Note 8 – Capital Commitments

On July 6, 2023, the Company entered into a Capital Commitment Agreement (“Agreement”) with GEM Global Yield LLC SCS (“GGY”), under the terms of which GGY agreed to provide the Company with up to $30 million Australian dollars through a Security Subscription Facility (the “Facility”) over a 3-year term. The Agreement allowed the Company to draw down funds during the 3-year term by giving GGY 15 Australian Securities Exchange (“ASX”) trading days’ notice to subscribe for CDIs, subject to share lending arrangement(s) being in place. The number of CDIs which GGY may subscribe for was capped at 700% of the average daily number of CDIs traded on the ASX during the 15 trading days prior to the relevant drawdown notice, subject to certain adjustments. The subscription price of the CDIs to be issued to GGY was the higher of (i) 90% of the average closing bid price of the Company’s CDIs over the 15 consecutive trading days after the Company gave the drawdown notice, subject to certain adjustments; or (ii) a fixed floor price nominated by the Company in the drawdown notice. The Company controlled the timing of drawdowns under the Facility and had no minimum drawdown obligation. The issue of CDIs to GGY pursuant to any drawdown notice was also conditional on the Company having sufficient placement capacity under ASX Listing Rules 7.1 or 7.1A (as applicable) or obtaining any requisite securityholder approval for the issue.

The Agreement met the definition of a derivative in accordance with ASC 815 and was measured at fair value. Any changes in fair value of such instruments are recorded in other income (expense) on the unaudited condensed consolidated statements of operations. 

The following table provides a summary of the change in fair value of the derivative asset for the three and nine months ended  September 30:

As the Agreement approached its contractual expiration on July 6, 2026, and no further drawdowns were expected prior to its expiration, our fair‑value assessment as of  June 30, 2026, resulted in the derivative asset being reduced to zero. Following the expiration of the Agreement on July 6, 2026, the derivative asset remained at zero as of  September 30, 2026. The derivative asset’s fair value as of  December 31, 2025, was calculated using the Monte Carlo Simulation model utilizing the following assumptions:

Pursuant to the terms of the Agreement, the Company issued options to purchase 5,700,000 CDIs with an exercise price of $0.61 Australian dollars per CDI and a 3-year term.
 

The following table provides a summary of activity related to the CDI options for the nine months ended September 30:
 

The following table provides a summary of the changes in fair value of the CDI options for the three and nine months ended  September 30:
 

As of  December 31, 2025, the CDI options had a fair value of $3,157,717 and were classified as current liabilities on the unaudited condensed consolidated balance sheets.

The CDI options’ fair value was calculated using the Black-Scholes option pricing model utilizing the following assumptions:

The fair value of CDI options was determined using the Black-Scholes option pricing model with assumptions consistent in methodology to those used for stock options, except that the contractual life of the options is used as the expected term and volatility of the stock price is estimated based on the Company's own historical volatility.