NOTE 11 – SHARE-BASED COMPENSATION

On March 1, 2026, the Board adopted the AI Era Corp. 2026 Equity Incentive Plan (the “2026 Plan”), which reserves a maximum of 10,000,000 shares of Common Stock for issuance thereunder. The 2026 Plan provides for the grant of stock options, restricted stock, restricted stock units, performance shares, stock appreciation rights, and other equity-based awards to eligible employees, officers, directors, consultants, and other service providers of the Company and its subsidiaries. The grants to Messrs. Moradi, Deng and Kastahorau described above were made under the 2026 Plan.

On March 1, 2026, the Company granted 1,500,000 stock options to Chiyuan Deng, the Company's President, and 2,000,000 stock options to Ahmad Moradi, the Company's Chief Executive Officer, under the Company's 2026 Equity Incentive Plan. On April 7, 2026, the Company granted 1,500,000 stock options to Dzmitry Kastahorau, the Company's Chief Financial Officer, under the same plan.

The stock options vest over three years, with 25% vesting after the first year, 35% after the second year, and the remaining 40% after the third year, subject to the recipients' continued service and the achievement of applicable performance milestones. The awards provide for accelerated vesting upon a change in control or termination without cause, as specified in the applicable award agreements.

Mr. Moradi resigned on May 7, 2026, and Mr. Kastahorau resigned on June 3, 2026. Accordingly, all of their unvested stock options were forfeited and cancelled.

The following table summarizes the Company’s share option activity for the nine months ended May 31, 2026:

The Black-Scholes pricing model was applied in determining the estimated fair value of the options granted. The model requires the input of subjective assumptions. The following table presents the assumptions used to estimate the fair values of the share options granted for the nine months ended May 31, 2026:

The expected term was estimated using the simplified method. The expected volatility was estimated based on the historical volatility of the companies with a time horizon close to the contract life of the Company’s options. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for the expected term of the stock-based award. Expected dividend yield is zero as the Company has never declared or paid any cash dividends on its shares, and the Company does not anticipate any dividend payments in the foreseeable future. For the nine months ended May 31, 2026 and 2025, the total share-based compensation expenses were $41,110 and $0, respectively. The Company did not grant any share options during the nine months ended May 31, 2025.

AI ERA CORP. (FORMERLY KNOWN AS AB INTERNATIONAL GROUP CORP.)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)