STOCK OPTIONS

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

STOCK OPTIONS

16. Stock Options.

The Company has 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 option 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 for all options are issued for not less than fair market value at the date of the grant.

The following table summarizes the Company’s stock option activities for the years ended December 31, 2021 and 2020:

	Number of shares			Exercise price per share		Weighted average exercise price
Balance, December 31, 2019		635,000		$	0.75 – 1.75	$	1.35
Granted		172,000		$	2.44	$	2.44
Cancelled or expired		(13,000	)	$	2.44 – 3.46	$	2.75
Exercised		(45,000	)	$	0.75 – 1.05	$	0.88
Balance, December 31, 2020		749,000		$	0.75 – 4.13	$	2.42
Granted		170,000		$	3.61	$	3.61
Cancelled or expired		(34,799	)	$	1.42 – 3.46	$	2.30
Exercised		(94,701	)	$	0.75 – 3.46	$	1.58
Balance, December 31, 2021		789,500		$	1.42 – 4.13	$	2.78
Exercisable, December 31, 2021		564,500		$	1.42 – 4.13	$	2.63

The weighted-average remaining contractual life of outstanding options is 3.20 years.

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

	2021			2020
Expected life – years		3.0			3.0
Interest rate		1.23	%		0.37	%
Volatility		63.28	%		70.14	%
Weighted average fair value of options granted	$	1.23		$	1.12

During the year ended December 31, 2021, the Company granted 45,000 (2020 – 45,000) stock options to consultants and has applied ASC 718 using the Black-Scholes option-pricing model, which resulted in expenses of $13,860 (2020 - $10,080). Options granted in other years resulted in additional expenses of $51,210 (2020 – $43,905). During the year ended December 31, 2021, employees were granted 125,000 (2020 – 127,000) stock options, which resulted in expenses of $38,500 (2020 – $28,316). Options granted in other years resulted in additional expenses in the amount of $106,542 for employees during the year ended December 31, 2021 (2020 - $73,711). There were 61,500 employee and 33,201 consultant stock options exercised during the year ended December 31, 2021 (2020 – 35,000 employee; 10,000 consultant).

As of December 31, 2021, there was approximately $229,918 of compensation expense related to non-vested awards. This expense is expected to be recognized over a weighted average period of 1.0 years.

The aggregate intrinsic value of vested options outstanding at December 31, 2021 is $712,945 (2020 – $nil). The intrinsic value of options exercised during the year was $203,701 (2020 - $56,230).