Note 18 – Stock Option Plan

The Company’s 2024 Employees’, Directors’, Officers’, and Consultants’ Stock Option Plan (the “Plan”), as amended, authorizes the issuance of options to purchase up to 15,000,000 shares of common stock, and is described in Note 18 to the 2026 Form 10-K. The Plan is administered by the Compensation Committee of the Board of Directors; options have a maximum term of ten years and options may not be granted under the Plan after December 31, 2026.

On June 4, 2026 the Board of Directors approved grants of options to purchase 2,849,200 shares of common stock at an exercise price of $0.23 per share, including 1,500,000 options granted to the Chief Executive Officer in replacement of 900,000 options at $0.75 per share granted in June 2024 that were cancelled on the same date; the cancellation and replacement were accounted for as a modification under ASC 718-20-35-8 and only the incremental fair value of $188,020 is recognized over the requisite service period. On June 24, 2026 the Board granted 60,000 fully vested options at an exercise price of $0.90 per share. During the quarter 318,450 options at $0.75 per share expired unexercised following the departure of the holders. No options were exercised or forfeited.

The weighted average exercise price of options granted during the quarter was $0.24 (2,849,200 at $0.23 and 60,000 at $0.90). As of August 31, 2026, the intrinsic value of the 5,286,200 outstanding options was $0, as the exercise prices of all outstanding options exceeded the $0.1485 closing market price of the common stock on August 31, 2026. Options available for future grant under the Plan at August 31, 2026 were 9,353,800.

Fair Value of Options

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model. Options granted during the three months ended August 31, 2026 used the following weighted-average assumptions: expected volatility of 55.5%, determined by reference to the historical volatility of guideline companies over a one-year window because trading in the Company’s common stock is limited and sporadic ; expected life of 5 years; risk-free interest rate of 4.0%; and an expected dividend yield of 0%. The grant-date fair value of the June 4, 2026 options was $0.1452 per option, based on the $0.2625 closing price of the common stock on the grant date.

Stock-Based Compensation Expense

For the three months ended August 31, 2026, the Company recognized stock-based compensation expense related to stock options of $89,586 (three months ended August 31, 2025: $92,309), presented within salaries and wages. A further $153,707 of share-based compensation on shares issued for services is recognized within the captions to which the services relate. As of August 31, 2026, unrecognized compensation cost related to unvested stock options was approximately $562,730, expected to be recognized over a weighted-average period of approximately 1.15 years as the options vest.