6. ADDITIONAL PAID IN CAPITAL

6 Months Ended

Jun. 30, 2015

Additional Paid in Capital [Abstract]

ADDITIONAL PAID IN CAPITAL

Stock-based compensation

We have options outstanding and exercisable that were issued under two plans, the Fixed Stock Option Plan (“FSOP”) and the 10% Rolling Stock Option Plan (“RSOP”).

The FSOP was originally approved by shareholders on December 11, 2002, and subsequently approved by shareholders on December 7, 2009 following certain amendments to the FSOP. The FSOP expired upon the adoption of the RSOP that was approved by shareholders on December 2, 2011, and as such, we may no longer grant options under the FSOP. However, the terms of the FSOP continue to govern all prior awards granted under such plan until such awards have been cancelled, forfeited or exercised in accordance with the terms thereof. As of June 30, 2015, we had 1,290,000 options outstanding under our FSOP, as amended, and 3,298,900 options outstanding under our RSOP.

The fair value of each employee stock option award is estimated at the grant date using a Black-Scholes option pricing model and the price of our common shares on the date of grant. The significant assumptions used to estimate the fair value of stock options awarded during the six-months ended June 30, 2015 and 2014, using a Black-Scholes model are as follows:

	June 30,
	2015	2014
Risk-free interest rate	1.0% - 1.1%	0.93% - 0.99%
Expected volatility	73.4% - 79.7%	74.7% - 79.1%
Expected dividend yield	Nil	Nil
Expected term in years	3.4	3.25 – 3.28
Estimated forfeiture rate	3.4% - 3.6%	3.7%

The compensation expense recognized in our consolidated financial statements for the three and six months ended June 30, 2015 for stock option awards was $48 and $121, respectively, and $130 and $318 for the same periods in 2014. As of June 30, 2015, there was $199 of total unrecognized compensation cost related to 995,200 unvested stock options that is expected to be recognized over a weighted-average remaining vesting period of 0.86 years.

The following table summarizes our stock option activity for each of the six-month periods ended June 30, 2015 and 2014:

	2015		2014
	Number of Stock Options	Weighted Average Exercise Price	Number of Stock Options	Weighted Average Exercise Price
Outstanding, beginning of period	4,345,500	$      5.16	4,700,500	$      5.51
Granted	999,000	0.45	275,000	1.28
Cancelled/expired	(749,600)	3.16	(280,000)	6.74
Exercised	(6,000)	0.32	(150,000)	0.52
Outstanding, end of period	4,588,900	$      4.25	4,545,500	$      5.31
Exercisable, end of period	3,593,700	$      5.28	3,852,500	$      6.01
Weighted-average fair value per share of options granted during period	$                0.24		$                0.65