Stock-based compensation

12 Months Ended

Dec. 31, 2024

Share-based Payment Arrangement [Abstract]

7. Stock-based compensation

In 2023, the Company approved the Equity Incentive Plan (the "Plan"). The Plan provides both for the direct award or sale of shares and for the grant of options to purchase shares. Under the plan the total number of shares available for options cannot exceed 10% of the Company's issued and outstanding common shares at the time of any grant. The Company is authorized to issue options to employees, non-employee directors and consultants under the plan.

On June 25, 2024, the Board of Directors approved the acceleration of vesting for all outstanding share options to June 25, 2024, resulting in the Company recognizing the remaining expense for all share options outstanding and unvested as of that date.

The following table summarizes option transactions for the Plan:

Number of

options

Weighted

average

exercise price

Weighted

average

remaining

contractual life

(years)

Aggregate

intrinsic value

Outstanding at December 31, 2022

Granted

812,500

1.16

4.82

2.84

Outstanding at December 31, 2023

812,500

1.16

4.82

2.84

Granted

485,000

3.83

Forfeited

(112,500

)

3.20

Outstanding at December 31, 2024

1,185,000

2.06

4.18

1.89

Exercisable at December 31, 2024

875,000

1.32

3.92

2.63

Unvested at December 31, 2024

310,000

3.72

4.94

0.23

The weighted average grant-date fair value of options granted during the years ended December 31, 2024 and December 31, 2023 was C$2.82 and C$0.73, respectively. The weighted average grant-date fair value of options forfeited during the year ended December 31, 2024 was C$2.36.

As of December 31, 2024 and December 31, 2023, there were $565,986 and $335,812 of unrecognized stock-based compensation cost related to share options outstanding, which is expected to be recognized over a weighted-average period of 2.25 and 4.82 years, respectively.

For the years ended December 31, 2024 and 2023, stock-based compensation expense was $713,119 and $98,585, respectively. Stock-based compensation expense has been reported in the Company's consolidated statements of operations and comprehensive loss within the line items 'general and administrative' and 'research and development' expenses.

The following table presents the assumptions that were used in the Black-Scholes option pricing model to determine the fair value of share options granted during the period:

	2024	2023
Expected dividend yield	-	-
Risk-free interest rate	2.95% - 4.24%	4.24%
Expected term (in years)	5 years	5 years
Expected volatility	95% - 100%	93.10%

The expected volatility is based on the share price volatility observed for comparable publicly traded companies over a period similar to the life of the options. The expected option life represents the period of time that options granted are expected to be outstanding. The risk-free interest rate is based on Canadian government bonds with a remaining term equal to the expected life of the options.