Quarterly report pursuant to Section 13 or 15(d)

STOCK OPTIONS

v3.5.0.2
STOCK OPTIONS
6 Months Ended
Sep. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]
10.
STOCK OPTIONS
 
The purpose of the Company’s stock option plan, is to attract, retain and motivate persons of training, experience and leadership to the Company, including their directors, officers and employees, and to advance the interests of the Company by providing such persons with the opportunity, through share options, to acquire an increased proprietary interest in the Company.
 
Options may be granted in respect of authorized and unissued shares, provided that the aggregate number of shares reserved for issuance upon the exercise of all Options granted under the Plan, shall not exceed 15% of the shares of common stock and Exchangeable Shares issued and outstanding (determined as of January 1 of each year). Optioned shares in respect of which options are not exercised shall be available for subsequent options.
 
On April 11, 2014 and June 20, 2014 the Company issued 657,430 and 264,230 options to employees and a consultant at an exercise price of $0.165 and $0.23, respectively, with a term of seven years. The options vest one-third on grant date and two thirds equally over the subsequent two years on the anniversary date. During the nine month period ended December 31, 2014, 125,824 of the 657,430 options were cancelled. On February 26, 2015, as a result of the Merger, the options were re-valued. The fair value, as re-measured, of the 531,606 options issued in April 2014 and the 264,230 options issued in June 2014 was $230,930 and $118,957 respectively. An additional 62,912 options were cancelled during the quarter ended June 30, 2016. Stock compensation has been fully expensed on these options and so there is no compensation expense in the three months ended September 30, 2016 however there was $3,658 and $176 was recognized in the first quarter and the six months ended September 30, 2016.
 
On July 1, 2014, the Company issued 2,972,592 options to management of the Company, at an exercise price of $0.23 with a term of 7 years, which vested May 27, 2015. On February 26, 2015, as a result of the Merger, the options were re-valued at a fair value of $1,259,487, which vests immediately. During the first quarter, one management executive left the Company and 990,864 of these options will be cancelled six months after his last day according to his employment agreement. On October 8, 2016, 990,864 of these options expired.
 
On February 17, 2015, the Company issued 314,560 options to a director, employees and a consultant with an exercise price of $0.23, that vest one third immediately and two thirds over the next two anniversary dates with an expiry date of seven years. The grant date fair value of the options was $136,613. Previously 110,100 options were cancelled and $7,400 of stock compensation was recognized in the quarter and $14,800 of stock compensation was recognized for the six months ended September 30, 2016.
 
On November 24, 2015, the Company issued 650,000 options granted to employees that vest over three years at the anniversary date. The grant date fair value of the options was $694,384. During the year ended March 31, 2016 250,000 options were cancelled and stock compensation expense of $62,317 was recognized. During the quarter ended September 30, 2016, $35,609 of stock compensation expense was recognized and for the six months ended September 30, 2016, $78,638 of stock compensation was recognized.
 
On December 14, 2015, the Company issued 2,495,000 options granted to employees, directors and consultants that vest over three years at the anniversary date. The grant date fair value of the options was $1,260,437. During the year ended March 31, 2016, 25,000 options were cancelled and for the quarter ended June 30, 2016 40,000 options were cancelled and for the three months ended September 30, 2016 stock compensation expenses of $102,300 was recognized. For the six months ended September 30, 2016, the stock compensation expense of $202,608 was recognized.
 
On April 21, 2016, the Company issued 3,000,000 stock options to employees of Bionik, Inc. in exchange for 3,895,000 options that existed before the Company purchased IMT, of which 1,000,000 have an exercise price of $0.25, 1,000,000 has an exercise price of $0.95 and 1,000,000 have an exercise price of $1.05. The grant fair value of vested options was $2,582,890 and has been recorded as part of the acquisition equation (Note 3). For options that have not yet vested $10,169 of compensation expense was recognized in the quarter ended September 30, 2016.
 
On April 26, 2016, the Company issued 250,000 options to an employee with an exercise price of $1.00 that will vest over three years at the anniversary date. The grant fair value was $213,750. During the quarter ended September 30, 2016, $17,812 of stock compensation expense was recognized. For the six months ended September 30, 2016, $22,479 of stock compensation expenses was recognized.
 
On August 8, 2016, the Company issued 750,000 options to an employee with an exercise price of $1.00 that will vest over three years at the anniversary date. The grant fair value was $652,068. During the quarter ended September 30, 2016, $31,552 of stock compensation expense was recognized.
 
During the three month period ended September 30, 2016, the Company recorded $204,842 in share-based compensation related to the vesting of stock options (September 30, 2015 - $3,309).
 
These options at their respective grant dates were valued using the Black-Scholes option pricing model with the following key assumptions:
 
Grant date
 
Expected life
in years
 
Risk
free rate
 
Dividend
rate
 
Forfeiture
rate
 
Expected
volatility
 
Grant date
fair value
 
February 17, 2015
 
 
5.39
 
 
1.59
%
 
0
%
 
0
%
 
114
%
$
136,613
 
July 1, 2014
 
 
4.75
 
 
1.59
%
 
0
%
 
0
%
 
114
%
$
1,259,487
 
June 20, 2014
 
 
4.72
 
 
1.59
%
 
0
%
 
0
%
 
114
%
$
118,957
 
April 11, 2014
 
 
4.50
 
 
1.59
%
 
0
%
 
0
%
 
114
%
$
230,930
 
November 24, 2015
 
 
6.15
 
 
1.59
%
 
0
%
 
0
%
 
114
%
$
694,384
 
December 14, 2015
 
 
6.21
 
 
1.59
%
 
0
%
 
0
%
 
114
%
$
1,260,437
 
April 21, 2016
 
 
0.79-9.25
 
 
1.59
%
 
0
%
 
0
%
 
114
%
$
2,582,890
 
April 26, 2016
 
 
6.57
 
 
1.59
%
 
0
%
 
0
%
 
114
%
$
213,750
 
August 8, 2016
 
 
6.86
 
 
1.59
%
 
0
%
 
0
%
 
114
%
$
652,068
 
 
 
 
Number of Options
 
Weighted-Average
Exercise Price ($)
 
Outstanding, March 31, 2016
 
 
6,604,880
 
 
0.57
 
Issued
 
 
4,000,000
 
 
0.77
 
Cancelled
 
 
(143,637)
 
 
0.48
 
Outstanding, September 30, 2016
 
 
10,461,243
 
 
0.59
 
 
The following is a summary of stock options outstanding and exercisable as of September 30, 2016:
 
 
 
 
 
 
 
 
 
Number of
 
Exercise Price ($)
 
Number of Options
 
Expiry Date
 
Exercisable Options
 
 
0.165
 
 
374,324
 
April 1, 2021
 
 
374,324
 
 
0.23
 
 
99,610
 
June 20, 2021
 
 
99,610
 
 
0.23
 
 
2,972,592
 
July 1, 2021
 
 
2,972,592
 
 
0.23
 
 
204,460
 
February 17, 2022
 
 
136,314
 
 
1.22
 
 
400,000
 
November 24, 2022
 
 
-
 
 
1.00
 
 
2,430,000
 
December 14, 2022
 
 
-
 
 
1.00
 
 
250,000
 
April 26, 2023
 
 
-
 
 
0.25
 
 
906,077
 
July 28, 2025
 
 
906,077
 
 
0.25
 
 
86,972
 
December 30, 2025
 
 
59,158
 
 
0.95
 
 
9,486
 
February 2, 2017
 
 
9,486
 
 
0.95
 
 
111,937
 
March 28, 2023
 
 
111,937
 
 
0.95
 
 
31,620
 
March 3, 2024
 
 
31,620
 
 
0.95
 
 
15,810
 
March 14, 2024
 
 
15,810
 
 
0.95
 
 
82,213
 
September 30, 2024
 
 
82,213
 
 
0.95
 
 
7,431
 
June 2, 2025
 
 
7,431
 
 
0.95
 
 
671,859
 
July 29, 2025
 
 
671,859
 
 
0.95
 
 
57,353
 
December 30, 2025
 
 
8,193
 
 
1.05
 
 
36,697
 
February 2, 2017
 
 
36,697
 
 
1.05
 
 
433,027
 
March 28, 2023
 
 
433,027
 
 
1.05
 
 
122,324
 
March 3, 2024
 
 
122,324
 
 
1.05
 
 
61,162
 
March 14, 2024
 
 
61,162
 
 
1.05
 
 
318,042
 
September 30, 2024
 
 
318,042
 
 
1.05
 
 
28,747
 
June 2, 2025
 
 
28,747
 
 
1.00
 
 
750,000
 
August 8, 2023
 
 
-
 
 
 
 
 
10,461,243
 
 
 
 
6,486,623
 
 
The weighted-average remaining contractual term of the outstanding options is 5.80 (September 30, 2015 - 4.76) and for the options that are exercisable the weighted average is 6.22 (September 30, 2015 - 4.74).