| STOCK BASED COMPENSATION [Text Block] |
| 5. |
STOCK BASED COMPENSATION
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Effective May 31, 2013, the Company adopted an incentive stock option plan (the “2013 Plan”), which replaces the stock option and stock bonus plans that were in place prior to adoption of the 2013 Plan. All outstanding options to purchase Common Shares granted by the Company under the prior plans are now governed by the 2013 Plan and the prior plans (an Incentive Stock Option Plan, a Non-Qualified Stock Option Plan, and a Stock Bonus Plan) have been terminated.
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The purpose of this Plan is to authorize the grant to Eligible Persons of the Company of Options to purchase Shares and thus benefit the Company by enabling it to attract, retain and motivate Eligible Persons by providing them with the opportunity, through Options, to acquire an increased proprietary interest in the Company.
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The maximum number of Shares which may be reserved for issuance to any one Consultant under the Plan, any other employer stock options plans or options for services, within any
12
-month period, shall be
2% of the Shares issued and outstanding at the time of the grant (on a non-diluted basis).
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The maximum number of Shares which may be reserved for issuance to Investor Relations Optionees under the Plan, any other employer stock options plans or options for services, within any
12
-month period shall be
2% of the Shares issued and outstanding at the time of the grant (on a non-diluted basis).
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The maximum number of Shares which may be reserved for issuance to insiders of the Company in any
12
- month period shall be
10% of the Shares issued and outstanding at the start of such
12
-month period (on a non-diluted basis).
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The purchase price (the “Price”) for the Shares under each Option shall be determined by the Board of Directors or Committee, as applicable, on the basis of the market price, where “market price” shall mean the prior trading day closing price of the Shares on any stock exchange on which the Shares are listed or last trading price on the prior trading day on any dealing network where the Shares trade, and where there is no such closing price or trade on the prior trading day, “market price” shall mean the average of the daily high and low board lot trading prices of the Shares on any stock exchange on which the Shares are listed or dealing network on which the Shares trade for the five (5) immediately preceding trading days. In the event the Shares are listed on the TSXV, the price may be the market price less any discounts from the market price allowed by the TSXV, subject to a minimum price of CDN$0.10.
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Year ended November 30, 2016
Warrants:
On June 9, 2016, the board of directors extended the expiry dates of
400,000
warrants issued in 2012 to a director at exercise price of $0.20, from original expiry date of August 9, 2016 to August 7, 2020. The change in the terms of the warrants was determined to be a modification and not a cancellation and issuance of a new warrant. As a result of these modifications, the fair value of
400,000
warrants increased by $49,912.
Fair value of warrants was calculated using the Black Scholes option pricing model with the following assumptions:
| Risk free rate |
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2.00%
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| Expected dividends |
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0%
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| Forfeiture rate |
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0%
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101.25% to
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| Volatility |
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150.29%
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| Warrant modification expense |
$ |
49,912
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Stock Options
:
On August 18, 2016, the board of directors granted options to a consultant to acquire a total of
25,000
common shares. These options were issued at an exercise price of $0.11
(CAD $0.14) per share and vest immediately with an expiry term of five years. The fair value of each option used for the purpose of estimating the stock compensation is calculated using the Black-Scholes option pricing model with the following assumptions:
| Risk free rate |
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2.00%
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| Expected dividends |
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0%
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| Forfeiture rate |
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0%
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| Volatility |
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163.68%
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| Market price of Company’s common stock on date of grant of options |
$ |
0.11
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| Stock-based compensation cost |
$ |
2,574
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On October 20, 2016, the board of directors granted options to a new director to acquire a total of
350,000
common shares. These options were issued at an exercise price of $0.08
(CAD $0.11) per share and vest immediately with an expiry term of five years. The fair value of each option used for the purpose of estimating the stock compensation is calculated using the Black-Scholes option pricing model with the following assumptions:
| Risk free rate |
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2.00%
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| Expected dividends |
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0%
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| Forfeiture rate |
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0%
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| Volatility |
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149.08%
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| Market price of Company’s common stock on date of grant of options |
$ |
0.08
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| Stock-based compensation cost |
$ |
25,450
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As of November 30, 2016, there was $Nil
of unrecognized expense related to non-vested stock-based compensation arrangements granted.
Nine- month period ended August 31, 2017
Warrants:
The Company did not issue any warrants during the nine- month period ended August 31, 2017.
Nine- month period ended August 31, 2017-Cont’d
Stock Options:
On March 27, 2017, the board of directors granted options to the CEO to acquire a total of
1,150,000
common shares. These options were issued at an exercise price of $0.10
(CAD $0.13) per share and vest thirty-three and one-third (33 1/3) percent every six months commencing January 1, 2017, with an expiry term of five years. The fair value of each option used for the purpose of estimating the stock compensation is calculated using the Black-Scholes option pricing model with the following assumptions:
| Risk free rate |
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2.00%
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| Expected dividends |
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0%
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| Forfeiture rate |
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0%
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| Volatility |
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134.27%
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| Market price of Company’s common stock on date of grant of options |
$ |
0.10
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| Stock-based compensation cost expensed |
$ |
44,624
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| Unvested stock based compensation expense |
$ |
55,781
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On May 26, 2017, the board of directors granted
895,000
options to directors and
75,000
options to a consultant to acquire a total of
970,000
common shares. These options were issued at an exercise price of $0.15
(CAD $0.20) per share and vest immediately with an expiry term of five years. The fair value of each option used for the purpose of estimating the stock compensation is calculated using the Black-Scholes option pricing model with the following assumptions:
| Risk free rate |
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2.00%
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| Expected dividends |
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0%
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| Forfeiture rate |
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0%
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| Volatility |
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127.9%
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| Market price of Company’s common stock on date of grant of options |
$ |
0.15
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| Stock-based compensation cost expensed |
$ |
124,326
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| Unvested stock based compensation expense |
$ |
Nil
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On June 19, 2017, the board of directors granted options to an employee to acquire a total of
150,000
common shares. These options were issued at an exercise price of $0.16
(CAD $0.20) per share and vest immediately with an expiry term of five years. The fair value of each option used for the purpose of estimating the stock compensation is calculated using the Black-Scholes option pricing model with the following assumptions:
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Risk free rate |
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2.00%
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Expected dividends |
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0%
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Forfeiture rate |
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0%
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Volatility |
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128.8%
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Market price of Company’s common stock on date of grant of options |
$ |
0.14
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Stock-based compensation cost expensed |
$ |
17,795
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Unvested stock based compensation expense |
$ |
Nil
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On August 10, 2017, the board of directors granted options to a new director to acquire a total of
96,667
common shares. These options were issued at an exercise price of $0.16
(CAD $0.20) per share and vest immediately and expire August 16, 2022. The fair value of each option used for the purpose of estimating the stock compensation is calculated using the Black-Scholes option pricing model with the following assumptions:
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Risk free rate |
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2.00%
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Expected dividends |
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0%
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Forfeiture rate |
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0%
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Volatility |
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129.9%
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Market price of Company’s common stock on date of grant of options |
$ |
0.13
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Stock-based compensation cost expensed |
$ |
10,633
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Unvested stock based compensation expense |
$ |
Nil
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As of August 31, 2017, there was $55,781
of unrecognized expense related to non-vested stock-based compensation arrangements granted.
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