Stock Options

6 Months Ended

Jun. 30, 2019

Share-based Payment Arrangement [Abstract]

Stock Options

14. Stock Options

The Company adopted a stock option plan (“Plan”). The purpose of this Plan is to provide additional incentives to key employees, officers, directors and consultants of the Company and its subsidiaries in order to help attract and retain the best available personnel for positions of responsibility and otherwise promote the success of the Company’s business. It is intended that options issued under this Plan constitute non-qualified stock options. The general terms of awards under the Plan are that 100% of the options granted will vest the year following the grant. The maximum term of options granted is 5 years and the exercise price of all options are issued for not less than fair market value at the date of grant.

The following table summarizes the Company’s stock option activity for the year ended December 31, 2017 and the six month period ended June 30, 2019:

	Number of shares			Exercise price per share		Weighted average exercise price
Balance, December 31, 2017		713,000		$	0.75 – 1.70	$	1.21
Granted		110,000		$	1.48 – 1.75	$	1.74
Cancelled or expired		(61,334	)	$	1.00 – 1.70	$	1.09
Exercised		(101,666	)	$	0.75 – 1.42	$	1.01
Balance, December 31, 2018		660,000		$	0.75 – 1.75	$	1.35
Granted		153,000		$	3.46	$	3.46
Cancelled or expired		(47,112	)	$	0.75 – 1.70	$	1.37
Exercised		(117,888	)	$	0.75 – 1.70	$	1.19
Balance, June 30, 2019		648,000		$	0.75 – 3.46	$	1.85
Exercisable, June 30, 2019		395,000		$	0.75 – 1.70	$	1.25

The fair value of each option grant is calculated using the following weighted average assumptions:

	2019			2018
Expected life – years		3.0			3.0
Interest rate		1.93	%		2.8 – 2.96	%
Volatility		43.89	%		47.59 – 51.85	%
Weighted average fair value of options granted	$	1.0959		$	0.4759 – 0.6313

During the six months ended June 30, 2019, the Company granted 40,000 (2018 – nil) stock options to consultants and has applied ASC 718 using the Black-Scholes option-pricing model, which resulted in expenses of $14,612 (2018 - $nil). The Company granted 113,000 stock options to employees during the six months ended June 30, 2019 (2018 – 5,000) which resulted in $41,279 in expenses (2018 - $1,109). Vesting of options granted in previous years resulted in expenses in the amount of $nil for employees (2018 - $36,547) during the six months ended June 30, 2019 and $11,495 for consultants (2018 - $13,350) . There were 102,000 employee and 15,888 consultant stock options exercised during the during the six months ended June 30, 2019 (2018 – 23,000 employee and 15,000 consultant stock options).

As of June 30, 2019, there was approximately $157,669 of compensation expense related to non-vested awards. This expense is expected to be recognized over a weighted average period of 2.0 years.

The aggregate intrinsic value of vested options outstanding at June 30, 2019 is $1,289,080 (2018 – $321,330).