NOTE 5 – OPTIONS

The Company, under its 2012 Stock Option Plan, issues options to various officers, directors, and consultants. The options vest in equal annual installments over a five year period with the first 20% vested when the options are granted. All of the options are exercisable at a purchase price based on the last trading price of the Company’s common stock. 

During the nine month period ended July 31, 2026 the Company issued 631,250 options to 18 individuals. The options are exercisable into common stock of the Company at $0.41 per share. The Company calculated the fair value of the outstanding options of $53,128 using the Black Scholes option pricing model with computed volatility of 128.00%, risk-free interest rate of 4.5%, expected dividend yield 0%, stock  price at measurement date of $0.51 and the expected term of ten years. The options are expensed over a five year period with 20% upon issuance and 20% for the first and each subsequent year.

During the nine month period ended July 31, 2026 the Company issued 1,695,000 options to 20 individuals. The options are exercisable into common stock of the Company at $0.33-$0.50 per share. The Company calculated a fair value for the outstanding options as of July 31, 2026 of $125,456 using the Black Scholes option pricing model with computed volatility of 161%, risk-free interest rate of 4.5%, expected dividend yield 0%, stock price at measurement date of $0.38-$0.50 and the expected term of ten years. The options are expensed over a five year period with 20% upon issuance and 20% for the first and each subsequent year.

As of July 31, 2026 the total number of options was 10,432,200 with 7,641,200 exercisable and 2,890,000 are not exercisable.

During the nine month period ended July 31, 2026, the Company recognized $188,963 of option expense. The unrecognized future balance to be expensed over the term of the options is $807,197. 

The following sets forth the options granted and outstanding as of July 31, 2026: