11. Debentures

On September 17, 2025, the Company entered into a securities purchase agreement with Yorkville to issue a debenture with the principal amount of $8,000,000 issued at a discount of $633,707 for proceeds of approximately $7,366,293. Interest will accrue on the outstanding principal amount of the debenture at an annual rate of 8%, subject to a potential increase to 18% per annum upon the occurrence of certain events of default. The debenture will mature on September 17, 2026, and will be repaid using proceeds from the SEPA.

The debenture was initially recorded at fair value, based on the discounted proceeds. Subsequently, the Company accounted for the debenture at amortized cost using the effective interest rate method, resulting in accretion expense of $374,712 for the three months ended March 31, 2026. The effective interest rate calculated was 32.75% as of March 31, 2026.

Debenture issued on September 17, 2025:		March 31, 2026
Net balance as at December 31, 2025		5,245,543
Repayment of new debenture		(3,180,084	)
Interest accretion		374,712
Interest payment		(96,393	)
Ending balance	$	2,343,778