain employees,
consultants, officers or directors to the Company and to motivate them to
advance the interests of the Company by affording them with the opportunity to
acquire an equity interest in the Company. The directors and Compensation
Committee of the Company administer the Plan. The Plan provides that the number
of Shares issuable under the Plan, together with all of the Companys other
previously established or proposed share compensation arrangements may not
exceed 10% of the total number of issued and outstanding shares of the Company.
All options expire on a date not later than five years after the date of grant
of such option.

The following table sets forth the details of all awards
outstanding as at December 31, 2017 including awards granted prior to the most
recently completed financial year to the Named Executive Officers (NEOs).
Values expressed in Canadian (CDN$).

Option-Based Awards
    Share-Based AwardsName and Principal Position
    Number of Securities
      Underlying Unexercised Options (#)
    Option Exercise Price (CDN$)
    Option Expiration Date
    Value of Unexercised
      In-the- Money Options (CDN$)
    Number of Shares or
      Units of Shares That have Not
      Vested (#)
    Market or Payout Value
      of Share- Based Awards That Have
      Not Vested (CDN$)Charles Provini
      President/Chief Executive Officer
    300,000
    0.20
    December 9, 2021
    Nil
    Nil
    Nil350,000
    0.40
    January 13, 2021
    Nil
    Nil
    Nil300,000
    0.58
    April 30, 2010
    Nil
    Nil
    NilBrian Zucker Former Chief
      Financial Officer
    90,000
    0.20
    December 9, 2021
    Nil
    Nil
    Nil20,000
    0.80
    January 4, 201810,000
    1.08
    January, 201910,000
    0.75
    December 17, 201910,000
    0.40
    January 13, 2021John Meekison Former
      Director
    300,000
    0.20
    December 9, 2021
    Nil
    Nil
    Nil286,500
    0.58
    April 30, 2020195,000
    0.40
    January 13, 2021Dennis Flood Chief Technology
      Officer
    90,000
    0.20
    December 9, 2021
    Nil
    Nil
    Nil


---

Value Vested or Earned During the Twelve Months Ended
December 31, 2017

Name and Principal Position
    Value of Unexercised In-
      the-Money Options (CDN$)
    Number of Shares or Units of Shares
      That have Not Vested (#)
    Market or Payout Value of Share-Based
      Awards That Have Not Vested (CDN$)Charles Provini
    Nil
    Nil
    NilPresident/Chief Executive OfficerRichard Childs
    Nil
    Nil
    NilChief Financial OfficerJohn Meekison
    Nil
    Nil
    NilFormer DirectorDennis Flood
    Nil
    Nil
    NilChief Technology Officer


Options-based Awards Exercised During the Twelve Months
Ended December 31, 2017

Name and Principal Position
    Securities Acquired on
      Exercise (#)
    Exercise Price ($)
    Date of Exercise (m/d/y)
    Aggregate Value Realized ($)Charles Provini
    Nil
    N/A
    N/A
    NilPresident/Chief Executive OfficerRichard Childs
    Nil
    N/A
    N/A
    NilChief Financial OfficerJohn Meekison
    Nil
    N/A
    N/A
    NilFormer DirectorDennis Flood
    Nil
    N/A
    N/A
    NilChief Technology Officer


---

Option-based Awards Granted During the Twelve Months Ended
December 31, 2017

Name and Principal Position
    Date of Grant (m/d/y)
    Number of Option-Based
      Awards Granted ($)
    Exercise Price ($)
    Expiry Date (m/d/y)Charles Provini
    N/A
    Nil
    N/A
    N/APresident/Chief Executive OfficerRichard Childs
    N/A
    Nil
    N/A
    N/AChief Financial OfficerJohn Meekison
    N/A
    Nil
    N/A
    N/AFormer DirectorDennis Flood
    N/A
    Nil
    N/A
    N/AChief Technology Officer


Pension Plan Benefits

The Company does not have a pension plan that provides for
payments or benefits to the Named Executive Officers at, following or in
connection with retirement.

Termination of Employment, Change in Responsibilities and
Employment Contracts

Other than disclosed below, the Company does not have an
employment contract with any of its Named Executive Officers. Each Named
Executive Officer devotes a portion of his or her time to the Company and a
portion of his or her time to other companies where he or she is a director
and/or officer. Accordingly, the Named Executive Officers invoice the Company
based on the percentage of time devoted to the Company.

Other than as disclosed below, neither the Company nor any of
its subsidiaries have any plan or arrangement with respect to compensation to
its executive officers which would result from the resignation, retirement or
any other termination of the executive officers employment with the Company and
its subsidiaries or from a change of control of the Company or any subsidiary of
the Company or a change in the executive officers responsibilities following a
change in control.

The Company entered into an employment agreement dated April 5,
2012 with Charles Provini (Employment Agreement) for his services as President
and Chief Executive Officer and such other capacities as the board of directors
of the Company may designate from time to time. Pursuant to the Employment
Agreement, Mr. Provini is paid a base salary of US $275,000 per year. After the
first anniversary of the date of the Employment Agreement, the base salary of US
$275,000 per year may be reviewed periodically and increases in such base salary
may be granted at the sole discretion of the Companys board of directors. The
Employment Agreement ends on the earliest of two years from the date of the
Employment Agreement or any extension thereafter. On April 5, 2014, the
employment agreement was extended for an additional three years. Mr. Provini is
entitled to certain option grants upon the achievement of certain revenue
milestones by the Company. Mr. Provini shall also be entitled to receive options
to purchase up to Five Hundred Thousand (500,000) shares of the Companys common
stock (the Stock Options) as follows: He shall receive Stock
Options to purchase One Hundred Thousand (100,000) shares of the Companys
common stock upon the Companys receipt of One Million Dollars ($1,000,000) of
net revenue during the Term of his employment, and he shall receive Stock
Options to purchase One Hundred Thousand (100,000) shares of the Companys
common stock for each additional One Million Dollars ($1,000,000) of net revenue
received by the Company during the Term of his employment (up to a maximum of
Five Hundred Thousand (500,000) shares of the Companys common stock). Options
granted under this incentive plan will be priced at the lowest possible strike
price approved by the TSX Venture Exchange at the time of the grant. Mr. Provini
may terminate the Employment Agreement at any time upon 30 days written notice
to the Company or immediately for cause. Should the Company terminate the
Employment Agreement without cause, it is obligated to pay to Mr. Provini a lump
sum payment of an amount equal to three months base salary, plus one years
benefits. The Employment Agreement contains certain non-competition and
non-solicitation provisions during the employment term. For a period of one year
following the employment term, Mr. Provini cannot solicit business from current
or potential clients or customers of Natcore or induce employees, consultants,
etc. of the Company to terminate or not renew with the Company and may not
directly or indirectly, engage in any business in the state of New Jersey or any
other location in which the Company is then doing business, for the development,
sale, service or distribution of process or equipment for the manufacture of
solar panels (or any component thereof) or other alternative energy technology
products or any similar business that is competitive with the business of the
Company or its affiliates, including as a proprietor, principal, agent, partner,
officer, director, shareholder, employee, member, consultant or otherwise.

---

Compensation of Directors

The following table sets forth all amounts of compensation
provided to directors who were not NEOs of the Company duringthe twelve months
ended December 31, 2017.

Name
    Fees Earned ($)
    Share- Based Awards
      ($)
    Option- Based Awards
      ($)
    Non-Equity Incentive Plan
      Compensation ($)
    Pensions Value ($)
    All Other Compensation
      ($)
    Total CompensationJohn Calhoun
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    NilBrien Lundin
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil
    Nil


Outstanding share-based awards and option-based awards

The following table sets forth information concerning all
awards outstanding under share-based or option-based incentive plans of the
Company as of December 31, 2017 including awards granted prior to the most
recently completed financial year to each of the Directors of the Company who
were not Named Executive Officers.

---

Option-Based Awards
    Share-Based AwardsName and Principal Position
    Number of Securities
      Underlying Unexercised Options (#)
    Option Exercise Price (CDN$)
    Option Expiration Date
    Value of Unexercised
      In-the- Money Options (CDN$)
    Number of Shares or Units
      of Shares That have Not Vested (#)
    Market or Payout Value of
      Share- Based Awards That Have Not Vested
      (CDN$)John Calhoun
    Nil
    N/A
    N/A
    Nil
    Nil
    NilBrien Lundin
    Nil
    N/A
    N/A
    Nil
    Nil
    Nil


Value Vested or Earned During the Twelve Months Ended
December 31, 2017

Name
    Option-based awards  Value
      vested during the year ($)
    Share-based awards  Value vested
      during the year ($)
    Non-equity incentive plan
      compensation  Value earned during the year ($)John Calhoun
    Nil
    Nil
    NilBrien Lundin
    Nil
    Nil
    Nil


Option-based Awards Exercised During the Twelve Months Ended
December 31, 2017

Name
    Securities Acquire on Exercise
      (#)
    Exercise Price ($)
    Date of Exercise (m/d/y/)
    Aggregate Value Realized ($)John Calhoun
    Nil
    N/A
    N/A
    NilBrien Lundin
    Nil
    N/A
    N/A
    Nil


Option-based Awards Granted During the Twelve Months Ended
December 31, 2017

Name
    Date of Grant (m/d/y)
    Number of Option-Based Awards
      Granted (#)
    Exercise Price ($)
    Expiry Date (m/d/y)John Calhoun
    N/A
    Nil
    N/A
    N/ABrien Lundin
    N/A
    Nil
    N/A
    N/A


Securities Authorized for Issuance Under Equity Compensation
Plans

The only equity compensation plan that the Company has in place
is its stock option plan (the Plan), which was previously adopted by the
Company. As of December 31, 2017 the Stock Option Plan reserves a maximum of
14,782,720 Common Shares for issuance upon the exercise of options. Options
granted under the Stock Option Plan will comply with the rules and regulations
of the Exchange regarding share incentive arrangements.

The purpose of the Stock Option Plan is to attract and retain
employees, consultants, officers and directors to the Company and to motivate
them to advance the interests of the Company by affording them with the
opportunity, through share options, to acquire an equity interest in the Company
and benefit from its growth. The Stock Option Plan authorizes the Board to
grant, in its absolute discretion, stock options to directors, officers,
employees or consultants on such terms, limitations, conditions and
restrictions, as it deems necessary and advisable, subject to terms of the Plan
and regulatory and TSX Venture Exchange approval.

---

Equity Compensation Plan Information as of December 31,
2017

Name
    Number of securities to be issued
      upon exercise of outstanding options,
      warrants, and rights (#)
    Weighted-average exercise price
      of outstanding options, warrants and rights
      ($)
    Number of securities remaining
      available for future issuance under equity
      compensation plans (excluding securities
      reflected in column (a))Equity compensation plans approved by
      security holders
    6,105,000
    CAD$0.42
    8,677,720Equity compensation plans not approved by
      security holders
    N/A
    N/A
    N/ATOTAL
    6,105,000
    CAD$0.42
    8,677,720


C.Board Practices

Terms of Directors and Executive Officers

The Companys officers are appointed by and serve at the
discretion of the board of directors. The current directors have not been
elected to serve for a specific term and, unless re-elected, hold office until
the close of the Companys next annual meeting of shareholders or until such
time as their successors are elected or appointed.

Committees of the Board of Directors

Audit Committee

Item 306 of Regulation S-K requires the Companys audit
committee (in this section the Audit Committee) to meet certain requirements.
It also requires the Company to disclose in this Management section certain
information regarding the Audit Committee. That information is disclosed below.

Overview

The Audit Committee is principally responsible for:

| | i.   | recommending to the Board the external audit or to be
      nominated for election by the shareholders at each annual general meeting
      and negotiating the compensation of such external auditor,                                                                                                                     
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | ii.  | overseeing the work of the external auditor,                                                                                                                                                                                                                                                                               
| | iii. | reviewing the Companys annual and interim financial
      statements, MD&A and press releases regarding earnings before they are
      reviewed and approved by the Board and publicly disseminated by the
      Company, and                                                                                             
| | iv.  | reviewing the Companys financial reporting procedures
      and internal controls to ensure adequate procedures are in place for the
      Companys public disclosure of financial information extracted or derived
      from its financial statements, other than disclosure described in the
      previous paragraph.

---

The Audit Committees Charter

The Audit Committee has various responsibilities as set forth
in Item 306 of Regulation S-K. The Board has adopted a Charter for the Audit
Committee which sets out the Audit Committees mandate, organization, powers and
responsibilities. The complete Charter is below:

Purpose of the Committee

The Audit Committee represents the Board in discharging its
responsibility relating to the accounting, reporting and financial practices of
the Company and its subsidiaries, and has general responsibility for oversight
of internal controls, accounting and auditing activities, and legal compliance
of the Company and its subsidiaries.

Members of the Committee

The Audit Committee shall consist of no less than three
Directors a majority of whom shall be independent as defined under Exchange
Act Rule 10A-3, while the Company is in the developmental stage of its business.
The members of the Committee shall be selected annually by the Board and shall
serve at the pleasure of the Board.

At least one Member of the Audit Committee must be financially
literate as defined under Canadian private placement law, National Instrument
52-110, having sufficient accounting or related financial management expertise
to read and understand a set of financial statements, including the related
notes, that present a breadth and level of complexity of the accounting issues
that are generally comparable to the breadth and complexity of the issues that
can reasonably be expected to be raised by the Companys financial statements.

Meeting Requirements/Quorum

The Committee will, where possible, meet on a regular basis at
least once every quarter, and will hold special meetings as it deems necessary
or appropriate. Meetings may be held in person or telephonically, and shall be
at such times and places as the Committee determines. Without meeting, the
Committee may act by unanimous written consent of all members, which shall
constitute a meeting for the purposes of this charter.

A majority of the members of the Committee shall constitute a
quorum.

Duties and Responsibilities

The Audit Committees function is one of oversight only and
shall not relieve the Companys management of its responsibilities for preparing
financial statements that accurately and fairly present the Companys financial
results and conditions or the responsibilities of the external auditors relating
to the auditor review of financial statements. Specifically, the Audit Committee
will:

| | a) | have the authority with respect to the appointment,
      retention or discharge of the independent public accountants as auditors
      of the Company (the Auditors) who perform the annual audit in accordance
      with applicable securities laws, and who shall be ultimately accountable
      to the Board through the Audit Committee;
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | b) | review with the Auditors the scope of the audit and the
      results of the annual audit examination by the auditors, including any
      reports of the auditors prepared in connection with the annual
    audit;                                                                                                                              
| | c) | review information, including written statements from the
      Auditors, concerning any relationships between the Auditors and the
      Company, or any other relationships that may adversely affect the
      independence of the Auditors and assess the independence of the
      Auditors;                                                 

---

| | d) | review and discuss with management and the Auditors the
      Companys audited financial statements and accompanying Managements
      Discussion and Analysis of Financial Conditions (MD&A), including a
      discussion with the Auditors of their judgments as to the quality of the
      Companys accounting principles and report on them to the Board;
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | e) | review and discuss with management the Companys interim
      financial statements and interim MD&A and report on them to the
      Board;                                                                                                                                                                                                                         
| | f) | pre-approve all auditing services and non-audit services
      provided to the Company by the Auditors to the extent and in the manner
      required by applicable law or regulation. In no circumstances shall the
      Auditors provide any non-audit services to the Company that are prohibited
      by applicable law or regulation;                        
| | g) | evaluate the external Auditors performance for the
      preceding fiscal year, reviewing their fees and making recommendations to
      the Board;                                                                                                                                                                                                                
| | h) | periodically review the adequacy of the Companys
      internal controls and ensure that such internal controls are
    effective;                                                                                                                                                                                                                                 
| | i) | review changes in the accounting policies of the Company
      and accounting and financial reporting proposals that are provided by the
      Auditors that may have a significant impact on the Companys financial
      reports, and report on them to the Board;                                                                                               
| | j) | oversee and annually review the Companys Code of
      Business Conduct and Ethics;                                                                                                                                                                                                                                                                                
| | k) | approve material contracts where the Board of Directors
      determines that it has a conflict;                                                                                                                                                                                                                                                                    
| | l) | establish procedures for the receipt, retention and
      treatment of complaints received by the Company regarding the audit or
      other accounting matters;                                                                                                                                                                                                    
| | m) | where unanimously considered necessary by the Audit
      Committee, engage independent counsel and/or other advisors at the
      Companys expense to advise on material issues affecting the Company which
      the Audit Committee considers are not appropriate for the full
    Board;                                                                       
| | n) | satisfy itself that management has put into place
      procedures that facilitate compliance with the provisions of applicable
      securities laws and regulation relating to insider trading, continuous
      disclosure and financial reporting;                                                                                                              
| | o) | review and monitor all related party transactions which
      may be entered into by the Company; and                                                                                                                                                                                                                                                               
| | p) | periodically review the adequacy of its charter and
      recommending any changes thereto to the Board.                                                                                                                                                                                                                                                            

Miscellaneous

Nothing contained in the Charter is intended to extend
applicable standards of liability under statutory or regulatory requirements for
the directors of the Company or members of the Committee. The purposes and
responsibilities outlined in the Charter are meant to serve as guidelines rather
than as in flexible rules and the Committee is encouraged to adopt such
additional procedures and standards as it deems necessary from time to time to
fulfill its responsibilities.

Composition of the Audit Committee

The Audit Committee consists of three directors. Unless a
company is a venture issuer (an issuer the securities of which are not listed
or quoted on any of the TSX Venture Exchange, a market in the United States of
America other than the over-the-counter market, or a market outside of Canada
and the U.S.A.) as of the end of its last financial year, Exchange Act Rule
10A-3 requires each of the members of the Committee to be independent and
financially literate. Since the Company is a venture issuer (its securities
are listed on the TSX Venture Exchange, but are not listed or quoted on any
other exchange or market) it is exempt from this requirement. In addition, the
Companys governing corporate legislation requires the Company to have an Audit
Committee composed of a minimum of three directors, a majority of whom are not
officers or employees of the Company.

---

As noted above, the members of the audit committee are Charles
Provini, John Calhoun and Brien Lundin. All of the members of the Audit
Committee are considered independent, with the exception of Mr. Provini, who is
a member of management. All members are considered financially literate.

A member of the audit committee is independent if the member
has no direct or indirect material relationship with the Company. A material
relationship means a relationship that could, in the view of the Companys board
of directors, reasonably interfere with the exercise of a members independent
judgment.

A member of the audit committee is considered financially
literate if he or she has the ability to read and understand a set of financial
statements that present a breadth and level of complexity of accounting issues
that are generally comparable to the breadth and complexity of the issues that
can reasonably be expected to be raised by the Company.

There are no other management functions of the Company, which
are to any substantial degree performed by a person or company other than the
directors or senior officers of the Company.

Pursuant to the provisions of the Business Corporations Act of
British Columbia, the Company is required to have an audit committee, which at
the present time, is comprised of Charles Provini, John Calhoun and Brien
Lundin. For additional information regarding the Companys Audit Committee,
please see below. The Company does not have an executive committee.

As at the date of this Information Management section and
within the ten years before the date of this Information Management section, no
proposed director:

| | a) | is or has been a director or executive officer of any
      company (including the Company), that while that person was acting in that
      capacity:
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | was the subject of a cease trade order or similar order
      or an order that denied the relevant company access to any exemption under
      securities legislation, for a period of more than 30 consecutive days;                                                                                                                                                    
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | was subject to an event that resulted, after the director
      or executive officer ceased to be a director or executive officer, in the
      company being the subject of a cease trade or similar order or an order
      that denied the relevant company access to any exemption under securities
      legislation, for a period of more than 30 consecutive days;
| |  | within a year of that person ceasing to act in that
      capacity, became bankrupt, made a proposal under any legislation relating
      to bankruptcy or insolvency or was subject to or instituted any
      proceedings, arrangement or compromise with creditors or had a receiver,
      receiver manager or trustee appointed to hold its assets; or              

| | b) | has within 10 years before the date of the Information
      Management section became bankrupt, made a proposal under any legislation
      relating to bankruptcy or insolvency or was subject to or instituted any
      proceedings, arrangement or compromise with creditors or had a receiver,
      receiver manager or trustee appointed to hold the assets of the director,
      officers or shareholders.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

D.Employees

December 31, 2017
    December 31, 2016
    December 31, 2015Research Employees
    6
    6
    5Administrative Employees
    7
    7
    7


The Companys employees are not governed by a collective
agreement. The Company has not experienced a work stoppage and believe the
Companys employee relations are satisfactory.

---

The nature of the Companys business requires the recruitment
and retention of a highly educated and skilled workforce, including highly
qualified management, scientific and manufacturing personnel for innovation,
research and development. Typically a high proportion of the Companys employees
have a Bachelors degree or higher. For each of the last three fiscal years,
most of the employees of the Company were employed at the Companys office in
New York.

E.Share Ownership

| | (a) | The direct and indirect shareholdings of the Companys
      Directors and Officers as at June 8, 2018 were as
  follows:
| | --- | -------------------------------------------------------------------------------------------------------------------------

Name and Municipality of Principal
      Residence
    Positions held with the
      Issuer
    Number of Common Shares, Options
      and Warrants(1)(3)Charles Provini,Delray Beach,
      Florida, USA
    Director, President and CEO
    1,198,000 common shares 900,000 optionsJohn Meekison, Vancouver B.C., Canada
    Former Director(2)
    10,000 common shares 481,500 optionsBrien Lundin, Metairie, LA, USA
    Director
    3,006,223 common shares 950,000 options
      20,000 warrantsJohn Calhoun, New Orleans, LA, USA
    Director
    640,900 common shares, 300,000 options
      547,500 warrantsDennis Flood, Columbus, OH, USA
    Chief Technology Officer
    960,000 common shares 149, 895 warrants


|Notes: |                                                                                                                                                                                                                    
|------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1)    | All of the shares held by the Directors are voting common
      shares and do not have any different voting or other rights than the other
      outstanding common shares of the Company.                         
|(2)    | Mr. Meekison resigned on May 5, 2017.                                                                                                                                                                              
|(3)    | The information as to shares beneficially owned or
      controlled or directed, not being within the knowledge of the Company, has
      been furnished by the respective directors and officers
    individually.

As of the date of this annual report, the Companys directors
and officers, as a group, owned or had control or direction over, directly or
indirectly, 5,815,123of the Common Shares representing approximately 6.6% of the
outstanding Common Shares.

| | (b) | Share purchase options
  outstanding
| | --- | ------------------------------------

See Item 6.B as well as Item 6.E of this annual report.

ITEM 7  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A.Major Shareholders

Please refer to Item 6. Directors, Senior Management and
Employes  E. Share Ownership.

---

B.Related Party Transactions

The Company has an agreement (the Employment Agreement) dated
October 1, 2007, and amended July 31, 2008, with Mr. Charles Provini under which
the Company pays a fee for employee services at a base salary of $220,000 per
annum. On April 30, 2010, the Board of Directors passed a resolution to increase
this to $250,000 per annum and on May 13, 2011 the Board of Directors passed a
resolution to increase this to $275,000 per annum. The Company was not obligated
to commence payments until the Company raised at least $1,000,000, which
occurred during the year ended December 31, 2009. Mr. Provini is entitled to
receive options under the terms and conditions of the Companys stock option
plan. Mr. Provini will serve as the President and Chief Executive Officer of the
Company. On April 5, 2012, the employment agreement was extended for an
additional two years under the same terms. On April 5, 2014, the agreement was
extended for an additional three years under the same terms.

Mr. Provini has the right, upon 30 days notice, to terminate
the Employment Agreement. The Company may terminate the Employment Agreement on
10 days notice if for cause or on 30 days notice if without cause. Should the
Company terminate the contract without cause, it is obligated to pay Mr. Provini
an amount equal to three months base salary.

In addition to his employment agreement, Mr. Provini, receives
$60,000 per year for various administrative functions performed for the NewCyte
subsidiary which is consolidated in the financial statements.

On November 5, 2015, the Company entered into a consulting
agreement with Mr. Richard Childs under which the Company pays a fee for
consulting services in relation to Mr. Childs appointment as Chief Financial
Officer of the Company at a rate of $4,000 per month. The consulting agreement
has a three-month term, extendable by the parties. Either party has the right to
terminate the agreement on 30 days notice unless there is a material breach, in
which case the agreement is able to be terminated on seven days notice.

Mr. Brian Zucker personally received a salary of $48,000 for
the year 2012 and 2013. On May 8, 2009, Mr. Zucker bought 50,000 shares of
common stock at CDN$0.40 through the exercise of stock options. After his
resignation as CFO, Mr. Zucker continues to perform tax and administrative
functions for which he receives annual compensation of $48,000.

Finally, each of Charles Provini, President, Chief Executive
Officer and a director of the Company and Brien Lundin and John Calhoun,
directors of the Company participated in the acquisition of shareholders of
Natcore US and Brien Lundin participated in the concurrent as well as the recent
private financing as a subscriber for units. Natcore (Canadian parent company)
used to be called Syracuse Capital Corp. and was a capital pool company on the
TSX Venture Exchange.

On May 8, 2009, Syracuse Capital Corp. acquired all of the
shares of Natcore Technology, Inc. (the Delaware now subsidiary company). At the
time, each of John Calhoun, Brien Lundin and Charles Provini were shareholders,
either directly or indirectly, of the Delaware Company and received
consideration from Natcore parent.

John Calhoun (as the controlling shareholder of Fort Hill
Resources Inc.) held 1,000,000 shares of the Delaware company and received in
consideration therefore 1,100,000 Natcore parent shares (at a deemed price of
CDN$0.40 per share). Mr. Calhoun had also held at the time warrants to acquire
shares in the Delaware company (225,000 to be specific) which were exchanged for
247,500 warrants of Natcore parent. The warrants were exercisable at CDN$0.40
per share and were all exercised on May 5, 2014.

---

Brien Lundin held 926,112 shares of the Delaware company
directly and a further 1,000,000 shares through Jefferson Direct, LLC. As a
result, he received 1,018,723 common shares of Natcore parent directly and
1,100,000 common shares of Natcore parent indirectly through Jefferson (at a
deemed price of CDN$0.40 per share). Mr. Lundin had also held at the time
warrants to acquire shares in the Delaware company (225,000 to be specific)
which were exchanged for 247,500 warrants of Natcore parent. The warrants were
exercisable at CDN$0.40 per share and were all exercised on May 2, 2014.

Charles Provini (as the controlling shareholder of Hawk
Partnership LP) held 1,050,000 shares of the Delaware company which were
exchanged for 1,155,000 common shares of Natcore parent (at a deemed price of
CDN$0.40 per share). Mr. Provini had also held at the time warrants to acquire
shares in the Delaware company (225,000 to be specific) which were exchanged for
247,500 warrants of Natcore parent. The warrants were exercisable at CDN$0.40
per share and were all exercised on May 7, 2014. Since that time, neither Mr.
Provini nor Mr. Calhoun have subscribed for shares in a Natcore placement. Mr.
Lundin, however, has bought in Natcore private placements as follows: On May 9,
2009  as part of a financing completed in conjunction with the Qualifying
Transaction noted above  Mr. Lundin, in his individual capacity, purchased
300,000 units of Natcore parent at a price of CDN$0.40 per unit. This entitled
him to 300,000 shares and 300,000 warrants exercisable until May 9, 2011 at a
price of CDN$0.75 per share. The warrants were exercised on April 11, 2014.

On December 22, 2010, Mr. Lundin, in his individual capacity,
bought 40,000 units of Natcore (at a price of CDN$0.75 per unit). This entitled
him to 40,000 shares and 20,000 warrants (exercisable until December 22, 2015 at
a price of $1.00 per share  originally the expiry date was December 22, 2013,
but the Company extended the term of all the then outstanding warrants in that
batch to December 22, 2015). The warrants are still outstanding as of the date
of this filing.

Pursuant to the Companys Form F-1 registration statement filed
with the SEC on August 31, 2015, the Company registered 325,000 shares of Common
Stock issued to LoPresti Law Group, P.C. (LLG) in exchange for the provision
of legal services rendered in preparation of the aforementioned registration
statement. On June 22, 2016, pursuant to a Form F-1 registration statement filed
with the SEC the Company registered 400,000 shares of Common Stock to LLG in
exchange for legal services rendered.

Related Party Balances

As of December 31, 2017 and December 31, 2016, $598,285 and
$318,685, respectively, owed to directors, officers, and companies controlled by
directors has been included in trade payables and accrued liabilities.

Key Management Personnel Compensation

Years EndedDecember 31, 2017
    December 31, 2016
    December 31, 2015Administrative Fees
    60,000
    60,000
    60,000Consulting
    48,000
    48,000
    100,200Wages and benefits
    512,490
    587,041
    558,320Stock-based compensation
    40,211
    933,616
    239,875660,701
    1,628,657
    958,395


C.Interests of Experts and Counsel

Not Applicable.

---

ITEM 8  FINANCIAL INFORMATION

A.Consolidated Statements and Other Financial Information

This annual report contains the audited Consolidated Financial
Statements which comprise the consolidated statements of: financial position as
at December 31, 2017 and December 31, 2016, and the consolidated statements of
comprehensive loss, consolidated statement of changes in equity (deficit) and
consolidated statements of cash flows for the years ended December 31, 2017,
December 31, 2016 and December 31, 2015.

Reference is made to the financial statements filed as part of
this annual report on pages FlF26.

Dividend Policy

Natcore has never paid cash dividends on its common shares and
does not anticipate paying cash dividends in the foreseeable future.

Legal Proceedings and Regulatory Actions

The Company is not currently involved in any litigation
believed to be material to the development of the Companys business objectives.
To the best of the Companys knowledge, no litigation is pending or threatened.

During the twelve-month period ended December 31, 2016, there
were no (i) penalties or sanctions imposed against the Company by a court
relating to securities legislation or by a securities regulatory authority; (ii)
penalties or sanctions imposed by a court or regulatory body against the Company
that would likely be considered important to a reasonable investor in making an
investment decision, or (iii) settlement agreements the Company entered into
before a court relating to securities legislation or with a securities
regulatory authority.

---

B.Significant Changes

The Company has not experienced any significant changes since
the date of the financial statements included with this annual report except as
disclosed in this annual report.

ITEM 9  THE OFFERING AND LISTING

A.Offering and Listing Details

The Companys common stock is quoted on the TSX Venture
Exchange under the ticker symbol NXT and on the OTCQB marketplace under symbol
NTCXF.

Trading Price and Volume

The high and low market prices expressed in Canadian dollar on
the TSX Venture Exchange for the Companys common shares for the last five
financial years, for the last six months, and each quarter for the last three
fiscal years:

TSX Venture Exchange (Canadian Dollars)

Last Six Months
    High
    LowMay 2018
    0.160
    0.100April 2018
    0.230
    0.100March 2018
    0.220
    0.040February 2018
    0.070
    0.050January 2018
    0.090
    0.060December 2017
    0.090
    0.0502017Fourth Quarter ended December 31, 2017
    0.110
    0.050Third Quarter ended September 30, 2017
    0.160
    0.080Second Quarter ended June 30, 2017
    0.200
    0.140First Quarter ended March 31, 2017
    0.370
    0.1202016Fourth Quarter ended December 31, 2016
    0.34
    0.14Third Quarter ended September 30, 2016
    0.54
    0.24Second Quarter ended June 30, 2016
    0.66
    0.39First Quarter ended March 31, 2016
    0.69
    0.362015Fourth Quarter ended December 31, 2015
    0.6
    0.3Third Quarter ended September 30, 2015
    0.8
    0.44Second Quarter ended June 30, 2015
    0.83
    0.48First Quarter ended March 31, 2015
    0.91
    0.432014Fourth Quarter ended December 31, 2014
    0.74
    0.43Third Quarter ended September 30, 2014
    0.96
    0.56Second Quarter ended June 30, 2014
    1.03
    0.72First Quarter ended March 31, 2014
    1.21
    0.84Last Five Fiscal Years2017
    0.370
    0.0502016
    0.69
    0.142015
    0.91
    0.302014
    1.21
    0.432013
    1.39
    0.55


---

ITEM 10  ADDITIONAL INFORMATION

A.Share Capital

Not Applicable

B.Articles and By-laws

The Company incorporates by reference into this annual report
the description of its Articles contained in its F-1 registration statement
(File No. 333-206666), as amended, as exhibit 3.1 initially filed with the SEC
on August 31, 2015.

C.Material Contracts

Below is a description of material contracts the Company
entered into in the two years preceding the date of this annual report other
than contracts entered into in the ordinary course of business and other than
contracts described in Item 4. Information on the Company, Item 5. Operating
and Financial Review and Prospects or elsewhere in this annual report on Form
20-F:

(a)       Cooperative Joint
Venture Contract between Zhuzhou Hexing Industrial Company and Natcore Asia
Technology, Limited dated September 21, 2010 providing the terms of and
conditions of the joint venture.

D.Exchange Controls

Canada has no system of currency exchange controls. There are
no governmental laws, decrees or regulations in Canada that restrict the export
or import of capital, including but not limited to, foreign exchange controls,
or that affect the remittance of dividends, interest or other payments to
non-resident holders of the Companys securities.

E.Taxation

The following description is not intended to constitute a
complete analysis of all tax consequences relating to the acquisition, ownership
and disposition of Natcore common shares. Investors should consult his or her
own tax advisor concerning the tax consequences of the investors particular
situation, as well as any tax consequences that may arise under the laws of any
state, local, foreign or other taxing jurisdiction.

Canadian Income Taxation

The following is a general discussion of all material Canadian
federal income tax consequences under current law, generally applicable to U.S.
Holders (as defined below) in respect of purchasing, owning and disposition of
Natcore common shares. This discussion is not a complete analysis or listing of
all of the possible Canadian federal income tax consequences and does not
address all tax considerations that may be relevant to investors in light of
their particular circumstances.

This summary applies only to U.S. Holders who at all times for
the purposes of the Income Tax Act (Canada) (the Tax Act) is a non-resident of
Canada, does not hold his shares in the course of carrying on a business in
Canada, holds his common shares as capital property and deals at arms length
with the Company and is restricted to such circumstances. In addition, the
summary does not describe all of the Canadian federal income tax consequences
that may be relevant to U.S. Holders subject to special rules, such as:

---

- Bank and other financial institutions,
- Insurance companies,
- Traders and dealers in securities, or
- Tax-exempt organizations or entities.

This summary is based on the current provisions of the Tax Act and the regulations there under, all specific proposals to amend the Tax Act and the regulations there under publicly announced by or on behalf of the Minister of Finance (Canada) prior
to the date hereof (the “Proposed Amendments”), and the current published administrative practices and assessing policies of the Canada Revenue Agency.

This summary assumes that the Proposed Amendments will be enacted as currently proposed, although no assurance can be given that the Proposed Amendments will be enacted in the form proposed or at all. Except for the Proposed Amendments, this summary
does not take into account nor anticipate any changes in law or administrative practice, whether by judicial, legislative, governmental or administrative decisions or action, nor does it take into account any provincial, territorial or foreign tax
considerations, which may differ significantly from the Canadian federal income tax considerations discussed herein.

This summary is not and is not intended to be, nor should it be construed to be, legal or tax advice to any particular U.S. Holder.
  Prospective U.S. Holders should consult their own tax advisors regarding the Canadian tax consequences to them of purchasing, owning and disposing of common shares in their particular circumstances

Dividends

A U.S. Holder will be subject to Canadian withholding tax (“Part XIII Tax”) equal to 25%, or such lower rate as may be available under a tax treaty, of the gross amount of any dividend paid or deemed to be paid on the common shares.
Under the Canada-U.S. Income Tax Convention (1980) (the “Treaty”) the rate of Part XIII Tax applicable to a dividend on common shares paid to a U.S. Holder who is a resident of the United States and a “qualifying person” for
purposes of the Treaty is reduced from the 25% rate. Under the Treaty, the Company will be required to withhold Part XIII Tax at a rate of 15% from each dividend so paid and will be required to remit the amount withheld directly to the Receiver
General of Canada on behalf of the U.S. Holder. The 15% rate is further reduced to 5% if the Holder is a company owning at least 10% of the voting shares of the Company.

Disposition of Common Shares

A U.S. Holder who disposes of a common share, including a deemed disposition on death, will not be subject to Canadian tax on any capital gain (or capital loss) thereby realized unless the common share constitutes “taxable Canadian
property” as defined by the Act. Generally, a common share will not constitute taxable Canadian property of a U.S. Holder unless the U.S. Holder held the common shares as property used by the U.S. Holder in carrying on a business in Canada, or
at any time within 60 months preceding the disposition, 25% or more of the issued shares of any class of stock of the Company were owned by or belonged to the U.S. Holder, persons with whom the U.S. Holder did not deal at arm’s length and/or
partnerships in which the U.S. Holder and non-arm’s length persons held a membership interest, and more than 50% of the value of the common share is derived from real property situated in Canada, Canadian resource properties, timber resource
properties or any option or interest in respect of such property.

---

A U.S. Holder who is a resident of the United States and realizes a capital gain on the disposition of a common share that is taxable Canadian property will nevertheless, by virtue of the Treaty, generally be exempt from Canadian tax thereon unless
(a) more than 50% of the value of the common share is derived from real property situated in Canada (including any option or
similar right in respect thereof), rights to explore for or exploit Canadian
mineral deposits, sources and other natural resources and rights to amounts
computed by reference to the amount or value of production from such resources,
(b) the common share formed part of the business property of a permanent
establishment that the U.S. Holder has or had in Canada within the 12 months
preceding the disposition, or (c) the Holder

(i)        is an individual
who was a resident of Canada at any time within the ten years immediately
preceding, and for a total of 120 months during the 20 years preceding the
disposition, (ii) owned the common share when the individual ceased to be
resident in Canada, and (iii) was not a property that the individual was deemed
to have disposed of when the individual ceased to be a resident of Canada and
became a resident of the United States.

A Holder who is subject to Canadian tax in respect of a capital
gain realized on disposition of a common share must include one half of the
capital gain (taxable capital gain) in computing the Holders taxable income
earned in Canada. This Holder may, subject to certain limitations, deduct one
half of any capital loss (allowable capital loss) arising on the disposition of
other taxable Canadian property (other than treaty protected property) realized
in the year of disposition and may deduct the capital loss (after taking into
account any difference in inclusion rates between the particular year and year
of disposition) realized in any preceding year or any of the three subsequent
years from dispositions of other taxable Canadian property (other than treaty
protected property) to the extent the capital loss was not deducted in any other
year.

United States Federal Income Taxation

The following discussion sets forth the material U.S. federal
income tax consequences to U.S. Holders (as defined below) of purchasing,
owning, and disposing of common shares as of the date hereof. This discussion is
not a complete analysis or listing of all of the possible tax consequences and
does not address all tax considerations that may be relevant to investors in
light of their particular circumstances. This summary applies only to U.S.
Holders that hold common shares as capital assets for U.S. federal income tax
purposes (generally, property held for investment), and it does not describe all
of the U.S. federal income tax consequences that may be relevant to U.S. Holders
subject to special rules, such as:

- banks and other financial institutions;
- insurance companies;
- regulated investment companies;
- real estate investment trusts;
- dealers and traders in securities that use mark-to-market accounting for
  U.S. federal income tax purposes;
- U.S. Holders holding common shares as part of a hedging transaction,
  straddle, conversion transaction or other integrated transaction;
- U.S. Holders whose functional currency for U.S. federal income tax
  purposes is not the U.S. dollar;
- U.S. Holders liable for the alternative minimum tax;
- tax-exempt organizations or entities, including an individual retirement
  account or Roth IRA as defined in Section 408 or 408A of the Code,
  respectively;
- U.S. Holders that received the common shares as compensation for the
  performance of services;
- U.S. Holders holding common shares that own or are deemed to own 10% or
  more of the voting shares of the Company; or
- former citizens and residents of the United States subject to tax as
  expatriates.

This summary is based on the Internal Revenue Code of 1986, as
amended (the Code), administrative pronouncements, judicial decisions and
final, temporary and proposed Treasury regulations, all as
currently in effect and available. These authorities are subject to change, possibly with retroactive effect. U.S. Holders should consult their own tax advisers concerning the U.S. federal, state, local, and foreign tax consequences of purchasing,
owning and disposing of common shares in their particular circumstances.

---

For purposes of this summary, a “U.S. Holder” is a beneficial owner of common shares who is, for U.S. federal income tax purposes:

- a citizen or individual resident of the United States;
- a corporation, or other entity taxable as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States, any state thereof or the District of Columbia;
- an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or
- a trust that (1) is subject to the primary supervision of a U.S. court and one or more U.S. persons that have the authority to control all substantial decisions of the trust or (2) has a valid election in effect under applicable Treasury regulations
to be treated as a U.S. person.

If a partnership (or other entity treated as a partnership for U.S. federal income tax purposes) holds the common shares, the tax treatment of a partner in such partnership generally will depend upon the status of the partner and upon the activities
of the partnership. Prospective investors who are partners in a partnership should consult their tax advisers as to the particular U.S. federal income tax consequences of purchasing, owning and disposing of common shares in their particular
circumstances.

This summary does not address the U.S. federal estate and gift, state, local or non-U.S. tax consequences to U.S. Holders of purchasing, owning, and disposing of common shares. Prospective investors should consult their own tax advisors regarding
the U.S. federal, state and local, as well as non-U.S. income and other tax consequences of purchasing, owning and disposing of common shares in their particular circumstances.

Taxation of distributions

Distributions paid on common shares will be treated as dividends to the extent paid out of the Company’s current or accumulated earnings and profits (as determined under U.S. federal income tax principles). Such dividends paid to a U.S. Holder
with respect to common shares generally will be taxable as ordinary income at the time of receipt by a U.S. Holder. Distributions in excess of the Company’s current and accumulated earnings and profits will be treated first as a non- taxable
return of capital, thereby reducing such U.S. Holder’s adjusted tax basis in common shares (but not below zero), and thereafter as either long-term or short- term capital gain depending upon whether the U.S. Holder has held common shares for
more than one year as of the time such distribution is received. Because the Company does not maintain calculations of its earnings and profits under U.S. federal income tax principles, it is expected that distributions generally will be reported to
U.S. Holders as dividends. Distributions of additional common shares to U.S. Holders that are part of a pro rata distribution to all of the Company’s shareholders generally will not be subject to U.S. federal income tax. The amount of any
distribution of property other than cash will be the fair market value of such property on the date of distribution. As used below, the term “dividend” means a distribution that constitutes a dividend for U.S. federal income tax
purposes.

---

With respect to non-corporate U.S. Holders, dividends received may be subject to reduced rates of taxation provided that the Company’s common shares are readily tradable on a qualifying U.S. securities market and that (i) such U.S. Holder
  holds such common shares for 61 days or more during the 121-day period beginning on the date which is 60 days before the date on which such shares become ex-dividend with respect to such dividends and (ii) the U.S. Holder is not under an obligation (whether pursuant to a short sale or otherwise) to make related
payments with respect to existing or substantially similar or related property. The Company’s common shares are expected to be readily tradable 12 months after this registration.

Dividends received on the common shares will be treated as foreign source income and will not be eligible for the dividends-received deduction generally allowed to U.S. corporations under the Code.

Sale or other taxable disposition of shares

For U.S. federal income tax purposes, gain or loss realized on the sale or other taxable disposition of common shares will be capital gain or loss, and will be long- term capital gain or loss if a U.S. Holder held common shares for more than one
year. Non-corporate U.S. Holders may be eligible for preferential rates of U.S. federal income tax in respect of long-term capital gains. The deductibility of capital losses is subject to limitations under the Code.

The amount of the gain or loss realized will be equal to the difference between a U.S. Holder’s adjusted tax basis in the common shares disposed of and the amount realized on the disposition. Such gain or loss generally will be U.S.-source
gain or loss for U.S. foreign tax credit purposes. A U.S. Holder’s initial tax basis in its common shares will be the amount paid for the common shares.

Medicare tax

Certain U.S. Holders that are individuals, estates or trusts are subject to a 3.8% tax on all or a portion of their “net investment income,” which may include all or a portion of their dividend income and net gains from the disposition
of common shares. Each U.S. Holder that is an individual, estate or trust is urged to consult its tax advisors regarding the applicability of the Medicare tax to its income and gains in respect of its investment in the common shares.

Information reporting and backup withholding

Payments of dividends and proceeds from the sale or other taxable disposition that are made within the United States or through certain U.S.-related financial intermediaries generally are subject to information reporting, and may be subject to
backup withholding, unless (1) the U.S. Holder is a corporation or other exempt recipient or (2) in the case of backup withholding, the U.S. Holder provides a correct taxpayer identification number and certifies that it is not subject to backup
withholding.

The amount of any backup withholding from a payment to a U.S. Holder will be allowed as a credit against a U.S. Holder’s U.S. federal income tax liability and may entitle such holder to a refund, provided that the required information is
timely furnished to the United States Internal Revenue Service.

---

Foreign asset reporting

Certain U.S. Holders who are individuals are required to report
information relating to an interest in common shares, subject to certain
exceptions (including an exception for common shares held in accounts maintained
by U.S. financial institutions). U.S. Holders are urged to consult their tax
advisors regarding their information reporting obligations, if any, with respect
to their ownership and disposition of common shares.

F.Dividends and Paying Agents

Not Applicable

G.Statement by Experts

Not Applicable

H.Documents on Display

The Company is subject to the periodic reporting and other
informational requirements of the Exchange Act. Under the Exchange Act, the
Company is required to file reports and other information with the SEC.
Specifically, the Company is required to file annually a Form 20-F within four
months after the end of each fiscal year for fiscal years ending on or after
December 15, 2011. Copies of reports and other information, when so filed, may
be inspected without charge and may be obtained at prescribed rates at the
public reference facilities maintained by the Securities and Exchange Commission
at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. The public may obtain
information regarding the Washington, D.C. Public Reference Room by calling the
Commission at 1-800-SEC- 0330. The SEC also maintains a website at www.sec.gov
that contains reports, proxy and information statements, and other information
regarding registrants that make electronic filings with the SEC using its EDGAR
system. As a foreign private issuer, the Company is exempt from the rules under
the Exchange Act prescribing the furnishing and content of quarterly reports and
proxy statements, and officers, directors and principal shareholders are exempt
from the reporting and short-swing profit recovery provisions contained in
Section 16 of the Exchange Act.

I.Subsidiary Information

For a listing of the Companys subsidiaries, see Item 4.
Information on the CompanyC. Organizational Structure.

ITEM 11  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT
MARKET RISK

Credit Risk

Credit risk is the risk that one party to a financial
instrument will fail to discharge an obligation and cause the other party to
incur a financial loss. The Companys primary exposure to credit risk is on its
cash, and cash equivalents. The majority of cash is deposited in bank accounts
held with major banks in Canada and the United States. As most of the Companys
cash is held by two banks there is a concentration of credit risk. This risk is
managed by using major banks that are high credit quality financial institutions
as determined by rating agencies. The Companys secondary exposure to risk is on
its receivables. The risk is considered to be minimal.

---

Liquidity Risk

Liquidity risk is the risk that the Company will not be able to
meet its financial obligations as they fall due. The Company has a planning and
budgeting process in place to help determine the funds required to support the
Companys normal operating requirements on an ongoing basis. The Company ensures
that there are sufficient funds to meet its short-term business requirements,
taking into account its anticipated cash flows from operations and its holdings
of cash and cash equivalents.

Historically, the Companys sole source of funding has been the
issuance of equity securities for cash, primarily through private placements.
The Companys access to financing is always uncertain. There can be no assurance
of continued access to significant equity funding.

The following is an analysis of the contractual maturities of
the Companys non-derivative financial liabilities as at December 31, 2017:

Within One Year
    Between One and
      Fiver Years
    More Than
      Five YearsTrade Payables and Accrued Liabilities ($)
    1,777,483
    
    


Foreign Exchange Risk

Foreign exchange risk is the risk that the fair values of
future cash flows of a financial instrument will fluctuate because they are
denominated in currencies that differ from the respective functional currency.
The Company does not hedge its exposure to fluctuations in foreign exchange
rates.

The following is an analysis of the United States dollar
equivalent of financial assets and liabilities that are denominated in Canadian
dollars

December 31, 2017
    December 31, 2016Cash and cash equivalents ($)
    
    21,933Trade payables and accrued liabilities ($)
    (232,147)
    (140,756)Net ($)
    (232,147)
    (118,823)


Based on the above net exposures, a 1% change in the Canadian
dollar to United States dollar exchange rate would impact the Companys net loss
by $2,321 and $1,188 at December 31, 2017 and 2016, respectively.

Interest Rate Risk

Interest rate risk is the risk that the fair value of future
cash flows of a financial instrument will fluctuate because of changes in market
interest rates. The Company is exposed to interest rate risk on its cash
equivalents as these instruments have original maturities of three months or
less and are therefore exposed to interest rate fluctuations on renewal. A 1%
change in market interest rates would not have a significant impact on the
Companys net loss.

ITEM 12  DESCRIPTION OF SECURITIES OTHER THAN EQUITY
SECURITIES

Not Applicable.

---

PART II

ITEM 13  DEFAULTS, DIVIDEND ARREARS AND DELINQUENCIES

Not Applicable.

ITEM 14  MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY
HOLDERS AND USE OF PROCEEDS

Not Applicable.

ITEM 15  CONTROLS AND PROCEDURES

A.Disclosure Controls and Procedures

Disclosure controls and procedures are defined in Rule
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as
amended (the Exchange Act) to mean controls and other procedures of an issuer
that are designed to ensure that information required to be disclosed by the
Company in the reports that we file or submit under the Exchange Act is
recorded, processed, summarized and reported, within the time periods specified
in the SECs rules and forms and includes, without limitation, controls and
procedures designed to ensure that such information is accumulated and
communicated to the issuers management, including its principal executive and
principal financial officers, or persons performing similar functions, as
appropriate to allow timely decisions regarding required disclosure.

As required by Rule 13a-15 or 15d-15 under the Exchange Act, we
have carried out an evaluation of the effectiveness of our Companys disclosure
controls and procedures as of the end of the period covered by this Annual
Report on Form 20-F, being December 31, 2017. This evaluation was carried out by
our Chief Executive Officer and Chief Financial Officer. Based upon that
evaluation, our Chief Executive Officer and Chief Financial Officer concluded
that our disclosure controls and procedures were effective as of December 31,
2017.

B.Managements Annual Report on Internal Control Over Financing Reporting
(ICOFR)

Our management is responsible for establishing and maintaining
adequate internal control over financial reporting. The Exchange Act in Rule
13a-15(f) and 15d-15(f) defines this as a process designed by, or under the
supervision of, the companys principal executive and principal financial
officers and effected by the board, management and other personnel, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles and includes those policies and
procedures that:

- pertain to the maintenance of records that, in reasonable detail,
  accurately and fairly reflect the transactions and dispositions of the assets
  of the company;
- provide reasonable assurance that transactions are recorded as necessary to
  permit preparation of financial statements in accordance with generally
  accepted accounting principles, and that receipts and expenditures of the
  company are being made only in accordance with authorizations of management
  and directors of the company; and
- provide reasonable assurance regarding prevention or timely detection of
  unauthorized acquisition, use or disposition of the companys assets that may
  have a material effect on the financial statements.

---

Under the supervision and with the participation of our Chief
Executive Officer and Chief Financial Officer, our management assessed the
effectiveness of our internal control over financial reporting as at December
31, 2017. In making this assessment, our management used the criteria,
established in Internal Control-Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO). Based upon this
assessment, our management concluded that our internal control over financial
reporting was effective as at December 31, 2017.

Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements. Also, projections
of any evaluation of effectiveness of internal control over financial reporting
to future periods are subject to risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.

C.Attestation Report of Registered Public Accounting Firm

This annual report does not include an attestation report of
the Companys registered public accounting firm regarding internal control over
financial reporting. Managements report was not subject to attestation by the
Companys registered public accounting firm pursuant to (i) the Dodd-Frank Wall
Street Reform and Consumer Protection Act of 2010, which permits the Company to
provide only managements report in this Annual Report; the Dodd-Frank Act
permits a non- accelerated filer to provide only managements report on
internal control over financial reporting in an Annual Report and omit an
attestation report of the issuers registered public accounting firm regarding
managements report on internal control over financial reporting and (ii) as the
Company qualifies as an emerging growth company under section 3(a) of the
Exchange Act (as amended by the JOBS Act, enacted on April 5, 2012), and is
therefore exempt from the attestation requirement.

D.Changes in Internal Controls Over Financial Reporting

During the period ended December 31, 2017, there were no
changes in our internal control over financial reporting (as defined in Rules
13a-15(f) and 15d-15(f) of the Exchange Act) that have materially affected, or
are reasonably likely to materially affect, our internal control over financial
reporting.

ITEM 16A  AUDIT COMMITTEE FINANCIAL EXPERT

The Audit Committee has various responsibilities as set forth
in National Instrument 52-110 (NI 52-110). The Board has adopted a Charter for
the Audit Committee which sets out the Audit Committees mandate, organization,
powers and responsibilities.

The Audit Committee consists of three directors. Unless a
company is a venture issuer (an issuer the securities of which are not listed
or quoted on any of the Toronto Stock Exchange, a market in the United States of
America other than the over-the-counter market, or a market outside of Canada
and the U.S.A.) as of the end of its last financial year, NI 52-110 requires
each of the members of the Committee to be independent and financially literate.
Since the Company is a venture issuer (its securities are listed on the TSX
Venture Exchange, but are not listed or quoted on any other exchange or market)
it is exempt from this requirement. In addition, the Companys governing
corporate legislation requires the Company to have an Audit Committee composed
of a minimum of three directors, a majority of whom are not officers or
employees of the Company.

---

The members of the audit committee are Charles Provini, John
Calhoun and Brien Lundin. Mr. Provini is not considered an independent member of
the audit committee given his role as the Companys CEO. All other members of
the audit committee are considered independent. All members are considered
financially literate.

ITEM 16B  CODE OF ETHICS

The Company has adopted a code of ethics that applies to the
Companys directors, officers and employees. A copy of the Companys code of
ethics is posted in the Corporate Governance section of the Natcore
Technology, Inc. website, and may be viewed at
http://www.natcoresolar.com/corporate/corporate-governance/. The Company will
also provide a hard copy of its code of ethics free of charge upon written
request of a shareholder. Shareholders may direct their requests to the
attention of Investor Relations, Natcore Technology, Inc., 189 N. West Street,
Rochester, NY 14604-1163. No waivers of the Companys code of ethics were
granted to the Companys principal executive officer, principal financial
officer, principal accounting officer or controller or persons performing
similar functions during the fiscal year ended December 2016

ITEM 16C  PRINCIPAL ACCOUNTANT FEES AND SERVICES

The audit committee has reviewed the nature and amount of the
services provided by Dale Matheson Carr-Hilton LaBonte LLP, Chartered
Accountants, to the Company to ensure auditor independence. Fees incurred with
Dale Matheson Carr-Hilton LaBonte LLP for audit services in the last two fiscal
years are outlined below:

Financial Year Ended
    Audit Fees(1)($)
    Audit Related Fees(2)($)
    Tax Fees(3)($)
    All Other Fees(4)($)2017
    21,420
    Nil
    3,150
    Nil2016
    28,500
    Nil
    3,150
    Nil


|Notes: |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1)    | Audit Fees include fees necessary to perform the annual
      audit and quarterly reviews of the Companys consolidated financial
      statements. Audit Fees include fees for review of tax provisions and for
      accounting consultations on matters reflected in the financial statements.
      Audit Fees also include audit or other attest services required by
      legislation or regulation, such as comfort letters, consents, reviews of
      securities filings and statutory audits.
|(2)    | Audit-Related Fees include services that are
      traditionally performed by the auditor. These audit-related services
      include employee benefit audits, due diligence assistance, accounting
      consultations on proposed transactions, internal control reviews and audit
      or attest services not required by legislation or regulation.                                                                                                                                                
|(3)    | Tax Fees include fees for all tax services other than
      those included in Audit Fees and Audit-Related Fees. This category
      includes fees for tax compliance, tax planning and tax advice. Tax
      planning and tax advice includes assistance with tax audits and appeals,
      tax advice related to mergers and acquisitions, and requests for rulings
      or technical advice from tax authorities.                                                                               
|(4)    | All Other Fees includes all other non-audit
      services.                                                                                                                                                                                                                                                                                                                                                                                                                                            

ITEM 16D  EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT
COMMITTEES

The Company is relying on the exemptions provided for in
Section 6.1 of NI 52-110 in respect of the composition of its audit committee
and in respect of certain of its reporting obligations under NI 52-110.

ITEM 16E  PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND
AFFILIATED PURCHASERS

Neither the Company nor, to the Companys knowledge, any
affiliated purchaser has made any purchases of the Companys registered shares
during the last financial year.

---

ITEM 16F  CHANGE IN REGISTRANTS CERTIFYING ACCOUNTANT

Not Applicable

ITEM 16G  CORPORATE GOVERNANCE

Not Applicable.

ITEM 16H  MINE SAFETY DISCLOSURE

Not Applicable

PART III

ITEM 17  FINANCIAL STATEMENTS

See Item 18

ITEM 18  FINANCIAL STATEMENTS

The financial statements and schedules appear on pages F-1
through F-26 of this Annual Report and are incorporated herein by reference.

ITEM 19  EXHIBITS

A.Financial Statements and Notes

See Pages F1  F26.

B.Exhibit List

Exhibit No.
    Description1.1
    Articles of Syracuse Capital Corp. (1)4.1
    Employment contracts/executive employment agreements
      (1)4.2
    License Agreement between Natcore and William Marsh Rice
      University, dated March 31, 2004 (1)4.3
    Amendment to License Agreement between Natcore and
      William Marsh Rice University, dated July 29, 2008 (1)4.4
    Sponsored Research Agreement between Natcore and William
      Marsh Rice University, dated September 1, 2009 (1)4.5
    Amendment to License Agreement between Natcore and
      William Marsh Rice University, dated May 10, 2012 (1)4.6
    License Agreement between Alliance for Sustainable
      Energy, LLC and Natcore, dated January 5, 2012 (1)4.7
    Amendment to License Agreement between Alliance for
      Sustainable Energy, LLC and Natcore, dated July 27, 2012 (1)4.8
    Amendment to License Agreement between Alliance for
      Sustainable Energy, LLC and Natcore, dated January 22, 2014 (1)4.9
    Cooperative Joint Venture Contract between Zhuzhou Hexing
      Industrial Company and Natcore Asia Technology, Limited (Chinese Version),
    dated September 21, 2010 (1)


---

|4.10 | Cooperative Joint Venture Contract between Zhuzhou Hexing
      Industrial Company and Natcore Asia Technology, Limited (English Version),
    dated September 21, 2010 (1)
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.11 | Investment Agreement between Natcore Technology, Inc. and
      Dutchess Opportunity Fund, II, LP, dated August 21, 2015 (1)                                               
|4.12 | Registration Rights Agreement between Natcore Technology,
      Inc. and Dutchess Opportunity Fund, II, LP, dated August 21, 2015 (1)                                      
|12.1 | Section 302(a) Certification of CEO (*)                                                                                                                                    
|12.2 | Section 302(a) Certification of CFO (*)                                                                                                                                    
|13.1 | Section 906 Certifications of CEO and CFO (*)                                                                                                                              

|Notes: |                                                                                                                                                            
|------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------
|(*)    | Filed herewith.                                                                                                                                            
|(1)    | Filed as an exhibit to our registration statement on Form
      F-1 as field with the SEC on September 25, 2015 and incorporated herein by
      reference.

---





NATCORE TECHNOLOGY INC.Consolidated Financial
      StatementsFor Years Ended December 31, 2017 and 2016

Expressed in United States Dollars







---

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Directors of Natcore Technology
  Inc.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated financial
  statements of Natcore Technology Inc. (the Company), which comprise the
  consolidated statements of financial position as at December 31, 2017 and 2016,
  the consolidated statements of comprehensive loss, changes in equity (deficit)
  and cash flows for the years ended December 31, 2017, 2016 and 2015, and the
  related notes, comprising a summary of significant accounting policies and other
  explanatory information (collectively referred to as the financial
  statements).

In our opinion, the financial statements present fairly, in all
  material respects, the financial position of the Company as at December 31, 2017
  and 2016, and its financial performance and its cash flows for the years ended
  December 31, 2017, 2016 and 2015 in accordance with International Financial
  Reporting Standards as issued by the International Accounting Standards
  Board.

Material Uncertainty Related to Going Concern

Without modifying our opinion, we draw attention to Note 1 to
  the financial statements, which indicates that the Company has incurred
  recurring losses and has a cumulative deficit of $23,213,638. As stated in Note
  1 to the financial statements, these events or conditions, along with other
  matters as set forth in Note 1, indicate that a material uncertainty exists that
  casts substantial doubt on the Companys ability to continue as a going concern.

Basis for Opinion

Managements Responsibility for the Financial
  Statements

Management is responsible for the preparation and fair
  presentation of these financial statements in accordance with International
  Financial Reporting Standards as issued by the International Accounting
  Standards Board, and for such internal control as management determines is
  necessary to enable the preparation of financial statements that are free from
  material misstatement, whether due to fraud or error.

Auditors Responsibility

Our responsibility is to express an opinion on these financial
  statements based on our audits. We conducted our audits in accordance with
  Canadian generally accepted auditing standards and the standards of the Public
  Company Accounting Oversight Board (United States) (PCAOB). Those standards
  require that we plan and perform the audit to obtain reasonable assurance about
  whether the financial statements are free from material misstatement, whether
  due to error or fraud. Those standards also require that we comply with ethical
  requirements, including independence. We are required to be independent with
  respect to the Company in accordance with the ethical requirements that are
  relevant to our audit of the financial statements in Canada, the U.S. federal
  securities laws and the applicable rules and regulations of the Securities and
  Exchange Commission and the PCAOB. We are a public accounting firm registered
  with the PCAOB.

An audit includes performing procedures to assess the risks of
  material misstatements of the financial statements, whether due to error or
  fraud, and performing procedures to respond to those risks. Such procedures
  included obtaining and examining, on a test basis, audit evidence regarding the
  amounts and disclosures in the financial statements. The procedures selected
  depend on our judgment, including the assessment of the risks of material
  misstatement of the financial statements, whether due to fraud or error. In
  making those risk assessments, we consider internal control relevant to the
  Companys preparation and fair presentation of the financial statements 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. The Company is not required to have, nor were we engaged to
  perform, an audit of its internal control over financial reporting. Accordingly,
  we express no such opinion.

An audit also includes evaluating the appropriateness of
  accounting policies and principles used and the reasonableness of accounting
  estimates made by management, as well as evaluating the overall presentation of
  the financial statements.

We believe that the audit evidence we have obtained in our
  audits is sufficient and appropriate to provide a reasonable basis for our audit
  opinion.

/s/ DMCL LLP

We have served as the Companys auditor since 2007. 
  Vancouver, Canada
  May 2, 2018

---

Natcore Technology Inc.Consolidated Statements of
      Financial Position(Expressed in United States Dollars)

|                                             | Notes |   | 2017        |   |   | 2016        |  
|-------------------------------------------- | ----- | - | ----------- | - | - | ----------- | -
|ASSETS                                       |       |   |             |   |   |             |  
|Current assets                               |       |   |             |   |   |             |  
|Cash and cash
      equivalents              | 4     | $ | 56,391      |   | $ | 23,252      |  
|Receivables                                  | 5     |   | 4,084       |   |   | 12,071      |  
|Prepaid expenses                             |       |   | 7,568       |   |   | 55,187      |  
|                                             |       |   | 68,043      |   |   | 90,510      |  
|Non-current
      assets                     |       |   |             |   |   |             |  
|Equipment                                    | 6     |   | 149,601     |   |   | 223,325     |  
|TOTAL ASSETS                                 |       | $ | 217,644     |   | $ | 313,835     |  
|                                             |       |   |             |   |   |             |  
|LIABILITIES                                  |       |   |             |   |   |             |  
|Current liabilities                          |       |   |             |   |   |             |  
|Trade payables and
      accrued liabilities | 7, 12 | $ | 1,577,483   |   | $ | 1,192,636   |  
|Derivative liability                         | 8     |   | 267,077     |   |   | 367,346     |  
|TOTAL LIABILITIES                            |       |   | 1,844,560   |   |   | 1,559,982   |  
|                                             |       |   |             |   |   |             |  
|DEFICIT                                      |       |   |             |   |   |             |  
|Share capital                                | 9     |   | 17,213,591  |   |   | 16,417,322  |  
|Share-based payment
      reserve            | 9, 10 |   | 4,373,131   |   |   | 4,275,173   |  
|Accumulated deficit                          |       |   | (23,213,638 | ) |   | (21,938,642 | )
|TOTAL DEFICIT                                |       |   | (1,626,916  | ) |   | (1,246,147  | )
|TOTAL LIABILITIES AND DEFICIT                |       | $ | 217,644     |   | $ | 313,835     |  
|                                             |       |   |             |   |   |             |  
|                                             |       |   |             |   |   |             |  
|Nature and continuance of operations         | 1     |   |             |   |   |             |  
|Commitments                                  | 14    |   |             |   |   |             |  
|Subsequent events                            | 17    |   |             |   |   |             |  

Approved on behalf of the Board:

John
        Calhoun
      
      Brien Lundin Director
      
       Director


|The accompanying notes are an integral part of these
      consolidated financial statements. | 3
|--------------------------------------------------------------------------------------------- | -

---

Natcore Technology Inc.Consolidated Statements of
      Comprehensive Loss(Expressed in United States Dollars)

|                                                                        |       |   |            |   |   | For
      the Years Ended |   |   |            |  
|----------------------------------------------------------------------- | ----- | - | ---------- | - | - | ------------------------- | - | - | ---------- | -
|                                                                        |       |   |            |   |   | December 31,              |   |   |            |  
|                                                                        | Notes |   | 2017       |   |   | 2016                      |   |   | 2015       |  
|                                                                        |       |   |            |   |   |                           |   |   |            |  
|Expenses                                                                |       |   |            |   |   |                           |   |   |            |  
|Consulting                                                              |       | $ | 132,936    |   | $ | 124,652                   |   | $ | 181,589    |  
|Depreciation and amortization                                           | 6     |   | 75,272     |   |   | 146,946                   |   |   | 279,527    |  
|Filing Fees                                                             |       |   | 26,278     |   |   | 45,172                    |   |   | 25,016     |  
|Foreign exchange loss                                                   |       |   | 1,457      |   |   | 16,457                    |   |   | 5,159      |  
|Interest and bank charges                                               |       |   | 7,804      |   |   | 2,698                     |   |   | 2,383      |  
|Marketing                                                               |       |   | 76,582     |   |   | 341,104                   |   |   | 268,853    |  
|Office and other operational expenses                                   |       |   | 191,766    |   |   | 201,736                   |   |   | 216,811    |  
|Professional fees                                                       |       |   | 81,589     |   |   | 219,016                   |   |   | 335,762    |  
|Research and development                                                | 16    |   | 861,947    |   |   | 1,137,422                 |   |   | 1,203,716  |  
|Stock-based compensation                                                | 9, 12 |   | 67,599     |   |   | 869,130                   |   |   | 387,648    |  
|Travel                                                                  |       |   | 22,231     |   |   | 37,472                    |   |   | 45,858     |  
|Wages and salaries                                                      | 12    |   | 615,331    |   |   | 763,223                   |   |   | 778,339    |  
|                                                                        |       |   | 2,160,792  |   |   | 3,905,028                 |   |   | 3,730,661  |  
|Other income                                                            |       |   |            |   |   |                           |   |   |            |  
|Fair value adjustment on warrants                                       | 8     |   | 885,673    |   |   | 1,880,587                 |   |   | 226,827    |  
|Other income                                                            |       |   | 123        |   |   | 1,932                     |   |   | 14,124     |  
|Interest income                                                         |       |   | -          |   |   | 809                       |   |   | 1,581      |  
|                                                                        |       |   |            |   |   |                           |   |   |            |  
|Net and comprehensive loss for the year                                 |       | $ | (1,274,996 | ) | $ | (2,021,700                | ) | $ | (3,488,129 | )
|                                                                        |       |   |            |   |   |                           |   |   |            |  
|Loss per share  basic and diluted                                      |       | $ | (0.02      | ) | $ | (0.03                     | ) | $ | (0.07      | )
|                                                                        |       |   |            |   |   |                           |   |   |            |  
|Weighted average number of shares outstanding  basic
      and diluted |       |   | 71,014,878 |   |   | 60,007,618                |   |   | 51,329,138 |  

|The accompanying notes are an integral part of these
      consolidated financial statements. | 4
|--------------------------------------------------------------------------------------------- | -

---

NatcoreTechnologyInc.ConsolidatedStatementofChangesin Equity(Deficit)(Expressedin United StatesDollars)

|                                                                                         |  |       |  |  | Share capital |  |   |            |   |   |             |   |   |               |   |   |             |  
|---------------------------------------------------------------------------------------- |  | ----- |  |  | ------------- |  | - | ---------- | - | - | ----------- | - | - | ------------- | - | - | ----------- | -
|                                                                                         |  |       |  |  |               |  |   |            |   |   | Share-based |   |   | Share         |   |   |             |  
|                                                                                         |  |       |  |  | Number of     |  |   |            |   |   | payment     |   |   | subscriptions |   |   |             |  
|                                                                                         |  | Notes |  |  | shares        |  |   | Amount     |   |   | reserve     |   |   | received      |   |   | Deficit     |  
|                                                                                         |  |       |  |  |               |  |   |            |   |   |             |   |   |               |   |   |             |  
|Balance at January 1, 2015                                                               |  |       |  |  | 47,861,502    |  | $ | 13,977,256 |   | $ | 2,956,964   |   | $ | 313,874       |   | $ | (16,428,813 | )
|Comprehensive loss for the year                                                          |  |       |  |  | -             |  |   | -          |   |   | -           |   |   | -             |   |   | (3,488,129  | )
|Shares issued for services                                                               |  |       |  |  | 325,000       |  |   | 111,764    |   |   | -           |   |   | -             |   |   | -           |  
|Stock-based compensation                                                                 |  |       |  |  | -             |  |   | -          |   |   | 387,648     |   |   | -             |   |   | -           |  
|Transactions with owners, in their capacity
      as owners,
      and other transfers:  |  |       |  |  |               |  |   |            |   |   |             |   |   |               |   |   |             |  
|Shares issued for cash  private
      placement                                         |  |       |  |  | 8,146,745     |  |   | 3,017,290  |   |   | -           |   |   | (313,874      | ) |   | -           |  
|Derivative liability 
      warrants issued                                             |  |       |  |  | -             |  |   | (1,237,161 | ) |   | -           |   |   |               |   |   |             |  
|Issuance costs  finders warrants                                                       |  |       |  |  | -             |  |   | (31,098    | ) |   | 31,098      |   |   | -             |   |   | -           |  
|Issuance costs  cash                                                                    |  |       |  |  | -             |  |   | (147,680   | ) |   | -           |   |   | -             |   |   | -           |  
|Subscriptions received                                                                   |  |       |  |  | -             |  |   | -          |   |   | -           |   |   | 31,102        |   |   | -           |  
|Balance at December 31, 2015                                                             |  |       |  |  | 56,333,247    |  |   | 15,690,371 |   |   | 3,375,710   |   |   | 31,102        |   |   | (19,916,942 | )
|Comprehensive loss for the year                                                          |  |       |  |  | -             |  |   | -          |   |   | -           |   |   | -             |   |   | (2,021,700  | )
|Stock-based compensation                                                                 |  | 9     |  |  | -             |  |   | -          |   |   | 869,130     |   |   | -             |   |   | -           |  
|Transactions with owners, in their capacity as owners, 
      and
      other transfers: |  |       |  |  |               |  |   |            |   |   |             |   |   |               |   |   |             |  
|Shares issued for cash  private
      placement                                         |  | 9     |  |  | 8,095,055     |  |   | 1,968,209  |   |   | -           |   |   | (31,102       | ) |   | -           |  
|Shares issued for services                                                               |  | 9     |  |  | 400,000       |  |   | 124,000    |   |   | -           |   |   | -             |   |   | -           |  
|Shares issued for cash- options
      exercise                                           |  | 9     |  |  | 38,500        |  |   | 24,381     |   |   | (10,699     | ) |   | -             |   |   | -           |  
|Derivative liability  warrants issued                                                   |  | 9     |  |  | -             |  |   | (1,112,776 | ) |   | -           |   |   |               |   |   |             |  
|Issuance costs  finders
      warrants                                                 |  | 9     |  |  | -             |  |   | (41,032    | ) |   | 41,032      |   |   | -             |   |   | -           |  
|Issuance costs  cash                                                                    |  | 9     |  |  | -             |  |   | (235,831   | ) |   | -           |   |   | -             |   |   | -           |  
|Balance at December 31, 2016                                                             |  |       |  |  | 64,866,802    |  |   | 16,417,322 |   |   | 4,275,173   |   |   | -             |   |   | (21,938,642 | )
|Comprehensive loss for the period                                                        |  |       |  |  | -             |  |   | -          |   |   | -           |   |   | -             |   |   | (1,307,112  | )
|Stock-based compensation                                                                 |  | 9     |  |  | -             |  |   | -          |   |   | 67,599      |   |   | -             |   |   | -           |  
|Transactions with owners, in their capacity as owners, 
      and
      other transfers: |  |       |  |  |               |  |   |            |   |   |             |   |   |               |   |   |             |  
|Shares issued for cash 
      private placements                                        |  | 9     |  |  | 12,651,633    |  |   | 1,645,457  |   |   | -           |   |   | -             |   |   | -           |  
|Shares issued for cash  options exercise                                                |  | 9     |  |  | 130,000       |  |   | 65,618     |   |   | (26,008     | ) |   | -             |   |   | -           |  
|Shares issued for cash 
      warrants exercise                                         |  | 9     |  |  | 375,000       |  |   | 97,253     |   |   | -           |   |   | -             |   |   | -           |  
|Derivative liability  warrants issued                                                   |  | 9     |  |  | -             |  |   | (813,126   | ) |   | -           |   |   | -             |   |   | -           |  
|Shares issued for services                                                               |  | 9     |  |  | 140,000       |  |   | 32,155     |   |   | -           |   |   | -             |   |   | -           |  
|Issuance costs  finders warrants                                                       |  | 9     |  |  | -             |  |   | (56,367    | ) |   | 56,367      |   |   | -             |   |   | -           |  
|Issuance costs  cash                                                                    |  | 9     |  |  | -             |  |   | (174,721   | ) |   | -           |   |   | -             |   |   | -           |  
|                                                                                         |  |       |  |  |               |  |   |            |   |   |             |   |   |               |   |   |             |  
|Balance at December 31, 2017                                                             |  |       |  |  | 78,163,435    |  | $ | 17,213,591 |   | $ | 4,373,131   |   | $ | -             |   | $ | (23,213,638 | )

|The accompanying notes are an integral part of these
      consolidated financial statements. | 5
|--------------------------------------------------------------------------------------------- | -

---

Natcore Technology Inc.Consolidated Statements of
      Cash Flows(Expressed in United States Dollars)

|                                                                    |   |            |   |   | For
      the Years Ended |   |   |            |  
|------------------------------------------------------------------- | - | ---------- | - | - | ------------------------- | - | - | ---------- | -
|                                                                    |   |            |   |   | December 31,              |   |   |            |  
|                                                                    |   |            |   |   |                           |   |   |            |  
|                                                                    |   | 2017       |   |   | 2016                      |   |   | 2015       |  
|                                                                    |   |            |   |   |                           |   |   |            |  
|Operating Activities                                                |   |            |   |   |                           |   |   |            |  
|Net loss                                                            | $ | (1,274,996 | ) | $ | (2,021,700                | ) | $ | (3,488,129 | )
|Adjustments for non-cash items:                                     |   |            |   |   |                           |   |   |            |  
|Depreciation and amortization                                       |   | 75,272     |   |   | 146,946                   |   |   | 279,527    |  
|Fair value adjustment on
      warrants                             |   | (885,673   | ) |   | (1,880,588                | ) |   | (226,827   | )
|Stock-based compensation                                            |   | 67,599     |   |   | 869,130                   |   |   | 387,648    |  
|Shares issued for services                                          |   | 32,155     |   |   | -                         |   |   | 111,764    |  
|Changes in non-cash working capital items:                          |   |            |   |   |                           |   |   |            |  
|Receivables                                                         |   | 7,987      |   |   | (1,188                    | ) |   | (4,944     | )
|Prepaid expenses                                                    |   | 47,619     |   |   | 92,889                    |   |   | (87,681    | )
|Trade payables and accrued liabilities                              |   | 384,846    |   |   | 448,037                   |   |   | 440,297    |  
|Net cash flows
      used in operating activities                   |   | (1,545,191 | ) |   | (2,346,474                | ) |   | (2,588,345 | )
|                                                                    |   |            |   |   |                           |   |   |            |  
|Investing Activities                                                |   |            |   |   |                           |   |   |            |  
|Expenditures on equipment                                           |   | (1,548     | ) |   | (3,542                    | ) |   | (27,185    | )
|Net cash flows
      used in investing activities                   |   | (1,548     | ) |   | (3,542                    | ) |   | (27,185    | )
|                                                                    |   |            |   |   |                           |   |   |            |  
|Financing Activities                                                |   |            |   |   |                           |   |   |            |  
|Subscriptions received for pending private
      placement          |   | -          |   |   | -                         |   |   | 31,102     |  
|Proceeds on issuance of common shares  exercise of options         |   | 39,610     |   |   | 13,682                    |   |   | -          |  
|Proceeds on issuance of common shares 
      exercise of warrants  |   | 69,532     |   |   | -                         |   |   | -          |  
|Proceeds on
      issuance of common shares  net of issuance costs |   | 1,470,736  |   |   | 1,838,065                 |   |   | 2,557,562  |  
|Net cash flows provided by financing activities                     |   | 1,579,878  |   |   | 1,851,747                 |   |   | 2,588,644  |  
|Increase (decrease) in cash and cash equivalents                    |   | 33,139     |   |   | (498,269                  | ) |   | (26,866    | )
|Cash and cash equivalents, beginning                                |   | 23,252     |   |   | 521,521                   |   |   | 548,387    |  
|Cash and cash
      equivalents, ending                             | $ | 56,391     |   | $ | 23,252                    |   | $ | 521,521    |  

|The accompanying notes are an integral part of these
      consolidated financial statements. | 6
|--------------------------------------------------------------------------------------------- | -

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

1. Nature and Continuance of Operations

Natcore Technology Inc. (the Company) was incorporated under
  the British Columbia Business Corporations Act on August 9, 2007. The Companys
  common shares are listed on the TSX Venture Exchange (the Exchange) under the
  symbol NXT. Effective May 26, 2015, the Company became a fully-reporting issuer
  in the United States. The Company develops and owns technology for the
  manufacturing of solar cells.

The Companys head office address is 189 North Water Street,
  Suite 700, Rochester, NY 14604-1163. The Companys registered office is 2080 -
  777 Hornby Street, Vancouver British Columbia V6Z 1S4.

These consolidated financial statements have been prepared on
  the assumption that the Company will continue as a going concern, meaning it
  will continue in operation for the foreseeable future and will be able to
  realize assets and discharge liabilities in the ordinary course of operations.
  Different bases of measurement may be appropriate if the Company is not expected
  to continue operations for the foreseeable future. As of December 31, 2017 the
  Company has had recurring losses from operations and a cumulative deficit of
  $23,213,638. The Companys continuation as a going concern is dependent upon its
  ability to attain profitable operations and generate funds there from and/or
  raise equity capital or borrowings sufficient to meet current and future
  obligations. These conditions indicate the existence of a material uncertainty
  that may cast significant doubt about the Companys ability to continue as a
  going concern. Management intends to finance operating costs over the next
  twelve months with existing cash resources and the private placement of common
  shares.

2. Significant Accounting Policies and Basis of Preparation

Statement of Compliance with International Financial
  Reporting Standards

These consolidated financial statements of the Company have
  been prepared in accordance with International Financial Reporting Standards
  (IFRB") issued by the International Accounting Standards Board (IASB) and
  interpretations of the International Financial Reporting Interpretations
  Committee (IFRIC).

The consolidated financial statements were authorized for issue
  by the Board of Directors on May 2, 2018.

Basis of Preparation

The consolidated financial statements of the Company have been
  prepared on an accrual basis and are based on historical costs, modified where
  applicable. The consolidated financial statements are presented in United States
  dollars unless otherwise noted.

Consolidation

The consolidated financial statements include the accounts of
  the Company and its controlled entities. Details of controlled entities are as
  follows:

Percentage Owned*Jurisdictionof
      December
      DecemberIncorporation
      31, 2017
      31,2016Natcore Technology, Inc.
      United States
      100%
      100%Newcyte, Incorporated
      United States
      100%
      100%Vanguard Solar, Inc.
      United States
      100%
      100%Natcore Asia Technology, Limited
      Hong
        Kong
      100%
      100%


*Percentage of voting power is in
  proportion to ownership.

Inter-company balances are eliminated on consolidation.

7

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

2. Significant Accounting Policies and Basis of Preparation
  (continued)

Significant Accounting Judgments, Estimates and
  Assumptions

The preparation of consolidated financial statements in
  accordance with IFRS requires the Company to make estimates and assumptions
  concerning the future. The Companys management reviews these estimates and
  underlying assumptions on an ongoing basis, based on experience and other
  factors, including expectations of future events that are believed to be
  reasonable under the circumstances. Revisions to estimates are adjusted for
  prospectively in the period in which the estimates are revised.

Estimates and assumptions where there is significant risk of
  material adjustments to assets and liabilities in future accounting periods
  include the useful lives of equipment, impairment considerations for equipment
  and intangible assets, determination of fair value for stock-based compensation
  and other share-based payments, valuations and assumptions used to determine
  deferred income taxes and the fair value of financial instruments.

Foreign Currency Translation

The functional currency of each of the Companys entities is
  measured using the currency of the primary economic environment in which that
  entity operates. The consolidated financial statements are presented in United
  States dollars which is the functional currency of the Company and its
  subsidiaries.

Transactions and Balances:

Foreign currency transactions are translated into functional
  currency using the exchange rates prevailing at the date of the transaction.
  Foreign currency monetary items are translated at the period-end exchange rate.
  Non-monetary items measured at historical cost continue to be carried at the
  exchange rate at the date of the transaction. Non-monetary items measured at
  fair value are reported at the exchange rate at the date when fair values were
  determined.

Exchange differences arising on the translation of monetary
  items or on settlement of monetary items are recognized in profit or loss in the
  statement of comprehensive loss in the period in which they arise, except where
  deferred in equity as a qualifying cash flow or net investment hedge.

Exchange differences arising on the translation of non-monetary
  items are recognized in other comprehensive loss in the statement of
  comprehensive loss to the extent that gains and losses arising on those
  non-monetary items are also recognized in other comprehensive loss. Where the
  non-monetary gain or loss is recognized in profit or loss, the exchange
  component is also recognized in profit or loss.

Intangible Assets

Intangible Assets Acquired Separately

Intangible assets with finite useful lives that are acquired
  separately are carried at cost less accumulated amortization and accumulated
  impairment losses. Amortization is recognized on a straight-line basis over
  their estimated useful lives. The estimated useful life and amortization method
  are reviewed at the end of each reporting period, with the effect of any changes
  in estimate being accounted for on a prospective basis. Intangible assets with
  indefinite useful lives that are acquired separately are carried at cost less
  accumulated impairment losses.

8

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

2. Significant Accounting Policies and Basis of Preparation
  (continued)

Internally-Generated Intangible Assets - Research and
  Development Expenditure

Expenditure on research activities is recognized as an expense
  in the period in which it is incurred.

An internally-generated intangible asset arising from
  development (or from the development phase of an internal project) is recognized
  if, and only if, all of the following have been demonstrated:

| | The technical feasibility of
      completing the intangible asset so that it will be available for use or
      sale;                                    
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                           
| | The intention to complete the
      intangible asset and use or sell it;                                                                                  
|  |                                                                                                                                                           
| | The ability to use or sell the
      intangible asset;                                                                                                    
|  |                                                                                                                                                           
| | How the intangible asset will
      generate probable future economic benefits;                                                                           
|  |                                                                                                                                                           
| | The availability of adequate technical, financial and
      other resources to complete the development and to use or sell the
      intangible asset; and
|  |                                                                                                                                                           
| | The ability to measure reliably
      the expenditure attributable to the intangible asset during its
      development.                                  

The amount initially recognized for internally-generated
  intangible assets is the sum of the expenditure incurred from the date when the
  intangible asset first meets the recognition criteria listed above. Where no
  internally-generated intangible asset can be recognized, development expenditure
  is recognized in loss in the period in which it is incurred.

Subsequent to initial recognition, internally-generated
  intangible assets are reported at cost less accumulated amortization and
  accumulated impairment losses, on the same basis as intangible assets that are
  acquired separately.

At December 31, 2017 and 2016, the Company has not recognized
  any internally-generated intangible assets.

Share-Based Payments

The Company operates a stock option plan. Share-based payments
  to employees are measured at the fair value of the instruments issued and
  amortized over the vesting periods. Share-based payments to non-employees are
  measured at the fair value of goods or services received or the fair value of
  the equity instruments issued, if it is determined the fair value of the goods
  or services cannot be reliably measured, and are recorded at the date the goods
  or services are received. The corresponding amount is recorded to the
  share-based payment reserve. The fair value of options is determined using the
  BlackScholes Option Pricing Model. The number of shares and options expected to
  vest is reviewed and adjusted at the end of each reporting period such that the
  amount recognized for services received as consideration for the equity
  instruments granted shall be based on the number of equity instruments that
  eventually vest.

Financial Instruments

The Company classifies its financial instruments in the
  following categories: at fair value through profit or loss, loans and
  receivables, held-to-maturity investments, available-for-sale and financial
  liabilities. The classification depends on the purpose for which the financial
  instruments were acquired. Management determines the classification of its
  financial instruments at initial recognition.

Financial assets are classified at fair value through profit or
  loss when they are either held for trading for the purpose of short-term profit
  taking, derivatives not held for hedging purposes, or when they are designated
  as such to avoid an accounting mismatch or to enable performance evaluation
  where a group of financial assets is managed by key management personnel on a
  fair value basis in accordance with a documented risk management or investment
  strategy. Such assets are subsequently measured at fair value with changes in
  carrying value being included in profit or loss.

9

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

2. Significant Accounting Policies and Basis of Preparation
  (continued)

Financial Instruments (continued)

Loans and receivables are non-derivative financial assets with
  fixed or determinable payments that are not quoted in an active market and are
  subsequently measured at amortized cost. They are included in current assets,
  except for maturities greater than 12 months after the end of the reporting
  period. These are classified as non-current assets.

Held-to-maturity investments are non-derivative financial
  assets that have fixed maturities and fixed or determinable payments, and it is
  the Companys intention to hold these investments to maturity. They are
  subsequently measured at amortized cost. Held-to-maturity investments are
  included in non-current assets, except for those which are expected to mature
  within 12 months after the end of the reporting period.

Available-for-sale financial assets are non-derivative
  financial assets that are designated as available-for-sale or are not suitable
  to be classified as financial assets at fair value through profit or loss, loans
  and receivables or held-to-maturity investments and are subsequently measured at
  fair value. These are included in current assets. Unrealized gains and losses
  are recognized in other comprehensive loss, except for impairment losses and
  foreign exchange gains and losses.

Non-derivative financial liabilities (excluding financial
  guarantees) are subsequently measured at amortized cost. Derivative financial
  liabilities are classified at fair value through profit and loss and are
  subsequently measured at fair value with changes in carrying value being
  included in profit or loss.

Regular purchases and sales of financial assets are recognized
  on the trade-date  the date on which the Company commits to purchase the
  asset.

Financial assets are derecognized when the rights to receive
  cash flows from the investments have expired or have been transferred and the
  Company has transferred substantially all risks and rewards of ownership.

At each reporting date, the Company assesses whether there is
  objective evidence that a financial instrument has been impaired. In the case of
  available-for-sale financial instruments, a significant and prolonged decline in
  the value of the instrument is considered to determine whether impairment has
  arisen.

Impairment of Long-Lived Assets

The carrying amount of the Companys long-lived assets (which
  include equipment and intangible assets) is reviewed at each reporting date to
  determine whether there is any indication of impairment. If such indication
  exists, the recoverable amount of the asset is estimated in order to determine
  the extent of the impairment loss. An impairment loss is recognized whenever the
  carrying amount of an asset or its cash generating unit exceeds its recoverable
  amount. Impairment losses are recognized in the statement of comprehensive loss.

The recoverable amount of assets is the greater of an assets
  fair value less cost to sell and value in use. In assessing value in use, the
  estimated future cash flows are discounted to their present value using a
  pre-tax discount rate that reflects the current market assessments of the time
  value of money and the risks specific to the asset. For an asset that does not
  generate cash inflows largely independent of those from other assets, the
  recoverable amount is determined for the cash-generating unit to which the asset
  belongs.

An impairment loss is only reversed if there is an indication
  that the impairment loss may no longer exist and there has been a change in the
  estimates used to determine the recoverable amount, however, not to an amount
  higher than the carrying amount that would have been determined had no
  impairment loss been recognized in previous years.

Assets that have an indefinite useful life are not subject to
  amortization and are tested annually for impairment.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, deposits held
  at call with banks and other short-term highly liquid investments, such as
  guaranteed investment certificates with original maturities of three months or
  less. Guaranteed investment certificates are investments with Canadian banks
  that are the equivalent of a certificate of deposit.

10

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

2. Significant Accounting Policies and Basis of Preparation
  (continued)

Income Taxes

Current Income Tax:

Current income tax assets and liabilities for the current
  period are measured at the amount expected to be recovered from or paid to the
  taxation authorities. The tax rates and tax laws used to compute the amount are
  those that are enacted or substantively enacted, at the reporting date, in the
  countries where the Company operates and generates taxable income.

Current income tax relating to items recognized directly in
  other comprehensive loss or equity is recognized in other comprehensive loss or
  equity and not in profit or loss. Management periodically evaluates positions
  taken in the tax returns with respect to situations in which applicable tax
  regulations are subject to interpretation and establishes provisions where
  appropriate.

Deferred Income Tax:

Deferred income tax is provided using the asset and liability
  method on temporary differences at the reporting date between the tax bases of
  assets and liabilities and their carrying amounts for financial reporting
  purposes.

The carrying amount of deferred income tax assets is reviewed
  at the end of each reporting period and recognized only to the extent that it is
  probable that sufficient taxable profit will be available to allow all or part
  of the deferred income tax asset to be utilized.

Deferred income tax assets and liabilities are measured at the
  tax rates that are expected to apply to the year when the asset is realized or
  the liability is settled, based on tax rates (and tax laws) that have been
  enacted or substantively enacted by the end of the reporting period.

Deferred income tax assets and deferred income tax liabilities
  are offset, if a legally enforceable right exists to set off current tax assets
  against current income tax liabilities and the deferred income taxes relate to
  the same taxable entity and the same taxation authority.

Equipment

Equipment is stated at historical cost less accumulated
  depreciation and accumulated impairment losses.

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. The carrying amount of the
  replaced part is derecognized. All other repairs and maintenance are charged to
  the statement of comprehensive loss during the financial period in which they
  are incurred.

Gains and losses on disposals are determined by comparing the
  proceeds with the carrying amount and are recognized in profit or loss.

Depreciation and amortization are calculated on a straight-line
  method to write off the cost of the assets to their residual values over their
  estimated useful lives.

Comparative Information

Certain expenses have been reclassified to conform to the
  presentation in the current year.

11

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

3. Accounting Standards Issued but Not Yet Effective

New Standard IFRS 16 Leases

This new standard replaces IAS 17 Leases and the related
  interpretative guidance. IFRS 16 applies a control model to the identification
  of leases, distinguishing between a lease and a service contract on the basis of
  whether the customer controls the asset being leased. For those assets
  determined to meet the definition of a lease, IFRS 16 introduces significant
  changes to the accounting by lessees, introducing a single, on-balance sheet
  accounting model that is similar to current finance lease accounting, with
  limited exceptions for short-term leases or leases of low value assets. Lessor
  accounting is not substantially changed. The standard is effective for annual
  periods beginning on or after January 1, 2019, with early adoption permitted for
  entities that have adopted IFRS 15.

The Company has not early adopted this new standard and is
  currently assessing the impact that these standards will have on its
  consolidated financial statements.

Other accounting standards or amendments to existing accounting
  standards that have been issued but have future effective dates are either not
  applicable or are not expected to have a significant impact on the Companys
  consolidated financial statements.

4. Cash and Cash Equivalents

| |              |   | December 31, |  |   | December 31, | 
| | ------------ | - | ------------ |  | - | ------------ | 
| |              |   | 2017         |  |   | 2016         | 
| | Cash at Bank | $ | 56,391       |  | $ | 23,252       | 

5. Receivables

| |                |   | December 31, |  |   | December 31, | 
| | -------------- | - | ------------ |  | - | ------------ | 
| |                |   | 2017         |  |   | 2016         | 
| | GST receivable | $ | 4,084        |  | $ | 12,071       | 
| |                | $ | 4,084        |  | $ | 12,071       | 

6. Equipment

| |                            |   | Furniture and |  |   |            |  |   |           | 
| | -------------------------- | - | ------------- |  | - | ---------- |  | - | --------- | 
| |                            |   | Office        |  |   | Production |  |   |           | 
| |                            |   | Equipment     |  |   | Equipment  |  |   | Total     | 
| | Cost:                      |   |               |  |   |            |  |   |           | 
| | At December 31, 2015       | $ | 360,742       |  | $ | 932,808    |  | $ | 1,293,550 | 
| | Additions                  |   | 2,708         |  |   | 834        |  |   | 3,542     | 
| | At
      December 31, 2016 |   | 363,450       |  |   | 933,642    |  |   | 1,297,092 | 
| | Depreciation:              |   |               |  |   |            |  |   |           | 
| | At December 31, 2015       |   | 342,512       |  |   | 584,309    |  |   | 926,821   | 
| | Charge for the Period      |   | 6,988         |  |   | 139,958    |  |   | 146,946   | 
| | At
      December 31, 2016 |   | 349,500       |  |   | 724,267    |  |   | 1,073,767 | 
| | Net Book Value:            |   |               |  |   |            |  |   |           | 
| | At December 31, 2016       | $ | 13,950        |  | $ | 209,375    |  | $ | 223,325   | 

12

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

6. Equipment (continued)

| | Cost:                       |   |         |  |   |         |  |   |           | 
| | --------------------------- | - | ------- |  | - | ------- |  | - | --------- | 
| | At December 31, 2016        | $ | 363,450 |  | $ | 933,642 |  | $ | 1,297,092 | 
| | Additions                   |   | -       |  |   | 1,548   |  |   | 1,548     | 
| | At
      December 31, 2017  |   | 363,450 |  |   | 935,190 |  |   | 1,298,640 | 
| | Depreciation:               |   |         |  |   |         |  |   |           | 
| | At December 31, 2016        |   | 349,500 |  |   | 724,267 |  |   | 1,073,767 | 
| | Charge for the
      Period |   | 4,707   |  |   | 70,565  |  |   | 75,272    | 
| | At
      December 31, 2017  |   | 354,207 |  |   | 794,832 |  |   | 1,149,039 | 
| | Net Book
      Value:       |   |         |  |   |         |  |   |           | 
| | At December 31, 2017        | $ | 9,243   |  | $ | 140,358 |  | $ | 149,601   | 

7. Trade Payables and Accrued Liabilities

| |                                        |   | December 31, |  |   | December 31, | 
| | -------------------------------------- | - | ------------ |  | - | ------------ | 
| |                                        |   | 2017         |  |   | 2016         | 
| | Trade Payables and Accrued Liabilities | $ | 1,577,483    |  | $ | 1,192,636    | 

8. Derivative Financial Liability

| |                                                        |   | Year Ended   |   |   | Year Ended   |  
| | ------------------------------------------------------ | - | ------------ | - | - | ------------ | -
| |                                                        |   | December 31, |   |   | December 31, |  
| |                                                        |   | 2017         |   |   | 2016         |  
| | Balance, Beginning                                     | $ | 367,346      |   | $ | 1,135,157    |  
| | Fair value of warrants issued during the year          |   | 813,126      |   |   | 1,112,776    |  
| | Fair value of warrants exercised during the
      year |   | (27,722      | ) |   | -            |  
| | Change in fair
      value of warrants outstanding     |   | (885,673     | ) |   | (1,880,587   | )
| | Balance, Ending                                        | $ | 267,077      |   | $ | 367,346      |  

13

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

8. Derivative Financial Liability (continued)

The derivative financial liability consists of the fair value
  of share purchase warrants that have exercise prices that differ from the
  functional currency of the Company and are within the scope of IAS 32 Financial
  Instruments: Presentation. Details of these warrants and their fair values are
  as follows:

Number of
      
      Number ofWarrants
      Fair Value at
      WarrantsOutstanding at
      December
      Outstanding at
      Fair Value atExercise
      December 31,
      31,
      December 31,
      December 31,Expiration
        Date
      Price
      2017
      2017
      2016
      2016CDN $
      
      US $
      
      US $July 20, 2017
      0.90
      -
      -
      3,840,700
      574January 21, 2018
      0.70
      1,352,062
      -
      1,352,062
      3,497April 14, 2018
      0.95
      1,200,050
      -
      1,200,050
      4,028April 27, 2018
      0.95
      397,000
      -
      397,000
      1,506July 23, 2018
      0.74
      1,000,000
      20
      1,000,000
      8,052July 31, 2018
      0.74
      822,000
      18
      822,000
      6,650November 30, 2018
      0.55
      1,694,444
      609
      1,694,444
      26,938December 18, 2018
      0.55
      1,681,189
      1,254
      1,681,189
      27,987February 2, 2019
      0.55
      273,058
      309
      273,058
      6,144March 17, 2019
      0.55
      2,244,497
      2,132
      2,244,497
      53,241June 28, 2019
      0.55
      1,000,000
      2,930
      1,000,000
      26,377July 28, 2019
      0.55
      1,000,000
      3,155
      1,000,000
      29,049September 16, 2019
      0.55
      650,000
      3,471
      650,000
      23,768November 2, 2019
      0.30
      1,000,000
      8,955
      1,000,000
      49,316November 22, 2019
      0.30
      427,500
      3,899
      427,500
      20,328December 5, 2019
      0.25
      1,000,000
      11,201
      1,000,000
      53,205December 14, 2019
      0.25
      500,000
      5,651
      500,000
      26,686January 9, 2020
      0.25
      646,800
      6,247
      -
      -February 3, 2020
      0.40
      650,000
      4,696
      -
      -March 17, 2020
      0.25
      900,000
      11,315
      -
      -April 11, 2020
      0.25
      1,030,000
      13,070
      -
      -May 13, 2020
      0.27
      500,000
      6,067
      -
      -June 14, 2020
      0.24
      1,250,000
      18,968
      -
      -July 11, 2020
      0.24
      650,000
      10,424
      -
      -July 26, 2020
      0.24
      900,000
      14,649
      -
      -August 9, 2020
      0.24
      1,000,000
      19,648
      -
      -September 12, 2020
      0.24
      500,000
      10,093
      -
      -October 16, 2020
      0.24
      1,250,000
      30,078
      -
      -November 24, 2020
      0.24
      1,449,833
      35,227
      -
      -December 27, 2020
      0.19
      1,550,000
      42,991
      -
      -28,518,433
      267,077
      20,082,500
      367,346


The fair values of these warrants were estimated using the
  Black-Scholes Option Pricing Model using the following assumptions.

| | The stock price was based upon the publicly traded price
      at the time of issuance;                                                                                                                  
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                          
| | The risk-free interest rate assumption is based on the
      government of Canada marketable bonds for a period consistent with the
      expected term of the option in effect at the time of the grant;
|  |                                                                                                                                                                                                          
| | The Company does not pay dividends on common stock and
      does not anticipate paying dividends on its common stock in the
      foreseeable future. Therefore, the expected dividend rate was 0%;     

14

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

8. Derivative Financial Liability (continued)

| | The expected life of the warrants was estimated to be 75%
      of the remaining contractual term which is based on the historical
      exercise patterns of warrant holders; and   
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                      
| | The expected volatility was based off of the historical
      trading prices of the Companys common stock price over a period
      equivalent to the expected life of the warrants.

The fair values of these warrants as of December 31, 2017 were
  estimated using the Black-Scholes Option Pricing Model using the following
  inputs:

Input
      RangeExpected volatility
      96% - 100%Expected life
      0.04 - 2.24 yearsDividends
      0.00%Risk-free
        interest rate
      0.65%


The fair values of these warrants as of December 31, 2016 were
  estimated using the Black-Scholes Option Pricing Model using the following
  inputs:

Input
      RangeExpected volatility
      86% - 95%Expected life
      0.41 - 2.22 yearsDividends
      0.00%Risk-free interest
        rate
      0.74%


9. Share Capital

Authorized Share Capital

Unlimited number of common shares without par value.

Issued Share Capital

At December 31, 2017 and 2016, there were 78,163,435 and
  64,866,802, respectively, issued and fully paid common shares.

Private Placements

In February 2016, the Company completed a non-brokered private
  placement and issued 273,058 units at a price of CDN$0.36 per unit for gross
  proceeds of $70,908 (CDN$98,301). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.55 per share
  for a period of three years from the date of closing. The Company had received
  subscriptions of $31,102 at December 31, 2015 that related to this private
  placement. On issue the fair value of the warrants was determined to be $26,464
  and included in derivative liability (Note 8).

In March 2016, the Company completed a non-brokered private
  placement and issued 2,244,497 units at a price of CDN$0.36 per unit for gross
  proceeds of $622,166 (CDN$808,019). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.55 per share
  for a period of three years from the date of closing. On issue the fair value of
  the warrants was determined to be $489,252 and included in derivative liability
  (Note 8). The Company paid finders fees of $6,150 and incurred other share
  issue costs of $3,276. The Company also issued 23,450 finders warrants with a
  fair value of $5,112 in connection with this private placement exercisable at a
  price of CAD$0.55 per share for a period of three years from the date of
  closing.

15

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

In June 2016, the Company completed a non-brokered private
  placement and issued 1,000,000 units at a price of CDN$0.40 per unit for gross
  proceeds of $305,421 (CDN$400,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.55 per share
  for a period of three years from the date of closing. On issue the fair value of
  the warrants was determined to be $167,222 and included in derivative liability
  (Note 8). The Company paid finders fees of $10,000. The Company also issued
  70,000 finders warrants with a fair value of $10,940 in connection with this
  private placement exercisable at a price of CAD$0.55 per share for a period of
  three years from the date of closing.

In July 2016, the Company completed a non-brokered private
  placement and issued 1,000,000 units at a price of CDN$0.40 per unit for gross
  proceeds of $303,630 (CDN$400,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.55 per share
  for a period of three years from the date of closing. The Company also issued
  70,000 finders warrants with a fair value of $9,841 in connection with this
  private placement exercisable at a price of CAD$0.55 per share for a period of
  three years from the date of closing.

In September 2016, the Company completed a non-brokered private
  placement and issued 650,000 units at a price of CDN$0.36 per unit for gross
  proceeds of $177,048 (CDN$234,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.55 per share
  for a period of three years from the date of closing. The Company also issued
  45,500 finders warrants with a fair value of $5,333 in connection with this
  private placement exercisable at a price of CAD$0.55 per share for a period of
  three years from the date of closing.

In November 2016, the Company completed a non-brokered private
  placement and issued 1,427,500 units at a price of CDN$0.23 per unit for gross
  proceeds of $244,966 (CDN$328,325). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.30 per share
  for a period of three years from the date of closing. The Company also issued
  70,000 finders warrants with a fair value of $7,801 in connection with this
  private placement exercisable at a price of CAD$0.30 per share for a period of
  three years from the date of closing.

In December 2016, the Company completed a non-brokered private
  placement and issued 1,500,000 units at a price of CDN$0.21 per unit for gross
  proceeds of $238,373 (CDN$315,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.30 per share
  for a period of three years from the date of closing. The Company also issued
  70,000 finders warrants with a fair value of $5,569 in connection with this
  private placement exercisable at a price of CAD$0.30 per share for a period of
  three years from the date of closing.

For the year ended December 31, 2016, the Company determined
  the fair value at the time of issuance of the warrants included in the
  derivative liability and the finders warrants using the Black-Scholes Option
  Pricing Model using the following inputs:

Input
      RangeExpected volatility
      86% - 95%Expected life
      2.25 yearsDividends
      0.00%Risk-free
        interest rate
      0.45% - 0.80%


In January 2017, the Company completed a non-brokered private
  placement and issued 1,021,800 units at a price of CDN$0.21 per unit for gross
  proceeds of $162,030 (CDN$214,578). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.25 per share
  for a period of three years from the date of closing. The Company also issued
  70,000 finders warrants with a fair value of $7,139 in connection with this
  private placement exercisable at a price of CAD$0.25 per share for a period of
  three years from the date of closing.

In February 2017, the Company completed a non-brokered private
  placement and issued 650,000 units at a price of CDN$0.34 per unit for gross
  proceeds of $169,195 (CDN$221,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.40 per share
  for a period of three years from the date of closing. The Company also issued
  45,500 finders warrants with a fair value of $4,894 in connection with this
  private placement exercisable at a price of CAD$0.40 per share for a period of
  three years from the date of closing.

16

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

9. Share Capital (continued)

Private Placements (continued)

In March 2017, the Company completed a non-brokered private
  placement and issued 900,000 units at a price of CDN$0.19 per unit for gross
  proceeds of $128,077 (CDN$171,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.25 per share
  for a period of three years from the date of closing. The Company also issued
  63,000 finders warrants with a fair value of $5,714 in connection with this
  private placement exercisable at a price of CAD$0.25 per share for a period of
  three years from the date of closing.

In April 2017, the Company completed a non-brokered private
  placement and issued 1,030,000 units at a price of CDN$0.19 per unit for gross
  proceeds of $146,186 (CDN$195,700). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.25 per share
  for a period of three years from the date of closing. The Company also issued
  72,100 finders warrants with a fair value of $4,543 in connection with this
  private placement exercisable at a price of CAD$0.25 per share for a period of
  three years from the date of closing.

In May 2017, the Company completed a non-brokered private
  placement and issued 500,000 units at a price of CDN$0.21 per unit for gross
  proceeds of $76,603 (CDN$105,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.27 per share
  for a period of three years from the date of closing. The Company also issued
  35,000 finders warrants with a fair value of $3,414 in connection with this
  private placement exercisable at a price of CAD$0.27 per share for a period of
  three years from the date of closing.

In June 2017, the Company completed a non-brokered private
  placement and issued 1,250,000 units at a price of CDN$0.19 per unit for gross
  proceeds of $179,955 (CDN$237,500). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.24 per share
  for a period of three years from the date of closing. The Company also issued
  87,500 finders warrants with a fair value of $6,505 in connection with this
  private placement exercisable at a price of CAD$0.24 per share for a period of
  three years from the date of closing.

In July 2017, the Company completed a non-brokered private
  placement and issued 650,000 and 900,000 units at a price of CDN$0.19 per unit
  for gross proceeds of $95,565 (CDN$123,500) and $136,732 (CDN$171,000). Each
  unit comprised one common share and one purchase warrant, with each warrant
  exercisable at a price of CDN$0.24 per share for a period of three years from
  the date of closing. The Company also issued 45,500 and 63,000 finders warrants
  with a fair value of $3,472 and $4,260 in connection with this private placement
  exercisable at a price of CAD$0.24 per share for a period of three years from
  the date of closing.

In August 2017, the Company completed a non-brokered private
  placement and issued 1,000,000 units at a price of CDN$0.15 per unit for gross
  proceeds of $118,007 (CDN$150,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.19 per share
  for a period of three years from the date of closing. The Company also issued
  70,000 finders warrants with a fair value of $5,192 in connection with this
  private placement exercisable at a price of CAD$0.19 per share for a period of
  three years from the date of closing

In September 2017, the Company completed a non-brokered private
  placement and issued 500,000 units at a price of CDN$0.15 per unit for gross
  proceeds of $61,687 (CDN$75,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.19 per share
  for a period of three years from the date of closing. The Company also issued
  35,000 finders warrants with a fair value of $1,898 in connection with this
  private placement exercisable at a price of CAD$0.24 per share for a period of
  three years from the date of closing.

In October 2017, the Company completed a non-brokered private
  placement and issued 1,250,000 units at a price of CDN$0.12 per unit for gross
  proceeds of $119,736 (CDN$150,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.15 per share
  for a period of three years from the date of closing. The Company also issued
  87,500 finders warrants with a fair value of $3,392 in connection with this
  private placement exercisable at a price of CAD$0.15 per share for a period of
  three years from the date of closing.

17

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

9. Share Capital (continued)

Private Placements (continued)

In November 2017, the Company completed a non-brokered private
  placement and issued 1,449,833 units at a price of CDN$0.12 per unit for gross
  proceeds of $136,996 (CDN$173,980). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.15 per share
  for a period of three years from the date of closing. The Company also issued
  87,500 finders warrants with a fair value of $2,913 in connection with this
  private placement exercisable at a price of CAD$0.15 per share for a period of
  three years from the date of closing.

In December 2017, the Company completed a non-brokered private
  placement and issued 1,550,000 units at a price of CDN$0.10 per unit for gross
  proceeds of $114,688 (CDN$147,250). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.12 per share
  for a period of three years from the date of closing. The Company also issued
  108,500 finders warrants with a fair value of $3,031 in connection with this
  private placement exercisable at a price of CAD$0.12 per share for a period of
  three years from the date of closing.

The Company incurred cash shares issuance costs of $174,721 in
  connection with the private placements completed during the year ended December
  31, 2017.

For the year ended December 31, 2017, the Company determined
  the fair value at the time of issuance of the warrants included in the
  derivative liability and the finders warrants using the Black-Scholes Option
  Pricing Model using the following inputs:

Input
      RangeExpected volatility
      93% - 99%Expected life
      2.25 yearsDividends
      0.00%Risk-free
        interest rate
      0.65% - 0.80%


Shares Issued For Services

In July 2016, the Company issued 400,000 shares of common stock
  for professional services. The fair value of the shares was $124,000

In February 2017, the Company issued 140,000 shares for
  services at a value of $0.23 per share for a total cost of $32,155.

Basic and Diluted Loss Per Share

Diluted loss per share did not include the effect of stock
  options and warrants as the effect would be anti-dilutive.

18

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

9. Share Capital (continued)

Stock Options

The Company has adopted an incentive stock option plan, which
  provides that the Board of Directors of the Company may from time to time, at
  its discretion, and in accordance with the Exchange requirements, grant to
  directors, officers, employees and technical consultants to the Company,
  non-transferable options to purchase common shares, provided that the number of
  common shares reserved for issuance will not exceed 6,779,255 common shares.
  Such options will be exercisable for a period of up to 10 years from the date of
  grant. In connection with the foregoing, the number of common shares reserved
  for issuance to any one optionee will not exceed five percent (5%) of the issued
  and outstanding common shares and the number of common shares reserved for
  issuance to all technical consultants will not exceed two percent (2%) of the
  issued and outstanding common shares. Options may be exercised no later than 90
  days following cessation of the optionees position with the Company or 30 days
  following cessation of an optionee conducting investor relations activities
  position.

Stock-based compensation expense has been calculated using the
  Black-Scholes option pricing model. The expected life of the options has been
  estimated to be the contractual term of the option given the limited history of
  early exercise. Future volatility has been determined based on historical
  volatility for a period equivalent to the expected life of the option.

During the years ended December 31, 2017 and 2016, the Company
  recorded stock-based compensation expense of $67,599 and $869,130, respectively.

On January 31, 2016, the Company granted 1,975,000 stock
  options to employees. The options vested immediately. The options are
  exercisable at CDN$0.40 and expire January 13, 2021. The options had a grant
  date fair value of $395,116 (CDN$562,580) determined using the Black-Scholes
  Option Pricing Model with the following assumptions: Risk free rate of 0.92%;
  Expected life of 5.00 years; Volatility of 94%; and a Dividend yield of 0%.

On February 15, 2016, the Company granted 120,000 stock options
  to an employee. The options vest accordingly: 80,000 after 6 months, and 40,000
  after 1 year. The options are exercisable at CDN$0.51 and expire February 15,
  2021. The options had a grant date fair value of $31,489 (CDN$43,622) determined
  using the Black-Scholes Option Pricing Model with the following assumptions:
  Risk free rate of 0.92%; Expected life of 5.00 years; Volatility of 94%; and a
  Dividend yield of 0%.

On December 9, 2016, the Company granted 1,830,000 stock
  options to employees. The options vested immediately. The options are
  exercisable at CDN$0.20 and expire December 9, 2021. The options had a grant
  date fair value of $197,874 (CDN$260,531) determined using the Black-Scholes
  Option Pricing Model with the following assumptions: Risk free rate of 1.08%;
  Expected life of 5.00 years; Volatility of 93%; and a Dividend yield of 0%.

On December 30, 2016, the Company granted 1,830,000 stock
  options to employees. The options vested immediately. The options are
  exercisable at CDN$0.18 and expire December 30, 2021. The options had a grant
  date fair value of $54,561 (CDN$73,250) determined using the Black-Scholes
  Option Pricing Model with the following assumptions: Risk free rate of 1.11%;
  Expected life of 5.00 years; Volatility of 94%; and a Dividend yield of 0%.

In January 2017, an option holder exercised 130,000 options for
  proceeds of $39,610 (CDN$52,000).

19

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

9. Share Capital (continued)

Stock Options (continued)

On June 22, 2017, the Company granted 120,000 stock options to
  employees. The options vested immediately. The options are exercisable at
  CDN$0.22 and expire June 22, 2022. The options had a granted date fair value of
  $13,018 (CDN$17,238) determined using the Black-Scholes Option Pricing Model
  with the following assumptions: Risk free rate of 0.65%; Expected life of 5.00
  years; Volatility of 98%; and a Dividend yield of 0%.

On September 20, 2017, the Company granted 200,000 stock
  options to employees. The options vested immediately. The options are
  exercisable at CDN$0.17 and expire September 20, 2022. The options had a grant
  date fair value of $13,129 (CDN$16,369) determined using the Black-Scholes
  Option Pricing Model with the following assumptions: Risk free rate of 0.65%;
  Expected life of 5.00 years; Volatility of 98%; and a Dividend yield of 0%.

The changes in options during the years ended December 31, 2017
  and 2016 are as follows:

December 31, 2017
      
      
      December 31, 2016Weightedaverage
      
      
      
      
      
      WeightedNumber of
      
      
      exercise
      
      
      Number of
      
      
      averageoptions
      
      
      price
      
      
      options
      
      
      exercise priceOptions outstanding,
        beginning
      
      7,511,500
      
      
      CDN $ 0.46
      
      
      5,275,000
      
      
      CDN $ 0.65Options granted
      
      320,000
      
      
      CDN $ 0.19
      
      
      4,605,000
      
      
      CDN $ 0.24Options forfeited
      
      981,500
      
      
      CDN $ 0.37
      
      
      -
      
      
      -Options exercised
      
      (130,000
      )
      
      CDN $ 0.40
      
      
      (38,500
      )
      
      CDN $ 0.46Options expired
      
      (615,000
      )
      
      CDN $ 0.84
      
      
      (2,330,000
      )
      
      CDN $ 0.90Options outstanding, ending
      
      6,105,000
      
      
      CDN
        $ 0.42
      
      
      7,511,500
      
      
      CDN
        $ 0.46Options exercisable, ending
      
      5,805,000
      
      
      CDN
        $ 0.41
      
      
      6,070,000
      
      
      CDN
        $ 0.45


Details of options outstanding as of December 31, 2017 are as
  follows:

Number of OptionsExercise
        Price
      Expiration Date
      OutstandingCDN$
      0.80
      January 4, 2018
      20,000CDN$
      0.71
      April 5, 2018
      40,000CDN$
      0.83
      June 3, 2018
      25,000CDN$
      0.58
      July 31, 2018
      100,000CDN$
      1.08
      January 10, 2019
      315,000CDN$
      0.75
      December 17, 2019
      405,000CDN$
      0.65
      December 20, 2019
      80,000CDN$
      0.58
      April 30, 2020
      900,000CDN$
      0.54
      June 15, 2020
      15,000CDN$
      0.65
      July 13, 2020
      80,000CDN$
      0.40
      January 13, 2021
      1,625,000CDN$
      0.51
      February 15, 2021
      120,000CDN$
      0.20
      December 9, 2021
      1,440,000CDN$
      0.18
      December 30, 2021
      620,000CDN$
      0.22
      June 22, 2022
      120,000CDN$
      0.17
      September 20, 2022
      200,0006,105,000


Each option entitles the holder to purchase one common share of
  the Company.

20

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

9. Share Capital (continued)

Warrants

The changes in warrants during the years ended December 31,
  2017 and 2016 are as follows:

December 31, 2017
      
      
      December 31, 2016WeightedWeighted
      
      
      
      
      
      AverageNumber of
      
      
      Average
      
      
      Number of
      
      
      ExerciseWarrants
      
      
      Exercise Price
      
      
      Warrants
      
      
      PriceWarrants outstanding, beginning
      
      26,679,670
      
      
      CDN $ 0.63
      
      
      18,708,432
      
      
      CDN $ 0.72Warrants issued
      
      13,539,233
      
      
      CDN $ 0.22
      
      
      8,446,105
      
      
      CDN $ 0.44Warrants exercised
      
      (375,000
      )
      
      CDN $ 0.25
      
      
      -
      
      
      -Warrants expired
      
      (3,840,700
      )
      
      CDN
        $ 0.90
      
      
      (474,867
      )
      
      CDN
        $ 0.96Warrants outstanding, ending
      
      36,003,203
      
      
      CDN $ 0.45
      
      
      26,679,670
      
      
      CDN $ 0.63


The weighted average remaining life of the warrants outstanding
  as at December 31, 2017 is 1.56 years.

Details of warrants outstanding as December 31, 2017 are as
  follows:

Number of WarrantsOutstanding andExercise
        Price
      Expiration Date
      ExercisableCDN$
      0.70
      January 21, 2018
      1,356,312CDN$
      0.95
      April 14, 2018
      1,209,080CDN$
      0.95
      April 27, 2018
      421,500CDN$
      0.74
      July 23, 2018
      1,070,000CDN$
      0.74
      July 31, 2018
      825,500US$
      0.62
      August 20, 2018
      6,038,240CDN$
      0.74
      November 30, 2018
      1,764,444CDN$
      0.74
      December 18, 2018
      1,707,789CDN$
      0.55
      February 2, 2019
      273,058CDN$
      0.55
      March 17, 2019
      2,267,947CDN$
      0.55
      June 28, 2019
      1,070,000CDN$
      0.55
      July 28, 2019
      1,070,000CDN$
      0.43
      September 16, 2019
      695,500CDN$
      0.30
      November 2, 2019
      1,070,000CDN$
      0.30
      November 22, 2019
      429,600CDN$
      0.25
      December 5, 2019
      1,070,000CDN$
      0.25
      December 14, 2019
      500,000CDN$
      0.25
      January 9, 2020
      716,800CDN$
      0.40
      February 3, 2020
      695,500CDN$
      0.25
      March 17, 2020
      963,000CDN$
      0.25
      April 7, 2020
      1,102,100CDN$
      0.27
      May 11, 2020
      535,000CDN$
      0.24
      June 14, 2020
      1,337,500CDN$
      0.24
      July 11, 2020
      695,500CDN$
      0.24
      July 26, 2020
      963,000CDN$
      0.24
      August 9, 2020
      1,087,500CDN$
      0.19
      September 12, 2020
      535,000CDN$
      0.15
      October 16, 2020
      1,337,500CDN$
      0.15
      November 24, 2020
      1,537,333CDN$
      0.12
      December 27, 2020
      1,658,50036,003,203


21

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

10. Reserves

Share-Based Payment Reserve

The share-based payment reserve records the fair value of
  options and warrants recorded in accordance with IFRS 2 Share-based payments
  until such time that the stock options or warrants are exercised, at which time
  the corresponding amount will be transferred to share capital.

11. Financial Instrument Fair Values

The fair value of the Companys financial assets and
  liabilities approximates the carrying amount.

Financial instruments measured at fair value are classified
  into one of three levels in the fair value hierarchy according to the relative
  reliability of the inputs used to estimate the fair values. The three levels of
  the fair value hierarchy are:

- Level 1  Unadjusted quoted prices in active markets for identical assets
      or liabilities;
- Level 2  Inputs other than quoted prices that are observable for the asset
      or liability either directly or indirectly; and
- Level 3  Inputs that are not based on observable market data.

Financial liabilities measured at fair value at December 31,
  2017 and 2016 consisted of the derivative financial liability, which is measured
  using level 3 inputs.

The fair value of the derivative liability is determined by the
  Black-Scholes option pricing model using the historical volatility as an
  estimate of future volatility. At December 31, 2017 if the volatility used was
  increased by 10% the impact would be an increase to the derivative liability of
  $82,240, with a corresponding decrease to comprehensive loss.

12. Related Party Transactions and Balances

Related Party Balances

As of December 31, 2017 and December 31, 2016, $598,285 and
  $318,685, respectively, owed to directors, officers, and companies controlled by
  directors has been included in trade payables and accrued liabilities.

Key Management Personnel Compensation

| |                          |   | December 31, |  |   | December 31, |  |   | December 31, | 
| | ------------------------ | - | ------------ |  | - | ------------ |  | - | ------------ | 
| |                          |   | 2017         |  |   | 2016         |  |   | 2015         | 
| | Administrative fees      | $ | 60,000       |  | $ | 60,000       |  | $ | 60,000       | 
| | Consulting               |   | 48,000       |  |   | 48,000       |  |   | 100,200      | 
| | Stock-based compensation |   | 40,211       |  |   | 933,616      |  |   | 239,875      | 
| | Wages and benefits       |   | 512,490      |  |   | 587,041      |  |   | 558,320      | 
| |                          | $ | 660,701      |  | $ | 1,628,657    |  | $ | 958,395      | 

22

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

13. Financial Risk and Capital Management

The Company is exposed in varying degrees to a variety of
  financial instrument related risks. The Board of Directors approves and monitors
  the risk management processes, inclusive of documented investment policies,
  counterparty limits, and controlling and reporting structures. The type of risk
  exposure and the way in which such exposure is managed is provided as
  follows:

Credit Risk

Credit risk is the risk that one party to a financial
  instrument will fail to discharge an obligation and cause the other party to
  incur a financial loss. The Companys primary exposure to credit risk is on its
  cash, and cash equivalents. The majority of cash is deposited in bank accounts
  held with major banks in Canada and the United States. As most of the Companys
  cash is held by two banks there is a concentration of credit risk. This risk is
  managed by using major banks that are high credit quality financial institutions
  as determined by rating agencies. The Companys secondary exposure to risk is on
  its receivables. The risk is considered to be minimal.

Liquidity Risk

Liquidity risk is the risk that the Company will not be able to
  meet its financial obligations as they fall due. The Company has a planning and
  budgeting process in place to help determine the funds required to support the
  Companys normal operating requirements on an ongoing basis. The Company ensures
  that there are sufficient funds to meet its short-term business requirements,
  taking into account its anticipated cash flows from operations and its holdings
  of cash and cash equivalents.

Historically, the Company's sole source of funding has been the
  issuance of equity securities for cash, primarily through private placements.
  The Companys access to financing is always uncertain. There can be no assurance
  of continued access to significant equity funding.

The following is an analysis of the contractual maturities of
  the Companys non-derivative financial liabilities as at December 31, 2017:

Between OneWithin One
      
      
      and Five
      
      
      More ThanYear
      
      
      Years
      
      
      Five YearsTrade Payables and Accrued Liabilities
      $
      1,777,483
      
      $
      -
      
      $
      -


Foreign Exchange Risk

Foreign exchange risk is the risk that the fair values of
  future cash flows of a financial instrument will fluctuate because they are
  denominated in currencies that differ from the respective functional currency.
  The Company does not hedge its exposure to fluctuations in foreign exchange
  rates.

The following is an analysis of the United States dollar
  equivalent of financial assets and liabilities that are denominated in Canadian
  dollars:

December 31,
      
      
      December 31,2017
      
      
      2016Cash and cash equivalents
      $
      -
      
      $
      21,933Trade payables and
        accrued liabilities
      
      (232,147
      )
      
      (140,756
      )Net
      $
      (232,147
      )
      $
      (118,823
      )


Based on the above net exposures, a 1% change in the Canadian
  dollar to United States dollar exchange rate would impact the Companys net loss
  by $2,321 and $1,188 at December 31, 2017 and December 31, 2016, respectively.

23

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

13. Financial Risk and Capital Management
  (continued)

Interest Rate Risk

Interest rate risk is the risk that the fair value of future
  cash flows of a financial instrument will fluctuate because of changes in market
  interest rates. The Company is exposed to interest rate risk on its cash
  equivalents as these instruments have original maturities of three months or
  less and are therefore exposed to interest rate fluctuations on renewal. A 1%
  change in market interest rates would not have a significant impact on the
  Companys net loss.

14. Commitments

Employment Agreement

The Company has an agreement (the Employment Agreement) dated
  October 1, 2007, and amended July 31, 2008, with an officer of the Company under
  which the Company pays a fee for employee services at a base salary of $220,000
  per annum. On April 30, 2010, the Board of Directors passed a resolution to
  increase this to $250,000 per annum and on May 13, 2011 passed a resolution to
  increase this to $275,000 per annum. The employee is entitled to receive options
  under the terms and conditions of the Companys stock option plan. The employee
  will serve as the President and Chief Executive Officer of the Company. On April
  5, 2012, the employment agreement was extended for an additional two years under
  the same terms. On April 5, 2014, the employment agreement was extended for an
  additional three years under the same terms. On April 5, 2017, the employment
  agreement was extended for an additional three years under the same terms.

Pursuant to the Employment Agreement, the Company has committed
  to granting 500,000 stock options based on the Company achieving certain
  consolidated net revenue targets. The exercise price and term of the options
  will be set at time the targets are met.

The employee has the right, upon 30-days notice, to terminate
  the Employment Agreement. The Company may terminate the Employment Agreement on
  10-days notice if for cause or on 60 days notice if without cause. Should the
  Company terminate the contract without cause, it is obligated to pay the
  employee an amount equal to three months base salary.

License Agreement

In 2004, the Company entered into a License Agreement with a
  university under which the university is entitled to receive: (i) 2% of the
  Companys adjusted gross sales as defined in the License Agreement, and (ii) 2%
  of the adjusted gross sales of any sub licensee as defined in the License
  Agreement. The License Agreement gives the Company an exclusive license to a
  certain United States patent and the related technology for low temperature
  growth of inorganic materials from solution using catalyzed growth and
  re-growth.

Research and Development Facility Lease

On June 1, 2013, the Company entered into a new two-year lease
  for its research and development facility in Rochester, New York. The Company
  will pay a base rent of $103,596 per year in monthly installments of $8,633. On
  June 26, 2015, the Company extended the lease from July 1, 2015 to June 30, 2017
  at a base rent of $105,212 per year in monthly installments of $8,768. This
  lease was extended for another three years expiring on June 30, 2020. Base
  annual rent for the years ending June 30, 2018, 2019, and 2020 is $108,312,
  $109,474, and $110,637, respectively.

Patent License Agreement

On December 9, 2011, the Company entered into a Patent License
  Agreement to use certain licensed patents. The Company is required to pay an
  annual fee of $25,000 for as long as the Company uses the patents.

24

---

|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

15. Income Taxes

A reconciliation of the expected income tax recovery to the
  actual income tax recovery is as follows:

| |                                           |   | Year Ended   |   |   | Year Ended   |   |   | Year Ended   |  
| | ----------------------------------------- | - | ------------ | - | - | ------------ | - | - | ------------ | -
| |                                           |   | December 31, |   |   | December 31, |   |   | December 31, |  
| |                                           |   | 2017         |   |   | 2016         |   |   | 2015         |  
| | Net loss                                  | $ | (1,274,996   | ) | $ | (2,021,700   | ) | $ | (3,488,129   | )
| | Tax rate                                  |   | 34%          |   |   | 34%          |   |   | 34%          |  
| | Expected income tax recovery              |   | (433,499     | ) |   | (687,378     | ) |   | (1,185,964   | )
| | Derivative liability                      |   | (314,154     | ) |   | (607,888     | ) |   | (38,927      | )
| | Non-deductible items and other            |   | 18,014       |   |   | 275,973      |   |   | 83,288       |  
| | Share issuance costs not recognized       |   | (60,269      | ) |   | (58,233      | ) |   | -            |  
| | Effect of different foreign tax rates     |   | 24,457       |   |   | 19,251       |   |   | 30,448       |  
| | Effect of change in US corporate tax rate |   | 3,059,896    |   |   | -            |   |   | -            |  
| | Temporary differences not recognized      |   | (2,295,685   | ) |   | 1,058,275    |   |   | 1,111,155    |  
| |                                           | $ | -            |   | $ | -            |   | $ | -            |  

The Company has the following deductible temporary difference
  for which no deferred tax asset has been recognized and that can be carried
  forward indefinitely.

| |                             |   | December 31, |  |   | December 31, | 
| | --------------------------- | - | ------------ |  | - | ------------ | 
| |                             |   | 2017         |  |   | 2016         | 
| | Non-capital losses  Canada | $ | 2,322,369    |  | $ | 1,934,799    | 
| | Tax losses  United States  |   | 22,359,419   |  |   | 20,420,145   | 
| | Equipment tax pools         |   | 1,178,241    |  |   | 1,102,969    | 
| | Share issuance
      costs  |   | 324,049      |  |   | 247,194      | 
| |                             | $ | 26,184,078   |  | $ | 23,705,107   | 

The Canadian non-capital losses expire between 2027 and 2037.
  The US tax losses may be carried forward indefinitely. No deferred tax asset has
  been recognized as there is insufficient persuasive evidence that the Company
  will have sufficient taxable income in the future to utilize the tax losses.

16. Research and Development Expense

Details of this expense account by nature are as follows:

| |                                           |   | Year Ended   |  |   | Year Ended   |  |   | Year Ended   | 
| | ----------------------------------------- | - | ------------ |  | - | ------------ |  | - | ------------ | 
| |                                           |   | December 31, |  |   | December 31, |  |   | December 31, | 
| |                                           |   | 2017         |  |   | 2016         |  |   | 2015         | 
| | Consulting                                | $ | -            |  | $ | 10,754       |  | $ | 18,676       | 
| | Equipment rental, rent and facility costs |   | 214,024      |  |   | 286,323      |  |   | 284,533      | 
| | Professional fees                         |   | 48,268       |  |   | 103,011      |  |   | 123,313      | 
| | Royalty and other                         |   | 4,995        |  |   | 39,102       |  |   | 71,239       | 
| | Wages and salaries                        |   | 594,660      |  |   | 698,232      |  |   | 705,953      | 
| |                                           | $ | 861,947      |  | $ | 1,137,422    |  | $ | 1,203,714    | 

17. Subsequent Events

In January 2018, the Company granted 1,354,000 stock options to
  employees and officers with an exercise price of CDN$0.095 per share for a
  period of 5 years.

In January 2018, the Company completed a non-brokered private
  placement and issued 1,500,000 units at a price of CDN$0.09 per unit for gross
  proceeds of $109,221 (CDN$135,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.11 per share
  for a period of three years from the date of closing. The Company also issued
  105,000 finders warrants with an exercise price of CDN$0.11.

25

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|Natcore Technology Inc.                             
|----------------------------------------------------
|Notes to the Consolidated Financial Statements      
|(Expressed in United States Dollars)                
|For The Years
      Ended December 31, 2017 and 2016

17. Subsequent Events (continued)

In February 2018, the Company completed a non-brokered private
  placement and issued 1,250,000 units at a price of CDN$0.07 per unit for gross
  proceeds of $68,632 (CDN$87,500). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.09 per share
  for a period of three years from the date of closing. The Company also issued
  87,500 finders warrants with an exercise price of CDN$0.09.

In March 2018, the Company extended the expiry date of an
  aggregate of 1,597,050 outstanding share purchase warrants. The warrants were
  originally had expiry dates of April 14, 2018 and April 27, 2018. The expiry
  date has been extended by two years.

In April 2018, the Company completed a non-brokered private
  placement and issued 7,000,000 units at a price of CDN$0.14 per unit for gross
  proceeds of $762,224 (CDN$980,000). Each unit comprised one common share and one
  purchase warrant, with each warrant exercisable at a price of CDN$0.21 per share
  for a period of three years from the date of closing. The Company also issued
  226,065 finders warrants with an exercise price of CDN$0.21.

26

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SIGNATURES

The registrant hereby certifies that it meets all of the
requirements for filing on Form 20-F and that it has duly caused and authorized
the undersigned to sign this Annual Report on its behalf.

Date: June 14, 2018

| | NATCORE TECHNOLOGY
    INC.                       
| | --------------------------------------------------
| | (Registrant)                                      
| |                                                   
| | By:                                               
| | Name:                                             
| | Title:                                            
| | Authorized
    Representative in the United States

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