| Stock options |
The following is a summary of stock options which are outstanding
as at December 31, 2012:
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# of |
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# of |
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average |
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exercise |
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stock options |
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|
stock options |
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|
remaining contractual |
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price |
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outstanding |
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exercisable |
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life (years) |
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$ |
0.45 |
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|
105,600 |
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|
105,600 |
|
|
|
2.8 |
|
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$ |
0.53 |
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|
|
150,000 |
|
|
|
100,000 |
|
|
|
1.0 |
|
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$ |
0.63 |
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|
|
450,000 |
|
|
|
450,000 |
|
|
|
1.6 |
|
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$ |
0.75 |
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395,000 |
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|
- |
|
|
|
4.5 |
|
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$ |
0.76 |
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90,000 |
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|
- |
|
|
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5.0 |
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$ |
0.86 |
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815,000 |
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|
- |
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|
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4.6 |
|
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$ |
0.89 |
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150,000 |
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|
- |
|
|
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4.1 |
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$ |
1.16 |
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435,000 |
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255,000 |
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3.6 |
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$ |
1.20 |
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|
|
300,000 |
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|
|
60,000 |
|
|
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4.6 |
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|
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2,890,600 |
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|
970,600 |
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|
|
3.7 |
|
| A continuity of the number of stock options outstanding at the end of each of the last three years ended December 31 is as follows: |
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2012 |
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|
2011 |
|
| |
|
|
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|
weighted |
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|
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|
|
weighted |
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|
# of |
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|
average |
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|
# of |
|
|
average |
|
| |
|
stock options |
|
|
exercise price |
|
|
stock options |
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|
exercise price |
|
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|
|
|
|
|
|
|
|
|
|
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|
| Outstanding at beginning of the year |
|
|
2,473,100 |
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|
$ |
1.02 |
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|
|
2,134,804 |
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|
$ |
0.62 |
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| Granted |
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|
1,900,000 |
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|
$ |
0.89 |
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|
|
1,054,800 |
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$ |
1.58 |
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| Forfeited |
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(390,268 |
) |
|
$ |
1.72 |
|
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|
(398,300 |
) |
|
$ |
0.65 |
|
| Expired unexercised |
|
|
(877,232 |
) |
|
$ |
1.05 |
|
|
|
(288,204 |
) |
|
$ |
0.63 |
|
| Cancelled |
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(140,000 |
) |
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$ |
0.63 |
|
|
|
- |
|
|
|
- |
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| Exercised |
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|
(75,000 |
) |
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$ |
0.63 |
|
|
|
(30,000 |
) |
|
$ |
0.63 |
|
| Options outstanding as at end of the year |
|
|
2,890,600 |
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|
$ |
0.86 |
|
|
|
2,473,100 |
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|
$ |
1.02 |
|
| Options exercisable as at end of the year |
|
|
970,600 |
|
|
$ |
0.86 |
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|
1,538,100 |
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$ |
0.68 |
|
| |
|
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|
2010 |
|
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|
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|
weighted |
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|
# of |
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|
average |
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|
stock options |
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|
exercise price |
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| Outstanding at beginning of the year |
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2,757,204 |
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$ |
1.76 |
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| Granted |
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|
248,900 |
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$ |
0.62 |
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| Forfeited |
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|
(431,300 |
) |
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$ |
1.48 |
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| Expired unexercised |
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(340,000 |
) |
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$ |
0.66 |
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| Cancelled |
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|
(2,113,204 |
) |
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$ |
1.94 |
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| Granted on re-pricing in 2010 |
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|
2,113,204 |
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$ |
0.63 |
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| Exercised |
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|
(100,000 |
) |
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$ |
0.55 |
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| Options outstanding as at end of the year |
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|
2,134,804 |
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$ |
0.62 |
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| Options exercisable as at end of the year |
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1,737,637 |
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$ |
0.61 |
|
Stock options granted generally expire, if unexercised, five years
from the date granted and entitlement to exercise vests at a rate of one-third at the end of each of the first three years following
the date of grant, except as otherwise noted below.
| ● |
A total of 300,000 stock options were granted in August, 2012, with an average exercise price of $1.20, expiring August 2017, and with 20% of the options vesting after each 3 month period. |
| ● |
In July 2012 a total of 830,000 stock options with an exercise price of $0.86 were granted to Directors and Officers of NXT. In addition, two Directors of NXT surrendered for cancellation a total of 140,000 vested stock options, which had an exercise price of $0.63 per share, and an expiry date of December 12, 2012. |
| ● |
A total of 400,000 stock options were granted in December, 2011, at an average exercise price of $2.50, expiring June 1, 2013, and with 25% of the options vesting after each 3 month period. In 2012, a total of 200,000 of these options were forfeited and the remaining 200,000 expired. |
| ● |
A total of 214,800 of the 504,800 stock options which were granted in July, 2011 at an exercise price of $1.16 per share had immediate vesting. |
| ● |
In January, 2011 an Officer of the Company was granted 150,000 options at an excise price of $0.53 per share, and with one third of the options vesting at the date of grant and one-third vesting at the end of each of the following two years. These options will expire three years from the date of grant. |
On December 8, 2010, following approval by
the Company's shareholders, a total of 2,113,204 stock options (which had an average original exercise price
of U.S. $2.04) were re-priced to an exercise price of Cdn. $0.63 per share. All of these re-priced options retained
the rest of their original terms, and were treated for accounting purposes as a modification of the previously issued options.
The re-pricing included a total of 1,615,000 options held by Directors and Officers of the Company which had an average exercise
price of U.S. $2.35 per share.
Stock based compensation expense is calculated based on the fair
value attributed to grants of stock options using the Black-Scholes valuation model and utilizing the following weighted average
assumptions:
| |
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2012 |
|
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2011 |
|
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2010 |
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| Stock based compensation expense for the period |
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$ |
265,000 |
|
|
$ |
344,800 |
|
|
$ |
577,815 |
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| Expected dividends paid per common share |
|
Nil |
|
|
Nil |
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|
Nil |
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| Expected life in years |
|
|
4.0 |
|
|
|
2.8 |
|
|
|
1.8 |
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| Expected volatility in the price of common shares |
|
|
79 |
% |
|
|
111 |
% |
|
|
92 |
% |
| Risk free interest rate |
|
|
1.0 |
% |
|
|
1.5 |
% |
|
|
1.5 |
% |
| Weighted average fair market value per share at grant date |
|
$ |
0.52 |
|
|
$ |
0.57 |
|
|
$ |
0.27 |
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| Intrinsic (or "in-the-money") value per share of options exercised |
|
$ |
0.13 |
|
|
$ |
0.22 |
|
|
$ |
0.53 |
|
As of December 31, 2012 there was $967,000
(December 31, 2011 - $338,000) of unamortized stock based compensation expense related to non-vested stock options. This
amount will be recognized in future expense over the remaining vesting periods of the underlying stock options. |