STOCK BASED COMPENSATION

Effective October 30, 2006 the Company adopted the following stock option and stock bonus plans which were replaced by the incentive stock option plan (the “2013 Plan”)

Incentive Stock Option Plan . The Company’s Incentive Stock Option Plan authorizes the issuance of shares of its Common Stock to persons that exercise options granted pursuant to the Plan. Only employees may be granted options pursuant to the Incentive Stock Option Plan. The option exercise price is determined by its directors but cannot be less than the market price of its common stock on the date the option is granted. The Company has reserved 1,000,000 common shares under this plan. No options have been issued under this plan as at August 31, 2013.

Non-Qualified Stock Option Plan . SDI’s Non-Qualified Stock Option Plan authorizes the issuance of shares of its Common Stock to persons that exercise options granted pursuant to the Plans. SDI’s employees, directors, officers, consultants and advisors are eligible to be granted options pursuant to the Plans, provided however that bona fide services must be rendered by such consultants or advisors and such services must not be in connection with the offer or sale of securities in a capital-raising transaction. By a resolution of the Board of Directors, the Company amended this plan to increase the number of common shares available under this plan from 2,250,000 to 4,500,000 effective October 10, 2007. The Company further amended its Non-Qualified Stock Option Plan to increase the number of Common Shares available under this plan to 5,000,000 and filed an S- 8 registration statement on April 10, 2008.

Stock Bonus Plan . SDI’s Stock Bonus Plan allows for the issuance of shares of common stock to its employees, directors, officers, consultants and advisors. However bona fide services must be rendered by the consultants or advisors and such services must not be in connection with the offer or sale of securities in a capital-raising transaction. The Company has reserved 150,000 common shares under this plan. No options have been issued under this plan as at August 31, 2013.

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.

The 2013 Plan authorizes the issuance that number of Common Shares as is equal to 20% of the issued and outstanding Common Shares. As a condition precedent to the TSXV issuing its final acceptance of listing of the Common Shares on the TSXV, all of the warrants previously issued by the Corporation in satisfaction of remuneration for services (in aggregate, warrants entitling the purchase of 4,319,000 Common Shares that were outstanding as of the date of filing of the amended and restated prospectus on August 15, 2013) are considered for purposes of the 2013 Plan reserve to be incentive stock options and included under the 2013 Plan reserve.

The Board of Directors administers the 2013 Plan. The Corporation’s employees, directors, officers, consultants and advisors are eligible to be granted options pursuant to 2013 Plan and in accordance with the policies of the TSXV, provided however that bona fide services must be rendered by such consultants or advisors and such services must not be in connection with the offer or sale of securities in a capital-raising transaction. In no instance shall an option be less than the market price of the Common Shares; the period during which options may be exercised cannot exceed ten years from the date of grant. No option shall be transferable or assignable. If there is any reclassification, consolidation or merger, the number of Common Shares subject to option and the option price per Common Share shall be proportionately adjusted in accordance with the terms of the 2013 Plan. The Board may attach other terms to the options at the time of grant. The Plan shall be governed by the laws of the Province of Ontario.

Year ended November 30, 2012

On January 4, 2012, the board of directors granted options to three directors to acquire a total of 775,000 common shares, one officer to acquire 20,000 common shares and two consultants to acquire a total of 110,000 common shares. The 905,000 options were issued at an exercise price of $0.13 per share and vest immediately with an expiry term of four 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 weighted average assumptions: