11. Customer Deposits

In October 2022, the Company received a cash deposit from a customer of $1,000,000 in relation to an executed capacity reservation agreement. The deposit is to be credited against any future sales of Loop™ PET resin over a five-year period, commencing two years after the first delivery of Loop™ PET resin to the customer. The use of the deposit is designated for expenditures related to the Infinite Loop™ manufacturing facility in Bécancour Québec and is refundable in the event that the Infinite Loop™ manufacturing facility in Bécancour Québec is not constructed. As a result of the decision by management to no longer proceed with construction of the Infinite Loop manufacturing facility in Becancour Quebec as contemplated under the capacity reservation agreement with the customer, the cash deposit has been reflected as restricted cash as at November 30, 2022, with a corresponding financial liability of an equal amount.