The Company has a stock option plan which allows the Board of Directors of the Company to grant options to acquire common shares of the Company to directors, officers, key employees and consultants. The option price, term and vesting are determined at the discretion of the Board of Directors, subject to certain restrictions as required by the policies of the TSX Venture Exchange. The stock option plan is a 20% fixed number plan with a maximum of 112,831,976 common shares reserved for issue at August 31, 2021.

On August 7, 2020, the Company issued a five-year option exercisable for 3,000,000 common shares, vesting over nine months, at an exercise price of CAD$0.085 per share to its newly appointed Chief Operating Officer.

On August 20, 2020, the Company issued a six-month option exercisable for 2,220,000 common shares, vesting immediately, at an exercise price of CAD$0.11 per share to a lender.

No stock options were granted for the year ended August 31, 2021.

During the year ended August 31, 2021 the share-based compensation expense of $603,244 (2020 - $887,818) relates to the vesting of options granted during the prior fiscal years.

Stock option transactions under the stock option plan were:

Stock options outstanding and exercisable as at August 31, 2021 are: