DIVERSIFIED ROYALTY CORP .  Notes toConsolidatedFinancial Statements  (Unaudited)  (Expressed in Canadian dollars)  Year ended December 31, 2014  12. Share-based payment(continued):  13. Income (loss) per share:  The fair value of each option grant was estimated using the Black -Scholes option pricing model  using the following weighted average assumptions: The total fair value of the options granted in 2013 was $575,060 or $0.32 per option. Other  than  the 500,000 options issued to the Company’s new President and CEO in 2013, which vested  immediately, the balance of the options (1,284,400) issued  were set to vest once certain  performance criteria  weremet.  During theyearended December 31, 2014, total stock compensation expense was $ 280,461 (2013  - $413,236).  The reconciliation of the loss for the  year and weighted average number of common shares used  to calculate basic and diluted earnings per share is as  follows:  2014 2013  Risk-free interest rate  n/a  1.035%  Expected option lives (years)   n/a  3.0  Expected volatility  n/a 38.0%  Dividend yield n/a nil%  2014  2013  Income (loss) for the year  $  7,422,238  $ (3,586,462)  Net (loss) income per common share:  Basic  0.17  (0.09)  Diluted  0.17  (0.09)  Weighted average number of shares: Basic  44,725,281  38,739,262  Diluted  44,867,709  38,739,262  25 