| STOCK OPTIONS AND RESTRICTED STOCK UNITS |
|
20. |
STOCK OPTIONS AND RESTRICTED STOCK UNITS |
The Company’s board of directors adopted the 2020 Equity Incentive Plan (the “Plan”) on July 21, 2020. The Company may issue awards under the Plan equal to 20% of the total SV Shares outstanding. The Company may issue stock options, stock appreciation rights, restricted stock and restricted stock units (“RSU’s”).
The following table summarizes the stock option movements for the year ended December 31, 2025 and 2024:
| Schedule of stock option |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Number of
stock options |
|
|
Weighted average
exercise price |
|
|
Aggregate
intrinsic
value
($) |
|
| Balance, December 31, 2023 |
|
|
11,800,000 |
|
|
$ |
0.13 (CAD$0.18 |
) |
|
|
1,791,547 |
|
| Granted to employees(1)(2) |
|
|
5,445,000 |
|
|
$ |
0.62 (CAD$0.85 |
) |
|
|
- |
|
| Granted to service providers(1) |
|
|
1,910,000 |
|
|
$ |
0.62 (CAD$0.85 |
) |
|
|
- |
|
| Exercised |
|
|
(3,686,308 |
) |
|
$ |
0.11 (CAD$0.15 |
) |
|
|
1,638,097 |
|
| Forfeited |
|
|
(103,692 |
) |
|
$ |
0.11 (CAD$0.15 |
) |
|
|
- |
|
| Balance, December 31, 2024 |
|
|
15,365,000 |
|
|
$ |
0.37 (CAD$0.51 |
) |
|
|
4,527,243 |
|
| Granted to employees(3)(4)(5) |
|
|
2,330,000 |
|
|
$ |
0.61 (CAD$0.83 |
) |
|
|
- |
|
| Exercised |
|
|
(2,764,167 |
) |
|
$ |
0.15 (CAD$0.21 |
) |
|
|
703,068 |
|
| Forfeited |
|
|
(1,040,833 |
) |
|
$ |
0.43 (CAD$0.60 |
) |
|
|
- |
|
| Balance, December 31, 2025 |
|
|
13,890,000 |
|
|
$ |
0.45 (CAD$0.61 |
) |
|
|
1,835,510 |
|
|
(1) |
On August 31, 2024, the Company issued 4,945,000 stock options to employees and 1,910,000 stock options to service providers. The stock options have an exercise price of $0.62 (CAD$0.84). The options expire as follows: 3,470,000 stock options expire on August 31, 2027, 75,000 stock options expire on August 31, 2028, and 1,400,000 stock options expire on August 31, 2029. The options vest as follows: 6,805,000 options vest in 3 equal tranches on December 31, 2024, 2025 and 2026 and 50,000 stock options vest on August 31, 2025. |
|
(2) |
On December 31, 2024, the Company issued 500,000 stock options to the Company’s Chief Financial Officer. The stock options have an exercise price of $0.69 (CAD$0.93) and expire on December 31, 2028. The options vest in 3 equal tranches on December 31, 2025, December 31, 2026 and December 31, 2027. |
|
(3) |
On February 3, 2025, the Company issued 2,000,000 stock options to an employee. The stock options have an exercise price of $0.63 (CAD$0.87) and expire on February 3, 2029. The options vest in 25 equal monthly tranches commencing on March 3, 2025. |
|
(4) |
On March 18, 2025, the Company issued 30,000 stock options to an employee. The stock options have an exercise price of $0.52 (CAD$0.74) and expire on March 18, 2028. The options vest as follows: 10,000 vest on March 18, 2026 and 20,000 vest on March 18, 2027. |
|
(5) |
On September 3, 2025, the Company issued 300,000 stock options to an employee. The stock options have an exercise price of $0.43 (CAD$0.61) and expire on September 3, 2029. The options vest in 4 equal tranches on March 4, 2026, September 3, 2026, March 4, 2027 and September 3, 2027. |
The following is a summary of the outstanding stock options as at December 31, 2025:
| Schedule of outstanding stock options |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Expiry Date |
|
Outstanding
(#) |
|
|
Aggregate
intrinsic
value
($) |
|
|
Exercisable
(#) |
|
|
Aggregate
intrinsic
value
($) |
|
|
Exercise price
($) |
|
|
Remaining
contractual
life (years) |
|
| April 19, 2026 |
|
|
300,000 |
|
|
|
120,385 |
|
|
|
300,000 |
|
|
|
120,385 |
|
|
$ |
0.11 (CAD$0.15 |
) |
|
|
0.30 |
|
| January 10, 2027 |
|
|
3,725,000 |
|
|
|
1,494,783 |
|
|
|
3,725,000 |
|
|
|
1,494,783 |
|
|
$ |
0.11 (CAD$0.15 |
) |
|
|
1.03 |
|
| September 14, 2027 |
|
|
300,000 |
|
|
|
87,553 |
|
|
|
233,333 |
|
|
|
68,097 |
|
|
$ |
0.22 (CAD$0.30 |
) |
|
|
1.70 |
|
| November 16, 2027 |
|
|
500,000 |
|
|
|
113,089 |
|
|
|
500,000 |
|
|
|
113,089 |
|
|
$ |
0.28 (CAD$0.39 |
) |
|
|
1.88 |
|
| August 31, 2027 |
|
|
4,760,000 |
|
|
|
- |
|
|
|
3,189,988 |
|
|
|
- |
|
|
$ |
0.61 (CAD$0.84 |
) |
|
|
1.67 |
|
| March 18, 2028 |
|
|
30,000 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
$ |
0.54 (CAD$0.74 |
) |
|
|
2.21 |
|
| December 31, 2028 |
|
|
500,000 |
|
|
|
- |
|
|
|
166,666 |
|
|
|
- |
|
|
$ |
0.68 (CAD$0.93 |
) |
|
|
3.00 |
|
| August 31, 2028 |
|
|
75,000 |
|
|
|
- |
|
|
|
49,999 |
|
|
|
- |
|
|
$ |
0.61 (CAD$0.84 |
) |
|
|
2.67 |
|
| February 3, 2029 |
|
|
2,000,000 |
|
|
|
- |
|
|
|
458,333 |
|
|
|
- |
|
|
$ |
0.63 (CAD$0.87 |
) |
|
|
3.10 |
|
| August 31, 2029 |
|
|
1,400,000 |
|
|
|
- |
|
|
|
933,333 |
|
|
|
- |
|
|
$ |
0.61 (CAD$0.84 |
) |
|
|
3.67 |
|
| September 3, 2029 |
|
|
300,000 |
|
|
|
19,699 |
|
|
|
- |
|
|
|
- |
|
|
$ |
0.45 (CAD$0.61 |
) |
|
|
3.68 |
|
| |
|
|
13,890,000 |
|
|
|
1,835,509 |
|
|
|
9,556,652 |
|
|
|
1,796,354 |
|
|
|
|
|
|
|
1.98 |
|
During the year ended December 31, 2025, the Company recognized share-based payment expense of $1,270,714 within share-based compensation expense on the consolidated statement of net income (loss) and comprehensive income (loss) (year ended December 31, 2024 - $984,772) related to vested stock options. The Company has unrecognized stock-based compensation expense of $728,387 associated with outstanding stock options.
The Company has computed the fair value of share purchase options granted using the Black-Scholes option pricing model. The expected term used for options issued to non-employees is the contractual life and the expected term used for options issued to employees and directors is the estimated period of time that options granted are expected to be outstanding. The Company utilizes the “simplified” method to develop an estimate of the expected term of “plain vanilla” employee share purchase option grants. The Company is utilizing an expected volatility figure based on a review of the historical volatilities, over a period of time, equivalent to the expected life of the instrument being valued, of similarly positioned public companies within its industry. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued.
The Company applied the following inputs in the Black-Scholes option pricing model for the year ended December 31, 2025 and 2024:
| Schedule of assumptions Black-Scholes option |
|
|
|
|
|
|
|
|
| |
|
December 31,
2025 |
|
|
December 31,
2024 |
|
| Share price |
|
$ |
0.60 (CAD$0.94 |
) |
|
$ |
0.62 (CA$0.88 |
) |
| Expected life options (years) |
|
|
2.53 |
|
|
|
2.19 |
|
| Expected volatility |
|
|
94.77 |
% |
|
|
70.64 |
% |
| Expected dividend yield |
|
|
0 |
% |
|
|
0 |
% |
| Risk-free interest rate |
|
|
2.62 |
% |
|
|
2.78 |
% |
| Black-Scholes value of each option |
|
$ |
0.34 |
|
|
$ |
0.26 |
|
|
20.2 |
Restricted stock units |
The following table summarizes the RSU’s movements for the year ended December 31, 2025 and 2024:
| Schedule of summarizes the rsu movements |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Number of
RSUs
(#) |
|
|
Weighted average
issue price
($) |
|
|
Aggregate
intrinsic
value
($) |
|
| Balance, December 31, 2023 |
|
|
- |
|
|
|
- |
|
|
|
- |
|
| Granted to employees(1)(2) |
|
|
725,700 |
|
|
$ |
0.63 (CAD$0.86 |
) |
|
|
454,913 |
|
| Balance, December 31, 2024 |
|
|
725,700 |
|
|
$ |
0.63 (CAD$0.86 |
) |
|
|
469,040 |
|
| Granted to employees(3) |
|
|
1,234,375 |
|
|
$ |
0.66 (CAD$0.91 |
) |
|
|
729,045 |
|
| Exercised(1) |
|
|
(463,575 |
) |
|
$ |
0.65 (CAD$0.90 |
) |
|
|
257,250 |
|
| Balance, December 31, 2025 |
|
|
1,496,500 |
|
|
$ |
0.65 (CAD$0.89 |
) |
|
|
764,300 |
|
|
(1) |
On August 31, 2024, the Company issued 454,200 RSU’s to employees of which 80,200 RUS’s expire on January 1, 2025 (80,200 RSU’s were exercised during the year ended December 31, 2025 resulting in the issuance of 80,200 SV Shares) and 374,000 RSU’s expire on January 1, 2026 (modified on December 31, 2025 to expire on January 1, 2027 as noted below). |
|
(2) |
On December 31, 2024, the Company issued 271,500 RSU’s to employees of which 60,000 RUS’s expire on December 31, 2025 (modified on December 31, 2025 to expire on December 31, 2026 as noted below) and 211,500 RSU’s expire on January 1, 2026 (211,500 RSU’s were exercised during the year ended December 31, 2025 resulting in the issuance of 211,500 SV Shares). |
|
(3) |
On January 1, 2025, the Company issued 78,125 RSU’s to an employee which expire on June 30, 2025 (exercised during the year ended December 31, 2025 resulting in the issuance of 78,125 SV Shares). |
|
(4) |
On February 1, 2025, the Company issued 1,156,250 RSU’s to employees which expire on January 1, 2026 (968,750 RSU’s were modified on December 31, 2025 to expire on January 1, 2027 as noted below) (93,750 RUS’s were exercised during the year ended December 31, 2025 resulting in the issuance of 93,750 SV Shares). |
On December 31, 2025, the Company modified 1,342,750 outstanding RSU’s held by employees and service providers to extend the maturity date to January 1, 2027 and modified 60,000 outstanding RSU’s held by an employee to extend the maturity date to December 31, 2026. This modification did not result in an incremental charge as the Company’s share price on the date of initial grant was more than the Company’s share price on the date of modification. When the share price has fallen: (1) the pre-modification fair value is already lower, and (2) the post-modification fair value is usually equal to or less than that amount. Therefore, there is usually no incremental fair value as a result of the modification and no incremental compensation cost is recognized. Remaining unrecognized costs continue to be recognized.
The following is a summary of the outstanding RSU’s as at December 31, 2025:
| Schedule of outstanding RSU |
|
|
|
|
|
|
|
|
|
|
|
|
| Expiry Date |
|
Exercise price |
|
|
Outstanding at
December 31,
2025 |
|
|
Weighted average
remaining
contractual life
(years) |
|
| December 31, 2026 |
|
$ |
0.66 (CAD$0.91 |
) |
|
|
60,000 |
|
|
|
1.00 |
|
| January 1, 2026 |
|
$ |
0.66 (CAD$0.91 |
) |
|
|
93,750 |
|
|
|
0.00 |
|
| January 1, 2027 |
|
$ |
0.61 (CAD$0.83 |
) |
|
|
374,000 |
|
|
|
1.00 |
|
| January 1, 2027 |
|
$ |
0.66 (CAD$0.91 |
) |
|
|
968,750 |
|
|
|
1.00 |
|
| |
|
$ |
0.65 (CAD$0.89 |
) |
|
|
1,496,500 |
|
|
|
0.94 |
|
During the year ended December 31, 2025, the Company recognized share-based payment expense of $1,123,280 within share-based compensation expense on the consolidated statement of net income (loss) and comprehensive income (loss) (year ended December 31, 2024 - $624,051) related to RSU’s. The Company has computed the fair value of RSU’s granted based on the Company’s share price at the grant date.
Total share-based compensation expense for the year ended December 31, 2025 of $2,393,994 is comprised of $1,270,714 related to stock options and $1,123,280 related to RSU’s (year ended December 31, 2024 – total expense of $1,608,823 comprised of $984,772 related to stock options and $624,051 related to RSU’s).
|