STOCK OPTIONS AND WARRANTS [Text Block] | 10. STOCK OPTIONS AND WARRANTS Stock Options On July 15, 2014, the shareholders approved and adopted at the Annual General Meeting the Company’s 2014 Stock Option Plan. On April 14, 2011, the shareholders approved and adopted at the Annual General Meeting to consolidate the Company’s 2007 Equity compensation plan and the Company’s 2010 Equity Compensation Plan into a new Company 2011 Stock Option Plan. The purpose of these Plans is to advance the interests of the Corporation, through the grant of Options, by providing an incentive mechanism to foster the interest of eligible persons in the success of the Corporation and its affiliates; encouraging eligible persons to remain with the Corporation or its affiliates; and attracting new Directors, Officers, Employees and Consultants. On September 19, 2016, the Company granted 800,000 stock options to consultant of the Company with an exercise price of $0.07 vested immediately, expiring September 19, 2021. On January 20, 2017, the Company granted 1,535,000 stock options to directors, officers and consultant of the Company with an exercise price of $0.07 vested immediately, expiring January 20, 2022. On January 31, 2017, the Company granted 1,500,000 stock options to consultant of the Company with an exercise price of $0.07 vested immediately, expiring January 31, 2022. On May 2, 2017, the Company granted 500,000 stock options to consultant of the Company with an exercise price of $0.10, vested immediately, expiring May 2, 2022. On November 1, 2017, the Company granted 800,000 stock options to a director and consultant of the Company with an exercise price of $0.05, expiring November 2, 2022. On May 11, 2018, the Company granted 535,000 stock options to a director and consultant of the Company with an exercise price of $0.06, expiring May 11, 2023. On May 22, 2018, the Company granted 550,000 stock options to consultants of the Company with an exercise price of $0.07, expiring May 22, 2023. For the year ended August 31, 2018, the Company recorded $89,596 (August 31, 2017: $227,428) stock based compensation expense. A summary of the changes in stock options for the year ended August 31, 2018 is presented below: Options Outstanding Weighted Average Number of Shares Exercise Price Balance, August 31, 2016 3,210,000 $ 0.07 Cancelled (250,000 ) 0.06 Granted 4,335,000 0.07 Balance, August 31, 2017 7,295,000 $ 0.07 Granted 1,885,000 0.06 Exercised (610,000 ) 0.05 Balance, August 31, 2018 8,570,000 $ 0.07 The fair value of options granted has been estimated as of the date of the grant by using the Black-Scholes option pricing model with the following assumptions: August 31, 2018 August 31, 2017 Expected volatility 204% 182%-232% Risk-free interest rate 1.93% 1.22%- 1.95% Expected life 5.00 years 5.00 years Dividend yield 0.00% 0.00% Estimated fair value per option $0.05 $0.05 -$0.09 The Company has the following options outstanding and exercisable. August 31, 2018 Options outstanding and exercisable Number Remaining Exercise prices of shares contractual life $0.07 550,000 4.73 years $0.06 535,000 4.70 years $0.05 800,000 4.16 years $0.10 500,000 3.67 years $0.07 1,500,000 3.42 years $0.07 1,535,000 3.39 years $0.07 800,000 3.05 years $0.05 1,100,000 2.15 years $0.10 1,000,000 1.18 years $0.06 250,000 0.18 years 1 8,570,000 2.88 years 1. 250,000 options expired unexercised subsequent to August 31, 2018 August 31, 2017 Options outstanding and exercisable Number Remaining Exercise prices of shares contractual life $0.10 500,000 4.67 years $0.07 1,500,000 4.42 years $0.07 1,535,000 4.39 years $0.07 800,000 4.05 years $0.05 1,460,000 3.15 years $0.10 1,000,000 2.18 years $0.06 500,000 1.18 years 7,295,000 3.43 years The aggregate intrinsic value for options vested and total options as at August 31, 2018 and 2017 is $Nil. Warrants On February 28, 2017, the Company signed a Letter of Engagement with Adam Mogil and issued 1,000,000 warrant options to convert to 1,000,000 common shares to Adam Mogil to provide corporate services. The warrants have an exercise price of $0.09 and expire August 28, 2017. The fair value of the warrants granted has been estimated as of the date of the grant by using the Black-Scholes option pricing model with the following assumptions: expected volatility: 182%, risk-free interest rate: 1.22%, expected life: 0.50 years, dividend yield: 0.00% . The Company has recorded $29,168 in stock based compensation expense related to these warrants in the year ended August 31, 2017. On April 21, 2017, the Company issued 95,500 shares for gross proceeds of $5,685 from the exercise of warrants of previous financings at $0.05 and $0.07. On April 30, 2017, the Company issued 166,500 shares for gross proceeds of $11,655 from the exercise of warrants from a previous financing at $0.07. During the year ended August 31, 2017, the Company issued 12,332,571 warrants attached to units issued in multiple private placements, see Note 9 for disclosure of individual amounts and terms of warrants by private placement. In addition, the Company issued 615,900 brokers warrants in connection with these private placements, also disclosed in Note 9. The fair value of the brokers warrants was $33,213 (2016 - $Nil), recorded as share issuance costs off-setting the gross proceeds of private placements in additional-paid-in-capital, and was calculated using the Black Scholes option pricing model, with the following weighted average assumptions: expected volatility 168%, risk-free interest rate: 1.14%, expected life: 2 years, dividend yield: 0.00% . During the year ended August 31, 2018, the Company issued 16,781,900 warrants attached to units in private placements and 922,690 broker warrants in connection with the private placements, see Note 9 for disclosure of the terms of the warrants. The fair value of the brokers warrants was $27,791, recorded as share issuance costs off-setting the gross proceeds of private placements in additional-paid-in-capital, and was calculated using the Black Scholes option pricing model, with the following weighted average assumptions: expected volatility 152%, risk-free interest rate: 2.10%, expected life: 2.43 years, dividend yield: 0.00% . A summary of warrants as at August 31, 2018 and August 31, 2017 is as follows: Warrant Outstanding Weighted Average Number of warrants Exercise Price Balance, August 31, 2016 29,412,139 $ 0.09 Expired (3,906,800 ) 0.10 Exercised (262,000 ) 0.07 Issued 13,948,471 0.08 Balance, August 31, 2017 39,191,810 $ 0.09 Expired (16,107,340 ) 0.12 Issued 17,704,590 0.06 Exercised (50,000 ) 0.07 Balance, August 31, 2018 40,739,060 $ 0.06 Number Exercise Expiry Outstanding 1 Price Date 4,800,000 $0.050 August 31, 2021 2,540,000 $0.075 May 25, 2020 1,891,590 $0.075 May 11, 2020 1,688,600 $0.060 January 12, 2020 4,184,400 $0.060 December 8, 2019 2,600,000 $0.060 November 1, 2019 3,253,333 $0.050 and $0.10 after 18 months June 8, 2019 6,882,666 $0.050 and $0.10 after 18 months May 20, 2019 3,454,400 $0.120 April 29, 2019 4,477,500 $0.060 February 28, 2019 1,020,000 $0.060 January 20, 2019 3,946,571 $0.070 September 23, 2018 2 40,739,060 1. Each warrant entitles a holder to purchase one common share. 2. 3,946,571 warrants expired unexercised subsequent to August 31, 2018 |