DIVERSIFIED ROYALTY CORP .  Notes toConsolidatedFinancial Statements  (Unaudited)  (Expressed in Canadian dollars)  Year ended December 31, 2014  11. Share capital:  At December 31, 2014 the authorized share capital of the Company consists of an unlimited  number of common shares. The issued share capital of the Company is as follows: Common  shares  Amount  Balance, December 31, 2013  38,778,897  $  97,155,660  Reduction in stated capital -  (47,155,660)  Shares issued in private placement(note 20)  5,240,964  8,700,000  Shares issued in connection with acquisitionof FW Rights  8,992,187  20,682,030  Shares issued pursuant to options exercised 1,143,125  2,693,500  Equity issued, bought deal, net of costsand taxes  14,375,000  32,937,932  Balance, December 31, 2014  68,530,173  $ 115,013,462  In November 2014, the Company completed a bought deal  in which it issued 14,375,000 common  shares for gross proceeds of $ 34,500,000, and incurred total share issuance costs of $1,562,068,  net of tax benefits of $548,835.  At the annual meeting of the Company on June 30, 2014, the shareholders approved a  resolution  to reduce the stated capital to $50,000,000. This approval resulted in a reduction of share capital  of $47,155,660 and a corresponding reduction in accumulated deficit. During the year ended December 31, 2014, the Comp any introduced a restricted share unit (“RSU”)  plan available to both employees and non -employees as part of the Company’s long-term incentive  plan (the “Plan”) where the maximum number of common shares issued under the Plan will be 10%  of the issued and outstanding common sharesof the Companyat thetime of grant.The Company’s  Board of Directors has discretion as to the number of  RSUs granted, as well as in determining the  vesting period and expiry dates. On each vesting date, the RSU participant may el ect in an election  notice to settle its vested RSUs in cash, in the Company’s shares issued from treasury, or a  combination thereof based on the fair market value of the Company’s shares as at such date. The  holder of an award of RSU has no rights as a s hareholder until a common share is issued in  settlement of vested restricted stock units.  RSUs have accompanying dividend-equivalent rights  and, therefore, additional RSUs are issued to reflect dividends declared on the common shares. The Company hasissued 250,000 restricted share units to the President and CEO during the year  ended December 31, 2014(year ended December 31, 2013- nil) at a grant date fair value of $2.35  totaling $587,000.The RSUs vest in their entirety on the third anniversary of the grant  date. 12. Share-based payment:  23 