CENTR Brands Corp. — Remuneration Information 2024

Dec 10, 2024

CENTR Brands Corp.
507-837 West Hastings Street
Vancouver, British Columbia, V6C 3N6, Canada

Form 51-102F6V
Statement of Executive Compensation – Venture Issuers
(for financial year ended May 31, 2024)

The following information, dated as of December 9, 2024, is provided in accordance with Form 51-102F6V – Statement of Executive Compensation, for Venture Issuers (the “Form”), as such term is defined in National Instrument 51-102 – Continuous Disclosure Obligations.

GENERAL

For the purposes of this Form:

“compensation securities” includes stock options, convertible securities, exchangeable securities and similar instruments including stock appreciation rights, deferred share units and restricted stock units granted or issued by the Company or one of its subsidiaries (if any) for services provided or to be provided, directly or indirectly to the Company or any of its subsidiaries (if any);

“external management company” includes a subsidiary, affiliate or associate of the external management company;

“NEO” or “named executive officer” means:

(a) each individual who served as chief executive officer (“CEO”) of the Company, or who performed functions similar to a CEO, during any part of the most recently completed financial year,

(b) each individual who served as chief financial officer (“CFO”) of the Company, or who performed functions similar to a CFO, during any part of the most recently completed financial year,

(c) the most highly compensated executive officer of the Company or any of its subsidiaries (if any) other than individuals identified in paragraphs (a) and (b) at the end of the most recently completed financial year whose total compensation was more than CAD$150,000 for that financial year, and

(d) each individual who would be an NEO under paragraph (c) but for the fact that the individual was neither an executive officer of the Company or its subsidiaries (if any), nor acting in a similar capacity, at the end of that financial year;

“plan” includes any plan, contract, authorization, or arrangement, whether or not set out in any formal document, where cash, compensation securities or any other property may be received, whether for one or more persons;

“underlying securities” means any securities issuable on conversion, exchange or exercise of compensation securities.

DIRECTOR AND NAMED EXECUTIVE OFFICER COMPENSATION

During financial year ended May 31, 2024, based on the definition above, the NEOs of the Company were R. W. Campbell Becher, CEO and director, and Anton J. Drescher, Interim CFO and director. The director of the Company who was not an NEO during the financial year ended May 31, 2024 was Jeffrey Holmgren.

Corporate Actions during financial year ended May 31, 2024

R.W. Campbell Becher was appointed CEO on March 28, 2024.

Jeffrey Holmgren was appointed as a director on March 28, 2024.

Anton J. Drescher was appointed Interim CFO on January 24, 2024.

Arjan Jagjit Chima served as a director from April 1, 2019 to March 4, 2024 and served as CEO from June 12, 2022 to March 5, 2024.

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David T. Young served as a director from March 12, 2020 to November 28, 2023, served as CFO from June 7, 2021 to November 28, 2023, and served as President from June 12, 2022 to November 28, 2023.

Joseph Patrick Elmlinger served as a director from December 9, 2021 to November 28, 2023.

During financial year ended May 31, 2023, based on the definition above, the NEOs of the Company were: Joseph Edward Meehan, Chairman, CEO and a director, Arjan Jagjit Chima, President and a director, and David T. Young, CFO and a director. The director of the Company who was not an NEO during the financial year ended May 31, 2023 was Joseph Patrick Elmlinger.

Corporate Actions during financial year ended May 31, 2023

Arjan Jagjit Chima served as President from January 21, 2020 to June 12, 2022.

Joseph Edward Meehan served as CEO from April 1, 2019 to June 12, 2022, served as a director from April 1, 2019 to December 13, 2022, and served as Chairman from January 21, 2020 to December 7, 2021.

DIRECTOR AND NAMED EXECUTIVE OFFICER COMPENSATION

Director and NEO Compensation, Excluding Options and Compensation Securities

The following compensation table, excluding options and compensation securities, provides a summary of the compensation paid by the Company to NEOs and directors of the Company who were not NEOs for financial years ended May 31, 2024 and May 31, 2023. Options and compensation securities are disclosed under the heading "Stock Options and other Compensation Securities" below.

Table of Compensation Excluding Compensation Securities in Financial Years ended May 31, 2024 and May 31, 2023

Table of compensation excluding compensation securities
Name and position	Year	Salary, consulting fee, retainer or commission (US$)	Bonus (US$)	Committee or meeting fees (US$)	Value of perquisites (US$)	Value of all other compensation (US$)	Total compensation (US$)
R. W. Campbell Becher(1)
CEO and Director	2024	14,660	Nil	Nil	Nil	30,000 (8)	44,660
	2023	Nil	Nil	Nil	Nil	52,500 (8)	52,500
Anton J. Drescher(2)
Interim CFO and Director	2024	29,320	Nil	Nil	Nil	30,000 (8)	59,320
	2023	Nil	Nil	Nil	Nil	52,500 (8)	52,500
Joseph Edward Meehan(3)
former Chairman, former CEO and former Director	2024	Nil	Nil	Nil	Nil	96,250 (9)	96,250
	2023	Nil	Nil	Nil	Nil	125,417 (9)	125,417
Arjan Jagjit Chima(4)
former President, former CEO and former Director	2024	113,654	Nil	Nil	Nil	Nil	113,654
	2023	125,000	Nil	Nil	Nil	Nil	125,000
David T. Young(5)
former CFO, former President and former Director	2024	100,000	Nil	Nil	Nil	Nil	100,000
	2023	200,000	Nil	Nil	Nil	Nil	200,000
Joseph Patrick Elmlinger(6)
former Director	2024	Nil	Nil	Nil	Nil	15,000 (8)	15,000
	2023	Nil	Nil	Nil	Nil	52,500 (8)	52,500
Jeffrey Holmgren(7)
Director	2024	Nil	Nil	Nil	Nil	5,000 (8)	5,000
	2023	Nil	Nil	Nil	Nil	Nil	Nil

Notes:
(1) R.W. Campbell Becher was appointed CEO on March 28, 2024.
(2) Anton J. Drescher was appointed Interim CFO on January 24, 2024. Mr. Drescher was appointed a director on May 5, 2014.

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(3) Joseph Edward Meehan served as CEO from April 1, 2019 to June 12, 2022, served as a director from April 1, 2019 to December 13, 2022, and served as Chairman from January 21, 2020 to December 7, 2021.

(4) Arjan Jagjit Chima served as President from January 21, 2020 to June 12, 2022, and served as a director from April 1, 2019 to March 4, 2024, and served as CEO from June 12, 2022 to March 5, 2024.

(5) David T. Young served as a director from March 12, 2020 to November 28, 2023, served as CFO from June 7, 2021 to November 28, 2023, and served as President from June 12, 2022 to November 28, 2023.

(6) Joseph Patrick Elmslinger served as a director from December 9, 2021 to November 28, 2023.

(7) Jeffrey Holmgren was appointed a director on March 28, 2024.

(8) Monthly director fees

(9) Advisory fees paid, in lieu of severance, as part of the settlement agreement entered in October 2022

Stock Options and Other Compensation Securities

Security-Based Compensation Plan

The Company has an Equity Incentive Compensation Plan (the “Equity Incentive Plan”). A full copy of the Equity Incentive Plan is attached as Appendix “A” to the Information Circular dated November 8, 2022 in respect of the Company’s annual general and special meeting held on December 13, 2022 at Meeting the Equity Incentive Plan was approved for adoption, and which can be accessed under the Company’s profile on SEDAR+ at www.sedarplus.ca.

Pursuant to the Equity Incentive Plan, the Company may grant equity-based compensation in the form of Stock Options (“Options”), Restricted Share Units (“RSUs”), Deferred Share Units (“DSUs”), Performance Share Units (“PSUs”) and Share Appreciation Rights (“SARs”), and together with the Options, RSUs, DSUs, and PSUs, (the “Awards”) to eligible participants, which include any director, employee, officer, or consultant of: (a) the Company; or (b) any Subsidiary (as such term is defined in the Securities Act (British Columbia) of the Company) (“Eligible Participants”).

The Equity Incentive Plan is a long-term component of compensation for executive officers, including Named Executive Officers, based on Options. This component of compensation is intended to reinforce management’s commitment to long term improvements in the Company’s performance. The Company may grant any Awards to Directors under the Equity Incentive Plan as compensation for service in lieu of cash payments.

The purpose of the Equity Incentive Plan is to permit the Company to grant Awards as an incentive and reward for Eligible Participants related to the achievement of long-term financial and strategic objectives of the Company and the resulting increases in shareholder value. The Equity Incentive Plan is intended to promote a greater alignment of interests between the shareholders of the Company and the selected Eligible Participants by providing an incentive to the Eligible Participants to participate in increases in the value of the Company through their interest in Common Share ownership. Participation in the Equity Incentive Plan is voluntary and, if an Eligible Participant agrees to participate, the grant of Awards will be evidenced by a grant agreement with each such participant (each such Eligible Participant that is granted an Award shall be referred to herein as a “Participant”). The interest of any Participant in The board of directors (the “Board”) believes that incentive compensation in the form of stock option grants and other security-based compensation awards which vest over time, is and has been, beneficial and necessary to attract and retain both senior executives and managerial talent at other levels. Furthermore, the Board believes stock option grants and other security-based awards are an effective long-term incentive vehicle because they are directly tied to share price over a longer period, up to 10 years, and motivate executives to deliver sustained long term performance and increase shareholder value and have a time horizon that aligns with long-term corporate goals. This component of compensation is intended to reinforce management’s commitment to long term improvements in the Company’s performance.

The aggregate number of shares available for issuance under the Equity Incentive Plan together with all of the Company’s other share compensation arrangements may not exceed 10% of the aggregate number of issued Common Shares. No more than one percent (1%) of the total issued and outstanding Common Shares (on a non-diluted basis) from time to time, shall be reserved and available for grant and issuance pursuant to Awards to directors of the Company, less the number of Common Shares reserved for issuance pursuant to awards under all other security based compensation agreements of the Company.

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The Equity Incentive Plan is under the discretion of the Board. The Compensation Committee of the Board (the "Compensation Committee") makes recommendations to the Board in relation to the Equity Incentive Plan and to the grants of Awards. The aggregate number of Common Shares available for grant and issuance from treasury pursuant to Awards under the Equity Incentive Plan may not exceed 10% of the aggregate number of issued Common Shares. The Equity Incentive Plan is considered an "evergreen plan", and the Common Shares covered by grants which have been exercised, settled, expired, cancelled or forfeited shall be available for subsequent grants under the Equity Incentive Plan and the number of Common Shares available to grant increases as the number of issued and outstanding Common Shares increases. Under Canadian Securities Exchange policy (the "CSE"), every three years after the effective date of the Equity Incentive Plan, all unallocated Awards under the Equity Incentive Plan shall be submitted for approval to the Board and the Shareholders.

No more than one percent (1%) of the total issued and outstanding Common Shares (on a non-diluted basis) from time to time, shall be reserved and available for grant and issuance pursuant to Awards to directors of the Company, less the number of Common Shares reserved for issuance pursuant to awards under all other security based compensation agreements of the Company. Subject to adjustment pursuant to provisions of the Equity Incentive Plan, the aggregate number of Common Shares (i) issued to reporting insiders of the Company (as defined in National Instrument 55-104 Insider Reporting Requirements and Exemptions) ("Insiders") under the Equity Incentive Plan or any other proposed or established security based compensation arrangement of the Company within any one-year period and (ii) issuable to Insiders at any time under the Equity Incentive Plan or any other proposed or established security based compensation arrangement of the Company, shall in each case not exceed ten percent (10%) of the total issued and outstanding Common Shares (on a non-diluted basis). A Participant whose employment or engagement with the Company or a Subsidiary (as such term is defined in the Securities Act (British Columbia)) has ceased for any reason, or who has given notice of such cessation, as the case may be, shall cease to be eligible to receive Awards under the Equity Incentive Plan as of the date on which such person provides notice to the Company or the Subsidiary, as the case may be, in writing or verbally, of such cessation, or on the date upon which such person ceases to be an Eligible Participant due to any cessation of such Participant's employment or engagement initiated by the Company.

Options

Subject to the terms and conditions of the Equity Incentive Plan, any applicable rules of the CSE and any shareholder or regulatory approval which may be required, the Board may, from time to time by resolution, in its sole discretion, (i) designate the Eligible Participants who may receive Options under the Equity Incentive Plan, (ii) fix the number of Options, if any, to be granted to each Eligible Participant and the date or dates on which such Options shall be granted, (iii) determine the price per Common Share to be payable upon the exercise of each such Option (the "Option Price") and (iv) determine the relevant vesting provisions, including criteria established by the Board which, without limitation, may include criteria based 21 on the Eligible Participant's personal performance and the financial performance of the Company or of its Subsidiaries, and that may be used to determine the vesting of the Awards, when applicable ("Performance Criteria"), if applicable, and the expiry of the Options (the "Option Term").

The Option Price for Common Shares that are the subject of any Option will be fixed by the Board when such Option is granted, but will not be less than the Market Value of such Common Shares on the trading day immediately preceding the date on which the Option is granted to the Eligible Participant. For the purposes of the Equity Incentive Plan, "Market Value" means, (A) if the Common Shares of the Company are listed on the CSE (or, if the Common Shares are not listed on the CSE, the stock exchange on which the Common Shares are principally listed from time to time, collectively referred to herein as the "Exchange"), (i) with respect to Options, at any date when the market value of Common Shares of the Company is to be determined, the greater of (x) the volume weighted average trading price of the Common Shares on the Exchange for the five trading days preceding the date on which the Market Value is to be determined, and (y) the closing price of the Common Shares on the trading day prior to the date of grant on the Exchange, and (ii) with respect to the RSUs, DSUs or PSUs, the volume weighted average trading price of the Common Shares on the Exchange for the five trading days preceding the date on which the Market Value is to be determined, or, (B) if the Common Shares of the Company are not listed on any Exchange, the value as is determined solely by the Board, acting reasonably and in good faith.

Subject to a limited extension if an Option expires during a black-out period, Options may be exercised for a period of up to five years from the date upon which the Option is granted, provided that (i) the Options have then vested and

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met any applicable Performance Criteria, and (ii) no Termination Event (as defined in the Equity Incentive Plan) has occurred in respect of the Participant that has shortened the Option Term. Subject to the foregoing, Options may be exercised by a Participant via the submission of an exercise notice, in the form attached to the grant agreement underlying the Option (the "Exercise Notice").

RSUs

Under the Equity Incentive Plan, the Company may grant restricted share units to an Eligible Participant, entitling such Eligible Participant to receive payment based on the value of one Common Share once such Award has vested, subject to restrictions and conditions as the Board may determine at the time of grant. Conditions may be based on such factors as may be determined by the Board from time to time, including continued employment or engagement with the Company or a Subsidiary.

Subject to the terms and conditions of Equity Incentive Plan, any applicable rules of the CSE and any shareholder or regulatory approval which may be required, the Board may, from time to time by resolution, in its sole discretion, (i) designate the Eligible Participants who may receive RSUs under the Equity Incentive Plan for services rendered in a particular year, (ii) fix the number of RSUs, if any, to be granted to each Eligible Participant and the date or dates on which such RSUs shall be granted, and (iii) determine the relevant conditions and vesting provisions and the settlement date of such RSUs.

Unless otherwise set forth in the written letter agreement between the Company and a Participant evidencing the grant of RSUs (each, an "RSU Agreement"), each RSU shall vest as to 1/3 on each of the first, second and third anniversary of the date of grant of such RSU.

Subject to the vesting and other conditions and provisions set forth in the Equity Incentive Plan and in any RSU Agreement, the Board shall determine whether each RSU awarded to a Participant will entitle the Participant to: (i) such number of Common Shares issued from treasury or purchased on the open market as is equal to the RSUs being settled; (ii) the cash equivalent of such number of Common Shares as is equal to the RSUs being settled; or (iii) a combination of Common Shares and cash as is eq equal to the RSUs being settled.

DSUs

Under the Equity Incentive Plan, the Company may grant deferred share units to an Eligible Participant, entitling such Eligible Participant to receive payment based on the value of one Common Share once such Award has vested, subject to restrictions and conditions as the Board may determine at the time of grant. Conditions may be based on such factors as may be determined by the Board from time to time, including the achievement of pre-established Performance Criteria.

Subject to the terms and conditions of Equity Incentive Plan, any applicable rules of the CSE and any shareholder or regulatory approval which may be required, the Board may, from time to time by resolution, in its sole discretion, (i) designate the Participants who may receive DSUs under the Equity Incentive Plan, (ii) fix the number of DSUs, if any, to be granted to each Eligible Participant and the date or dates on which such DSUs shall be granted, and (iii) determine the relevant conditions and vesting provisions of such DSUs.

Subject to the vesting and other conditions and provisions set forth in the Equity Incentive Plan and in any agreement relating to a grant of DSUs, when and if DSUs become payable, the Participant issued such DSUs shall be entitled to receive payment from the Company in settlement of such DSUs consisting of: (i) such number of Common Shares issued from treasury or purchased on the open market as is equal to the DSUs being settled; (ii) the cash equivalent of such number of Common Shares as is equal to the DSUs being settled; or (iii) a combination of Common Shares and cash as is equal to the DSUs being settled, all as determined by the Board in its sole discretion.

A Participant who ceases to be an Eligible Participant may request the settlement of all (but not less than all) of their DSUs at any time during the period between the date on which they cease to be an Eligible Participant and the business day preceding December 31 of the calendar year following the calendar year during which the Termination Event (as defined in the Equity Incentive Plan) that has caused such participant to cease to be an Eligible Participant has occurred, or such shorter period as may be determined by the Board at the time the DSU is granted (the "DSU Expiry Date"), in such manner as the Board may 22 determine from time to time and in accordance with such rules and

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regulations as the Board may prescribe from time to time. Any DSU which has not been settled prior to the DSU Expiry Date shall be automatically settled on the DSU Expiry Date.

PSUs

Under the Equity Incentive Plan, the Company may grant performance share units to an Eligible Participant, entitling such Eligible Participant to receive payment based on the value of one Common Share once such Award has vested, subject to restrictions and conditions as the Board may determine at the time of grant. Conditions may be based on such factors as may be determined by the Board from time to time, including continued employment or engagement with the Company or a Subsidiary and Performance Criteria.

Subject to the terms and conditions of Equity Incentive Plan, any applicable rules of the CSE and any shareholder or regulatory approval which may be required, the Board may, from time to time by resolution, in its sole discretion, (i) designate the Eligible Participants who may receive PSUs under the Equity Incentive Plan for services rendered in a particular year, (ii) fix the number of PSUs, if any, to be granted to each Eligible Participant and the date or dates on which such RSUs shall be granted, and (iii) determine the relevant conditions, Performance Criteria and vesting provisions and the settlement date of such PSUs.

Unless otherwise set forth in the written letter agreement between the Company and a Participant evidencing the grant of PSUs (each, a "PSU Agreement"), each PSU shall vest as to 1/3 on each of the first, second and third anniversary of the date of grant of such PSU.

Subject to the vesting and other conditions and provisions set forth in the Equity Incentive Plan and in any PSU Agreement, the Board shall determine whether each PSU awarded to a Participant will entitle the Participant to: (i) such number of Common Shares issued from treasury or purchased on the open market as is equal to the PSUs being settled; (ii) the cash equivalent of such number of Common Shares as is equal to the PSUs being settled; or (iii) a combination of Common Shares and cash as is equal to the RSUs being settled.

SARs

Under the Equity Incentive Plan, the Company may grant SARs to an Eligible Participant. An SAR is an Award entitling the recipient to receive Common Shares having a value equal to the excess of the Market Value of the Common Shares on the date of exercise over the exercise price of the SAR, which price shall not be less than 100% of the Market Value of the Common Share on the date of grant multiplied by the number of Common Shares with respect to which the SAR shall have been exercised.

Subject to the terms and conditions of Equity Incentive Plan, any applicable rules of the CSE and any shareholder or regulatory approval which may be required, the Board may, from time to time by resolution, in its sole discretion, (i) designate the Eligible Participants who may receive SARs under the Equity Incentive Plan, (ii) fix the number of SARs, if any, to be granted to each Eligible Participant and the date or dates on which such SARs shall be granted, (iii) determine the price per Common Share to be payable upon the exercise of each such SAR (the "SAR Price") and (iv) determine the relevant vesting provisions, including the Performance Criteria, if applicable, and the expiry of the SARs (the "SAR Term").

The SAR Price for Common Shares that are the subject of any Option will be fixed by the Board when such Option is granted, but will not be less than the Market Value of such Common Shares on the at the time of the grant.

Subject to a limited extension if an SAR expires during a black-out period, SARs may be exercised for a period of up to five years from the date upon which the SAR is granted, provided that (i) the SARs have then vested and met any applicable Performance Criteria, and (ii) no Termination Event (as defined in the Equity Incentive Plan) has occurred in respect of the Participant that has shortened the SAR Term. Subject to the foregoing, SARs may be exercised by a Participant via the submission of an Exercise Notice.

On November 18, 2024, the Company consolidated its common shares in the capital of the Company on a ten (old) for one (new) basis. Following the share consolidation, there were: 1) Nil outstanding Options, 2) Nil outstanding RSUs, 3) 235,231 outstanding DSUs, 4) Nil outstanding PSUs, and 5) Nil outstanding SARs that are governed by the terms of the Equity Incentive Plan.

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Outstanding Compensation Securities

The following table discloses all compensation securities outstanding to each NEO of the Company and to a director who was not an NEO of the Company, or a subsidiary of the Company during financial year ended May 31, 2024 for services provided or to be provided, directly or indirectly, to the Company, or a subsidiary of the Company.

Compensation Securities
Name and Position	Type of Compensation Security	Number of Compensation Securities, underlying securities and percentage of class(1) (#)	Date of Issue or Grant (mm/dd/yy)	Issue, conversion or exercise price ($)	Closing price of security or underlying security on date of grant ($)	Closing price of security or underlying security at year end ($)	Expiry Date (mm/dd/yy)
R. W. Campbell Becher
CEO and director	DSU	800,773 (34%)	01/04/23	N/A	N/A	N/A	Note 2
Anton J. Drescher
Interim CFO and director	DSU	850,773 (36%)	01/04/23	N/A	N/A	N/A	Note 2
Joseph Edward Meehan
former Chairman, former CEO and former director	N/A	Nil	N/A	Nil	Nil	Nil	N/A
Arjan Jagjit Chima
former President, former CEO and former director	N/A	Nil	N/A	Nil	Nil	Nil	N/A
David T. Young
former CFO, former President and former director	N/A	Nil	N/A	Nil	Nil	Nil	N/A
Joseph Patrick Elmlinger
former director	DSU	700,773 (30%)	01/04/23	N/A	N/A	N/A	Note 2
Jeffrey Holmgren
Director	N/A	Nil	N/A	Nil	Nil	Nil	N/A

Note:
(1) Represents the percentage of the 116,233,800 issued and outstanding Common Shares of the Company as at May 31, 2024. On November 18, 2024, the Company consolidated its common shares in the capital of the Company on a ten (old) for one (new) basis. Following the consolidation, the Company had 11,623,380 Common Shares of the Company issued and outstanding. Accordingly, the consolidated DSUs held by directors were as follows: R. W. Campbell Becher: 80,077, Anton J. Drescher: 85,077, Joseph Patrick Elmlinger: 70,077.
(2) The expiry date is the business day preceding December 31st of the calendar year following the calendar year during which the Participant (i) ceases to be a director of the Company; (ii) ceases to be employed by the Company or its subsidiaries; or (iii) ceases to provide services to the Company or its subsidiaries, as applicable or such shorter period as may be determined by the Board at the time the DSU is grant.

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Exercise of Compensation Securities by NEOs and Directors

The following table sets out compensation securities pursuant to the Equity Incentive Plan, that vested or were exercised during the most recently completed financial year:

Exercise of Compensation Securities by Directors and NEOs
Name and position	Type of compensation security	Number of underlying securities exercised	Exercise price per security ($)	Date of exercise	Closing price per security on date of exercise ($)	Difference between exercise price and closing price on date of exercise ($)	Total value on exercise date ($)
David T. Young
former CFO,
former President
and former director	RSU	300,000 (1)	N/A	May 1, 2023	$0.28 CAD	N/A	$84,000 CAD

Note:
(1) Issued on a pre-consolidated basis.

Compensation Discussion and Analysis

The information contained under this heading “Compensation Discussion and Analysis” relates to the Company’s current compensation program.

The purpose of this Compensation Discussion and Analysis is to describe and explain all significant elements of compensation awarded to, earned by, paid to, or payable to the Company’s “Named Executive Officers” for the Company’s fiscal year ended May 31, 2024, including: the Company’s philosophy, objectives and processes regarding their compensation; the elements of their compensation; and how the Company determines their compensation.

The Company’s “Named Executive Officers” during the fiscal year ended May 31, 2024 consisted of the Chief Executive Officer, and the Interim Chief Financial Officer and each of the three most highly compensated executive officers of the Company other than the Chief Executive Officer and Interim Chief Financial Officer, whose total compensation (on an annualized basis) was, individually, more than CDN$150,000 (each a “Named Executive Officer” and collectively, the “Named Executive Officers”).

Compensation Philosophy and Objectives

The Company’s executive compensation program will be designed to provide short and long-term cash and equity incentives based on the achievement of the Company’s goals. The objectives of the Company with respect to compensation of executive officers are to provide compensation levels necessary to attract and retain high quality executives, and to motivate key executives to contribute to the interests of the Company.

These objectives are to be met by the principal components of the Company’s executive compensation program, which has been focused on a combination of base compensation, cash bonus remuneration and long-term incentives in the form of equity-based compensation. The executive compensation program adopted by the Company and applied to its executive officers will be designed to attract and retain individuals of a high caliber and motivate their performance to achieve the Company’s strategic objectives.

The executive compensation program design will attempt to ensure that the compensation of the senior executive officers provides a competitive base compensation package and a strong link between corporate performance and compensation. Senior executive officers will be motivated through the program to enhance long-term shareholder value and rewarded for their individual contribution in the context of overall annual corporate performance.

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Compensation Governance

A Compensation Committee has been established to assist the Board in monitoring, reviewing and approving compensation policies and practices of the Company and administering the Company's share compensation plans. The Board has adopted a written charter for the Compensation Committee that establishes, among other things, the Compensation Committee's purpose and its responsibilities with respect to executive compensation.

The independent directors of the Company are expected to review and make recommendations to the Compensation Committee each year with respect to the executive compensation arrangements and employment agreements for the Named Executive Officers. For other non-executive employees, the decisions regarding compensation arrangements and employment agreements will be made by the Chief Executive Officer. The Board considers industry standards and the financial situation of the Company when determining executive compensation.

Compensation Components

The executive compensation program during the fiscal year ended May 31, 2024 consisted of two principal components: (i) base salaries; and (ii) equity-based compensation.

Base Salaries

Base salaries are intended to provide an appropriate level of fixed compensation that will assist in employee retention and recruitment. Base salaries will be determined on an individual basis, taking into consideration the past, current and potential contribution to the Company's success, the position and responsibilities of the Named Executive Officers.

Benchmarking

The philosophy of the Company is to pay the Named Executive Officers of the Company a total compensation amount that is competitive with other similar sized companies, although no specific benchmarks have been used.

Annual Incentive Compensation and Benefits

Annual bonuses are awarded based on qualitative and quantitative performance standards and will reward performance of each Named Executive Officer individually. The determination of a Named Executive Officer's performance may vary from year to year depending on economic conditions and conditions in the industry in which the Company operates and may be based on measures such as revenue and other operational targets to be determined as the Company expands its sales footprint in the U.S. and internationally, metrics the Compensation Committee and management believe to provide proper incentives for achieving long-term shareholder value for the Company at this time. The Compensation Committee and the Board of Directors retain full discretion over performance evaluation and the amount of any bonuses to be paid to Named Executive Officers.

Equity-Based Compensation

The long-term component of compensation for executive officers, including the Named Executive Officers, will be based on Stock Options ("Options"), Restricted Share Units ("RSUs"), Deferred Share Units ("DSUs"), Performance Share Units ("PSUs") or Share Appreciation Rights ("SARs"), together with the Options, RSUs, DSUs, and PSUs, the "Awards" and/or similar equity-based compensation, issued pursuant to the equity incentive plan of the Company.

The Board believes that incentive compensation in the form of stock option grants and other security-based compensation awards which vest over time, is and has been, beneficial and necessary to attract and retain both senior executives and managerial talent at other levels. Furthermore, the Board believes stock option grants and other security-based awards are an effective long-term incentive vehicle because they are directly tied to share price over a longer period, up to 10 years, and motivate executives to deliver sustained long term performance and increase shareholder value and have a time horizon that aligns with long-term corporate goals.

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Restrictions on Hedging

The Company’s Insider Trading and Reporting Policy prohibits the Company’s officers (including the Named Executive Officers), directors and employees from buying or selling financial instruments that are designed to hedge or offset a decrease in market value of equity securities of the Company granted as compensation or held, directly or indirectly, by such individuals.

External Management Companies

None of the NEOs or directors of the Company have been retained or employed by an external management company which has entered into an understanding, arrangement or agreement with the Company to provide executive management services to the Company, directly or indirectly.

Employment, Consulting and Management Agreements

As at and subsequent to May 31, 2024, none of the NEOs or directors of the Company have entered into employment, consulting or management agreements with the Company.

Pension Plan Benefits

The Company has not implemented a pension plan, defined benefit plan, defined contribution plan or deferred compensation plan that provides for payments or benefits to Named Executive Officers at, following, or in connection with retirement.

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