# EDGAR Filing Document

**Accession Number:** 0001824930
**File Stem:** 0001683168-26-003369
**Filing Date:** 2026-4
**Character Count:** 169878
**Document Hash:** 8949ff15a04f8c179b54e44175448a6a
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001683168-26-003369.hdr.sgml**: 20260430

**ACCESSION NUMBER**: 0001683168-26-003369

**CONFORMED SUBMISSION TYPE**: 1-K

**PUBLIC DOCUMENT COUNT**: 4

**CONFORMED PERIOD OF REPORT**: 20251231

**FILED AS OF DATE**: 20260430

**DATE AS OF CHANGE**: 20260430

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** RYSE Inc.
- **CENTRAL INDEX KEY:** 0001824930
- **STANDARD INDUSTRIAL CLASSIFICATION:** MOTORS & GENERATORS [3621]
- **ORGANIZATION NAME:** 04 Manufacturing
- **EIN:** 000000000
- **STATE OF INCORPORATION:** A6
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 1-K
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 24R-00421
- **FILM NUMBER:** 26924696

**BUSINESS ADDRESS:**
- **STREET 1:** 20 CAMDEN ST.
- **STREET 2:** SUITE 200
- **CITY:** TORONTO
- **STATE:** A6
- **ZIP:** M5V 1VI
- **BUSINESS PHONE:** 416-639-2324

**MAIL ADDRESS:**
- **STREET 1:** 20 CAMDEN ST.
- **STREET 2:** SUITE 200
- **CITY:** TORONTO
- **STATE:** A6
- **ZIP:** M5V 1VI

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** RYSE, Inc.
- **DATE OF NAME CHANGE:** 20200915

## Part

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 1-K**

**ANNUAL REPORT**

**ANNUAL REPORT ON FORM 1-K PURSUANT TO REGULATION A OF THE SECURITIES ACT OF 1933**

**For the fiscal year ended December 31, 2025**

**RYSE INC.**

**(Exact name of issuer as specified in its charter)**

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| | |
|:---|:---|
| Ontario, Canada | **N/A** |
| **(State or other jurisdiction of incorporation or organization)** | **(I.R.S. Employer Identification No.)** |
| 20 Camden St. Suite 200, Toronto, Canada | M5V 1V1 |
| **(Address of principal executive offices)** | **(Zip Code)** |

---

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| |
|:---|
| 929-219-3299 |
| **Issuer's telephone number, including area code** |

---

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| |
|:---|
| Class B Common Stock |
| **(Title of each class of securities issued pursuant to Regulation A)** |

---

*In this Annual Report, the term "RYSE," "we," "us," "our," or "the company" refers to RYSE Inc. and its consolidated subsidiaries; "$" refers to Canadian Dollars; and "USD$" refers to US Dollars.* 

THIS ANNUAL REPORT MAY CONTAIN FORWARD-LOOKING STATEMENTS AND INFORMATION RELATING TO, AMONG OTHER THINGS, THE COMPANY, ITS BUSINESS PLAN AND STRATEGY, AND ITS INDUSTRY. THESE FORWARD-LOOKING STATEMENTS ARE BASED ON THE BELIEFS OF, ASSUMPTIONS MADE BY, AND INFORMATION CURRENTLY AVAILABLE TO THE COMPANY'S MANAGEMENT. WHEN USED IN THE OFFERING MATERIALS, THE WORDS "ESTIMATE," "PROJECT," "BELIEVE," "ANTICIPATE," "INTEND," "EXPECT" AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. THESE STATEMENTS REFLECT MANAGEMENT'S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND ARE SUBJECT TO RISKS AND UNCERTAINTIES THAT COULD CAUSE THE COMPANY'S ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE CONTAINED IN THE FORWARD-LOOKING STATEMENTS. INVESTORS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE ON WHICH THEY ARE MADE. THE COMPANY DOES NOT UNDERTAKE ANY OBLIGATION TO REVISE OR UPDATE THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES AFTER SUCH DATE OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED EVENTS.

**Item 1. Business**

**Company Overview**

RYSE Inc. is an "internet-of-things" technology startup that creates devices to motorize and automate window coverings, servicing the residential and commercial markets. RYSE intends to re-invent the concept of window blinds and shades motorization, by creating a suite of retrofit and after-market devices that will enable the automation of existing installed window coverings. The company is developing AI-powered automation features in which their devices intelligently respond to sensors and weather data, controlling the window shades position to reduce energy use by lowering cooling loads or artificial lighting loads.

RYSE Inc. was incorporated on May 6, 2009 in Ontario, Canada as ETAPA Window Fashions and began operations on January 1, 2015. The company changed its legal name to Axis Labs Inc. on January 15, 2016 and to RYSE Inc. on August 28, 2020. The company has a Delaware subsidiary RYSE USA Inc. A transfer pricing agreement has been established with the Canadian parent, and the U.S. subsidiary; under this agreement, the U.S. subsidiary acts as the sales arm, or agent, of the Canadian parent for U.S.-related business activities.

**Our Mission**

Our mission at RYSE is to enhance your space, with smart and simple technology – focusing on both providing greater comfort and greater energy savings. We have the vision to put RYSE on every window covering. We want consumers to think of 'RYSE' when they think of smart blinds or smart shades.

**Our Products and Services**

RYSE SmartShades is a device that is installed on the window frame, and controls existing beaded chains or cord loops of a window shade, in order to motorize them, acting as a motorized pulley.

RYSE SmartCurtain is a device that is installed on and hangs on a curtain rod, track, or rail, gliding left-and-right in order to motorize and open-or-close curtains. The SmartCurtain can be installed in less than one minute without the need for any tools or modifications to the window covering or frame.

RYSE SmartBlinds is a device that is installed on mini-blinds, horizontal, Venetian-blinds, or any blind that has a wand to tilt the slats, and is installed in-between the headrail and the wand of the window blind. The SmartBlind motorizes the tilting of the slats by rotating the wand.

Once our devices are installed, users can control their shades via our mobile app, where they can create schedules or routines; for example, users can set a timer to have their bedroom window coverings open at 7 am to help them wake up to natural sunlight, and close at 8 pm to provide more privacy during the evenings. The mobile app gives users the ability to control shades or curtains from a smartphone, as well as integrating RYSE devices with home or building automation platforms, including Google Home, Amazon Alexa, Apple HomeKit, IFTTT, Homey, and any API based platform. Users can also control RYSE SmartShades via its on-device buttons to open and close their shades to a set position. For RYSE SmartCurtain, users are able to tug the curtain fabric for manual-assisted control, activating the device to move the curtain.

With the RYSE SmartButton or Remote Control, users can control RYSE devices with a push of a button, rather than rely on a mobile app, or voice control – a more practical accessory for public settings such as offices or hotels.

In addition to our physical hardware devices, we are also developing an AI-powered software suite for the commercial real estate market, including offices, hotels, and senior housing, to be used in conjunction with our hardware. The software will integrate with building automation systems and control the window shades' position throughout the day, based on weather conditions, sensor data, and user preferences, in order to optimize occupant comfort, and energy savings. For example, the RYSE SmartShades will automatically lower window shades during hot and sunny summer weather, to block solar-heat-gain and reduce indoor cooling, as well as automatically open window shades during overcast weather to harvest natural daylight and reduce indoor artificial lighting, which market studies have reported a reduction of upwards of 20% in cooling (HVAC) loads, and 24% in lighting loads, reducing overall energy consumption in the building and GHG emissions.

**Manufacturing and Production Process**

We outsource the manufacturing of our hardware device to a contract manufacturer based in China, with a supplementary factory located in the Philippines that is available for us to expand production to if necessary.

Our products are shipped from China and stored in a third-party fulfillment (3PL) center. When a customer places an order via our website, our 3PL will receive the order details and is responsible for order processing, packaging, and shipping.

Similarly, if a customer purchases from Amazon, Amazon's warehouse will be responsible for the order processing.

**Customers and Sales**

Our products are sold primarily online via our website (www.helloryse.com). We also sell on Amazon, BestBuy.com, HomeDepot.com, and Lowes.com. Our products are available in over 100 BestBuy brick-and-mortar retail store locations across Canada.

Customers discover our products via the use of online advertisements, primarily on Facebook, Instagram, Amazon, and Google and the latter's ad network. We are able to target customers based on their profiles and customer demographics via Facebook and Instagram, showing them image and video advertisements of our products to promote product discovery and engagement. With respect to Amazon and Google, we target customers based on their search query, as an indication of intent to purchase. The majority of all historical sales has been driven via these online advertisement platforms.

Going forward, we have plans in place to begin selling and distributing into scalable sales channels, including retailers and dealers, including window covering dealers and smart home integrators. Our past wholesale customers include real estate developers such as Related and Presidio Bay.

**Traction**

RYSE has generated over USD$15 million in lifetime revenues, having shipped over 80,000 devices to-date. Sales have been predominantly generated online via direct-to-consumer sales. The company has considerable experience with New Product Introduction and manufacturing in China, ensuring robust quality control measures are implemented. Our innovation in the smart window coverings space has resulted in 10 patents granted by the United States Patent and Trademark Office ("USPTO"), with 4 additional patents pending. Our patents are also pending in Canada, EU, and China via the Patent Cooperation Treaty filing. The company also owns the registered trademark to "RYSE" within our industry.

RYSE launched and began shipping the RYSE SmartShade in Q4-2021, and the RYSE SmartCurtain in Q4-2024. The company expects to begin shipping their newest product, the RYSE SmartBlinds in H2-2026.

The company has raised over USD$15 million in funding through family & friends, retail investors, angel investors and institutions, in the form of direct equity investments or convertible notes. Notable investors include GlobalLive, and OPN, as well as angel investor Shawn Doughtery. Founder and CEO, Trung Pham, also appeared and pitched on the television show Dragons Den, which is the show that inspired Shark Tank – this can be viewed on Netflix (Season 13, Episode 6).

In 2019, the company was awarded a $3.67 million federal cleantech grant, an additional $183,000 bonus funding in 2020, and an additional $192,000 bonus funding for 2021 for a total of $4.05 million from Sustainable Development Technology Canada ("SDTC"). The funding for the initial award is disbursed over the course of 3 years and 4 milestones, while the bonus funding was immediately disbursed. The grant funding is to be used for the development the RYSE SmartShade, piloting the device and its associated software into 2 commercial office spaces and 1 hotel. The goal of this pilot is to measure the energy savings provided by shade automation as a proof-of-concept, with the goal to subsequently scale our technology into other commercial buildings worldwide. As of the end of 2024, the company has completed this project. In 2025, the Company received $367,545 which is related to the successful completion of the specified project.

**Market Opportunity**

The market for our products and technology can be separated into two segments: consumer residential and commercial buildings.

On the consumer front, the smart shades market is also a sub-category of the "smart home" market, a USD$127 billion global market (2024) with a 27% compound annual growth rate (CAGR) from 2025 to 2030. The large growth in the smart home space is driven by the adoption of smart speakers that have now become the foundation of the smart home, as they enable home owners to control different devices. Smart shades becomes a high priority after home owners have outfitted their homes first with smart speakers – being the central control – followed by security cameras, smart thermostats, and smart lighting. The smart shades market itself is in its infancy, currently a global USD$351 million market in 2023, yet expected to grow to USD$2.81 billion by 2033, a compound annual growth rate (CAGR) of 23.1%.<sup>1</sup> Note that the smart shade market is defined as "fully-autonomous", that can be automated on a schedule, sensor, or set of algorithms, which is a subsect of the larger traditional motorized or electric shades market, which require human interaction (e.g. a push of a button on a remote or wall switch).

Commercial buildings are motivated primarily by occupant comfort and energy savings - 30% of energy consumed in buildings is wasted; half of this energy is lost through windows. Additionally, windows are responsible for more solar heat gain than any other building surface. This all amounts to a USD$35 billion problem. The US Energy Information Administration reports (2018) that there are over 933,000 commercial buildings with a 'Building Automation System" (BAS) – software to automate core functions in the building to improve occupant comfort and reduce energy consumption. Of this, over 317,000 buildings have already implemented lighting automation control systems in conjunction with their BAS.

_____________________________

<sup>1</sup> Fact MR: Smart Shades Market

The smart home industry itself has also seen significant M&A activity and consolidation over the years, including Google acquiring Nest (makers of the Smart Thermostat) for USD$3.2 billion, Amazon acquiring Ring (makers of the video doorbell) for USD$1 billion, and Assa Abbloy acquiring August (makers of the Smart Doorlock). More recently, EcoBee was acquired by Generac for USD$770 million, and LG entered the smart home market via their acquisition of Homey.

The window covering industry has also seen some significant acquisitions, including Hunter Douglas, the largest global window covering company, being acquired by private equity firm 3G, at an enterprise value of USD$7 billion, and Spring Window Fashions, the second largest global window covering company, acquired by private equity firm Clearlake Capital Group. Springs also acquired B&C International, a large European window coverings company.<sup>2</sup> Somfy, the inventors of the tubular motor to motorize roller shades, also went private at a USD$6 billion valuation.

**Competitors and Industry**

We operate in a highly competitive "window covering" industry – products that can "cover" a window. Our main competitors include incumbent companies and alternative technologies to RYSE that consist of window covering solutions that primarily focus on managing solar heat gain ("SHG") and natural daylight. The goal of these technologies would be to block solar heat gain that will in turn lower indoor cooling loads on HVAC systems, as well as capture natural daylight in order to reduce indoor artificial lighting –optimizing both is proven to yield substantial energy savings of upwards of 20% and 24% respectively.<sup>3</sup> We compete with companies that produce mechanisms to retrofit window shades, those that sell motorized shades, and those that tint windows.

Our traditional competitors, which sell motorized blinds and shades, include Hunter Douglas, Somfy, Lutron, qMotion, Mechoshades, and IKEA. Consumers are required to purchase complete motorized window coverings; if consumers already have manual shades installed, they must dispose of their current shades and replace them with motorized shades. These solutions vary in price, largely driven by the selection of fabric and size of the window shade.

Indirect competitors includes alternatives to window coverings, such as smart tinting glass, or a film applied to the glass. 'Smart Glass' companies such as SageGlass or Kinestral, dominate this space, but command a premium price point of more than $130 per square foot, and traditionally target commercial applications such as AAA commercial office buildings, airports, airplanes, and cruise ships, always during pre-construction phases. An alternative to smart glass is a film applied to the window glass, offered by companies such as Smart Tint, Sonte, and InvisiShade, after-market solutions that cost more than $25 per square foot.

There are a handful of other companies in the retrofit smart shading space that emerged around or after the launch of our Indiegogo crowdfunding campaign in 2015, several of whom we believe are infringing on our intellectual property. These companies include Brunt, Soma, and Teptron. Although all three have a similar approach to shade automation – by controlling the window shade's beaded chain or corded loop – and share some similarities in appearance, there are significant differences in the underlying technology and distribution channels. Furthermore, Brunt and Teptron appear to have ceased the sales of their shade automation product, while Soma is limited to sales on their own website. None of these competitors offer their products for commercial applications nor, to the knowledge of the company, are looking to expand into commercial applications.

*Competitive Advantage*

We believe that the competitive advantage of our products is in their retrofit nature, able to motorize existing installed window coverings and provide shade automation at a more affordable price point than the alternative solutions. Our devices are designed to be 'one-size-fits-all' that can be readily mass produced and distributed. This is an important distinction from our competitors, who require all sales and installations to be custom jobs and time-consuming, which adds unnecessary overhead and costs.

_____________________________

<sup>2</sup> Yahoo Finance

<sup>3</sup> SunProject: The Impact of Shading and Lighting Control on Energy Demand

RYSE is not only a disruptive product, but is building a defensible competitive advantage via its distribution channels. RYSE is also able to sell through non-traditional distribution channels, such as big box retail and ecommerce, simplifying the entire purchase process. The sales process for our competitors typically requires window sizes to be measured, and a price quoted for product and installation. For example, a customer who purchases motorized shades will typically go to a dealer, who will then provide a quote based on the fabric selected and the size of the windows. This information is then sent to the fabricator who must source the fabric and tubular motors from suppliers, and then assemble the motorize shade for the customer. The process from window measurement to design choices to fabrication, to shipping, to installation, can add significant lead times and costs. By design, RYSE makes both the purchase process and installation incredibly simple: customers can simply buy online and, as a do-it-yourself product, install our device in minutes.

Lastly our patents have allowed us to successfully remove products that infringe our patents off Amazon, through the Amazon APEX program (formally known as the Amazon Patent Neutrality Program), thereby mitigating the prospect of future competition. In Amazon.com's Brand Registry, we identify which products/companies are infringing on our patent with our US patent number, and our Amazon court case docket number that serves as a precedent, issued to us when we won our first Amazon APEX judgements. By doing this, Amazon will defer to our previous court judgement and immediately remove these products that infringe our patents. The products are delisted almost immediately. This is the regular process used by Amazon to deal with such disputes.

**Subsidiaries**

<br> The company has a U.S. sales subsidiary, **RYSE USA Inc.**, incorporated in Delaware. A transfer pricing agreement is in place that defines its relationship with **RYSE INC.**, the Canadian parent company. Under this arrangement, RYSE USA Inc. operates as the sales entity and records all sales, both domestic and international. The Company also had established other subsidiaries:

AXIS Intelligent Products (China WFOE) is inactive and was incorporated on January 15, 2016, under the laws of China.

RYSE GBP Ltd. was incorporated on October 9, 2024, under the *Companies Act* 2006. The registered office of the subsidiary is at 27 Old Gloucester St., Holborn, London, United Kingdom. This entity was dissolved on March 17, 2026.

**Intellectual Property**

The company currently has 10 granted patents issued by the USPTO, and 4 patents pending, as well as a trademark issued under "RYSE". The company also has one issued patent in China, and 3 patents pending; 2 patent issued in Europe, and 3 patents pending; and 2 patents in Canada.

**Employees**

The company currently has 24 full-time employees.

**Legal Proceedings**

From time to time, we may be involved in litigation or other legal proceedings incidental to our business. We are not currently a party to any litigation the outcome of which, if determined adversely to us, would individually or in the aggregate be reasonably expected to have a material adverse effect on our business, operating results, cash flows or financial condition.

**Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations**

***You should read the following discussion and analysis of our financial condition and results of our operations together with our financial statements and related notes appearing in Item 7 of this Annual Report. This discussion contains forward-looking statements reflecting our current expectations that involve risks and uncertainties. Actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors discussed elsewhere in this Annual Report.***

 ****

RYSE Inc. was incorporated on May 6, 2009 in Ontario, Canada as ETAPA Window Fashions and began operations on January 1, 2015. The Company changed its legal name to AXIS Labs Inc. on January 15, 2016 and changed its legal name to RYSE Inc. on August 28, 2020. The Company has a Delaware subsidiary RYSE USA Inc., responsible for all global sales and marketing activities of its products.

**Results of Operations**

***Year ended December 31, 2025 compared to year ended December 31, 2024***

***Revenues and Cost of Sales***

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| | | | | |
|:---|:---|:---|:---|:---|
| **All figures in Canadian dollars** | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** | **Year ended December 31** |
|  | **2025** | **2025** | **2024** | **2024** |
| Revenues | $| 3568693 | $| 2449083 |
| Cost of Sales |  | 1618756 |  | 1673751 |
| Gross Margin | $| 1949937 | $| 775332 |
| Gross Margin % |  | 54.6% |  | 31.7% |

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***Revenues***

Revenues for the year ended December 31, 2025 increased $1,119,610 to $3,568,693 compared to the revenues for the year ended December 31, 2024 of $2,449,083. The 45% increase in 2025 revenue was due to the company executing a stronger promotional campaigns compared to prior years, an increase in advertising, as well as the availability of inventory to sell compared to the previous year that had periods of stock outs.

***Cost of Sales***

Gross margin as a percent of sales rose to 54.6% in 2025 from 31.7% in 2024. This was due to the increase in promotional campaigns in 2024, which discounted the sales price, leading to a higher cost of sales as a percentage of revenue, and lower margin.

Inventory costs decreased from $1,673,751 for the year ended December 31, 2024 to the current year ended December 31, 2025 of $1,618,756 as the product costs in 2024 also include write-down of obsolete inventory during the year.

***Operating Expenses***

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| | | |
|:---|:---|:---|
| **All figures in Canadian dollars** | **Year ended December 31** | **Year ended December 31** |
|  | **2025** | **2024** |
| Operating Expenses | $8531142 | $7282351 |

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Operating expenses consist of salaries and benefits, advertising and promotion, research and development, freight and shipping, occupancy, office and general expenses.

Operating expenses increased in 2025 by $1,248,791 or 17% as compared to 2024. The increase is mainly driven by the increase in advertising and promotion expense which increased to $2,721,697 (2024 - $1,543,277) during the year to drive additional sales. Research and development also increased to $1,037,105 (2024 - $502,023) due to an increase in the number of products the company was developing over the year.

***Other Income and Expenses***

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| | | |
|:---|:---|:---|
| **All figures in Canadian dollars** | | |
|  | **2025** | **2024** |
| License fee | $3289440 | $– |
| Finance expense | $(2486663) | $(2092868) |
| Gain on warrants fair value adjustment | $1581340 | $49666 |
| Government grant income | $502539 | $175114 |
| Service fee | $41119 | $– |
| Royalty income | $23337 | $– |
| Interest income | $8005 | $107 |
| Forgiveness of government loan | $– | $43949 |
| Foreign exchange gain (loss) | $46266 | $(70154) |

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***License fee, service fee, royalty income***

 ****

In 2025, the Company entered into intellectual property license, distribution, service, and financing agreements with a newly incorporated related entity under common control. This funding was utilized to facilitate initial capital expenditures and operational cash flow needs. Total license, service, and royalty income for the year ended December 31, 2025 is $3,289,440, $41,119, and $23,337, respectively.

 **

***Finance expense***

 **

The Company's interest expense increased by $393,795 in 2025 as compared to 2024 as the Company has received additional net $4,733,984 of term loan and notes payable; and invested heavily into activities related to the Company operations.

 ****

***Government grant income***

The grant income increased to $502,538 during the year ending December 31, 2025, compared to $175,114 in 2024, which is mainly due to the receipt of $367,545 from SDTC, which is related to the successful completion of the project.

***Gain on warrants fair value adjustment***

The Company's warrants need to be valued at fair value under IFRS. The fair value of the warrants increased in 2025 from warrants revaluation, resulting in a gain of $1,581,340.

***Forgiveness of government loan***

 ****

During the year ended December 31, 2024, CEBA loan of $43,949 was forgiven and fully paid off.

 ****

***Foreign exchange gain (loss)***

The Company's financial instruments have been predominantly denominated in Canadian dollars $. As a result, we have minimal foreign currency balances and our foreign currency gains and losses have approximated only 10% of revenues. While we have sales of products in multiple countries, the time lag between sale and collection is relatively short, reducing our exposure to currency gains and losses.

***Loss for the Year***

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| | | |
|:---|:---|:---|
| **All figures in Canadian dollars** | **Year ended December 31** | **Year ended December 31** |
|  | **2025** | **2024** |
| Loss from operations | $6078666 | $6331905 |
| Comprehensive loss | $2965512 | $8848651 |

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Our loss from operations decreased by $253,239 or 4.0% from 2024 to 2025, as the gross margin was improved by an increase in sales, while minimizing the cost of goods sold.

Our total comprehensive loss was $8,848,651 in 2024 and decreased to $2,965,512 in 2025 due to an increase in gross margin during 2025 as well as the income earned from the intellectual property license and services agreements with a newly incorporated related entity under common control.

**Liquidity and Capital Resources** 

At December 31, 2025 the Company's cash and cash equivalents was $323,974 and its current liabilities were $17,380,495. The Company is generating limited revenues and requires the continued infusion of new capital to continue business operations. The Company has recorded losses since inception. The Company is reliant on the proceeds of its Regulation A offering, qualified by the SEC on September 19, 2025 to fund its continued operation. As of April 1, 2026, the Company had raised approximately USD$2,539,216 from such offering. It has raised approximately $12.6M from its previous Regulation A offering. The Company does not have current material capital commitments.

*Cash Flow*

The following table summarizes, for the periods indicated, selected items in our Statements of Cash Flows:

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| | | |
|:---|:---|:---|
|  | **Year ended December 31** | **Year ended December 31** |
|  | **2025** | **2024** |
| Net cash (used in) provided by: |  |  |
| Operating activities | $(4409827) | $(8396853) |
| Investing activities | $(40865) | $(179270) |
| Financing activities | $4377028 | $8721059 |

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***Cash used in Operating Activities***

We experienced negative cash flows from operations in the years ended December 31, 2025 of $4,409,827 compared to negative cash flow from operations of $8,396,853 in the year ended December 31, 2024.

The net cash used in operations in 2025 was used primarily to fund our net loss of $3,575,822. Our net loss for 2025 was $3,575,822 down from $8,401,205, in 2024, which can be attributed to higher profit margin during the year and revenue recognition of our licensing fees. Our operating loss for 2025 was $6,078,666, decreased from a loss of $6,331,905 in 2024.

***Cash Provided by Financing Activities***

 ****

The Company has financed its operations through the issuance of equity, advances and loans.

***Cash Used in Investing Activities***

Our operations require minimal investment in capital assets or intangible assets. Our total purchases of these items were $40,865 and $179,270 in 2025 and 2024, respectively.

***Off-Balance Sheet Arrangements***

We have no off-balance sheet arrangements, including arrangements that would affect the liquidity, capital resources, market risk support, and credit risk support or other benefits.

**Issuance of Equity Securities**

On December 28, 2020, the company filed an Offering Statement under Regulation A with the Commission. The Offering Statement was qualified on February 22, 2021. The company offered a maximum of 2,104,718 Class B Common Shares at USD$7.13 per share (the "2021 Regulation A Offering"). During the year ended December 31, 2021, the company sold 50,089 Class B Common shares for proceeds of $357,134. In addition, the company sold 17,142 shares at $9.48 per share, for proceeds of $162,506 during the same period in a concurrent private placement in Canada (the "Canadian Offering"). Share issuance costs directly attributable to the issuance of Class B Common shares totaled USD$54,666. The 2021 Regulation A Offering terminated on February 22, 2022.

On May 8, 2022, the company amended its Articles of Incorporation to subdivide and split the shares in the capital of the company on the basis of ten (10) shares for every one (1) share held. The share split resulted to a change in the 2021 Regulation A Offering from a maximum of 2,104,718 Class B Common Shares at USD$7.13 per share to a maximum of 21,047,180 Class B Common Shares at USD$0.713 per share, which means shares sold in the 2021 Regulation A Offering were effectively sold at USD$0.713 per share on a post-split basis.

On May 10, 2022, the company filed an Offering Statement under Regulation A with the Commission. The Offering Statement was qualified on July 27, 2022. The company offered a maximum of 25,000,000 Class B Common Shares at USD$1.00 per share.

During the year ended December 31, 2022, the company sold 339,451 Class B Common shares for proceeds of USD$339,451, under the July 27, 2022 Offering Statement. In addition, the company sold 141,770 shares at USD$1.00 per share, for proceeds of USD$141,770 during the same period in a concurrent private placement in Canada.

During the year ended December 31, 2022, the company issued 280,270 Class B common shares at USD$0.713 per share, for proceeds of USD$134,260 and $100,000 under Regulation D and a private placement in Canada.

During the year ended December 31, 2023, the Company issued 1,053,768 Class B Common Shares at USD$1.00 per share, for proceeds of USD$1,053,768 in the 2022 Regulation A Offering. In addition, the Company sold 229,850 shares at USD$1.00 per share, for proceeds of USD$229,850 during the same period in a concurrent private placement in Canada.

On August 23, 2023, the Company filed an amendment to the Offering Statement under Regulation A with the SEC, which was qualified on August 31, 2023 (the "2023 Offering Statement"). The Company is offering a maximum of 20,000,000 Class B Common Shares at USD$1.25 per share.

During the year ended December 31, 2023, the Company issued 1,190,391 Class B Common Shares (including bonus shares) at USD$1.25 per share, for proceeds of USD$1,394,302 under the 2023 Offering Statement. In addition, the Company sold 196,093 shares (including bonus shares) at USD$1.25 per share, for proceeds of USD$240,778 during the same period in a concurrent private placement in Canada. A total of 77,621 bonus shares were issued during the year 2023.

During the year ended December 31, 2023, the Company issued 2,347,253 Class B Common shares at USD$0.713 per share, for proceeds of USD$578,000 and USD$1,500,000 under Regulation D and a private placement in Canada.

During the year ended December 31, 2024, the Company issued 121,400 Class B Common Shares to pay of the remaining balance of certain notes payables amounting to $153,603.

During the year ended December 31, 2024, the Company issued 6,000 Class B Common Shares at a price of USD$1.00 per share, generating proceeds of USD$6,000.

In addition, the Company issued 52,600 Class B Common Shares, including bonus shares, at a price of USD$1.25 per share, generating proceeds of USD$25,000.

Additionally, the Company issued 2,181,494 Class B Common Shares, including bonus shares, at a price of USD$1.50 per share for total proceeds of USD$3,055,700.

Furthermore, the Company issued 1,032,628 Class B Common Shares, at a price of USD$1.75 per share. including bonus shares, in exchange for consideration totaling USD$1,671,415.

During the year ended December 31, 2025, the Company cancelled 73,225 Class A Common Shares and 42,080 Class B common shares amounting to $91,933.

During the year ended December 31, 2025, the Company issued 225,632 Class B Common Shares to pay off the remaining balance of certain notes payables amounting to $329,814.

During the year ended December 31, 2025, the Company issued 359,222 Class B Common Shares at a price of USD$1.00 per share, generating proceeds of USD$359,222.

In addition, the Company issued 2,400 Class B Common Shares, including bonus shares, at a price of USD$1.25 per share, generating proceeds of USD$3,000.

Additionally, the Company issued 35,893 Class B Common Shares, including bonus shares, at a price of USD$1.75 per share, generating proceeds of USD$54,812.

Furthermore, the Company issued 783,324 Class B Common Shares, including bonus shares, at a price of USD$1.90 per share, generating proceeds of USD$1,382,921.

Also, the Company issued 622,514 Class B Common Shares, including bonus shares, at a price of USD$2.00 per share, generating proceeds of USD$1,123,978.

Finally, the Company issued 301,907 Class B Common Shares, including bonus shares, at a price of USD$2.25 per share, generating proceeds of USD$586,010.

The total share issuance cost for the year ended December 31, 2025 is $1,685,673 (2024 - $2,138,588).

**Indebtedness**

*Term Debts without warrants*

The Company received a series of loans from the CEO's father, totaling $270,000 in 2021 (Note 22). These loans are unsecured and carry a 10% simple interest, paid semi-annually, with a 12-month maturity and option to renew. The option to renew has been exercised by both parties through 2025. Total accrued interest for 2025 is $27,000 (2024 - $27,000). Total interest payment during 2025 is $30,000 (2024 - $10,000). Total outstanding accrued interest for 2025 is $76,500 (2024 - $79,500).

The Company received a series of loans from third parties, totaling $300,000 from 2019 and 2022. These loans are unsecured and has no interests. During the year ended December 31, 2025, the Company repaid $150,000 (2024 - $20,000). The balance is fully repaid during 2025.

During 2021, the Company borrowed USD $192,815 under a promissory note. The repayment amount is two times the amount of the loan and repayments begin quarterly beginning December 22, 2022. The amount of each quarterly repayment will be 10% of the revenue earned by the Company in the quarter immediately preceding the repayment, and quarterly repayments will continue until the loan is repaid in full. During 2022, the Company borrowed an additional $145,669 under a promissory note with the same terms and condition as the original note. During the period ended December 31, 2025, the Company repaid $108,526 (2024 - $55,208).

During 2022, the Company borrowed $1,150,000 from third parties, with a 12-month maturity and the option to renew. These loans are unsecured and carry 16-18% simple interest. The option to renew has been exercised by the lenders through 2025. During the year ended December 31, 2025, the Company repaid $Nil (2024 - $220,000).

On December 6, 2024, the Company entered into a $270,118 USD financing agreement with the consignor. This consignment agreement allows the Company to expand its sales partner with expanded consignment opportunity. The loan is secured by a lien on consignment inventory. The agreement permits the lender to expand the collateral to include all Company assets, if payment defaults exceed $50,000 cumulatively or any payment remains overdue by 30+ days. During the year ended December 31, 2025, the Company received $298,428 and repaid $500,008 (2024 - $nil).

On April 29, 2025, the Company entered into a $319,000 USD financing agreement, including fees. During the period ended December 31, 2025, the Company repaid $423,467.

During December 31, 2025, the Company received a total of $437,221 and repaid $912,084. During December 31, 2024, the Company received a total of $388,673 and repaid $316,320.

 

 

 

 

*Term loans issued with warrants*

On May 2, 2018, the Company borrowed $1,119,750 and $400,000 USD repayable on April 30, 2021 from various lenders. Interest is calculated and payable monthly at a rate of 1.41667% per month. As part of the issuance of the term loans, the lenders received warrants (Note 15).

Under IAS 32 Financial Instruments: Disclosure and Presentation: The proceeds of the term loans were allocated between the term loan principle, and the warrants, based on the relative fair values of the two instruments. This resulted in $1,349,131 being allocated to term loans and $282,965 being allocated to warrants. The warrants are classified as a liability in accordance with IAS 32 since the amount of shares to be received upon exercise is not a fixed amount. These warrants are subsequently remeasured at their fair value each reporting period.

The loans are secured by a general security agreement over the assets of the Company and personal security from a shareholder for 30% of the principal amount.

During 2022, portion of term loans issued with warrants has extended the maturity date to June 30, 2024. During the year ended December 31, 2024, portion of the term loans issued with warrants were further extended to April 30, 2026. During December 31, 2025, the Company received a total of nil and repaid $491,288 (2024 - $787,832). The other movements in this loan pertains to fees and foreign exchange revaluation.

All interest and fees associated with the above term loans have been recorded through other interest and charges. Total non-cash interest (income)/expense in 2025 is $9,603 (2024 - $50,971).

*Notes payable*

 

During 2023, the company's wholly-owned subsidiary, RYSE USA Inc. issued a series of promissory notes from existing equity investors. The promissory notes hold interest rates ranging from 16% to 18%. As of the date of this Annual Report, the subsidiary has issued $7,510,878 in principal amount of notes.

During 2025 (2024), the Company received $6,962,731 (2024 - $5,543,876) and repaid $808,206 (2024 - $395,537) from promissory notes without conversion features issued by RYSE USA, Inc. which shall be due and payable in twelve (12) months after the effective date of the note. The interest rate is equal to eighteen percent (18%) per annum which shall be payable on a monthly basis. The other movements in this account pertains to foreign exchange revaluation.

During the year ended December 31, 2025, notes payable amounting to $329,814 was repaid in exchange for 225,632 Common B shares. During the year ended December 31, 2024, notes payable amounting to $217,809 was paid in exchange for 121,400 Common B shares.

*Convertible Notes payable*

 

During 2023, the company issued a series of convertible securities for total principal amount of $400,000. The notes accrue 15-18% per annum and are payable 12 months from the date of issuance. The option to renew has been exercised by both parties through 2025.

For the year ended December 31, 2024, the Company issued additional convertible debentures amounting to $27,000 with stated interest rates of 15% per annum. However, these debentures are short-term in nature and are due and payable 12 months from the date of issuance of the Note.

For the year ended December 31, 2025, the Company issued additional convertible debentures amounting to $284,992 with stated interest rates of 16% per annum. However, these debentures are short-term in nature and are due and payable 12 months from the date of issuance of the Note. The notes include a conversion feature.

*Advances*

 

The Company entered into various agreements with a lender and received $208,874 (USD$165,600) in 2021 with similar repayment terms. During the year, the Company received $559,105 (2024 - $631,372) and repaid $707,070 (2024 -$303,146). The other movements in this advance pertains to foreign exchange revaluation.

On January 7, 2021, the Company entered into an agreement and received $49,463 (USD$39,000) from an entity affiliated with a channel partner. Repayment of the amount advanced plus $7,984 ($6,295 USD) was made by transferring 30% of payments from the channel partner to the affiliated entity. During the year, the Company received $85,962 (2024 - $39,224) and repaid $62,738 (2024 - $39,411).

On May 7, 2024, the Company entered into a new agreement and received $55,000 from a financing company. On October 10, 2024, the Company entered into another agreement and received $65,000. Repayment of the amount advanced is to be repaid made through weekly payment according to pre-determined schedule. The advance carries an effective interest rate of 10% per annum. During the year, the Company received $132,500 (2024 - $120,000) and repaid $144,291 (2024 - $80,749).

On March 17, 2025, the Company entered into an agreement with an affiliated sales channel partner and received $132,787 ($95,000 USD). The advance carries an effective interest rate of 14.95% per annum. During the year, the Company received $132,787 and repaid $53,228 (2024 - $Nil).

*Shareholder Loan*

 

The company's CEO holds a Shareholders' Loan balance to the company for $3,775,884 as of December 31, 2025 and $3,759,537 as of December 31, 2024.

The company's total liabilities increased by $2,705,370 from $20,623,815 in 2024 to $23,329,185 in 2025.

**Plan of Operations**

We plan on continuing operating in a similar fashion as we have in the past, with investments into R&D, increase in staff, and ongoing sales via ecommerce, with increased focus on selling through B2B sales channels to real estate developers and landlords, brick-and-mortar retailers, window covering dealers, and through smart home, telecommunication, and security system integrators. The company has adopted a flexible hybrid office structure, mandating in-office attendance two days a week, specifically on Tuesdays and Thursdays, while permitting employees to work remotely for the remaining three days. The company also employs full-time contractors internationally, in Europe, India, China, the Philippines and South Africa for engineering and administrative roles.

**Trend Information**

We expect the residential market to continue to adopt smart home and home improvement technologies that can be attributed to the large adoption of voice speakers and DIY smart home platforms such as Google Home, Amazon Alexa, and Apple HomeKit. This trend is further strengthened by the push towards a unified radio communication protocol, known as "Matter", being promoted by Google, Amazon, and Apple, in order to reduce interoperability issues among devices and platforms.

We expect the commercial buildings market, which includes multi-family, offices, hotels, and senior housing, to adopt technology that will improve occupant comfort while reducing a building's energy consumption and GHG emissions. The US Climate Alliance is a bipartisan coalition of 25 states to reduce GHG emissions by at least 26-28% below 2005 levels, by 2025. The Alliance is led by state governments with the goals consistent with the Paris Agreement. Local and state regulations have also been introduced to target more aggressive GHG emissions targets. For example, New York City Local Law 97 stipulates that starting in 2024, buildings will be fined for not meeting carbon intensity targets, while California Title 24 (2019) requires daylighting controls in which automatically turn off lights when there is sufficient daylight, and the implementation of demand responsive lighting. Additional voluntary standards, such as LEED, WELL, and FitWel focus on both energy efficiency and occupant comfort. As such, we expect cost-effective retrofit solutions that are simple to deploy will increase in adoption, particularly those solutions that can lead to tangible ROI in the reduction of energy costs, and lower payback periods, such as that of RYSE.

The Company experiences common cyclical and seasonal sales that coincide with peaks during summer, and during sale periods (i.e. Black Friday in November, and Christmas holidays), with lower periods during Q1. Being a consumer electronic device to manage indoor comfort and heating, consumers become more receptive to our type of products and solutions during the summer periods.

The Company's contract manufacturing partner based in China has a factory located in both China as well as the Philippines. The factory in the Philippines was constructed in response to the increased tariffs of 25% levied on a select category of Chinese goods that are imported into the U.S., implemented in 2018. U.S. tariffs on Chinese goods further increased to 35% in 2025. As such, the company has the flexibility to move production to the Philippines where U.S. tariffs are set at 19%, reducing tariff risks and uncertainty, as U.S. tariffs on goods produced in the Philippines is currently set to 19%. This decreases our risk to global trade wars that could occur.

**Item 3. Directors, Executive Officers and Significant Employees**

Our directors are elected by our shareholders and our officers are appointed by our directors. The company's officers and directors as of December 31, 2025 are as follows:

---

| | | | |
|:---|:---|:---|:---|
| **Name** | **Position** | **Age** | **Term of Office** |
| **Executive Officers** | **Executive Officers** | **Executive Officers** | **Executive Officers** |
| Trung Pham | Chief Executive Officer | 38 | 2009-Present |
| Marc Bishara | Chief Technology Officer | 36 | 2015-Present |
| **Directors** | **Directors** | **Directors** | **Directors** |
| Trung Pham | Director | 38 | 2015-Present |

---

**Trung Pham (CEO and Director)**

Trung is a serial entrepreneur, with RYSE being his second venture. He has served as founder and CEO of RYSE since it commenced operations in 2015, leading strategy, hiring, and fundraising effort, where he has raised over $6 million in external financing (both debt and equity). His first startup, Nightlife Passport, is an event and promotions management web platform that allows nightclub and concert promoters to create events to sell tickets and manage their team. At Nightlife Passport, Trung focused on business development, and grew revenues to over $125,000 in recurring revenue within the first 12 months of operations. Nightlife Passport merged with a mobile-first player, Alfiee. Trung has a background in finance, completing all 3 Chartered Financial Analyst (CFA) exams within 18 months. He earned a Bachelor of Business Administration from York University's Schulich School of Business in 2009.

**Marc Bishara (CTO)**

Marc is a resilient engineer who loves solving exciting problems. Marc has served as RYSE's Chief Technology Officer since its inception in 2015, leading the development and launch of its entire hardware devices, and mobile applications. He has both corporate and start-up experience, first with ATS Automation as a vision engineer, where he designed optical systems and computer hardware for image processing applications. His first dive into the startup world was with Kiwi Wearables (www.kiwi.ai), where he was responsible for designing the firmware and application for their Bluetooth wearable product "Glance" – an application that tracks the orientation and displacement of Glance in 3D space. His skillsets intersect software, hardware, and embedded systems. Marc earned a Bachelor of Engineering in Mechatronics from McMaster University in 2014.

**Board Committees**

We have not established an audit committee, compensation committee, or nominating committee.

**Family Relationships**

There are no familial relationships between any of our officers and directors.

**Director or Officer Involvement in Certain Legal Proceedings**

Our current directors and executive officers have not at any time in the past five (5) years been convicted in a criminal proceeding (excluding traffic violations and other minor offenses) and no petition under the federal bankruptcy laws or any state insolvency law was filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of any such officers or directors, or any partnership in which they were a general partner at or within two years before the time of such filing, or any corporation or business association of which he was an executive officer at or within two years before the time of such filing.

**Code of Ethics**

We have not adopted any specific Code of Ethics.

**Compensation of Directors and Executive Officers**

For the fiscal year ended December 31, 2025 we compensated our highest-paid directors and executive officers as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Name** | **Capacities in which compensation was received** | **Cash compensation**<br> **($)** | **Other compensation**<br> **($)** | **Total compensation**<br> **($)** |
| Trung Pham\* | CEO | $39206 | $0 | $39206 |
| Marc Bishara\*\* | CTO | $122535 | $0 | $122535 |

---

\* The executive was paid an annual cash compensation of $80,000, converted at the rate of $1.00 = CAD$1.39

\*\* The executive was paid an annual cash compensation of $120,000, converted at the rate of $1.00 = CAD$1.39

**Item 4. Security Ownership of Management and Certain Securityholders**

As of December 31, 2025, there are 35,499,226 Class A Common Shares and 14,624,950 Class B Common Shares outstanding. The following table sets out, as of December 31, 2025 the securities of the company that are owned by executive officers and directors, and other persons holding more than 10% of any class of the company's securities, or having the right to acquire those securities.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Title of class** | **Name and address of beneficial owner\*\*** | **Amount and nature of beneficial ownership** | **Amount and nature of beneficial ownership acquirable** | **Percent of class** | **Total Voting Power** |
| Class A Common Shares | Trung Pham | 21000000 \* |  | 59.16% | 100% |
| Class A Common Shares | Officers and directors as a group | 21000000 |  | 59.16% | 100% |
| Class B Common Shares | Marc Bishara |  | 2442880 | 16.70% |  |
| Class B Common Shares | Officers and directors as a group |  | 2442880 | 16.70% |  |

---

\* Pursuant to the voting trust agreement by and among the holders of Class A Common Shares, Founder Trung Pham was granted a proxy to vote the shares of the other holders.

\*\* The address for all listed persons is the company's address, 20 Camden St, Suite 200, Toronto, ON, M5V 1V1, Canada.

**Item 5. Interest of Management and Others in Certain Transactions**

Except as described above and within the section entitled Executive Compensation of this Offering Circular, none of the following parties (each a "Related Party") has, in our fiscal years ended 2025 and 2024 had any material interest, direct or indirect, in any transaction with us or in any presently proposed transaction that has or will materially affect us:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· any of our directors or officers;

· any nominee for election as a director;

· any person who beneficially owns, directly or indirectly, shares carrying more than 10% of the voting rights attached to our outstanding shares of common stock; or

· any member of the immediate family (including spouse, parents, children, siblings and in- laws) of any of the above persons.

The company received a series of loans from the CEO's father, totaling $270,000 as of December 31, 2021 and December 31, 2022. These loans are unsecured, and carry a 10% simple interest, paid semi-annually, with a 12 month maturity and option to renew. The option to renew has been exercised by both parties through 2025.

The company's CEO holds a Shareholders' Loan balance to the company for $3,775,884 as of December 31, 2025 and $3,759,537 as of December 31, 2024. The balances due to shareholders are unsecured, non-interest bearing, with no specific terms of repayment.

**Item 6. Other Information**

None.

**Item 7. Financial Statements**

**Ryse Inc. (formerly Axis Labs Inc.)**

**Consolidated Financial Statements**

**For the years ended December 31, 2025 and 2024**

**<u>Contents</u>**

---

| | |
|:---|:---|
| **[Independent Auditors' Report](#a_001)** | **18-19** |
| **Consolidated Financial Statements** |  |
| [Consolidated Statements of Financial Position](#a_002) | **20** |
| [Consolidated Statements of Comprehensive Loss](#a_003) | **21** |
| [Consolidated Statements of Changes in Shareholders' Deficit](#a_004) | **22** |
| [Consolidated Statements of Cash Flows](#a_005) | **23** |
| [Notes to Consolidated Financial Statements](#a_006) | **24-56** |

---

**Goldstein & Loggia**

---

| | |
|:---|:---|
| ![](image_003.jpg) **CPA's, LLC** | |
|  | AARON GOLDSTEIN, CPA |
| 707 TENNENT ROAD, | RALPH LOGGIA, CPA |
| MANALAPAN, NEW JERSEY 07726 | DAVID LEWIS, CPA |
| WWW.AGCPASERVICES.COM |  |
| TELEPHONE: (732) 617-7004 |  |
| FAX: (848) 233-9452 |  |

---

**INDEPENDENT AUDITORS' REPORT**

To the Shareholders of Ryse Inc.

Toronto, Ontario

**Opinion**

We have audited the accompanying consolidated financial statements of Ryse Inc. and subsidiaries (the "Company"), which comprise the Consolidated Statements of Financial Position as of December 31, 2025 and December 31, 2024, and the related Consolidated Statements of Comprehensive Loss, Changes in Shareholders' Deficit, and Cash Flows for the years then ended, and the related notes to the consolidated financial statements.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and December 31, 2024, and the results of its operations and its cash flows for the years then ended in accordance with IFRS Accounting Standards issued by the International Accounting Standards Board.

**Basis for Opinion**

We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the *Auditors' Responsibilities for the Audit of the Consolidated Financial Statements* section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

**Substantial Doubt About the Company's Ability to Continue as a Going Concern**

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company has experienced recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Our opinion is not modified with respect to this matter.

**Responsibilities of Management for the Consolidated Financial Statements**

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS Accounting Standards, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern within one year after the date that the consolidated financial statements are available to be issued.

**Auditor's Responsibilities for the Audit of the Consolidated Financial Statements**

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and, therefore, is not a guarantee that an audit conducted in accordance with generally accepted auditing standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the consolidated financial statements.

In performing an audit in accordance with generally accepted auditing standards, we:

&nbsp;&nbsp;&nbsp;&nbsp;· Exercise professional judgment and maintain professional
skepticism throughout the audit.

&nbsp;&nbsp;&nbsp;&nbsp;· Identify and assess the risks of material misstatement
of the consolidated financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks.
Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

&nbsp;&nbsp;&nbsp;&nbsp;· Obtain an understanding of internal control relevant
to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the Company's internal control. Accordingly, no such opinion is expressed.

&nbsp;&nbsp;&nbsp;&nbsp;· Evaluate the appropriateness of accounting policies
used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the
consolidated financial statements.

&nbsp;&nbsp;&nbsp;&nbsp;· Conclude whether, in our judgment, there are
conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going
concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.

Goldstein & Loggia CPA's, LLC

April 30, 2026

**Ryse Inc.**

**Consolidated Statements of Financial Position**

**All figures in Canadian dollars**

---

| | | |
|:---|:---|:---|
| **December 31** | **2025** | **2024** |
| **Assets** |  |  |
| Current |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $323974 | $397638 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts and accrued receivables (Note 5) | 181384 | 495165 |
| &nbsp;&nbsp;&nbsp;&nbsp;Inventory (Note 7) | 1221084 | 1393062 |
| &nbsp;&nbsp;&nbsp;&nbsp;Prepaid inventory (Note 7) | 387344 | 93176 |
| &nbsp;&nbsp;&nbsp;&nbsp;Investment tax credit receivable (Note 8) | 791637 | 403005 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 2905423 | 2782046 |
| Non-current |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Property and equipment, net (Note 9) | 931596 | 1223286 |
| &nbsp;&nbsp;&nbsp;&nbsp;Security Deposits (Note 26) | 70993 | 22736 |
| &nbsp;&nbsp;&nbsp;&nbsp;Due from related parties (Note 22) | 3457277 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Intangible assets, net (Note 10) | 282780 | 277505 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-current assets | 4742646 | 1523527 |
| Total assets | $7648069 | $4305573 |
| **Liabilities and Shareholders' Deficit** |  |  |
| Current |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Bank indebtedness | $7614 | $78068 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities (Note 11) | 1795765 | 1943632 |
| &nbsp;&nbsp;&nbsp;&nbsp;Advances (Note 12) | 331585 | 388627 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deferred government assistance income (Notes 6,17) | 236825 | 332504 |
| &nbsp;&nbsp;&nbsp;&nbsp;Term loans – current portion (Note 13) | 507882 | 639356 |
| &nbsp;&nbsp;&nbsp;&nbsp;Notes payable (Note 14) | 13220615 | 7510878 |
| &nbsp;&nbsp;&nbsp;&nbsp;Short-term fair-value of convertible notes (Note 14) | 684992 | 427000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Current portion of lease liabilities (Note 26) | 280227 | 240382 |
| &nbsp;&nbsp;&nbsp;&nbsp;Warrant liability (Note 15) | 119806 | 1675883 |
| &nbsp;&nbsp;&nbsp;&nbsp;Government loans – current portion (Note 17) | 195184 | 286465 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 17380495 | 13522795 |
| Non-current |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Due to shareholders (Note 16) | 3775884 | 3759537 |
| &nbsp;&nbsp;&nbsp;&nbsp;Lease liabilities (Note 26) | 620555 | 900841 |
| &nbsp;&nbsp;&nbsp;&nbsp;Government loans (Note 17) | 270751 | 314864 |
| &nbsp;&nbsp;&nbsp;&nbsp;Term loans (Note 13) | 1281500 | 2125779 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-current liabilities | 5948690 | 7101021 |
| Total liabilities | 23329185 | 20623816 |
| Shareholders' deficit |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Share capital (Note 18) | 22241870 | 19002452 |
| &nbsp;&nbsp;&nbsp;&nbsp;Contributed surplus (Note 19) | 3030096 | 2734797 |
| &nbsp;&nbsp;&nbsp;&nbsp;Warrants (Note 15) | 338123 | 270201 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cumulative translation adjustment | 79110 | (531200) |
| &nbsp;&nbsp;&nbsp;&nbsp;Accumulated deficit | (41370315) | (37794493) |
| Total shareholders' deficit | (15681116) | (16318243) |
| Total liabilities and shareholders' deficit | $7648069 | $4305573 |

---

 

*(See accompanying notes to consolidated financial statements*)

**Ryse Inc.**

**Consolidated Statements of Comprehensive Loss**

**All figures in Canadian dollars**

---

| | | |
|:---|:---|:---|
| **For the years ended December 31** | **2025** | **2024** |
| Sales | $3568693 | $2449083 |
| Product costs (Note 24) | 1618756 | 1673751 |
| Gross margin | 1949937 | 775332 |
| Government assistance income (Note 6) | 502539 | 175114 |
| Expenses |  |  |
| Operating expenses (Note 24) | 8531142 | 7282351 |
| Loss from operations | (6078666) | (6331905) |
| Other income (expense) |  |  |
| &nbsp;&nbsp;&nbsp;License fee (Note 22) | 3289440 |  |
| &nbsp;&nbsp;&nbsp;Finance expenses (Note 25) | (2486663) | (2092868) |
| &nbsp;&nbsp;&nbsp;Service fee (Note 22) | 41119 |  |
| &nbsp;&nbsp;&nbsp;Gain on warrants fair value adjustment (Note 15) | 1581340 | 49666 |
| &nbsp;&nbsp;&nbsp;Royalty income (Note 22) | 23337 |  |
| &nbsp;&nbsp;&nbsp;Interest income (Note 25) | 8005 | 107 |
| &nbsp;&nbsp;&nbsp;Forgiveness of government loan (Note 17) |  | 43949 |
| &nbsp;&nbsp;&nbsp;Foreign exchange gain (loss) | 46266 | (70154) |
| Total other income (expense) | 2502844 | (2069300) |
| Loss before income tax expense | (3575822) | (8401205) |
| Income tax expense | – | – |
| Net loss for the year | (3575822) | (8401205) |
| Translation adjustment | 610310 | (447446) |
| Comprehensive loss for the year | $(2965512) | $(8848651) |
| Basic loss per share | $(0.07) | $(0.19) |
| Diluted loss per share | $(0.07) | $(0.19) |
| Weighted - average common shares outstanding: |  |  |
| &nbsp;&nbsp;&nbsp;Basic | 50124176 | 44963955 |
| &nbsp;&nbsp;&nbsp;Diluted | 50124176 | 44963955 |

---

 

*(See accompanying notes to consolidated financial statements)*

**Ryse Inc.**

**Consolidated Statements of Changes in Shareholders' Deficit**

**All figures in Canadian dollars**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | Class A common shares | Class A common shares | Class B common shares | Class B common shares | | | | | |
|  | Number | Amount | Number | Amount |<br>Warrants | Contributed<br>surplus | Cumulative<br> translation<br>adjustment | Accumulated<br>deficit | Total<br> shareholders'<br>deficit |
| **December 31, 2023** | **35572451** | $**4965656** | **8942016** | $**9609598** | $**294761** | $**1960898** | $**(83754)** | $**(29393288)** | $**(12646129)** |
| Net loss for the year |  |  |  |  |  |  |  | (8401205) | (8401205) |
| Translation adjustment |  |  |  |  |  |  | (447446) |  | (447446) |
| Stock based compensation (Note 19) |  |  |  |  |  | 773899 |  |  | 773899 |
| Issuance of warrants through service (Note 15) |  |  |  |  | 25105 |  |  |  | 25105 |
| Revaluation of expired warrants (Note 15) |  |  |  |  | (49665) |  |  |  | (49665) |
| Issuance of shares on notes payable (Note 14) |  |  | 121400 | 217809 |  |  |  |  | 217809 |
| Shares issued (Note 18) |  |  | 3047827 | 6347977 |  |  |  |  | 6347977 |
| Bonus Shares |  |  | 224895 |  |  |  |  |  |  |
| Share issuance cost (Note 18) | – | – | – | (2138588) | – | – | – | – | (2138588) |
| **December 31, 2024** | **35572451** | $**4965656** | **12336138** | $**14036796** | $**270201** | $**2734797** | $**(531200)** | $**(37794493)** | $**(16318243)** |
| Net loss for the year |  |  |  |  |  |  |  | (3575822) | (3575822) |
| Translation adjustment |  |  |  |  |  |  | 610310 |  | 610310 |
| Stock based compensation (Note 19) |  |  |  |  |  | 295299 |  |  | 295299 |
| Issued capital shares through warrants (Note 15) |  |  | 11000 | 11000 | (1356) |  |  |  | 9644 |
| Revaluation of expired warrants (Note 15) |  |  |  |  | (25264) |  |  |  | (806) |
| Issuance of warrants through service (Note 15) |  |  |  |  | 94542 |  |  |  | 70084 |
| Issuance of shares on notes payable (Note 14) |  |  | 225632 | 329814 |  |  |  |  | 329814 |
| Shares issued (Note 18) |  |  | 1932246 | 4676210 |  |  |  |  | 4676210 |
| Bonus shares (Note 18) |  |  | 162014 |  |  |  |  |  |  |
| Cancellation of shares (Note 18) | (73225) | (50000) | (42080) | (41933) |  |  |  |  | (91933) |
| Share issuance cost (Note 18) | – | – | – | (1685673) | – | – | – | – | (1685673) |
| **December 31, 2025** | **35499226** | $**4915656** | **14624950** | $**17326214** | $**338123** | $**3030096** | $**79110** | $**(41370315)** | $**(15681116)** |

---

*(See accompanying notes to consolidated financial statements)*

**Ryse Inc.**

**Consolidated Statements of Cash Flows**

**All figures in Canadian dollars**

---

| | | |
|:---|:---|:---|
| **For the years ended December 31** | **2025** | **2024** |
| **Cash flows from operating activities** |  |  |
| &nbsp;&nbsp;&nbsp;Net loss for the year | $(3575822) | $(8401205) |
| &nbsp;&nbsp;&nbsp;Adjustments for non-cash items |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Government assistance income (Note 6) | (95679) | (175114) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation (Note 19) | 295299 | 773899 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accretion on government loans (Note 17) | 102000 | 117574 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash interest income (Note 13) | (9603) | (50971) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized foreign exchange loss | 497116 | (445378) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation of property and equipment (Note 9) | 312914 | 309803 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Issuance of warrants through services (Note 15) | 94542 | 25105 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on warrants fair value adjustment (Note 15) | (1581340) | (49665) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of intangible assets (Note 10) | 14366 | 14412 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Forgiveness of government loans (Note 17) |  | (43949) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Expected credit losses on accounts receivable (Note 5) |  | 1169 |
| &nbsp;&nbsp;&nbsp;Changes in working capital balances |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | 313781 | 39940 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory and prepaid inventory | (122191) | (854366) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment tax credit receivable | (388632) | (126005) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Security deposits | (48257) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank indebtedness | (70454) | 78068 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities | (147867) | 389830 |
| Net cash used in operating activities | (4409827) | (8396853) |
| **Cash flows from investing activities** |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of property and equipment (Notes 9 and 27) | (21224) | (171878) |
| &nbsp;&nbsp;&nbsp;Purchase of intangible assets (Note 10) | (19641) | (7392) |
| Net cash used in investing activities | (40865) | (179270) |
| **Cash flows from financing activities** |  |  |
| &nbsp;&nbsp;&nbsp;Net proceeds from issuance of notes payable | 6154525 | 5436305 |
| &nbsp;&nbsp;&nbsp;Issuance of shares, net of cancellation | 4566921 | 6347978 |
| &nbsp;&nbsp;&nbsp;Loan to related parties (Note 22) | (3457277) |  |
| &nbsp;&nbsp;&nbsp;Share issuance cost | (1685673) | (2138588) |
| &nbsp;&nbsp;&nbsp;Repayment of term loans | (1403372) | (1104152) |
| &nbsp;&nbsp;&nbsp;Proceeds from convertible notes (Note 14) | 284992 | 27000 |
| &nbsp;&nbsp;&nbsp;Proceeds from term loans (Note 13) | 437221 | 388673 |
| &nbsp;&nbsp;&nbsp;Repayment of lease liabilities (Note 26) | (240441) | (148960) |
| &nbsp;&nbsp;&nbsp;Repayment of government loans (Note 17) | (237394) | (98895) |
| &nbsp;&nbsp;&nbsp;(Repayment of)/proceeds from advances (Note 12) | (56972) | 331508 |
| &nbsp;&nbsp;&nbsp;Proceeds/(Repayment of) from due to shareholders | 14498 | (319810) |
| Net cash generated from financing activities | 4377028 | 8721059 |
| (Decrease)/increase in cash and cash equivalents during the period | (73664) | 144936 |
| Cash and cash equivalents, beginning of year | 397638 | 252702 |
| Cash and cash equivalents, end of year | $323974 | $397638 |

---

**Supplemental cash flow information (Note 27)**

*(See accompanying notes to consolidated financial statements)*

 

 

 

 

**Ryse Inc. (formerly Axis Labs Inc.)**

**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

**For the years ended December 31, 2025 and 2024**

**All figures in Canadian dollars**

 ****

**1.** **Nature of Business** 

Ryse Inc. (formerly Axis Labs Inc.) (the "Company") was incorporated on May 6, 2009, under the laws of the *Canada Business Corporations Act* (Ontario). The Company and its subsidiaries develop products called AXIS Gear and RYSE SmartShade, a smart device to help automate shades in homes. Consumers can control their shades with a tab on the AXIS Gear item itself or with their smartphone. The registered office of the Company is 20 Camden St., Suite 200, Toronto, Ontario. The Company owns 100% of its two subsidiary companies, AXIS Labs USA Inc. and AXIS Intelligent Products (China WFOE).

Ryse USA Inc. (formerly AXIS Labs USA Inc.) was incorporated on July 6, 2017, under the laws of the *Delaware General Corporation Law Act*. The registered office of the subsidiary is in the state of Delaware at 2035 Sunset Lake Road, Suite B-2, Newark, New Castle.

AXIS Intelligent Products (China WFOE) is inactive and was incorporated on January 15, 2016, under the laws of China.

A new subsidiary, RYSE GBP Ltd., was incorporated on October 9, 2024, under the *Companies Act 2006.* The registered office of the subsidiary was at 27 Old Gloucester St., Holborn, London, United Kingdom. This entity has been dissolved on March 17, 2026.

**2.** **Basis of Presentation and Going Concern Uncertainties** 

**Going Concern Uncertainties**

The Company reported a consolidated net loss of $3,575,822 for the year ended December 31, 2025 (December 31, 2024 - $8,401,205). As of December 31, 2025, the Company had a working capital deficiency of $14,475,071 (December 31, 2024 - $10,740,749) and an accumulated deficit of $41,370,315 (December 31, 2024 - $37,794,493).

The Company has experienced recurring losses and is dependent on its ability to raise additional funds to continue operations. These circumstances create material uncertainties that cast significant doubt as to the ability of the Company to continue as a going concern. The Company is actively pursuing additional financing to further develop certain of the Company's scientific initiatives, but there is no assurance these initiatives will be successful, timely, or sufficient. Consequently, the Company's ability to continue as a going concern is dependent on its ability to secure additional financing.

These consolidated financial statements have been prepared on a going concern basis, which assumes that the future operations will allow for the realization of assets and the discharge of liabilities in the normal course of business. These consolidated financial statements do not include any adjustments to the carrying value and classification of assets and liabilities that might be necessary should the Company be unable to continue as a going concern, and such adjustments could be material.

The Company was affected by increasing tariff-related risk and cost pressure in 2025, particularly because production remains mainly concentrated in China. Management has taken active steps to reduce future exposure to import tariffs and trade uncertainty. These steps include evaluating and expanding manufacturing capacity in other Southeast Asian countries, including the Philippines, for selected production outside China, as well as developing a lower-cost product line for the U.S. market to help offset tariff-related cost pressure through a lower cost structure. The Company will continue to monitor tariff developments and adjust its supply chain and product strategy as needed to mitigate adverse impacts on operations and financial results.

**Statement of Compliance**

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards issued by the International Accounting Standards Board (collectively, "IFRS").

The consolidated financial statements were authorized for issue by representatives of the Company on April 30, 2026.

The consolidated financial statements are presented in Canadian dollars, which is the Company's functional currency.

**3.** **Critical accounting estimates and judgments** 

The preparation of the consolidated financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amount of revenues and expenses during the reporting period. Management is required to apply judgment in useful lives of assets, valuation of inventory obsolescence, recoverability of property and equipment and intangible assets, equity transactions, and valuation of derivative financial instruments. By their nature, these estimates are subject to measurement uncertainty and are reviewed periodically, and adjustments, if necessary, are made in the period in which they are identified. Actual results could differ from those estimates.

*Useful lives of assets* - Significant estimates are involved in the determination of the useful lives of property and equipment and intangible assets to determine their expected depreciation rates (Notes 9 and 10).

 

*Determination of valuation of equity transactions* – Significant estimates are involved in the determination of fair value of equity transactions such as equity settled transactions and warrant valuation (Notes 14 and 15).

*Valuation of derivative financial instruments* – The estimated fair values of financial liabilities are subject to measurement uncertainty due to their exposure to liquidity and market risks. The fair value of these derivatives is determined using valuation models which require assumptions concerning the amount and timing of future cash flows, and discount rates. Changes in fair value are recognized in profit and loss. During the year ended December 31, 2025, fair value revaluation is $1,556,077 (2024 - $Nil; see note 15).

Management's assumptions rely on external observable market data including volatility and interest rate yield curves. The resulting fair value estimates may not be indicative of the amounts realized or settled in current market transactions and, as such, are subject to measurement uncertainty. Derivative financial instruments are comprised of convertible notes and warrant liabilities (Notes 14 and 15).

*Inventory Valuation and Obsolescence* – Inventories are measured at the lower of cost and net realizable value. The company assesses inventory regularly for obsolescence, considering factors such as market demand, product expiration, and physical condition. Where necessary, inventories are written down to their net realizable value, with write-downs recognized as an expense in the period incurred. Reversals of write-downs are made if the net realizable value subsequently increases, limited to the original write-down amount (Note 7).

**4.** **Summary of Significant Accounting Policies** 

**Basis of Measurement**

These consolidated financial statements were prepared under the historical cost convention as modified by the measurement of certain financial instruments at fair value.

**Basis of Consolidation**

These financial statements are prepared on a consolidated basis. All significant intercompany transactions and balances have been eliminated on consolidation.

**Financial Instruments**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Recognition and Classification

*Financial Assets*

 

All financial assets are initially recognized at fair value, adjusted by, in the case of instruments not at fair value through profit or loss, directly attributable transaction costs. After initial recognition, financial assets are subsequently classified and measured at either fair value through profit or loss ("FVTPL"), fair value through other comprehensive income ("FVTOCI"), or amortized cost based on the Company's assessment of the business model within which the financial asset is managed and the financial asset's contractual cash flow characteristics.

The Company had no financial assets measured at FVTPL or measured at FVTOCI as of December 31, 2025 and 2024.

Financial assets measured at amortized cost are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are carried at amortized cost using the effective interest method less impairment. Cash and trade receivables are classified as measured at amortized cost. Cash consists of deposits in bank.

*Financial Liabilities*

 

The Company classifies its financial liabilities into one of the following two categories: measured at amortized cost and measured at fair value through profit and loss ("FVTPL").

Financial liabilities measured at FVTPL are comprised of convertible notes and warrant liability.

Financial liabilities measured at amortized cost are initially recognized at fair value net of any transaction costs directly attributable to the issue of the instrument. Such interest-bearing liabilities are subsequently measured at amortized cost using the effective interest rate method, which ensures that any interest expense over the period to repayment is at a constant rate on the balance of the liability carried in the Consolidated Statements of Financial Position.

Accounts payable and accrued liabilities, advances, term loans, notes payable, due to shareholders, and government loans are initially recognized at fair value and subsequently measured at amortized cost using the effective interest method.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) *Derecognition*

Financial assets are derecognized only when the contractual rights to the cash flows from the asset expire, or the Company transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. The Company derecognizes financial liabilities when its obligations are discharged, cancelled, or expired.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) *Offsetting*

Financial assets and liabilities are offset, and the net amount is presented in the Consolidated Statements of Financial Position when, and only when, the Company has a legal right to offset the recognized amounts, and it intends either to settle on a net basis or to realize the asset and settle the liability simultaneously.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) *Fair Value and Market Value Measurement*

Fair value is the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm's length transaction on the measurement date.

When available, the Company measures the fair value of an instrument using quoted market prices in an active market for that instrument. A market is regarded as active if quoted prices are readily and regularly available and represent actual and regularly occurring market transactions on an arm's length basis.

The fair value hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1), and the lowest priority to unobservable inputs (Level 3). See Note 21 for further information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) *Impairment of Financial Assets*

At each reporting date, the Company assesses whether there is objective evidence that financial assets not carried at FVTPL are impaired. A financial asset or a group of financial assets are impaired based upon the expected credit loss ("ECL") model as prescribed by IFRS 9, taking into consideration both historic and forward-looking information.

**Cash and Cash Equivalents**

The Company considers short-term, highly liquid investments with original maturities of three months or less, at the time of purchase, to be cash equivalents. Cash consists of funds held in the Company's checking account and online payment platforms. The balance of cash equivalents as of December 31, 2025 is $Nil (2024 - $Nil).

**Inventories**

Inventory consists of only finished goods and are stated at the lower of cost and net realizable value, which is determined using the first-in, first-out ("FIFO") method. Net realizable value is the estimated selling price less the estimated cost of completion and the estimated costs necessary to make the sale.

**Property and Equipment**

Property and equipment is initially recorded at cost and subsequently measured at cost less accumulated depreciation. Depreciation is recognized in the Consolidated Statements of Comprehensive Loss and is provided over the estimated useful life of the assets as follows:

---

| | |
|:---|:---|
| Tooling | - 20% diminishing balance basis |
| Office equipment | - 20% diminishing balance basis |
| Computer equipment<br> Leasehold improvements<br> Right-of-use ("ROU") assets | - 55% diminishing balance basis<br> - Straight-line method over 5 years<br> - Straight-line method over life of lease term |

---

Depreciation methods, useful lives and residual values are reviewed annually and adjusted, if necessary. There were no changes to the depreciation policies during 2025 and 2024.

**Intangible Assets**

Intangible assets include expenditures on patents.

Intangible assets are recorded at cost less accumulated amortization. Directly attributable costs, that are capitalized as part of intangible assets, include professional fees, design, development, filing, and registration of the patents. Amortization is recognized in the Consolidated Statements of Comprehensive Loss and is provided over the estimated useful life of the asset as follows:

Patents - 5% declining method

Amortization method and useful lives are reviewed, at least annually, and adjusted, if necessary. There were no changes in 2025 and 2024.

**Income Taxes**

Income tax expense represents the sum of current income taxes and deferred income taxes. Current and deferred taxes are recognized in the Consolidated Statements of Comprehensive Loss, except to the extent that it relates to items recognized in other comprehensive loss or directly in equity. Under these circumstances, the taxes are recognized in other comprehensive loss or directly in equity.

*Current income taxes*

Current income tax assets and liabilities for the current and prior years are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute current income tax assets and liabilities are measured at tax rates which have been enacted or substantively enacted at the reporting date. Current tax assets and current tax liabilities are only offset if a legally enforceable right exists to set off the amounts, and the Company intends to settle on a net basis, or to realize the asset and settle the liability simultaneously.

*Deferred income taxes*

 

Deferred income taxes are provided using the asset and liability method applied to temporary differences at the date of the Consolidated Statements of Financial Position between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.

Deferred income tax liabilities are recognized for all taxable temporary differences, except:

- Where the deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

- In respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred income tax assets are recognized for all deductible temporary differences, and carry forward of unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences and the carry forward of unused tax losses can be utilized except:

- Where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

- In respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred income tax assets are recognized only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilized.

The carrying amount of deferred income tax assets is reviewed at each date of the Consolidated Statements of Financial Position and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilized. Unrecognized deferred income tax assets are reassessed at each date of the Consolidated Statements of Financial Position and are recognized to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realized or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the date of the Consolidated Statements of Financial Position.

Deferred income tax assets and deferred income tax liabilities are offset if, a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend to either settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax assets or liabilities are expected to be settled or recovered.

**Foreign Currency**

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses which result from the settlement of such transactions and from the translation of year end exchange rates of monetary assets and liabilities denominated in foreign currency are recognized in the Consolidated Statements of Comprehensive Loss. Exchange differences arising from the translation of foreign operations' financial statements are recognized in other comprehensive income and accumulated in a separate component of equity under Cumulative Translation Adjustment ("CTA").

**Revenue Recognition**

Under IFRS 15, revenue is measured using the five-step recognition model which includes:

1) identifying the contract(s) with the customer; 2) identifying the separate performance obligations in the contract; 3) determining the transaction price; 4) allocating the transaction price to separate performance obligations; and 5) recognizing revenue when (or as) each performance obligation is satisfied.

*Step 1: Identifying the contract*

Before recognizing revenue, the Company reviews customer transactions to ensure each party's rights and payment terms are identified, there is commercial substance, and that it is probable that the Company will collect the consideration in exchange for the goods or services as stated in the contract.

*Step 2: Identifying the separate performance obligations in the contract*

The Company's revenues are derived from the sale of product. The transaction between the Company and end-user includes quantities purchased, prices, and discounts, if applicable. Revenue is recognized in line with the identified contractual terms and when collection of payment is reasonably assured in line with the agreed upon payment terms.

*Step 3: Determining the transaction price*

Transaction prices are typically the prices stated on the purchase orders or contracts, net of discounts. The Company reviews customer contracts for any variable consideration, existence of significant financing components and payables to customers, and adjusts transaction prices accordingly.

*Step 4: Allocating the transaction price to separate performance obligations*

The Company's customer online transactions contain a single performance obligation, and the allocation of the transaction price is based on the fixed price.

*Step 5: Recognizing revenue when (or as) each performance obligation is satisfied*

 

The timing of revenue recognition is based on when a customer obtains control of the asset. Control of an asset refers to the ability to direct the use of, and obtain substantially all of the remaining benefits from, the asset. Control includes the ability to prevent other entities from directing the use of, and obtaining the benefits from, an asset. The Company reviews customer transactions and the nature of the performance obligations to determine if a performance obligation is satisfied at a point in time, and recognizes revenue accordingly.

Revenue is generated from the sale of AXIS Gear units and RYSE SmartShade; consumers have an option to download the app free of charge on Android or Apple iPhones. There is a one-year warranty on the item, but no extended warranty or installation services provided by the Company. Hence, revenue is solely generated from the sale of product. Revenue from sales of the product is recognized at a point in time, when shipment occurs and risks and rewards of ownership have been transferred to the consumer. At this point in time, the Company retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold, revenue can be reliably measured and its probable that the economic benefits will flow to the Company.

When the Company receives payment for product, but shipment has not occurred, recognition of the revenue is deferred and recorded as a liability on the Consolidated Statements of Financial Position until the risks and rewards of ownership have been transferred to the consumer. No deferred revenue was recognized during 2025 and 2024.

**Other Revenue**

*License Fee Revenue*

License fee revenue is recognized when the customer obtains control of the licensed intellectual property. For licenses that provide a right to use the intellectual property as it exists at the commencement of the license period, revenue is recognized at a point in time when the license is made available to the customer.

*Royalty Income*

Royalty income represents variable consideration based on customer sales or usage of licensed intellectual property. In accordance with IFRS 15, royalty revenue related to a license of intellectual property is recognized only when the subsequent sale or usage occurs and the related performance obligation has been satisfied. Accordingly, royalty income is recognized as the underlying sales or usage take place.

*Service Fee Revenue*

Service fee revenue is derived from the provision of professional and support services and is recognized when control of the services is transferred to the customer. Service revenue is recognized over time when the customer simultaneously receives and consumes the benefits of the Company's performance, using an appropriate measure of progress. Where services are distinct and control transfers upon completion, revenue is recognized at a point in time when the service has been fully performed.

**Government Grants**

The Company receives governmental subsidies, grants, and credits (collectively, "Grants"), from time to time related to operating expenditures or the COVID-19 pandemic. The Company recognizes such Grants when there is reasonable assurance that it qualifies for, and has complied with the conditions of the Grant, and that the Grant will be received. If the Company receives a Grant but cannot reasonably assure that it has complied with the conditions of the Grant, recognition of the Grant is deferred and recorded as a liability on the Consolidated Statements of Financial Position until the conditions are fulfilled. For Grants that relate to operating expenditures, the Company recognizes the Grant as a reduction to the expenditure that the Grant was intended to offset, in the period the cost is incurred or when the conditions are fulfilled if they were not met when the costs were incurred.

**Leases**

Under IFRS 16, all leases are accounted for by recognizing a right-of-use asset in property and equipment and a lease liability except for leases of low value assets and leases with a duration of 12 months or less.

Lease liabilities are measured at the present value of the contractual payments due to the lessor over the lease term, with the discount rate determined by reference to the rate inherent in the lease unless this is not readily determinable, in which case the Company's incremental borrowing rate on commencement of the lease is used. The Company determines its incremental borrowing rate as the rate of interest it would have to pay to borrow over a similar term, and with similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment. Variable lease payments are only included in the measurement of the lease liability if they depend on an index or rate. In such cases, the initial measurement of the lease liability assumes the variable element will remain unchanged throughout the lease term. Other variable lease payments are expensed in the period to which they relate.

On initial recognition, the carrying value of the lease liability also includes:

· amounts expected to be payable under any residual value guarantee;

· the exercise price of any purchase option granted in favor of the Company if it is reasonably certain to exercise that option; and

· any penalties payable for terminating the leases, if the term of the lease has been estimated on the basis of the termination option being exercised.

Right-of-use assets are initially measured at the amount of the lease liability, reduced for any lease incentives received, and increased for:

· lease payments made at or before commencement of the lease;

· initial direct costs incurred; and

· the amount of any provision recognized where the Company is contractually required to dismantle, remove or restore the leased asset.

Subsequent to initial measurement, lease liabilities increase as a result of interest at a constant rate on the balance outstanding and are reduced for lease payments made. Right-of-use assets are amortized on a straight-line basis over the remaining term of the lease or over the remaining economic life of the asset, whichever is shorter.

When the Company revises its estimate of the term of any lease, it adjusts the carrying amount of the lease liability to reflect the payments to make over the revised term, which are discounted at the same discount rate that applied on lease commencement. The carrying value of lease liabilities is similarly revised when the variable element of future lease payments dependent on a rate or index is revised. In both cases, an equivalent adjustment is made to the carrying value of the right-of-use assets, with the revised carrying amount being amortized over the remaining lease term.

For contracts that both convey a right to the Company to use an identified asset and require services to be provided to the Company by the lessor, the Company has elected to account for the entire contract as a lease. That is, it does not allocate any amount of the contractual payment to, and account separately for, any services provided by the supplier as part of the contract.

**Stock-Based Compensation**

The Company may grant stock options to buy Class B common shares of the Company to directors, officers, employees or consultants. The Company records stock-based compensation related to stock options granted using the fair-value based method which is estimated using the Black-Scholes option pricing model.

Estimating fair value for share-based compensation requires management to estimate the most appropriate inputs to the Black-Scholes option pricing model including the expected life of the option, volatility, and dividend yield. Actual results could differ from these estimates.

The fair value of stock options is measured at the grant date, and is recognized, together with a corresponding increase in contributed surplus in shareholders' deficit, over the period during which the performance or service conditions are fulfilled. The cumulative expense recognized for stock options at each reporting date until the vesting date reflects the extent to which this vesting period has expired and is the Company's best estimate of the number of shares that will ultimately vest. The expense or credit recognized for a year represents the difference in recognized cumulative expense between the beginning and the end of the year and is recognized in the Consolidated Statements of Comprehensive Loss.

When stock options are exercised or exchanged, the amounts previously credited to contributed surplus are reversed and credited to share capital. The amount of cash, if any, received from participants is also credited to share capital.

**Research and Development and Government Assistance**

Research costs are expensed in the period incurred. Development costs are expensed in the period incurred unless the Company believes a development project meets generally accepted criteria for deferral and amortization in accordance with International Accounting Standard 38 – *Intangible Assets*. No development costs have been deferred as of December 31, 2025 and 2024.

Reimbursement of eligible costs pursuant to government assistance programs are recorded as government grant income when the related costs are incurred. Claims not settled by the reporting date are recorded as grants receivable on the Consolidated Statement of Financial Position when there is reasonable assurance of recovery. Funding amounts received in advance of expenses incurred are deferred and are recorded as deferred revenue on the Consolidated Statements of Financial Position.

**Provisions, Contingent Assets and Contingent Liabilities**

Provisions are recognized when all of the following conditions are met:

· an entity
has a present obligation as a result of a past event;

· it is probable
that an outflow of resources embodying economic benefit will be required to settle the obligation; and

· a reliable
estimate can be made of the amount of the obligation.

Where the expenditure required to settle a provision is expected to be reimbursed by another party, the reimbursement is recognized as a separate asset when it is virtually certain that reimbursement will be received if the Company settles the obligation. The expense relating to a provision is presented net of the amount recognized for a reimbursement.

Contingent liabilities, a possible obligation depending on whether some uncertain future event occurs, or a present obligation but payment is not probable or the amount cannot be measured reliably, are not recognized in Consolidated Statements of Financial Position but are disclosed in notes to the consolidated financial statements.

Contingent assets are disclosed where an inflow of economic benefits is probable.

**Standards and Interpretations Not Yet Applied**

IFRS 7 and IFRS 9 *Amendments, Classification and Measurement of Financial Instruments*, effective January 1, 2026, clarify financial assets and financial liabilities are derecognized at settlement date except for regular way purchases or sales of financial assets, and financial liabilities meeting conditions for a new exception. The new exception permits companies to elect to derecognize certain financial liabilities settled via electronic payment systems earlier than the settlement date. The Company is assessing potential impact of these amendments on the consolidated financial statements but does not expect it to be significant.

Effective January 1, 2027, IFRS 18, *Presentation and Disclosure in Financial Statements*, replaces IAS 1, which sets out presentation and base disclosure requirements for financial statements. The changes, which mostly affect the income statement, include the requirement to classify income and expenses into three new categories – operating, investing, and financing – and present subtotals for operating profit or loss and profit or loss before financing and income taxes. Further, operating expenses are presented directly on the face of the Consolidated Statements of Comprehensive Loss – classified either by nature (e.g. employee compensation), or function (e.g., cost of sales), or by using a mixed presentation. Expenses presented by function require more detailed disclosures about their nature. IFRS 18 also provides enhanced guidance for aggregation and disaggregation of information in the financial statements, introduces new disclosure requirements for management-defined performance measures ("MPMs"), and eliminates classification options for interest and dividends in the Consolidated Statements of Cash Flows. Changes in IFRS 18 must be applied retrospectively for annual reporting periods beginning on or after January 1, 2027. While early adoption is permitted, the Company has not elected to early adopt. It is currently assessing potential impact on its consolidated financial statements presentation.

There are no other new accounting standards and interpretations that have been published that are mandatory for annual reporting period commencing January 1, 2025, and have not been early adopted by the Company.

**New and amended standards adopted by the Company**

IAS 21 Amendment, *Lack of Exchangeability*, was adopted by the Company effective January 1, 2025, with no significant impact noted. Most sales are in USD and CAD, with few in GBP, EUR and AUD. Expenses are in USD and CAD. All currencies have spot exchange rates easily available from major financial institutions. The Company does not expect to face instances when it cannot exchange foreign currency into its functional or presentation currencies.

The Company has not adopted any other new standards and amendments in the reporting period.

**5.** **Accounts Receivable and Accrued Receivable** 

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Accounts receivable | $160520 | $482301 |
| Less: provision for expected credit losses | (15116) | (25161) |
| Accounts receivable, net | $145404 | $457140 |
| Accrued receivable | 35980 | 38025 |
| Total | $181384 | $495165 |

---

The provision for expected credit losses was determined based on historical loss rates and payment behavior from customers by major aging category, updated for estimates of forward-looking factors that may differ from past experience such as credit quality and industry factors. These updated loss rates were applied to aging categories to determine the expected credit losses on accounts receivable using the simplified approach. During the year ending December 31, 2025, the Company has estimated no additional expected credit losses on its receivables, which is included in the operating expenses, amounting to $Nil (2024 - $1,169) (Note 24). $10,045 of receivable was written off from the balance (2024 - $Nil). In the 2024 audited consolidated financial statements, the accrued receivable amount of $38,025 was included in the accounts receivable line.

---

| | |
|:---|:---|
|  | **Provision for expected credit losses** |
| Cost: |  |
| December 31, 2023 | $23992 |
| Additions | 1169 |
| December 31, 2024 | $25161 |
| Less: receivable write-off | (10045) |
| **December 31, 2025** | $**15116** |

---

**6.** **Government Grants** 

During the year ended December 31, 2025, the Company recognized $367,545 (2024 – $Nil) in grant revenue from Sustainable Development Technology Canada ("SDTC"). The funding is related to the successful completion of the specified project, and the amount has been reported under Government grant income in the consolidated statements of comprehensive loss.

During the year ended December 31, 2025, the Company received $Nil (2024 – $25,000) CanExport grant which supports the development of international R&D partnerships.

During the year ended December 31, 2025, the Company received $39,315 (2024 – $54,435) EcoCanada grant which offers wage subsidies to support environmental employers, for roles in sustainability, climate change, and natural resources.

**Deferred Government Assistance Income (Cumulative to Date)**

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Deferred grant revenue from government loans | 236825 | 332504 |
|  | $236825 | $332504 |

---

**Government Assistance Income**

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| SDTC | $367545 | $– |
| Federal Economic Development Agency (Note 17) | 82089 | 82089 |
| Eco Canada | 39315 | 54435 |
| HASCAP (Note 17) | 13590 | 13590 |
| CanExport Innovation Grant | – | 25000 |
| Total for the year | $502539 | $175114 |

---

**7.** **Inventory and Prepaid Inventory** 

As of December 31, 2025, the inventory balances of $1,221,084 (2024 - $1,393,062) is net of provision balances of $60,159 (2024 – $102,089). Inventories of $1,550,190 (2024 - $1,673,751) were included in product costs.

The Company also pays in advance for future inventories deliveries. Total prepaid inventories as of December 31, 2025 is $387,344 (2024 - $93,176).

During the year ended December 31, 2025, the Company has provision for inventory write-off included in product costs amounting to $37,536 (2024 - $Nil).

**8.** **Investment Tax Credit Receivable** 

The Company claims Scientific Research and Development ("SR&ED") and related investment tax credits for income tax purposes based on management's interpretation of the applicable legislation in the Income Tax Act of Canada. These claims are subject to audit by the Canada Revenue Agency ("CRA"). Included in investment tax credit receivable are amounts for SR&ED credits which are currently under review or are expected to come under review by the taxation authorities:

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Balance, opening | $403005 | $277000 |
| Additions | 791637 | 389042 |
| Recovered | (403005) | (263037) |
| Balance, ending | $791637 | $403005 |

---

**9.** **Property and Equipment** 

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Equipment** | **Tooling** | **Office** | **Computer Equipment** | **Leasehold Improvement** | **ROU Assets** | **Total** |
| Cost: |  |  |  |  |  |  |
| 31-Dec-23 | $164341 | $41452 | $71399 | $– | $– | $277192 |
| Additions | 136858 | 5543 | 19637 | 9840 | 1290183 | 1462061 |
| 31-Dec-24 | $301199 | $46995 | $91036 | $9840 | $1290183 | $1739253 |
| Additions | 1101 | 9143 | 7440 | 3540 | – | 21224 |
| **31-Dec-25** | $**302300** | $**56138** | $**98476** | $**13380** | $**1290183** | $**1760477** |
| Accumulated depreciation: |  |  |  |  |  |  |
| 31-Dec-23 | $121135 | $25295 | $59734 | $– | $– | $206164 |
| Depreciation | 22327 | 3728 | 11974 | 422 | 271352 | 309803 |
| 31-Dec-24 | $143462 | $29023 | $71708 | $422 | $271352 | $515967 |
| Depreciation | 31658 | 4451 | 12835 | 2534 | 261436 | 312914 |
| **31-Dec-25** | $**175120** | $**33474** | $**84543** | $**2956** | $**532788** | $**828881** |
| Net carrying amounts: |  |  |  |  |  |  |
| 31-Dec-24 | $157737 | $17972 | $19328 | $9418 | $1018831 | $1223286 |
| **31-Dec-25** | $**127180** | $**22664** | $**13933** | $**10424** | $**757395** | $**931596** |

---

**10.** **Intangible Assets** 

---

| | |
|:---|:---|
|  | **Trademarks and patents** |
| Cost: |  |
| December 31, 2023 | $398588 |
| Additions | 7392 |
| December 31, 2024 | $**405980** |
| Additions | 19641 |
| **December 31, 2025** | $**425621** |
| Accumulated amortization: |  |
| December 31, 2023 | $114063 |
| Amortization | 14412 |
| December 31, 2024 | $**128475** |
| Amortization | 14366 |
| **December 31, 2025** | $**142841** |
| Net carrying amounts: |  |
| December 31, 2024 | $**277505** |
| **December 31, 2025** | $**282780** |

---

**11.** **Accounts Payable and Accrued Liabilities** 

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Credit cards payable | $290668 | $281605 |
| Trade accounts payable | 1354635 | 1560624 |
| Government remittances payable | 150462 | 101403 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $1795765 | $1943632 |

---

**12.** **Advances** 

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Advance [a] | $185557 | $347124 |
| Advance [b] | 40554 | 2252 |
| Advance [c] | 27460 | 39251 |
| Advance [d] | 78014 | – |
| Total | $331585 | $388627 |

---

**[a] Advance** 

The Company entered into various agreements with a lender and received $208,874 ($165,600 USD) in 2021 with similar repayment terms. During the year, the Company received $559,105 (2024 - $631,372) and repaid $707,070 (2024 -$303,146). The other movements in this advance pertains to foreign exchange revaluation.

**[b] Advance**

On January 7, 2021, the Company entered into an agreement and received $49,463 ($39,000 USD) from an entity affiliated with a channel partner. Repayment of the amount advanced plus $7,984 ($6,295 USD) was made by transferring 30% of payments from the channel partner to the affiliated entity. During the year, the Company received $85,962 (2024 - $39,224) and repaid $62,738 (2024 - $39,411). The other movements in this advance pertains to fees and foreign exchange revaluation.

**[c] Advance**

On May 7, 2024, the Company entered into a new agreement and received $55,000 from a financing company. On October 10, 2024, the Company entered into another agreement and received $65,000. Repayment of the amount advanced is to be repaid made through weekly payment according to pre-determined schedule. The advance carries an effective interest rate of 10% per annum. During the year, the Company received $132,500 (2024 - $120,000) and repaid $144,291 (2024 - $80,749).

**[d] Advance** 

On March 17, 2025, the Company entered into an agreement with an affiliated sales channel partner and received $132,787 ($95,000 USD). The advance carries an effective interest rate of 14.95% per annum. During the year, the Company received $132,787 and repaid $53,228 (2024 - $Nil).

**13.** **Term Debt** 

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| &nbsp;&nbsp;Term loans | $1595994 | $2073856 |
| &nbsp;&nbsp;Term loans issued with warrants | 193388 | 691279 |
| &nbsp;&nbsp;Total term loans | 1789382 | 2765135 |
| &nbsp;&nbsp;Less: Current portion | 507882 | 639356 |
| Non-current term loans | $1281500 | $2125779 |

---

***Term loans***

The Company received a series of loans from the CEO's father, totaling $270,000 in 2021 (Note 22). These loans are unsecured and carry a 10% simple interest, paid semi-annually, with a 12-month maturity and option to renew. The option to renew has been exercised by both parties through 2025. Total accrued interest for 2025 is $27,000 (2024 - $27,000). Total interest payment during 2025 is $30,000 (2024 - $10,000). Total outstanding accrued interest for 2025 is $76,500 (2024 - $79,500).

The Company received a series of loans from third parties, totaling $300,000 from 2019 and 2022. These loans are unsecured and has no interests. During the year ended December 31, 2025, the Company repaid $150,000 (2024 - $20,000). The balance is fully repaid during 2025.

During 2021, the Company borrowed USD $192,815 under a promissory note. The repayment amount is two times the amount of the loan and repayments begin quarterly beginning December 22, 2022. The amount of each quarterly repayment will be 10% of the revenue earned by the Company in the quarter immediately preceding the repayment, and quarterly repayments will continue until the loan is repaid in full. During 2022, the Company borrowed an additional $145,669 under a promissory note with the same terms and condition as the original note. During the year ended December 31, 2025, the Company repaid $108,526 (2024 - $55,208).

During 2022, the Company borrowed $1,150,000 from third parties, with a 12-month maturity and the option to renew. These loans are unsecured and carry 16-18% simple interest. The option to renew has been exercised by the lenders through 2025. During the year ended December 31, 2025, the Company repaid $Nil (2024 - $220,000).

On December 6, 2024, the Company entered into a $270,118 USD financing agreement with the consignor. This consignment agreement allows the Company to expand its sales partner with expanded consignment opportunity. The loan is secured by a lien on consignment inventory. The agreement permits the lender to expand the collateral to include all Company assets, if payment defaults exceed $50,000 cumulatively or any payment remains overdue by 30+ days. During the year ended December 31, 2025, the Company received $298,428 and repaid $500,008 (2024 - $nil).

On April 29, 2025, the Company entered into a $319,000 USD financing agreement, including fees. During the year ended December 31, 2025, the Company repaid $423,467.

During December 31, 2025, the Company received a total of $437,221 and repaid $912,084. During December 31, 2024, the Company received a total of $388,673 and repaid $316,320.

*Term loans issued with warrants*

On May 2, 2018, the Company borrowed $1,119,750 and $400,000 USD repayable on April 30, 2021 from various lenders. Interest is calculated and payable monthly at a rate of 1.41667% per month. As part of the issuance of the term loans, the lenders received warrants (Note 15).

Under IAS 32 Financial Instruments: Disclosure and Presentation: The proceeds of the term loans were allocated between the term loan principle, and the warrants, based on the relative fair values of the two instruments. This resulted in $1,349,131 being allocated to term loans and $282,965 being allocated to warrants. The warrants are classified as a liability in accordance with IAS 32 since the amount of shares to be received upon exercise is not a fixed amount. These warrants are subsequently remeasured at their fair value each reporting period.

The loans are secured by a general security agreement over the assets of the Company and personal security from a shareholder for 30% of the principal amount.

During 2022, portion of term loans issued with warrants has extended the maturity date to June 30, 2024. During the year ended December 31, 2024, portion of the term loans issued with warrants were further extended to April 30, 2026. During December 31, 2025, the Company received a total of nil and repaid $491,288 (2024 - $787,832). The other movements in this loan pertains to fees and foreign exchange revaluation.

All interest and fees associated with the above term loans have been recorded through other interest and charges. Total non-cash interest (income)/expense in 2025 is $9,603 (2024 - $50,971).

**14.** **Notes Payable and Convertible Notes payable** 

*Notes payable*

 

During 2025, the Company received $6,962,731 (2024 - $5,543,876) and repaid $808,206 (2024 - $395,537) from promissory notes without conversion features issued by RYSE USA, Inc. which shall be due and payable in twelve (12) months after the effective date of the note. The interest rate is equal to fifteen to eighteen percent (15-18%) per annum, which shall be payable on a monthly basis. The other movements in this account pertains to foreign exchange revaluation.

During the year ended December 31, 2025, notes payable amounting to $329,814 was repaid in exchange for 225,632 Common B shares. For the year ended December 31, 2024, notes payable amounting to $217,809 was paid in exchange for 121,400 Common B shares.

Total notes payable without conversion feature for the year ended December 31, 2025 is $13,220,615 (2024 - $7,510,878).

*Convertible notes payable*

 

On February 22, 2022, the Company issued 119,050 Class A and 186,432 Class B shares on convertible notes with fair value amounting to $1,123,777 and $1,760,915, respectively. All convertible notes issued prior to December 31, 2022 were converted.

For the year ended December 31, 2023, the Company issued additional convertible debentures amounting to $400,000 with stated interest rates of 15-18% per annum. However, these debentures are short-term in nature and are due and payable 12 months from the date of issuance of the Note. During the years ended 2025 and 2024 the lenders opted to extend the debt for another 12 months. The convertible notes include a conversion feature that allows for conversion under one of the following two conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the convertible debentures convert automatically upon a qualified equity financing greater than $2,500,000 at a discount of 20% from the transaction price:

(b) at maturity, the holder of the convertible debenture has the option to convert at a price equal to the price per common share of $1 USD or be repaid.

For the year ended December 31, 2024, the Company issued additional convertible debentures amounting to $27,000 with stated interest rates of 15% per annum. However, these debentures are short-term in nature and are due and payable 12 months from the date of issuance of the Note. The notes include a conversion feature and has been exercised during 2025.

For the year ended December 31, 2025, the Company issued additional convertible debentures amounting to $284,992 with stated interest rates of 16% per annum. However, these debentures are short-term in nature and are due and payable 12 months from the date of issuance of the Note. The notes include a conversion feature.

Total notes payable with conversion feature for the year ended December 31, 2025 is $684,992 (2024 - $427,000).

Due to the short-term nature of these newly issued convertible debentures, the fair value was deemed to approximate its face value.

**15.** **Warrants** 

*Warrant liabilities*

**<u>[a] May 2, 2018</u>**

On May 2, 2018, the Company issued warrants as part of the term debt described in Note 13 – term loans issued with warrants, which are classified as a liability. The warrants have an exercise price of the lesser of $3.69 before share split ($0.369 after share split) and the most recent cash issue price paid in a qualifying financing to obtain one Class A common share. The warrants vest immediately and are exercisable for 5 years from issuance.

On December 26, 2022, the Company extended expiry date of some warrants to April 30, 2026. Subsequent to December 31, 2025, the Company extended the expiry date of the warrants to September 30, 2027. Currently issued warrants were canceled, and new warrants were issued to reflect the extended maturity date and adjusted number of Class A Common Shares of the Company that may be purchased by the holder of the warrants as a result of a 1:10 split of the Class A Common Shares.

During 2023, 50,000 of the total warrants expired and were not included in the extension until April 30, 2026.

In line with IFRS 9 and per the Company's policy, warrant liabilities are presented at their fair value with the results of this remeasurement reflected in the Consolidated Statements of Comprehensive Loss. During 2025, the Company recognized a gain of approx. $1.6M which included immaterial cumulative effect from the prior year.

*Warrants in equity*

 

**<u>[b] April 1, 2019</u>**

On April 1, 2019, the Company issued warrants for services to a non-employee. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 – Share-based payment (IFRS 2) as the value of the services could not be estimated reliably. The warrants have an exercise price of $4.91 to obtain one Class A common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model. During 2025, 100,000 warrants expired. The impact on the Company's operating results from the expired warrants was about $25K.

**<u>[c] December 7, 2019</u>**

On December 7, 2019, the Company issued warrants to settle interest due on a term loan. The transaction was valued at the fair value of the instruments in accordance with IFRS 9. The warrants have an exercise price of $5.33 to obtain one Class A common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

**<u>[d] December 7, 2019</u>**

On December 7, 2019, the Company issued warrants to settle interest due on a term loan. The transaction was valued at the fair value of the instruments in accordance with IFRS 9. The warrants have an exercise price of $3.18 to obtain one Class A common share. The warrants vest immediately and are exercisable for 5 years from issuance and have been valued using the Black-Scholes Model.

**<u>[e] December 7, 2019</u>**

On December 7, 2019, the Company issued warrants for services to a non-employee. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $5.65 to obtain one Class A common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

**<u>[f] December 7, 2019</u>**

On December 7, 2019, the Company issued warrants to settle interest due on a term loan. The warrants have an exercise price of $3.64 to obtain one Class A common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

**<u>[g] April 30, 2021</u>**

On April 30, 2021, the Company issued warrants for services to a corporation. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $9.48 to obtain one Class B common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

**<u>[h] August 17, 2021</u>**

On August 17, 2021, the Company issued warrants for services to a corporation. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $9.48 to obtain one Class B common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

**<u>[i] October 29, 2021</u>**

On October 29, 2021, the Company issued warrants for services to a corporation. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $9.48 to obtain one Class B common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

**<u>[j] December 21, 2021</u>**

On December 21, 2021, the Company issued warrants for services to a corporation. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $9.48 to obtain one Class B common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

**<u>[j] December 21, 2021</u>**

On December 21, 2021, the Company issued warrants for services to a corporation. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $9.48 to obtain one Class B common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

**<u>[k] February 28, 2022</u>**

On February 28, 2022, the Company issued warrants for services to a corporation. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $9.48 to obtain one Class B common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

**<u>[l] May 4, 2022</u>**

On May 4, 2022, the Company issued warrants for services to a corporation. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of USD$7.13 to obtain one Class B common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model. This warrant expired in 2025.

**Share split**

On May 8, 2022, the Company amended its Articles of Incorporation to subdivide and split the shares in the capital of the Company on the basis of ten (10) shares for every one (1) share held. The share split resulted to an increase in warrants by 2,292,129 shares and 445,644 shares for warrants in liabilities and equity, respectively. Exercise price are one tenth (1/10) of the initial value at the date of grant.

**Warrants after share split**

**<u>[m] June 7, 2022</u>**

On June 7, 2022, the Company issued warrants as part of the investment to the Company. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of US$0.713 to obtain one Class B common share. The warrants vest immediately and are exercisable for 2 years from issuance and have been valued using the Black-Scholes Model.

**<u>[n] July 25, 2022</u>**

On July 25, 2022, the Company issued some warrants as an equity kicker. The warrants are exercisable for 20 years from issuance with exercise price of $0.01 USD and have been valued using the Black-Scholes Model.

**<u>[o] October 24, 2022</u>**

On October 24, 2022, the Company issued some warrants as an equity kicker. The warrants are exercisable for 20 years from issuance with exercise price of $0.713 USD and have been valued using the Black-Scholes Model. This was exercised in 2023.

**<u>[p] November 9, 2022</u>**

On November 9, 2022, the Company issued some warrants as an equity kicker. The warrants are exercisable for 20 years from issuance with exercise price of $1.00 USD and have been valued using the Black-Scholes Model.

**<u>[q] November 9, 2022</u>**

On November 9, 2022, the Company issued some warrants as an equity kicker. The warrants are exercisable for 20 years from issuance with exercise price of $0.01 USD and have been valued using the Black-Scholes Model.

**<u>[r] November 15, 2022</u>**

On November 15, 2022, the Company issued some warrants as an equity kicker. The warrants are exercisable for 2 years from issuance with exercise price of $1.00 USD and have been valued using the Black-Scholes Model. This was exercised in 2025.

**<u>[s] November 24, 2022</u>**

On November 24, 2022, the Company issued some warrants as an equity kicker. The warrants are exercisable for 20 years from issuance with exercise price of $1.00 USD and have been valued using the Black-Scholes Model.

**<u>[t] April 28, 2023</u>**

On April 28, 2023, the Company issued warrants for services to a corporation. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $1.00 per Warrant Share to obtain one Class B common share. The warrants vest immediately and are exercisable for 5 years from issuance and have been valued using the Black-Scholes Model.

**<u>[u] July 26, 2023</u>**

On July 26, 2023, the Company issued warrants for services to a corporation. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $1.00 per Warrant Share to obtain one Class B common share. The warrants vest immediately and are exercisable for 5 years from issuance and have been valued using the Black-Scholes Model.

**<u>[v] December 9, 2024</u>**

On December 9, 2024, the Company issued warrants in exchange for consulting services from a contractor. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $0.01 per Warrant Share to obtain one Class B common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

**<u>[w] July 2, 2025</u>**

On July 2, 2025, the Company issued warrants in exchange for consulting services from a contractor. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $1.90 per Warrant Share to obtain one Class B common share. The warrants vest immediately and are exercisable for 5 years from issuance and have been valued using the Black-Scholes Model.

**<u>[x] July 18, 2025</u>**

On July 18, 2025, the Company issued warrants in exchange for consulting services from a contractor. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $0.01 per Warrant Share to obtain one Class B common share. The warrants vest immediately and are exercisable for 20 years from issuance and have been valued using the Black-Scholes Model.

**<u>[y] August 20, 2025</u>**

On August 20, 2025, the Company issued warrants in exchange for consulting services from a contractor. The transaction was valued at the fair value of the instruments in accordance with IFRS 2 as the value of the services could not be estimated reliably. The warrants have an exercise price of $0.01 per Warrant Share to obtain one Class B common share. The warrants vest immediately and are exercisable for 10 years from issuance and have been valued using the Black-Scholes Model.

---

| | | | |
|:---|:---|:---|:---|
|  | **Number of<br> warrants** | **Warrant liability<br> amount** | **Warrant equity<br> amount** |
| **December 31, 2023** | **3245576** | $**1675883** | $**294761** |
| Warrants issued | 10000 |  | 25105 |
| Expiration and revaluation of warrants | (213401) | – | (49665) |
| **December 31, 2024** | **3042175** | $**1675883** | $**270201** |
| Warrants issued | 31027 |  | 94542 |
| Expiration and revaluation of warrants | (103500) | (1556077) | (25264) |
| Warrants exercised | (7000) | – | (1356) |
| **December 31, 2025** | **2962702** | $**119806** | $**338123** |

---

**Warrants before share split**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of<br> warrants** | **Number of <br> common shares<br> exercisable into** | **Exercise<br> price** | **Expiry<br> date** |
| May 2, 2018 [a] | 254681 | 254681 | $3.69 | May 2, 2023 |
| April 1, 2019 [b] | 10000 | 10000 | $4.91 | April 1, 2029 |
| December 7, 2019 [c] | 4690 | 4690 | $5.33 | December 7, 2029 |
| December 7, 2019 [d] | 15730 | 15730 | $3.18 | December 7, 2024 |
| December 7, 2019 [e] | 11502 | 11502 | $5.65 | December 7, 2029 |
| December 7, 2019 [f] | 5494 | 5494 | $3.64 | December 7, 2029 |
| April 30, 2021 [g] | 408 | 408 | $9.48 | April 30, 2031 |
| August 17, 2021 [h] | 138 | 138 | $9.48 | August 17, 2031 |
| October 29, 2021 [i] | 153 | 153 | $9.48 | October 29, 2031 |
| December 21, 2021 [j] | 160 | 160 | $9.48 | December 21, 2031 |
| February 28, 2022 [k] | 891 | 891 | $9.48 | February 28, 2032 |
| May 4, 2022 [l] | 350 | 350 | $7.13USD | May 4, 2032 |
|  | 304197 | 304197 |  |  |

---

**Warrants after share split**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of<br> warrants** | **Number of <br> common shares<br> exercisable into** | **Exercise<br> price** | **Expiry<br> date** |
| May 2, 2018 [a] | 2546810 | 2546810 | $0.369 | April 30, 2026 |
| April 1, 2019 [b] | 100000 | 100000 | $0.491 | April 1, 2029 |
| December 7, 2019 [c] | 46900 | 46900 | $0.533 | December 7, 2029 |
| December 7, 2019 [d] | 157300 | 157300 | $0.318 | December 7, 2024 |
| December 7, 2019 [e] | 115020 | 115020 | $0.565 | December 7, 2029 |
| December 7, 2019 [f] | 54940 | 54940 | $0.364 | December 7, 2029 |
| April 30, 2021 [g] | 4080 | 4080 | $0.948 | April 30, 2031 |
| August 17, 2021 [h] | 1380 | 1380 | $0.948 | August 17, 2031 |
| October 29, 2021 [i] | 1530 | 1530 | $0.948 | October 29, 2031 |
| December 21, 2021 [j] | 1600 | 1600 | $0.948 | December 21, 2031 |
| February 28, 2022 [k] | 8910 | 8910 | $0.948 | February 28, 2032 |
| May 4, 2022 [l] | 3500 | 3500 | $0.713USD | May 4, 2032 |
| June 7, 2022 [m] | 56101 | 56101 | $0.713USD | June 7, 2024 |
| July 25, 2022 [n] | 56500 | 56500 | $0.01USD | July 25, 2042 |
| October 24, 2022 [o] | 1024000 | 1024000 | $0.713USD | October 24, 2042 |
| November 9, 2022 [p] | 66500 | 66500 | 1.00 USD | November 9, 2042 |
| November 9, 2022 [q] | 37000 | 37000 | $0.01USD | November 9, 2042 |
| November 15, 2022 [r] | 7000 | 7000 | $1.00USD | November 15, 2024 |
| November 24, 2022 [s] | 29500 | 29500 | $1.00USD | November 24, 2042 |
| April 28, 2023 [t] | 350 | 350 | $1.00USD | April 28, 2028 |
| July 26, 2023 [u] | 655 | 655 | $1.00USD | July 26, 2028 |
| December 9, 2024 [v] | 10000 | 10000 | $0.01USD | December 9, 2044 |
| July 2, 2025 [w] | 1027 | 1027 | $1.90USD | July 2, 2030 |
| July 18, 2025 [x] | 12000 | 12000 | $0.01USD | July 18, 2045 |
| August 20, 2025 [y] | 18000 | 18000 | $0.01USD | August 20, 2035 |
|  | 4360603 | 4360603 |  |  |
| Less: |  |  |  |  |
| Warrants exercised (o,r) | (1031000) | (1031000) |  |  |
| Expiration of warrants (a,b,d,l,m) | (366901) | (366901) |  |  |
|  | 2962702 | 2962702 |  |  |

---

The following assumptions were used to calculate the fair values at:

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Time to expiry in years | **10-20** | **20** |
| Expected volatility | **46%** | **44%** |
| Risk-free rate | **2.91-3.88%** | **3.16%** |
| Exercise price after share split | $**0.01-1.90** | $**0.01** |

---

The weighted average exercises price for the total outstanding warrants at December 31, 2025 was $0.39 (2024 – $0.40).<br>

A sensitivity analysis was performed to calculate the impact to the fair value of warrants issued in 2025 if the share price will increase (decrease) by 5%. Total impact on the fair value was less than $5,000.

**16.** **Due to Shareholders** 

The balances due to shareholders are unsecured, non-interest bearing, with no specific terms of repayment.

**17.** **Government Loans** 

*Canada Emergency Business Account ("CEBA")*

The Company borrowed $60,000 under the CEBA program in 2020. During the year ended December 31, 2024, $43,949 was forgiven and fully paid off. As of December 31, 2024, the balance was $Nil.

*Federal Economic Development Agency ("FedDev") Loan*

In December 2020, the Company borrowed $139,875 from FedDev as part of its Regional Economic Growth Through Innovation program. The loan is interest-free, and the principal is to be repaid in equal monthly installments from January 1, 2023 to December 1, 2027. The fair value of the debt of $55,671 was calculated using an effective rate of 24%, which corresponds to a rate that the Company would have obtained for a similar loan.

On April 1, 2021, the Company borrowed an additional $810,125 from FedDev under the same terms. The fair value of the debt of $395,441 was calculated using an effective rate of 24%, which corresponds to a rate that the Company would have obtained for a similar loan.

The book value at December 31, 2025 was $359,243 (2024 - $485,740). During the year ended December 31, 2025, $82,089 (2024 - $82,089) was recorded as government grant revenue on the Consolidated Statements of Comprehensive Loss. Deferred grant revenue is recognized over the interest free period of the loan.

 

 

 

 

*Highly Affected Sectors Credit Availability Program ("HASCAP") Loan*

On July 20, 2021, the Company borrowed $250,000 from a financial institution. The debt is guaranteed by the Business Development Bank of Canada as part of its Highly Affected Sectors Credit Availability Program. The loan carries an interest rate of 4% per annum. Monthly interest-only payments are required for the first twelve months, and principal is to be repaid in equal monthly installments from August 20, 2022 to July 20, 2031.

The fair value of the debt of $114,102 was calculated using an effective rate of 24%, which corresponds to a rate that the Company would have obtained for a similar loan. The book value at December 31, 2025 was $106,692 (2024 - $115,589). During the year ended December 31, 2025, $13,590 (2024 - $13,590) was recorded as government grant revenue on the Consolidated Statements of Comprehensive Loss. Deferred grant revenue is recognized over the interest free period of the loan.

---

| | |
|:---|:---|
| <br>**Government loans, December 31, 2023** | $**706034** |
| Accretion | 117574 |
| Payment | (178330) |
| Forgiveness of government loan | (43949) |
| **Government loans, December 31, 2024** | $**601329** |
| Accretion | 102000 |
| Payment | (237394) |
| **Government loans, December 31, 2025** | $**465935** |

---

---

| | |
|:---|:---|
| Current portion | $**195184** |
| Non-current portion | $**270751** |

---

**18.** **Share Capital** 

<u>Authorized</u> <br> Unlimited Class A Common shares <br> Unlimited Class B Common Shares, non-voting, non-participating

---

| | | | |
|:---|:---|:---|:---|
| Issued after share split |  | **2025** | **2024** |
| 35499226 | Class A Common shares | $4915656 | $4965656 |
| 14624950 | Class B Common shares | $17326214 | $14036796 |

---

On December 28, 2020, the Company filed and an Offering Statement and a Preliminary Offering Circular ("OC") under Regulation A with the Securities and Exchange Commission ("SEC"). On February 22, 2021, the SEC qualified the Offering Statement. The Company may offer a maximum of 2,104,718 Class B Common Shares at $7.13USD per share ($0.173USD per share after share split on May 8, 2022). During 2021, the Company sold 67,231 Class B Common shares for proceeds of $644,733, and incurred share issuance costs of $80,160.

On February 22, 2022, the Company issued 119,050 Class A and 186,432 Class B shares on convertible notes with fair value amounting to $1,123,777 and $1,760,915, respectively. During the year ended December 31, 2022, the Company issued 185,637 Class A Common shares for proceeds of $214,360. In addition, the Company issued 722,807 Class B Common shares, for total proceeds of $1,911,505 during the same period. Share issuance costs directly attributable to the issuance of Class B Common shares totaled $17,378.

On May 8, 2022, the Company amended its Articles of Incorporation to subdivide and split the shares in the capital of the Company on the basis of ten (10) shares for every one (1) share held. The share split resulted in an increase in Class A and B Common Shares by 31,887,504 shares and 2,951,991 shares, respectively.

On May 11, 2022, the Company filed an Offering Statement under Regulation A with the SEC. The Offering Statement was qualified on July 27, 2022. The Company is offering a maximum of 25,000,000 Class B Common Shares at $1.00USD per share (the "2022 Regulation A Offering"). As of December 31, 2022, the Company issued 339,451 Class B Common shares for proceeds of $339,451 in the 2022 Regulation A Offering. In addition, the Company issued 141,770 Class B Common shares for proceeds of $141,770 during the same period in a concurrent private placement in Canada.

During the year ended December 31, 2022, the Company issued 280,270 Class B Common shares at $0.713 per share, for proceeds of $134,260USD and $100,000 under Regulation D and a private placement in Canada.

During the year ended December 31, 2023, the Company issued 1,053,768 Class B Common Shares at $1.00USD per share, for proceeds of $1,053,768USD in the 2022 Regulation A Offering. In addition, the Company sold 229,850 shares at $1.00USD per share, for proceeds of $229,850USD during the same period in a concurrent private placement in Canada.

On August 23, 2023, the Company filed an amendment to the Offering Statement under Regulation A with the SEC, which was qualified on August 31, 2023 (the "2023 Offering Statement"). The Company is offering a maximum of 20,000,000 Class B Common Shares at $1.25USD per share.

During the year ended December 31, 2023, the Company issued 1,190,391 Class B Common Shares (including bonus shares) at $1.25USD per share, for proceeds of $1,394,302USD under the 2023 Offering Statement. In addition, the Company sold 196,093 shares (including bonus shares) at $1.25USD per share, for proceeds of $240,778USD during the same period in a concurrent private placement in Canada. A total of 77,621 bonus shares were issued during the year 2023.

During the year ended December 31, 2023, the Company issued 2,347,253 Class B Common shares at $0.713USD per share, for proceeds of $578,000USD and $1,500,000USD under Regulation D and a private placement in Canada.

During the year ended December 31, 2024, the Company issued 121,400 Class B Common Shares to pay off the remaining balance of certain notes payables amounting to $153,603.

During the year ended December 31, 2024, the Company issued 6,000 Class B Common Shares at a price of $1.00USD per share, generating proceeds of $6,000USD.

In addition, the Company issued 52,600 Class B Common Shares, including bonus shares, at a price of $1.25USD per share, generating proceeds of $25,000USD.

Additionally, the Company issued 2,181,494 Class B Common Shares, including bonus shares, at a price of $1.50USD per share for total proceeds of $3,055,700USD.

Furthermore, the Company issued 1,032,628 Class B Common Shares, at a price of $1.75USD per share. including bonus shares, in exchange for consideration totaling $1,671,415USD.

During the year ended December 31, 2025, the Company cancelled 73,225 Class A Common Shares and 42,080 Class B common shares amounting to $91,933.

During the year ended December 31, 2025, the Company issued 225,632 Class B Common Shares to pay off the remaining balance of certain notes payables amounting to $329,814.

During the year ended December 31, 2025, the Company issued 359,222 Class B Common Shares at a price of $1.00USD per share, generating proceeds of $359,222USD.

In addition, the Company issued 2,400 Class B Common Shares, including bonus shares, at a price of $1.25USD per share, generating proceeds of $3,000USD.

Additionally, the Company issued 35,893 Class B Common Shares, including bonus shares, at a price of $1.75USD per share, generating proceeds of $54,812USD.

Furthermore, the Company issued 783,324 Class B Common Shares, including bonus shares, at a price of $1.90USD per share, generating proceeds of $1,382,921USD.

Also, the Company issued 622,514 Class B Common Shares, including bonus shares, at a price of $2.00USD per share, generating proceeds of $1,123,978USD.

Finally, the Company issued 301,907 Class B Common Shares, including bonus shares, at a price of $2.25USD per share, generating proceeds of $586,010USD.

The total share issuance cost for the year ended December 31, 2025 is $1,685,673 (2024 - $2,138,588).

**19.** **Stock-Based Compensation** 

The Company may grant stock options to the Board, certain employees and consultants, that allow each participant to purchase Class B common shares of the Company. The exercise price of each stock option is equal to the fair value of the underlying Class B common share when the stock option was granted. Stock options vest quarterly over terms ranging from 2 to 4 years. Stock options have a 10-year term. Employees and consultants also have the benefit of cashless exercise wherein employees and consultants are not required to pay in cash to exercise the option, rather, the option plan allows the use of equity built up in the option to pay the exercise price.

On May 8, 2022, the Company amended its Articles of Incorporation to subdivide and split the shares in the capital of the Corporation on the basis of ten (10) shares for every one (1) share held. The share split resulted to an increase by 3,970,584 stock options. In addition, the Company granted additional 3,598,459 stock options in 2022 with the same exercise price and expiration date.

A summary of stock option activity under the plan is as follows:

---

| | | |
|:---|:---|:---|
|  | **Number of<br> stock options** | **Weighted average<br> exercise price** |
| December 31, 2018 | 413605 | $1.00 |
| Granted | 27571 | 1.00 |
| December 31, 2019 | 441176 | $1.00 |
| Granted | **–** | 1.00 |
| December 31, 2020 | 441176 | $1.00 |
| Granted | **–** | 1.00 |
| December 31, 2021 | 441176 | $1.00 |
| Share split | 3970584 | /10 |
| Granted | 2458699 | 0.10 |
| December 31, 2022 | 6870459 | $0.10 |
| Granted | 231968 | 0.10 |
| Expired/not vested | (199311) | 0.10 |
| December 31, 2023 | 6903116 | $0.10 |
| Granted | 548824 | 0.09 |
| December 31, 2024 | 7451940 | $0.10 |
| Granted | 20000 | 0.10 |
| December 31, 2025 | 7471940 | 0.10 |
| Options exercisable - December 31, 2025 | 7314964 | $0.10 |

---

The Company uses the fair value method for recording compensation expense related to stock-based instruments awarded to employees, consultants, officers, and the Board in accordance with IFRS 2. For the purpose of expensing stock options each tranche in an award is considered a separate award with its own vesting period and grant date fair value. Compensation expense is recognized over the tranche's vesting period by increasing contributed surplus based on the number of awards expected to vest. During 2025, the compensation expense including both salaries and benefits and professional service was $295,299 (2024 - $773,899).

For options granted in 2025 and 2024, the fair value of each stock option on the date of the grant was estimated using the Black-Scholes option pricing model as set out below.

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| &nbsp;&nbsp;&nbsp;&nbsp;Risk-free interest rate | 3.22% | 3.18%-3.62% |
| &nbsp;&nbsp;&nbsp;&nbsp;Estimated volatility | 39.8% | 43.5%-50.8% |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend yield |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Expected life (in years) | 10.00-20.00 | 10.00 |
| &nbsp;&nbsp;&nbsp;&nbsp;Weighted average share price at grant date | $0.37 | $0.36 |
| &nbsp;&nbsp;&nbsp;&nbsp;Weighted average fair value after share split | $0.414 | $0.345 |

---

Expected volatility has been based on an evaluation of the historical volatility of companies within the same industry as the Company, particularly over the historical period commensurate with the expected term.

As at December 31, 2025, the weighted average remaining contractual life of stock options was 7.53 years (2024 – 8.41 years).

**20.** **Capital Management** 

The Company's objectives when managing capital are to safeguard its ability to continue as a going concern while providing a return to its shareholders. The capital structure of the Company is composed of long-term debt, convertible notes, warrant liability, and equity attributable to the Company's shareholders. The Company's primary uses of capital are to finance the development of its technology. The Company's objectives in managing capital are: (i) to maintain sufficient working capital to meet current financial obligations and continue as a going concern; (ii) to maintain investor and creditor confidence; and (iii) to sustain future development of the business. Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Company, is reasonable. As at December 31, 2025, total managed capital was $45,200,769 (2024 - $38,145,882).

**21.** **Financial Instruments** 

Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the relative reliability of the inputs used to estimate the fair value. The three levels of the fair value hierarchy are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities:

· Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and

· Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

The carrying value of cash, accounts receivable, accounts payable and accrued liabilities, advances, and, due to shareholders approximate their fair values due to the relatively short-term maturities of these financial instruments.

---

| | | | |
|:---|:---|:---|:---|
|  | **Fair value hierarchy level** | **2025** | **2024** |
| Cash | Level 1 | $323974 | $397638 |
| Accounts and accrued receivables | Level 2 | 181384 | 495165 |
| Due from related parties | Level 2 | 3457277 | – |
|  |  | $3962635 | $892803 |
| Bank indebtedness | Level 1 | $7614 | $78068 |
| Accounts payable and accrued liabilities | Level 2 | 1795765 | 1943632 |
| Advances | Level 2 | 331585 | 388627 |
| Notes payable | Level 2 | 13220615 | 7510878 |
| Fair-value of convertible notes | Level 3 | 684992 | 427000 |
| Term loans | Level 3 | 1789382 | 2765135 |
| Warrant liability | Level 3 | 119806 | 1675883 |
| Lease liabilities | Level 3 | 900782 | 1141223 |
| Due to shareholders | Level 2 | 3775884 | 3759537 |
| Government loans | Level 3 | 465935 | 601329 |
|  |  | $23092360 | $20291312 |

---

The Company is exposed to the following risks by virtue of its activities: Credit Risk – Cash is primarily invested with one major bank in Canada and a bank in the United States. Management believes that the financial institutions that hold the Company's cash are financially sound and, accordingly, minimal credit risk exists with respect to this asset. The accounts and accrued receivable balance is mainly due from one large retailer which has been assessed for expected credit losses, and no significant allowance has been determined. The maximum credit risk is the sum of its cash and accounts and accrued receivable. None of the Company's financial assets are secured by collateral except the one mentioned in Note 13, or other credit enhancements. During the year ending December 31, 2025, the Company has estimated a provision for expected credit losses from its receivables amounting to $Nil (2024 - $1,169) (Note 5). Apart from the receivables, the Company determined that there were no financial assets that required valuation allowance. All the revenue is generated through e-commerce platforms in North America.

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rate. The Company enters into foreign currency purchase and sale transactions and has assets and liabilities denominated in foreign currencies resulting in exposure to the financial risk of earnings fluctuations arising from changes in foreign exchange rates and the degree of volatility of these rates. The Company does not use derivative instruments to reduce its exposure to foreign currency risk. The Company's financial instruments denominated in foreign currencies expressed in Canadian dollars and the exchange rate $1.37 Canadian dollars per $1 U.S. dollars during 2025 ($1.44 CAD per $1 USD in 2024) used at the balance sheet date are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **Currency** | **2025** | **2024** |
| Cash | U.S. dollar | $249234 | $131611 |
| Accounts payable and accrued liabilities | U.S. dollar | $1795765 | $1143031 |
| Advances | U.S. dollar | $304125 | $349376 |
| Notes payable | U.S. dollar | $13220615 | $7510878 |

---

Liquidity Risk - Liquidity risk arises from the Company will encounter difficulties in meeting its obligations associated with its financial liabilities. The Company is exposed to this risk mainly with respect to its accounts payable and accrued liabilities, advances, term loans, and convertible debts balances. The Company manages its liquidity risk by monitoring its operating requirements (Note 2).

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Carrying amount** | **Contractual cash flow** | **1 Year** | **2-7 years** |
| **December 31, 2025** |  |  |  |  |
| Bank indebtedness | $7614 | $7614 | $7614 | $– |
| Accounts payable and accrued liabilities | 1795765 | 1795765 | 1795765 |  |
| Advances | 331585 | 331585 | 331585 |  |
| Notes payable | 13220615 | 13220615 | 13220615 |  |
| Due to shareholders | 3775884 | 3775884 |  | 3775884 |
| Lease liabilities | 900782 | 1046561 | 358716 | 687845 |
| Term loans | 1789382 | 1789382 | 507882 | 1281500 |
| Convertible notes | 684992 | 684992 | 684992 |  |
| Government loans | 465935 | 612456 | 270632 | 341824 |
|  | $22972554 | $23264854 | $17177801 | $6087053 |
| **December 31, 2024** |  |  |  |  |
| Bank indebtedness | $78068 | $78068 | $78068 | $– |
| Accounts payable and accrued liabilities | 1943632 | 1943632 | 1943632 |  |
| Advances | 388627 | 388627 | 388627 |  |
| Notes payable | 7510878 | 7510878 | 7510878 |  |
| Due to shareholders | 3759537 | 3759537 |  | 3759537 |
| Lease liabilities | 1141223 | 1391935 | 345652 | 1046283 |
| Term loans | 2765135 | 2765135 | 639356 | 2125779 |
| Convertible notes | 427000 | 427000 | 427000 |  |
| Government loans | 601329 | 851420 | 286465 | 564955 |
|  | $18615429 | $19116232 | $11619678 | $7496554 |

---

**22.** **Compensation of Key Management and Related Party Transactions** 

Key management includes the Company's Board and key officers. Compensation awarded to key management included:

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Salaries and benefits | $161741 | $80000 |

---

<u>Transactions with related parties</u>

At December 31, 2025, $270,000 (December 31, 2024 - $270,000) of term loans were owed to a relative of the CEO (Note 13).

In 2025, the Company entered into intellectual property license, distribution, service, and financing agreements with a newly incorporated related entity under common control. This funding was utilized to facilitate initial capital expenditures and operational cash flow needs. As of December 31, 2025, the due from related party balance has accumulated to $3,457,277 (2024 - $Nil). Total license, service, and royalty income for the year ended December 31, 2025 is $3,289,440, $41,119, and $23,337, respectively.

**23.** **Income Taxes** 

The Company's effective income tax rate is made up as follows:

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Loss before income tax | $(3575822) | $(8401205) |
| Statutory tax rate | 26.5% | 26.5% |
| Expected income tax benefit | (947593) | (2226319) |
| Non-deductible expenses and permanent differences | 248691 | 509154 |
| Change in deferred tax assets not recognized | 698902 | 1717165 |
| Total income tax expense | $**–** | $– |

---

**Deferred Tax Assets and Liabilities**

The tax effects of temporary differences that give rise to the deferred income tax assets at December 31, 2025 and 2024 are as follows:

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Non-capital loss | $6903557 | $6409361 |
| SRED pools | 243576 | 243576 |
| Property and equipment | (26008) | (13548) |
| Share issuance costs | 743921 | 526755 |
|  | 7865046 | 7166144 |
| Deferred income tax assets not recognized | (7865046) | (7166144) |
| Total | $**–** | $– |

---

As at December 31, 2025, the Company has non-capital losses carried forward of $26,051,157 (2024 - $24,196,742) available to reduce future years taxable income. The losses expire in 2033 - 2045.

**24.** **Expenses by Nature** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2025** | **2025** | **2024** | **2024** |
|  | Product<br> costs | Operating<br> expenses | Product<br> costs | Operating<br> expenses |
| &nbsp;&nbsp;Advertising and promotion | $– | $2721697 | $– | $1543277 |
| &nbsp;&nbsp;Depreciation and amortization (Note 9, 10) |  | 327280 |  | 324214 |
| &nbsp;&nbsp;Freight and shipping |  | 653194 |  | 477561 |
| &nbsp;&nbsp;Inventory (Note 7) | 1618756 |  | 1673751 |  |
| &nbsp;&nbsp;Office and general |  | 2394032 |  | 2063904 |
| &nbsp;&nbsp;Short term rentals (Note 26) |  | 13207 |  | 22290 |
| &nbsp;&nbsp;Expected losses from receivables (Note 5) |  |  |  | 1169 |
| &nbsp;&nbsp;Research and development |  | 1037105 |  | 502023 |
| &nbsp;&nbsp;Salaries and benefits |  | 1131694 |  | 1574014 |
| &nbsp;&nbsp;Stock-based compensation (Note 19) | – | 252933 | – | 773899 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $1618756 | $8531142 | $1673751 | $7282351 |

---

**25.** **Finance Expense - net** 

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| &nbsp;&nbsp;Interest on term loans and notes payable (Note 13) | $2065814 | $1448268 |
| &nbsp;&nbsp;Term loan with warrants interest (Note 13) | 49337 | 269876 |
| &nbsp;&nbsp;Interest in leases (Note 26) | 104933 | 112014 |
| &nbsp;&nbsp;Accretion on government loans (Note 17) | 102000 | 117574 |
| &nbsp;&nbsp;Other interest and charges | 156574 | 145029 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $2478658 | $2092761 |

---

**26.** **Leases** 

The Company has entered into a lease for office space in Toronto and a lease for a vehicle. The leases are included in the Consolidated Statements of Financial Position as a right-of-use asset and lease liability. The vehicle lease began on May 31, 2023 and has a 4-year term. The Company has an option to purchase the vehicle at the end of the lease. The office lease started on January 1, 2024, it has a 5-year term, and there is no purchase option at the end of the lease term. The Company has provided a security deposit totaling $22,736 as of December 31, 2024 and 2025. Additional deposit of $48,257 was provided as of December 31, 2025. The security deposit is classified as a non-current asset on the Consolidated Statements of Financial Position, as it is expected to be returned at the end of the lease term, subject to the terms of the lease agreement. During the year ended December 31, 2025, interest expense incurred on lease liabilities is $104,933 (2024 - $112,014) (Note 25).

Other short-term rentals included in the operating expenses were immaterial for the year ended December 31, 2025 (2024 - $22,289) (Note 24).

**Lease Liabilities**

---

| | | | |
|:---|:---|:---|:---|
|  | **Vehicle** | **Office** | **Total** |
| **31-Dec-24** | $44843 | $1096380 | $1141223 |
| Lease Payments | (16998) | (223443) | (240441) |
| **31-Dec-25** | 27845 | 872937 | 900782 |
| Less: Current Portion | (18253) | (261974) | (280227) |
| Non-current portion | $9592 | $610963 | $620555 |

---

The following table presents the future cash flow from the two lease agreements as of December 31, 2025 for the next 5 years.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **2026** | **2027** | **2028** | **Thereafter** | **Total** |
| Lease Payments | $280227 | $299632 | $320982 | $– | $900841 |
| Finance Charges | 78489 | 49222 | 18009 | – | 145720 |
| Future undiscounted payments | $358716 | $348854 | $338991 | $– | $1046561 |

---

Additions to ROU assets and carrying amounts at the end of the reporting periods as well as depreciation charges are presented in Note 9.

**27.** **Supplemental Cash Flow Information** 

---

| | | |
|:---|:---|:---|
|  | **2025** | **2024** |
| Non-cash value of share issuance through exercise of warrants | $1356 | $– |
| Non-cash value of convertible notes converted to Common B Shares | 329814 | 217809 |
| Non-cash value of recognition of ROU assets & liabilities |  | 1290183 |
| Exercising convertible note | 27000 |  |

---

**28.** **Subsequent Events** 

The Company evaluated whether any events or transactions occurred subsequent to the date of its consolidated financial statements until April 30, 2026. Besides the events mentioned in Notes 1 and 15, no other material events or transactions occurred during this period that would require adjustment to or disclosure in the consolidated financial statements for the year ended December 31, 2025.

**<br> Item 8. Exhibits**

**INDEX TO EXHIBITS**

**2.1** [**Certificate and Articles of Incorporation as Amended**](http://www.sec.gov/Archives/edgar/data/1824930/000168316820004460/ryse_ex0201.htm) **\*** 

**2.2** [**Bylaws as Amended**](http://www.sec.gov/Archives/edgar/data/1824930/000168316822003286/ryse_ex0202.htm) **\*** 

**2.3** [**Certificate of Share Split Amendment**](http://www.sec.gov/Archives/edgar/data/1824930/000168316822003415/ryse_ex0203.htm) **\*** 

**4.1** [**Form of Subscription Agreement**](https://www.sec.gov/Archives/edgar/data/1824930/000168316823005098/ryse_ex04.htm) **\*** 

**6.1** [**Voting Trust Agreement as Amended**](http://www.sec.gov/Archives/edgar/data/1824930/000168316820004460/ryse-ex0601.htm) **\*** 

**6.2** [**Shareholders Agreement as Amended**](http://www.sec.gov/Archives/edgar/data/1824930/000168316822003286/ryse_ex0602.htm) **\*** 

**6.3** [**Employment Agreement Marc Bishara**](http://www.sec.gov/Archives/edgar/data/1824930/000168316820004460/ryse-ex0604.htm) **\*** 

**6.4** **[Lease (portions of this exhibit have been omitted)](https://www.sec.gov/Archives/edgar/data/1824930/000168316825005406/ryse_ex0604.htm) \*** 

**6.5** **[Agreement with Dealmaker](https://www.sec.gov/Archives/edgar/data/1824930/000168316825005406/ryse_ex0605.htm) \*** 

**\*** **Previously filed.**

**SIGNATURES**

Pursuant to the requirements of Regulation A, the issuer has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized April 30, 2026.

---

| | | |
|:---|:---|:---|
| **RYSE, Inc** |  |  |
| April 30, 2026 | By: | */s/ Trung Pham* |
|  | Name: | Trung Pham |
|  | Title: | Chief Executive Officer |
|  |  | (Principal Executive Officer) |
|  |  | Chief Financial Officer (Principal Accounting Officer) |

---

Pursuant to the requirements of the Securities Act of 1933, this report has been signed by the following persons in the capacities and on the date indicated.

---

| | | |
|:---|:---|:---|
| **Signature** | **Title** | **Date** |
| */s/ Trung Pham* | Chief Executive Officer, Chief Financial Officer, Secretary, and Director | April 30, 2026 |
| Trung Pham |  |  |

---

## Form 1-K Filing Summary

### Filer Information

**Issuer CIK:** 0001824930

**Issuer CCC:** XXXXXXXX

**Is filer a shell company?:** No

**Is this filing by a successor company?:** No

### Submission Contact Information

**Is this a LIVE or TEST Filing?:** LIVE

**Period:** 12-31-2025

### Item 1: Issuer Information (Tab 1 Notification)

**Type of Report:** Annual Report

**Fiscal Year End:** 12-31-2025

**Exact Name of Issuer:** RYSE, Inc.

**CIK:** 0001824930

**Jurisdiction of Incorporation:** A6

**IRS Number:** 00-0000000

**Address:** 20 CAMDEN ST., TORONTO, A6 M5V 1VI

**Issuer Phone Number:** 929-219-3299

**Title of each class of securities issued pursuant to Regulation A:** Class B Common Stock

### Item 2: Ongoing Reporting Requirements

**Is the issuer relying on the relief provided by Rule 257(d) for this filing?** Yes