{"url_path":"/sec/cxxif/10-k/2026/item-6","section_key":"item-6","section_title":"Item 6 ** **Directors, Senior Management and Employees**","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-12","source_url":"https://www.sec.gov/Archives/edgar/data/831609/0001062993-26-003168-index.html","accession_number":"0001062993-26-003168","cik":"0000831609","ticker":"CXXIF","issuer_name":"C21 Investments Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/831609/0001062993-26-003168-index.html","primary_entity_key":"0000831609","primary_entity_name":"C21 Investments Inc."},"word_count":5568,"has_tables":true,"body_markdown":"**Item 6.** **Directors, Senior Management and Employees**\n\n**A.** **Directors and Senior Management**\n\nThe size of the Company's Board is currently set at four. The Company's directors are elected annually by the shareholders and hold office until the next annual general meeting or until their successors are duly elected and qualified, unless their office is earlier vacated in accordance with the BCBCA and the Company's articles of incorporation. The Company's current directors and officers, and their respective current positions, are as follows:\n\n49\n\nNamePosition\n\nSonny NewmanPresident and Chief Executive Officer.\n\nMichael KiddChief Financial Officer, Corporate Secretary and Director.\n\nAron SwanChief Operating Officer\n\nTodd HarrisonDirector, Audit Committee Member and Corporate Governance and Compensation Committee Member\n\nD. Bruce MacdonaldChairman of the Board, Director, Audit Committee Member, Corporate Governance and Compensation Committee Member and Financial Expert.\n\nLeonard (Will) WerdenDirector, Audit Committee Member, and Corporate Governance and Compensation Committee Member.\n\nThe following is biographical information on our directors and officers who are acting in the capacity of director or officer as of the date hereof:\n\n***Sonny Newman**, Chief Executive Officer, and President.*Sonny Newman is the founder of Silver State Relief and Silver State Cultivation in Nevada, and has several other companies in electronics, manufacturing, electronics distribution, real estate development and an investment company. Mr. Newman was the sole owner of the Silver State companies when they were purchased by the Company in 2019 and today is the largest shareholder of the Company. Mr. Newman's proven operational and financial discipline in the cannabis and other sectors shows his ability to build solid teams and make strategic investments into opportunistic markets.\n\n***Michael Kidd**, Chief Financial Officer, Corporate Secretary and Director.*A native of Vancouver with international experience, Mr. Kidd brings an extensive background in finance with privately held firms in a variety of industries ranging from forestry to online retailing. Before joining the Company, Mr. Kidd was Chief Operating Officer and Chief Financial Officer at a privately held leading distributor with operations in Canada and Dubai. Mr. Kidd graduated from the University of British Columbia with a Bachelor of Commerce and is a Certified Public Accountant (Chartered Accountant).\n\n***Aron Swan**, Chief Operating Officer. *Mr. Swan has been the long-standing head of operations for the Silver State Relief and Silver State Cultivation companies.  Mr. Swan brings a breadth of experience in manufacturing, supply chain, and technology.  Before joining the Company, Mr. Swan was Chief Information Officer at a prominent electronics manufacturer and has held other senior supply chain and operations roles.  Mr. Swan holds a Bachelor of Science in Logistics Management and an MBA, both from the University of Nevada.\n\n***Todd Harrison**, Director.*Mr. Harrison brings a wealth of knowledge and insight to the Company's Board, both through his near 30 years on Wall Street as VP at Morgan Stanley to President of Cramer Berkowitz, as well as through his current role as Chief Investment Officer of CB1 Capital Management. He is also an author and Emmy award-winning executive producer for his work at financial media company, Minyanville. Mr. Harrison founded CB1 Capital Management in 2017 - an investment advisory firm that invests in stocks focused on cannabinoid-based wellness solutions and other cannabis-based bio-pharmaceutical applications, therapies, and other use-cases. Mr. Harrison has lectured at numerous academic institutions, has appeared on CNBC, CNN, FOX, Bloomberg TV, and has been featured across numerous publications and platforms. Mr. Harrison has a Bachelor of Science degree in Finance from Syracuse University.\n\n***D. Bruce Macdonald**, Chairman of the Board and Director.*Mr. Macdonald is a seasoned senior executive with more than 35 years of experience in financial services including extensive expertise in the capital markets sector. He has an impressive track record of leading innovative new business ventures in support of global growth strategies. Mr. Macdonald has exceptional expertise in building risk management and corporate governance control environments. Further, he serves on the boards of several Canadian corporations and associations and holds an ICD.D designation from the Institute of Corporate Directors.\n\n***Leonard (Will) Werden**, Director.*Mr. Werden has over 30 years of experience in global horticulture cultivation. He specializes in outdoor and indoor grow practices, facilities construction and design, lighting systems and practices, temperature and humidity control, and genetic strain selection. Having overseen large-scale grow operations with state-of-the-art technology, Mr. Werden brings a wealth of valuable knowledge to the Company. Mr. Werden was formerly a certified Millwright for over 30 years, and has been involved in numerous projects, including the Cyclotron Project for TRIUMF (Canada's national laboratory for particle and nuclear physics) at the University of British Columbia. Mr. Werden was also former CEO of Seashore Organic Marijuana Corp. (which transitioned to Veritas Pharma Inc.) until February 2016.\n\n50\n\nNo family relationships exist between any of the directors or senior management\n\n**Arrangements, Understandings, etc.**\n\nThe Company has no arrangements or understanding with any major shareholders, customers, suppliers or others, pursuant to which any person referred to above was selected as a director or member of senior management.\n\n**B.** **Compensation**\n\n**Compensation Discussion and Analysis**\n\n***Process for Determining Executive Compensation***\n\nTo determine compensation payable, the Corporate Governance and Compensation Committee will generally review compensation paid for directors, CEOs and CFOs (or persons acting in a similar capacity to a CEO or a CFO) of companies of similar size and stage of development in the cannabis industry and determines an appropriate compensation reflecting the need to provide incentive and compensation for the time and effort expended by the directors and senior management while taking into account the financial and other resources of the Company. In setting the compensation, the independent director will annually review the performance of the CEO and the CFO in light of the Company's objectives and consider other factors that may have impacted the success of the Company in achieving its objectives.\n\n***Compensation Policies and Risk Management***\n\nThe Board has not proceeded to an evaluation of the implications of the risks associated with the Company's compensation policies and practices.\n\nThe Company has not retained a compensation consultant during or subsequent to the most recently completed financial year.\n\nThe Company does not use a specific \"benchmark group\" to determine executive compensation levels.\n\nTotal compensation for executive officers includes consulting fees, long-term incentive stock options and performance milestone payments.\n\n***Hedging of Economic Risks in the Company's Securities***\n\nThe Company has not adopted a policy forbidding directors or officers from purchasing financial instruments that are designed to hedge or offset a decrease in market value of the Company's securities granted as compensation or held, directly or indirectly, by directors or officers. The Company is not, however, aware of any directors or officers having entered into this type of transaction.\n\n***Pension Plan Benefits***\n\nThe Company does not have a pension plan that provides for payments or benefits to its executive officers at, following, or in connection with retirement.\n\n***Compensation for Year Ending March 31, 2026***\n\nThe following table sets forth all annual and long-term compensation for services in all capacities to the Company for the most recently completed financial year of the Company ending on March 31, 2026, in respect of each of the individuals comprised of the Company's directors and members of it administrative, supervisory and management bodies for services provided by such persons to the Company and its subsidiaries. During the year ended March 31, 2026, the Company paid aggregate remuneration to its directors and officers as a group who served in the capacity of director or executive officer during such year of US$925,981\n\n51\n\n**Name and**\n**principal position**\n \n**Salary, Consulting Fees,Retainer orCommission**\n \n \n**Share-basedawards**\n \n \n**Option-basedawards**\n \n \n**Non-equity incentive**\n**plan compensation**\n \n \n**Pensionvalue**\n \n \n**All othercompensation**\n \n \n**Total compensation**\n \n\n \n**Annualincentive plans**\n \n \n**Long-termincentiveplans**\n \n\n**Sonny Newman**\nPresident and Chief Executive Officer\n$\n200,000\n \n \nNil\n \n \n22,442\n \n \nNil\n \n \nN/A\n \n \nN/A\n \n \n-\n \n$\n222,442\n \n\n**Michael Kidd**\nChief Financial Officer, Corporate Secretary and Director\n$\n161,136(1\n)\n \nNil\n \n \n15,709\n \n \nNil\n \n \nN/A\n \n \nN/A\n \n \n-\n \n$\n176,845\n \n\n**Aron Swan**\nChief Operating Officer\n$\n350,000\n \n \nNil\n \n \n67,323\n \n \nNil\n \n \nN/A\n \n \nN/A\n \n \n-\n \n$\n417,323\n \n\n**Todd Harrison**\nDirector\n$\n60,000\n \n \nNil\n \n \n11,220\n \n \nNil\n \n \nN/A\n \n \nN/A\n \n \n-\n \n$\n71,220\n \n\n**D. Bruce Macdonald**\nChairman of the Board and Director\n \nNil\n \n \nNil\n \n \n33,662\n \n \nNil\n \n \nN/A\n \n \nN/A\n \n \n-\n \n$\n33,662\n \n\n**Leonard (Will) Werden**\nDirector\n \nNil\n \n \nNil\n \n \n4,489\n \n \nNil\n \n \nN/A\n \n \nN/A\n \n \n-\n \n**$**\n4,489\n \n\n___________________________\n\n(1) Michael Kidd was not paid any compensation for his role as director of the Company.\n\nPlease see section entitled \"Deferred Share Units\" in Item 6.E. \"Share Ownership\" below for a brief summary of DSU treatment upon the termination of a director.\n\n**C.** **Board Practices**\n\nThe Board currently consists of four directors. Two of the four current members of the Board are considered independent directors using the definition set forth in Section 803A of the NYSE American Company Guide. The independent directors are D. Bruce Macdonald and Leonard Werden.  Todd Harrison is not an independent director as he controls CB1, a company which is engaged as a consultant to the Company. Michael Kidd is not an independent director as he is an executive officer of the Company. The size of the Company is such that all the Company's operations are conducted by a small management team. The Board considers that management is effectively supervised by the independent director on an informal basis as the independent director is involved in reviewing and supervising the operations of the Company and has full access to management.\n\nThe directors of the Company are elected annually by the shareholders and hold office until the next annual general meeting or until their successors are duly elected and qualified, unless their office is earlier vacated in accordance with the BCBCA and the Company's articles of incorporation.\n\nThe mandate of the Board, as prescribed by the BCBCA, is to manage or supervise the management of the business and affairs of the Company and to act with a view to the best interests of the Company. In doing so, the Board oversees the management of the Company's affairs directly and through its various committees. In fulfilling its mandate, the Board, among other matters, is responsible for reviewing and approving the Company's overall business strategies, reviewing and approving significant acquisitions and capital investments; reviewing major strategic initiatives to ensure that the Company's proposed actions accord with shareholder objectives; reviewing succession planning; assessing management's performance against industry standards; reviewing and approving the reports and other disclosure issued to shareholders; ensuring the effective operation of the Board; and safeguarding shareholders' equity interests through the optimum utilization of the Company's capital resources.\n\n52\n\nThe Board is responsible for identifying individuals qualified to become new members of the Board and recommending to the Board, new director nominees for the next annual meeting of shareholders. New nominees must have a track record in general business management, special expertise in an area of strategic interest to the Company, the ability to devote the required time, show support for the Company's mission and strategic objectives, and a willingness to serve.\n\nThe Board also takes responsibility for identifying the principal risks of the Company's business and for ensuring these risks are effectively monitored and mitigated to the extent reasonably practicable. At this stage of the Company's development, the Board does not believe it is necessary to adopt a written mandate, as sufficient guidance is found in the applicable corporate legislation and regulatory policies. However, as the Company grows, the Board may determine it is appropriate to develop a formal written mandate.\n\nIn keeping with its overall responsibility for the stewardship of the Company, the Board is responsible for the integrity of the Company's internal control and management information systems and for the Company's policies respecting corporate disclosure and communications.\n\nEach member of the Board understands that he is entitled, at the cost of the Company, to seek the advice of an independent expert if he reasonably considers it warranted under the circumstances. No director found it necessary to do so during the financial year ended March 31, 2026.\n\nThe Board does not, and does not consider it necessary to, have any formal structures or procedures in place to ensure that it can function independently of management. The Board of the Company briefs all new directors with respect to the policies of the Board and other relevant corporate and business information. The Board does not provide any continuing education.\n\nThe Board regularly monitors the adequacy of information given to directors, communications between the Board and management and the strategic direction and processes of the Board and its committees.\n\n***Directorships***\n\nThe current directors of the Company are not presently directors of other reporting issuers in Canada or elsewhere. Other than by virtue of being an officer, there are no termination benefits for directors who serve on the Board.\n\n***Orientation and Continuing Education***\n\nThe Company does not have formal orientation and training programs and does not consider these programs necessary at this stage of the Company's development. Board members are encouraged to communicate with management, auditors and technical consultants in order to keep themselves current with industry trends and developments and changes in legislation with management's assistance. Board members are also encouraged to attend related industry seminars and visit the Company's operations. Board members have full access to the Company's records.\n\n***Ethical Business Conduct***\n\nThe Board views good corporate governance as an integral component to the success of the Company and to meet responsibilities to shareholders. The Company's reputation for integrity is an important asset. The Company has always set high standards of personal and business integrity for its employees and intends to continue to conduct its business in accordance with those high standards. It is expected that the Company's business conduct and the personal actions of its employees reflect the spirit and intent of the laws under which the Company operates, and its employees live. Common sense and judgment supported by a deeply ingrained tradition of integrity provide the Company's foundation.\n\nThe Board has found that the fiduciary duties placed on individual directors by the Company's governing corporate legislation and the common law, and the restrictions placed by applicable corporate legislation on an individual director's participation in decisions of the Board in which the director has an interest have been sufficient to ensure that the Board operates independently of management and in the best interests of the Company.\n\nUnder corporate legislation, a director is required to act honestly and in good faith with a view to the best interests of the Company and exercise the level of care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. In addition, as some of the directors of the Company also serve as directors and officers of other companies engaged in similar business activities, directors must comply with the conflict-of-interest provisions of the BCBCA as well as the relevant securities regulatory instruments, in order to ensure that directors exercise independent judgment in considering transactions and agreements in respect of which a director or officer has a material interest. Any interested director would be required to declare the nature and extent of his interest and would not be entitled to vote at meetings of directors which evoke such a conflict.\n\n53\n\n***Nomination of Directors***\n\nThe Board as a whole has responsibility for identifying potential Board candidates. The Board has not formed a nominating committee or similar committee to assist the Board with the nomination of directors for the Company. Each of the directors has contacts he can draw upon to identify new members of the Board as needed from time to time.\n\nThe Board will continually assess its size, structure and composition, taking into consideration its current strengths, skills and experience, proposed retirements and the requirements and strategic direction of the Company. As required, directors will recommend suitable candidates for consideration as members of the Board.\n\n***Board Committees - Audit Committee; Corporate Governance and Compensation Committee; Special Committee***\n\nThe current Company committees include the Audit Committee and Corporate Governance and Compensation Committee and a Special Committee. The Board has no other standing committees.\n\nThe Company's Audit Committee has a charter. The primary function of the Audit Committee is to assist the Board in fulfilling its financial oversight responsibilities by reviewing (1) the financial reports and other financial information provided by the Company to regulatory authorities and shareholders, (2) the Company's systems of internal controls regarding finance and accounting, and (3) the Company's auditing, accounting and financial reporting processes. Consistent with this function, the Audit Committee encourages continuous improvement of, and fosters adherence to, the Company's policies, procedures and practices at all levels. As at the date of this Annual Report, the following Board members sit on the Audit Committee, all of which are financially literate: Leonard (Will) Werden, D. Bruce Macdonald and Todd Harrison. D. Bruce Macdonald is the Chair of the Audit Committee.\n\nThe Corporate Governance and Compensation Committee exercises the powers and carries out the obligations provided for in its mandate and in accordance with applicable regulatory standards and requirements and has the responsibility for determining director and senior management compensation. As at the date of this Annual Report, the following Board members sit on the Corporate Governance and Compensation Committee: Leonard (Will) Werden, D. Bruce Macdonald and Todd Harrison. D. Bruce Macdonald is the Chair of the Corporate Governance and Compensation Committee.\n\nTo determine compensation, the Corporate Governance and Compensation Committee reviews compensation paid for directors and CEOs (or persons acting in a similar capacity to CEO, such as Presidents) of companies of similar size and stage of development in the cannabis industry and determines an appropriate compensation reflecting the need to provide incentive and compensation for the time and effort expended by the directors and senior management, while taking into account the financial and other resources of the Company. In setting the compensation, the Corporate Governance and Compensation Committee annually reviews the performance of the CEO (or President) in light of the Company's objectives and considers other factors that may have impacted the success of the Company in achieving its objectives. Further information regarding director compensation appears above under \"Compensation - Compensation Discussion and Analysis\".\n\nThe Special Committee's purpose is to evaluate all strategic alternatives, change of control or business combination transactions, and opportunities that may be available to the Company with a view towards maximizing value for its stakeholders and to advise the Board. The Committee shall convey its findings and make recommendations with respect to its review to the Board for consideration and, where required, decision by the Board. The Committee does not have decision-making authority except where, and only to the extent that, such authority is expressly delegated by the Board, including as described in this Charter.  As at the date of this Annual Report, the following Board members sit on the Special Committee: Michael Kidd, D. Bruce Macdonald and Todd Harrison. D. Bruce Macdonald and Todd Harrison are voting members.  D. Bruce Macdonald is the Chair of the Special Committee.\n\n54\n\n***Assessments***\n\nThe Board does not consider that formal assessments would be useful at this stage of the Company's development. The Board conducts informal annual assessments of the Board's effectiveness, the individual directors and its Audit Committee. To assist in its review, the Board conducts informal surveys of its directors.\n\n**D.** **Employees**\n\nThe following outlines the number of employees of the Company for the last three fiscal years, categorized by activity (operations or corporate) and geographic location (Canada or Nevada):\n\n**Financial YearEnded**\n**CanadaEmployees**\n**NevadaEmployees**\n**OperationsEmployees**\n**CorporateEmployees**\n**Total**\n\nMarch 31, 2026\n2\n134\n129\n6\n136\n\nMarch 31, 2025\n1\n136\n132\n5\n137\n\nMarch 31, 2024\n1\n113\n110\n4\n114\n\nThe increase in employees in 2025 is due to the opening of our third dispensary.  No employees are represented by a labor union or covered by a collective bargaining agreement.\n\n**E.** **Share Ownership**\n\n***Share Capital***\n\nThe Company is authorized to issue an unlimited number of common shares. As of the date of this Annual Report, there are 118,678,994 common shares issued and outstanding. The holders of the common shares are entitled to one vote per share at all meetings of the shareholders of the Company. The holders of common shares are also entitled to dividends, if and when declared by the Board and the distribution of the residual assets of the Company in the event of a liquidation, dissolution or winding up of the Company.\n\nThe following table sets forth the share ownership of the persons set forth in the Compensation table at Item 6.B above, as of the date of this Annual Report:\n\n**Names and Principal Position**\n**No. of SharesHeld**\n**PercentageOwnership(capitaland voting)**\n**Percentage of holding ona fully diluted bases(capital and voting)**\n\nSonny Newman, President and Chief Executive Officer\n12,500,000\n10.5%\n10.3%\n\nMichael Kidd, Chief Financial Officer and Director\n38,055\n0.0%\n0.0%\n\nAron Swan, Chief Operating Officer\n24,449\n0.0%\n0.0%\n\nTodd Harrison, Director\n300,000\n0.3%\n0.2%\n\nD. Bruce Macdonald, Chairman of the Board and Director\n1,440,000\n1.2%\n1.2%\n\nLeonard (Will) Werden, Director\n265,000\n0.2%\n0.2%\n\n***Equity Incentive Plan***\n\nOn March 17, 2026, the Board adopted a 10% rolling security based compensation plan (the \"**Plan**\").  The Plan replaces the Company's prior 10% rolling stock option plan and restricted share unit plan (collectively, the \"**Prior Plans**\"). All outstanding awards previously granted under the Prior Plans will be treated as outstanding awards granted under the Plan; provided, however, that in the event of any inconsistency between the terms of any agreement governing the awards granted under the Prior Plans and the terms of this Plan, the terms of such agreement will govern. \n\nThe maximum number of common shares issuable under the Plan will not exceed 10% of the number of common shares that are issued and outstanding from time to time, inclusive of all common shares reserved for issuance pursuant to previously granted stock options or security based compensation plans including the Prior Plans.  Unless disinterested shareholder approval is obtained, the maximum number of common shares which may be reserved for issuance on a yearly basis to any one Participant under the Plan, together with all of the Company's other security based compensation arrangements, cannot exceed 5% of the outstanding common shares at the time of the grant. The maximum number of common shares which may be reserved for issuance on a yearly basis to any one consultant under the Plan, together with all of the Company's other security based compensation arrangements, shall not exceed 2% of the outstanding common shares at the time of the grant.  Unless disinterested shareholder approval is obtained, the maximum number of Common Shares reserved for issuance to insiders under the Plan, together with all of the Company's other security based compensation arrangements, cannot exceed 10% of the outstanding common shares at the time of the grant. Lastly, investor relations service providers may only be granted Options under the Plan, and the maximum number of Shares that are issuable to all investor relations service providers in any 12-month period must not exceed 2% of the outstanding common shares at the time of the grant.  Moreover, Options granted to any investor relations service provider must vest in stages over a period of not less than 12 months, such that not more than 25% vest any sooner than three months after the date of grant, and not more than 25% vest any sooner than every three months thereafter.\n\n55\n\nThe Plan is administered by the Board or a committee authorized and appointed by the Board to administer the Plan.  Awards may be granted under the Plan to such directors, officers, employees or consultants of the Company and its subsidiaries or such eligible charitable organizations, as the Board may from time to time designate (\"**Participants**\"). Awards that may be granted under the Plan include stock options (\"**Options**\"), deferred share units (\"**DSUs**\"), restricted stock units (\"**RSUs**\"), performance share units (\"**PSUs**\") and bonus shares.\n\n**Options**\n\nOptions awarded by the Board will be subject to a vesting schedule as set forth in the applicable award agreement; provided, however, that the Board may elect to accelerate vesting at any time.  The exercise price for options is determined by the Board, but cannot, in any event, be less than the greater of (i) $0.05; (ii) the closing price of the common shares on the CSE on the date prior to grant; and (iii) the closing price of the common shares on the CSE on the date of grant.  The Plan provides for a net exercise feature which allows an option holder to exercise vested Options without paying the exercise price in cash, and in return, the Company will deliver the number of common shares to such option holder equal to the value of the Options that are \"in-the-money\" (i.e. the 5-day VWAP of the common shares on the date of exercise less the exercise price of the respective Options) as well as a cashless exercise feature (i.e. a broker-assisted sale of a sufficient number of common shares to cover the exercise price). Options may be granted for a maximum term of 10 years.\n\n**Restricted Share Units**\n\nRSUs represents the right of a Participant to receive payment, in the form of common shares, a cash equivalent or a combination thereof, subject to the terms of the Plan.  The Board will determine the period of time during which an RSU is not vested and the Participant holding such RSU remains ineligible to receive common shares (the \"**Restricted** **Period**\"). In addition, at the sole discretion of the Board, at the time of grant, the RSU may be subject to performance conditions to be achieved by the Company, a class of Participants or by a particular Participant on an individual basis, within a Restricted Period, for such RSUs to entitle the holder thereof to receive the underlying common shares. Upon the expiry of the applicable Restricted Period (or on the deferred payment date (as described below), as applicable), an RSU will be automatically settled and the underlying common share will be issued, or the cash equivalent will be paid, to the holder of such RSU.\n\nParticipants who are residents of Canada for the purposes of the *Income Tax Act* (Canada) and not otherwise subject to the provisions of the Internal Revenue Code may elect no later than 30 days following the end of the Restricted Period to defer the receipt of all or any part of their common shares until one or more deferred payment dates which will be the earlier of (i) the date which the Participant has elected to defer receipt of common shares (which, for avoidance of doubt, must be a date after the end of the Restricted Period); and (ii) the date the Participant retires or otherwise terminates from employment with the Company or a related entity. No other Participants may elect a deferred payment date.  In the event of a Participant's death or disability, the Board may, in its absolute discretion, accelerate vesting of a pro rata portion of the Participant's RSUs.  In the event of the retirement or termination of employment of a Participant during the Restricted Period, any unvested RSUs will terminate; provided, however, the Board has the absolute discretion to modify the grant of the RSUs to provide that the Restricted Period will terminate immediately prior to the date of such retirement or termination of employment.  In the event that a dividend is declared and paid by the Company, a Participant may be credited with additional RSUs, subject to the Board's discretion.\n\n**Performance Share Units**\n\nPSUs represent the right, upon attainment of certain performance-based criteria, for a Participant to receive payment in the form of common shares, a cash equivalent or a combination thereof, at the end of the applicable performance period.  The Board will determine, in its sole discretion, the performance period and performance-based criteria and multipliers applicable to a PSU.  A payment for a PSU will be made following the end of the performance period in the form determined by the Board, subject to specific Plan terms regarding U.S. taxpayers.\n\nIn the event of the death or disability of a Participant during the performance period, the performance period will be deemed to end at the end of the calendar quarter immediately before the date of death or disability of the Participant and the amount payable to the Participant or its executors, as the case may be, will be calculated as of such date.  In the event of the retirement or termination of employment of a Participant during the performance period, any unvested PSUs will terminate; provided, however, the Board has the absolute discretion to modify the grant of the PSU to provide that the performance period would have ended at the end of the calendar quarter immediately prior to the date of such retirement or termination of employment, and the amount payable to the Participant will be calculated as of such date.  In the event that a dividend is declared and paid by the Company, a Participant may be credited with additional PSUs, subject to the Board's discretion.\n\n56\n\n**Deferred Share Units**\n\nThe Board may grant DSUs to directors, officers or employees, but in the case of U.S. taxpayers, only a non-employee director may be granted DSUs.  DSUs represent the right to receive common shares, a cash equivalent or a combination thereof with respect to each DSU.  DSUs may not be redeemed until after the earlier of a director's retirement, a director's termination, a director's death or a participant's separation date (each, a \"**DSU Termination Date**\").  Unless otherwise determined by the Board, if the DSU Termination Date occurs as a result of a termination for cause, all DSUs credited to such Participant will be forfeited and cancelled immediately.  If a DSU Termination Date occurs as a result of the death of a Participant, all DSUs will vest upon the Participant's death.  As  soon  as  reasonably practicable after the DSU Termination Date of a Participant, or as the Participant may elect otherwise elect (as described below), and in any event, no later than December 15 of the first calendar year commencing after the DSU Termination Date, the Company will redeem and fully settle each vested DSU (such settlement date being a \"**Redemption Date**\"), subject to certain specific Plan terms regarding U.S. taxpayers. With respect to Participants who are residents of Canada for the purposes of the Tax Act and who are not otherwise U.S. taxpayers, if the DSU Termination Date of a Participant occurs for a reason other  than  cause,  after  the  DSU  Termination  Date,  the Participant (or their estate) may elect up to three separate Redemption Dates as of which either a portion or all of the Participant's DSUs will be redeemed and settled, provided that the elected Redemption  Dates  are no  later  than  December  15  of  the  first  calendar  year  commencing  after  the Participant's DSU Termination Date. In the event that a dividend is declared and paid by the Company, a Participant may be credited with additional DSUs, subject to the Board's discretion.\n\n**Bonus Shares**\n\nBonus shares may be granted to participants as a discretionary bonus at such time or times as will be determined by the Board by resolution, pursuant to recommendations of the Board from time to time. All bonus shares will be issued at the fair market value on the grant date.\n\nAs of March 31, 2026, there were 5,375,000 options outstanding to purchase common shares of which 3,583,333 had vested.  As of the date of this Annual Report there were 5,375,000 options outstanding to purchase common shares of which 5,375,000 had vested. \n\nAs of March 31, 2026, there no RSU's, PSU's or DSU's outstanding.  As of the date of this Annual Report there were 833,339 RSU's outstanding of which none had vested, and 1,275,000 DSU's outstanding of which half had vested. \n\nThe following table sets forth the options, RSU's and DSU's exercisable into common shares, owned by the persons set forth in the Compensation table at Item 6.B above, as of the date of this Annual Report:\n\n**Names and Principal Position**\n**No. of OptionsHeld**\n**No. of SharesUnderlying theOptions**\n**OptionStrikePrice(C$)**\n**OptionExpirationDate**\n**RSU**\n**DSU**\n\nSonny Newman, President and Chief Executive Officer\n500,000\n500,000\n0.53\nMay 13, 2027\n-\n-\n\nMichael Kidd, Chief Financial Officer and Director\n350,000\n350,000\n0.53\nMay 13, 2027\n-\n200,000\n\nAron Swan, Chief Operating Officer\n1,500,000\n1,500,000\n0.53\nMay 13, 2027\n66,667\n-\n\nTodd Harrison, Director\n250,000\n250,000\n0.53\nMay 13, 2027\n-\n250,000\n\nD. Bruce Macdonald, Chairman of the Board and Director\n750,000\n \n750,000\n** **\n.0.53\n \nMay 13, 2027\n \n-\n675,000\n\nLeonard (Will) Werden, Director\n100,000\n100,000\n0.53\nMay 13, 2027\n-\n150,000\n\nA copy of the Equity Incentive Plan is incorporated by reference into this Annual Report as Exhibit 4.1.\n\n***Warrants***\n\nAs of March 31, 2026, there were 4,000,000 warrants outstanding to purchase common shares. As at the date of this Annual Report there were 4,000,000 warrants outstanding to purchase common shares.\n\n57\n\nThe following table sets forth the warrants, exercisable into common shares, owned by the persons set forth in the Compensation table at Item 6.B above, as of the date of this Annual Report:\n\n**Names and Principal Position**\n**AllotmentDate**\n**Expiration Date**\n**Exercise Price(C$)**\n**Total**\n\nSonny Newman, President and Chief Executive Officer\nN/A\n \nN/A\nN/A\nNil\n\nAron Swan, Chief Operating Officer\nN/A\nN/A\nN/A\nNil\n\nMichael Kidd, Chief Financial Officer and Director\nN/A\nN/A\nN/A\nNil\n\nTodd Harrison, Director\nN/A\nN/A\nN/A\nNil\n\nD. Bruce Macdonald, Chairman of the Board and Director\nN/A\nN/A\nN/A\nNil\n\nLeonard (Will) Werden, Director\nN/A\nN/A\nN/A\nNil\n\nFor further information, see Management's Discussion and Analysis, attached hereto as Exhibit 15.1, and incorporated by reference herein.\n\n**F.** **Disclosure of a Registrant's Action to Recover Erroneously Awarded Compensation**\n\nNot applicable."}