STOCK OPTIONS.

6 Months Ended

Jun. 30, 2023

Share-Based Payment Arrangement [Abstract]

STOCK OPTIONS.

13. 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 year ended December 31, 2022 and the six month period ended June 30, 2023:

	Number of shares			Exercise price per share		Weighted average exercise price
Balance, December 31, 2021		789,500		$	1.42 – 4.13	$	2.78
Granted		981,000		$	3.55 – 3.61	$	3.55
Cancelled or expired		(13,486	)	$	1.70 – 3.61	$	2.32
Exercised		(71,014	)	$	1.42 – 2.44	$	1.98
Balance, December 31, 2022		1,686,000		$	1.70 – 4.13	$	3.27
Exercised		(8,000	)	$	1.70	$	1.70
Balance, June 30, 2023		1,678,000		$	1.75 – 4.13	$	3.27
Exercisable, June 30, 2023		672,000		$	1.75 – 4.13	$	2.94

The weighted average remaining contractual life of options outstanding is 3.4 years.

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

	2022
Expected life – years		3.0
Interest rate		1.76 – 3.64	%
Volatility		66.01 - 69.66	%
Weighted average fair value of options granted	$	1.46 – 1.65

During the six months ended June 30, 2023 and 2022, the Company did not grant any new options to consultants or employees. Options granted in previous quarters resulted in expenses in the amount of $330,862 for consultants (2022 - $31,587) and in the amount of $31,594 for employees during the six months ended June 30, 2023 (2022 - $74,228). There were 8,000 employee and nil consultant stock options exercised during the six months ended June 30, 2023 (2022 – 29,500 employee; nil consultant).

As of June 30, 2023, there was approximately $1,070,505 of compensation expense related to non-vested awards. This expense is expected to be recognized over a weighted average period of 2.2 years.

The aggregate intrinsic value of vested options outstanding at June 30, 2023 is $nil (2022 – $nil).