Prepaid expenses and project deposits consist primarily of the unamortized value of consulting service agreements settled through issuance of common stock and advance payments to the Saskatchewan Research Council pursuant to the Company’s pilot metallization project. Under stock-based consulting arrangements, the grant-date fair value of common shares issued for future services is recorded as a prepaid asset and amortized over the applicable service period in accordance with ASC 718.

On November 20, 2025, the Company entered into a series of strategic arrangements with SRC to develop capabilities in rare-earth processing and metallization. The arrangements include, among other matters, a pilot-scale processing arrangement designed to evaluate and define processing parameters for dysprosium and terbium metallization, a

commercial-scale engineering and processing facility arrangement intended to support development of a commercial-scale metallization facility, and an upgrade of SRC’s existing Rare Earth Processing Facility. See Note 11 – Commitments and Contingencies.

During the six months ended June 30, 2026, the Company paid aggregate advances to SRC of $14.4 million, of which $12.6 million remained recorded as project deposits at June 30, 2026, and $1.0 million was reclassified to construction in progress during the three months ended June 30, 2026 upon the Company obtaining control of identifiable equipment and directly attributable costs qualifying for capitalization. See Note 11 – Commitments and Contingencies.

The Pilot project is intended to support pilot-scale process development and validation activities. The pilot process and related pilot equipment are expected to provide the technical information necessary to determine processing specifications, equipment configuration, operating parameters, and other requirements for the Company’s planned commercial-scale metallization facility. Amounts paid relating to the Pilot are expected to be recognized as research and project development expenses as the related services are performed, unless specific equipment, materials, or other assets are acquired that have an alternative future use and otherwise qualify for capitalization.

Amounts paid relating to the commercial-scale metallization facility are capitalized as construction in progress or machinery and equipment when the Company receives or obtains control of identifiable equipment, materials, construction activity, or other directly attributable costs that qualify for capitalization. Advance payments for which the Company has not received or otherwise obtained control of equipment or services remain recorded as project deposits and are assessed for recoverability each reporting period.

The agreements are time-and-materials arrangements, and total costs, timing, and scope remain subject to SRC work programs, procurement, technical results, and the Company’s approval of future expenditures. The Company has not recognized a liability for future amounts that may become payable under the arrangements because such amounts relate to future goods, services, or construction activities that had not been received or incurred as of June 30, 2026.


	June 30, 2026 ($)		December 31, 2025 ($)
Equity-based consulting prepaid (shares-for-services)	$	16,129	$	34,987
Saskatchewan Research Council advance payments	12,614		-
Advertising and marketing prepaid	121		-
Professional fees and other prepaid	980		-

Total prepaid expenses and project deposits	$	29,844	$	34,987


	Balance at December 31, 2025		Advances paid		Transferred to construction in progress		Recognized in expense		Balance at June 30, 2026
Pilot HREE Metallization	$	-	$	1,315	$	-	$	(315)	$	1,000
Commercial HREE Metallization	0		8,370		(973)		(281)		7,116
SRC REPF Upgrade	-		3,898		-		(200)		3,698
Supply agreement	-		800		-		-		800
Total project deposits	$	-	$	14,383	$	(973)	$	(796)	$	12,614