Stock Options

During the six-month period ended August 31, 2020, the Company granted 3,389 stock options (2019 – nil) with a weighted average exercise price of $8.78 (2019 – nil), no stock options were forfeited (2019 – 39,902; weighted average exercise price: $9.67) or exercised (2019 – 5,000; weighted average exercise price: $0.80) and no stock options expired (2019 – 260,417; weighted average exercise price: $13.59).

The Company applies the fair value method of accounting for stock-based compensation awards granted. Fair value is calculated based on a Black-Scholes option pricing model. The principal components of the pricing model were as follows:

The total number of stock options outstanding as at August 31, 2020 was 1,587,081 (2019 – 1,657,081) with a weighted average exercise price of $6.81 (2019 - $6.55), of which 1,083,748 were exercisable (2019 – 958,748) with a weighted average exercise price of $7.05 (2019 – $6.26).

During the three- and six-month periods ended August 31, 2020, stock-based compensation expense attributable to stock options amounted to $553,540 and $1,110,435 respectively (2019 - $498,198 and $1,073,711) and is included in expenses.

Restricted Stock Units

During the six-month period ended August 31, 2020, the Company granted 122,373 restricted stock units (“RSUs”) (2019 – 4,114,567) with a weighted average fair value of $8.86 (2019 – $1.06), settled 24,436 RSUs (2019 – 43,932) with a weighted average fair value of $9.78 (2019 – 10.36) and 2,989 RSUs were forfeited (2019 – 53,750) with a weighted average fair value of $8.78 (2019 – $9.82).

The Company applies the fair value method of accounting for awards granted through the issuance of restricted stock units. Fair value is calculated based on the closing share price at grant date multiplied by the number of restricted stock unit awards granted.

The total number of RSUs outstanding as at August 31, 2020 was 4,313,750 (2019 – 4,218,802), of which 891,327 were vested (2019 – 1,031,684).

During the three- and six-month periods ended August 31, 2020, stock-based compensation expense attributable to RSUs amounted to $312,390 and $682,877 respectively (2019 - $305,130 and $660,307) and is included in expenses.

During the three- and six-month periods ended August 31, 2020 and August 31, 2019, stock-based compensation included in research and development expenses amounted to $352,282 and $704,289 respectively (2019 – $250,242 and $660,455), and in general and administrative expenses amounted to $513,648 and $1,173,465 respectively (2019 - $755,229 and $1,530,686).