NOTE 8. Stock-based Compensation

In August 2022, the Company established a stock option plan, superseded by a 2023 Equity Incentive Plan (the “Incentive Plan”), under which the Company’s board of directors may, from time-to-time, in its discretion, grant stock options, Performance Share Units (“PSUs”), or other equity awards to its directors, officers, consultants and employees of the Company.

Stock Options

Stock options outstanding typically vest in equal tranches over a period of three years. During the three months ended August 31, 2026, the Company granted 660,000 stock options (August 31, 2025 - 278,000). The Company estimated the fair value of the stock options on the date of grant using the Black-Scholes option-pricing model with the following assumptions:

A summary of stock option activity for the Company is as follows:

During the three months ended August 31, 2026, the Company recorded stock-based compensation expenses of $264 (August 31, 2025 - $194) relating to stock options, of which $132 and $132 (August 31, 2025 - $97 and $97) was recorded in general and administrative and research and development expenses in the unaudited condensed consolidated interim financial statements, respectively.

Performance Share Units

On February 10, 2026, the Company issued 1,625,000 PSUs that vest in two separate and equal tranches; i) a scaled vesting upon achievement of the Company achieving a market capitalization of $USD 200-250 million; and ii) upon outperforming the Russell Microcap index over a two-year period. Included in general and administrative expenses and research and development expenses in the unaudited condensed interim consolidated statement of operation during the three months ended August 31, 2026, was $260 and $261, respectively (2025 – nil and nil).

In June 2026, 488,394 Class A ordinary shares were issued to satisfy partial vesting of 674,272 of these PSUs. The Company withheld 185,878 Class A ordinary shares to settle related tax liabilities.

Shares for Services

The Company periodically issues Class A ordinary shares for services provided by third parties. During the three months ended August 31, 2026, the Company recorded $96 of operating expenses relating to 78,480 Class A ordinary shares issued for services (August 31, 2025 – $604). Included in general and administrative expenses and research and development expenses in the unaudited condensed interim consolidated statements of operations during the three months ended August 31, 2026, was $83 and $13 (August 31, 2025 – $593 and $12), respectively.

During the three months ended August 31, 2026, the Company incurred $21 (August 31, 2025 - $410) in general and administrative costs in the unaudited condensed interim consolidated statements of operations relating to 8,204 (August 31, 2025 – 264,095) of Class A ordinary shares to be issued at a future date for services rendered. This has been recorded as a component of Shareholders’ Equity.