6. ADDITIONAL PAID IN CAPITAL

12 Months Ended

Dec. 31, 2015

Equity [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 10% Rolling Stock Option Plan, which 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. Under the FSOP, we could grant stock options for up to 5,779,347 common shares to eligible directors, officers, employees or consultants. The maximum term of an option was five years. The exercise price of an option was not less than the closing price on the last trading day preceding the grant date. All options granted under the FSOP vested as follows: 20% upon each of 4 months, 8 months, 12 months, 15 months and 18 months after the date of grant. As of December 31, 2015, there were 1,290,000 stock options outstanding under the FSOP with a weighted-average exercise price of $7.74, all of which were exercisable.

On December 2, 2011, at the Annual General Meeting, our shareholders approved by way of an ordinary resolution the terms of a new plan, the RSOP, which established the maximum number of common shares which may be issued under the RSOP as a variable amount equal to 10% of the issued and outstanding common shares on a non-diluted basis. Under the RSOP, our Board of Directors may from time to time grant stock options to individual eligible directors, officers, employees or consultants. The maximum term of any stock option is 10 years. The exercise price of a stock option is not less than the closing price on the last trading day preceding the grant date. The Board retains the discretion to impose vesting periods on any options granted. All options granted to date vest as follows:  20% upon each of 4 months, 8 months, 12 months, 15 months and 18 months after the date of grant. As of December 31, 2015, there were 3,288,700 stock options outstanding under the RSOP with a weighted-average exercise price of $2.53, of which 2,606,500 options were exercisable with a weighted-average exercise price of $3.07.

The fair value of stock option awards granted to directors, officers or employees of the Company are estimated on the grant date using the Black-Scholes option pricing model and the closing price of our common shares on the grant date as quoted on the stock exchange where the majority of the trading volume and value of the shares occurs, which was the NYSE MKT during 2015. The significant assumptions used to estimate the fair value of stock option awards using the Black-Scholes model are as follows:

	For the years ended December 31,
	2015	2014
Risk-free interest rate	1.0 – 1.1%	0.93 – 0.99%
Expected volatility	73 – 80%	74 – 79%
Expected dividend yield	Nil	Nil
Expected term in years	3.4 – 3.5	3.3
Estimated forfeiture rate	3.4 – 3.6%	3.7%

The fair value of stock option awards granted to consultants of the Company is estimated on the vesting date using the Black-Scholes option pricing model and the closing price of our common shares as quoted on the vesting date on the stock exchange where the majority of the trading volume and value of the shares occurs, which was the NYSE MKT during 2015. The significant assumptions used to estimate the fair value of stock option awards using the Black-Scholes models are as follows:

	For the years ended December 31,
	2015	2014
Risk-free interest rate	n/a	0.99%
Expected volatility	n/a	74-79%
Expected dividend yield	n/a	Nil
Expected term in years	n/a	3.3
Estimated forfeiture rate	n/a	3.7%

The following table summarizes stock option activity for each of the years ended December 31, 2015 and 2014:

	For the years ended December 31,
	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
Exercised	(12,600)	0.32	(150,000)	0.50
Cancelled/Expired	(753,200)	3.17	(480,000)	4.52
Outstanding, end of period	4,578,700	$3.99	4,345,500	$5.16
Exercisable, end of period	3,896,500	$4.61	3,950,500	$5.54
Weighted-average fair value per share of options granted during period	$0.24		$0.65

The following table summarizes information about stock options outstanding and exercisable at December 31, 2015:

	Outstanding Stock Options			Exercisable Stock Options
Range of Exercise Prices	Number Outstanding	Weighted-Average Remaining Contractual Life (in years)	Weighted-Average Exercise Price	Number Exercisable	Weighted-Average Remaining Contractual Life (in years)	Weighted-Average Exercise Price
$0.32 – $2.00	1,608,700	3.81	$           0.78	926,500	3.41	$         1.01
$2.01 – $4.00	737,000	1.90	3.30	737,000	1.90	3.30
$4.01 – $6.00	943,000	1.05	4.91	943,000	1.05	4.91
$6.01 – $8.00	1,175,000	0.27	7.41	1,175,000	0.27	7.41
$8.01 +	115,000	0.03	10.91	115,000	0.03	10.91
	4,578,700	1.93	$           3.99	3,896,500	1.51	$         4.61

A summary of stock option activity as of December 31, 2015 and changes during the year then ended are presented below.

Non-vested Stock Options	Number Outstanding	Weighted Average Grant Date Fair Value
Non-vested at December 31, 2014	395,000	$                    0.71
Granted	999,000	0.24
Vested	(709,100)	0.49
Cancelled/forfeited	(2,700)	0.44
Non-vested at December 31, 2015	682,200	0.25

The stock-based compensation cost recognized in our consolidated statements of operations and comprehensive loss for the years ended December 31, 2015 and 2014 was $254 and $517, respectively. As of December 31, 2015, there was $71 of unrecognized compensation cost related to 682,200 unvested stock options. This cost is expected to be recognized over a weighted-average remaining period of approximately 0.65 years. The total intrinsic value of options exercised in each of the periods ended December 31, 2015 and 2014 was $2 and $167, respectively. At December 31, 2015, there was no aggregate intrinsic value of outstanding and exercisable stock options.

Options and Warrants

The Company issued warrants, each exercisable for one of the Company’s common shares, to investors in connection with registered direct offerings of the Company that closed on September 27, 2013 and April 29, 2015. In addition, the Company issued warrants to a placement agent in connection with each offering, under the same terms as those issued to investors. The exercise price and exercise period are outlined below:

Financing	Investor Warrants	Placement Agent Warrants	Total Warrants	Exercise Price	Expiration Date
September 27, 2013 offering	1,338,688	133,869	1,472,557	$4.15	9/27/16
April 29, 2015 offering	2,615,385	261,539	2,876,924	$0.85	4/29/18
Total Warrants Outstanding as of December 31, 2015			4,349,481

The value of the warrants issued to the placement agent (non-employee) for its services in connection with the April 29, 2015 offering was offset against the proceeds of the financing. The Company used a Black-Scholes model with inputs including a market price of the Company’s common shares of $0.72, an exercise price of $0.85, a three-year term, volatility of 81.0%, a risk-free rate of 0.91% and no assumed dividends. The value of the warrants issued to the placement agent for its services in connection with the April 29, 2015 offering was estimated at $91.

The value of the warrants issued to the placement agent (non-employee) for its services in connection with the September 27, 2013 offering was offset against the proceeds of the financing. The Company used a Black-Scholes model with inputs including a market price of the Company’s common shares of $2.61, an exercise price of $4.15, a three-year term, volatility of 80.9%, a risk-free rate of 0.62% and assumed no dividends. The value of the warrants issued for services was estimated at $143.

The following table summarizes activity for options and warrants for the years ended December 31, 2015 and 2014:

	For the year ended December 31,		For the year ended December 31, 2014
	2015
	Number of Options and Warrants	Weighted-Average Exercise Price (USD$)	Number of Options and Warrants	Weighted-Average Exercise Price (USD$)
Outstanding, beginning of period	1,472,557	$      4.15	1,472,557	$      4.15
Granted	2,876,924	0.85	-	-
Exercised	-	-	-	-
Expired	-	-	-	-
Outstanding, end of period	4,349,481	$      1.97	1,472,557	$      4.15