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Stock options
 12 Months Ended
Dec. 31, 2014
Notes to Financial Statements  
10. Stock options

The following is a summary of stock options which are outstanding as at December 31, 2014:

 

                  average remaining  
Exercise price     # of options     # of options     contractual  
per share     outstanding     exercisable     life (in years)  
$0.45       74,600       74,600       0.8  
$0.75       355,000       236,664       2.5  
$0.76       303,335       131,110       3.1  
$0.86       707,500       454,163       2.6  
$1.16       411,000       411,000       1.6  
$1.20       300,000       300,000       2.6  
$1.35       55,000       55,000       5.0  
$1.39       55,000       55,000       4.5  
$1.55       40,000       -       4.2  
$1.61       25,000       -       4.1  
$1.67       150,000       -       4.9  
$1.83       65,000       65,000       4.0  
$1.02       2,541,435       1,782,537       2.7  

 

A continuity of the number of stock options which are outstanding at December 31, 2014 and 2013 is as follows:

 

    For the year ended     For the year ended  
    December 31, 2014     December 31, 2013  
          weighted           weighted  
    # of stock     average     # of stock     average  
    options     exercise price     options     exercise price  
Options outstanding, start of the year     2,888,100     $ 0.88       2,890,600     $ 0.86  
Granted     325,000     $ 1.55       542,500     $ 0.91  
Exercised     (482,665 )   $ 0.60       (16,667 )   $ 0.79  
Forfeited     (35,000 )   $ 1.42       (423,333 )   $ 0.79  
Expired     (154,000 )   $ 0.71       (105,000 )   $ 0.75  
Options outstanding, end of the year     2,541,435     $ 1.02       2,888,100     $ 0.88  
Options exercisable, end of the year     1,782,537     $ 1.01       1,733,930     $ 0.90  

 

Subsequent to December 31, 2014, the Company issued a total of 601,066 additional stock options with an average exercise price of $1.37 per share and a 5 year term to expiry in 2020.

 

Stock options granted generally expire, if unexercised, five years from the date granted and entitlement to exercise them generally vests at a rate of one-third at the end of each of the first three years following the date of grant.

 

Stock based compensation expense (“SBCE”) 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:

 

    2014     2013     2012  
Expected dividends paid per common share   Nil     Nil     Nil  
Expected life in years     5.0       5.0       4.0  
Expected volatility in the price of common shares     113 %     74 %     79 %
Risk free interest rate     1.5 %     1.0 %     1.0 %
Weighted average fair market value per share at grant date   $ 1.24     $ 0.55     $ 0.52  
Intrinsic (or "in-the-money") value per share of options exercised   $ 0.85     $ 0.76     $ 0.13  

                       

SBCE consists of the following amounts:

 

  2014   2013   2012  
SBCE recognized related to:            
Stock options   $ 432,000     $ 492,000     $ 265,000  
Preferred Share Rights (see note 8)     226,000       -       -  
Total SBCE     658,000       492,000       265,000  

 

The unamortized portion of SBCE related to the non-vested portion of stock options and the Preferred Share Rights, all of which will be recognized in future expense over the related remaining (2015 to 2017) vesting periods, is as follows:

 

As at December 31   2014     2013  
Unamortized SBCE related to:            
Stock options   $ 367,000     $ 475,000  
Preferred Share Rights (see note 8)     234,000       -  
      601,000       475,000