Share capital

6 Months Ended

Jun. 30, 2019

Share Capital

NOTE 3 - Share capital

The holders of common shares are entitled to receive dividends as declared, which is at the discretion of the Corporation, and are entitled to one vote per share at the annual general meeting of the Corporation. The Corporation has never paid any dividends.

(a) Private placements:

At the six-month period ended June 30, 2019, the Corporation completed one private placement to an accredited investor for a total of $5,000,000. A total of 2,500,000 common shares were issued at $2.00 per share and 2,500,000 warrants were issued connecting with the share issuance.

(b) Stock options:

The Corporation has established a stock option plan (the “Plan”) for its key employees, its officers and directors, and certain consultants. The Plan is administered by the Board of Directors of the Corporation. The Board may from time to time designate individuals to whom options to purchase common shares of the Corporation may be granted, the number of shares to be optioned to each, and the option price per share. The option price per share cannot involve a discount to the market price at the time the option is granted. The maximum number of shares which may be optioned under the stock option plan is 7,500,000. The maximum number of shares which may be optioned to any one individual is 15% of the total issued and outstanding common shares. Options under the Plan expire ten years after the grant date and vest either immediately or over periods up to six years, and are equity-settled. As at June 30, 2019, 1,410,000 options could still be granted by the Corporation.

The following table provides the activity of stock option awards during the six-month period ended June 30, 2019 and for options outstanding and exercisable at the end of the six-month period ended June 30, 2019, the range of exercise price and the weighted average years to expiration.

				outstanding		Weighted
				Weighted		average
				average		remaining
				exercise		contractual
	Number			Price		life (in years)
Outstanding, December 31, 2018		5,740,000		$	1.76		6.37
Expired / Cancelled		(10,000	)		3.43		-
Granted		360,000			2.08		9.76
Outstanding, June 30, 2019		6,090,000		$	1.78		6.11
Options exercisable		6,090,000		$	1.78		6.11

(c) Stock-based compensation: Stock -based compensation includes stock and stock option granted to employees

	Three months				Six months
	ended June 30,				ended June 30,
Employee expenses	2019		2018		2019		2018
Stock options and compensation granted in:
2015		609,389		913,964		1,286,823		1,920,769
2018		–		–		13,038		–
2019		680,290				680,290
Total stock-based compensation expense recognized	$	1,289,679	$	913,964	$	1,980,151	$	1920,769

The stock-based compensation expense is disaggregated in the statements of operations and comprehensive loss as follows:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2019		2018		2019		2018
Stock-based compensation pertaining to general and administrative	$	984,984	$	456,982	$	1,323,701	$	960,384
Stock-based compensation pertaining to research and development		304,695		456,982		656,450		960,385
Total	$	1,289,679	$	913,964	$	1,980,151	$	1,920,769

360,000 stock options were granted to five directors during the six-month period ended June 30, 2019 and no options were granted in the comparative period in 2018.

During the three -month period ended on June 30, 2019, the corporation issued one million shares with a total value of $1,330,000 to a related party for their significant contributions and development of the company from year 2014 to 2019.

(d) Warrants :

In the first quarter of 2019, the Corporation issued 2,500,000 warrants in connection with one private placement referred to in note 3 (a). Each warrant entitles the holder to acquire one common share of the Corporation at an exercise price of $8.00 with a five year term. The warrant was valued at $200,000 and recorded as part of additional paid in capital.