Stock Based Compensation

6 Months Ended

Jun. 30, 2011

Stock Based Compensation [Text Block]

9.	Stock Based Compensation
	On June 15, 2011, the Company amended the 2005 Non-Qualified Stock Option Plan to increase the number of shares authorized for issuance under the plan from 10,000,000 to 30,000,000 and extend the plan termination date for an additional 10 years. No options shall be issued under the Stock Option Plan at a price per share less than the defined Market Price. On June 11, 2008, the Company modified the Stock Option Plan to define Market Price as the volume weighted average trading price of the Company’s common shares on the Toronto Stock Exchange or American Stock Exchange, now the NYSE Amex, whichever has the greater trading volume for the five trading days before the date of grant. At June 30, 2011, the Company had 19,950,360 shares of common stock available to be issued under the Stock Option Plan.
	During the six months ended June 30, 2011, the Company granted 1,979,500 stock options with immediate vesting to directors, officers, employees and consultants to acquire 1,045,000 common shares at an exercise price of $3.98 per share expiring in 5 – 10 years, 884,500 common shares at an exercise price of $3.21 per share for 10 years, and 50,000 common shares at $2.87 per share for 2 years. During the six months ended June 30, 2011, the Company recorded stock-based compensation for the vested options of $5,055,236, as general and administrative expense.
	During the six months ended June 30, 2010, the Company granted 1,187,500 stock options to directors, officers, employees and consultants to acquire 702,500 common shares at an exercise price of $1.33 per share for 5 - 10 years, 185,000 common shares at an exercise price of $1.35 per share for 1.5 years, 100,000 common shares at an exercise price of $1.40 per share for 10 years and 200,000 common shares at an exercise price of $1.64 per share for 1.5 years. During the six months ended June 30, 2010, the Company recorded stock-based compensation for the vested options of $1,053,975, as general and administrative expense.
	On March 3, 2010, the Company modified the terms of 5,286,700 outstanding options. The weighted average grant date fair value of the modified stock options was $0.49 and the Company recognized an additional $2,535,808 stock based compensation expense which is included in general and administrative expense.

The fair values of stock options granted were estimated at the date of grant using the Black-Scholes option- pricing model and the weighted average grant date fair values of stock options granted during the six months ended June 30, 2011 and 2010 were $2.54 and $0.90 per share, respectively.

The weighted average assumptions used are as follows:

	Six Months Ended
	June 30,	June 30,
	2011	2010
Expected dividend yield	0%	0%
Risk-free interest rate	1.83%	1.61%
Expected volatility	98%	107%
Expected option life (in years)	4.43	3.32

The total intrinsic value of stock options exercised during the six months ended June 30, 2011 and 2010, was $6,356,975 and $nil respectively.

The following table summarizes the continuity of the Company’s stock options:

				Weighted-
			Weighted	Average
			Average	Remaining	Aggregate
	Number of		Exercise	Contractual	Intrinsic
	Options		Price	Term (years)	Value
			$		$
Outstanding, December 31, 2010	6,735,600		1.86	6.05	14,372,749
Granted	1,979,500		3.61
Exercised	(1,875,720	)	0.97
Expired	(40,000	)	0.65
Outstanding, June 30, 2011	6,799,380		2.62	6.85	4,302,151
Exercisable, June 30, 2011	6,774,380		2.63	6.84	4,261,651

A summary of the status of the Company’s non-vested options at June 30, 2011, and changes during the six months ended June 30, 2011 are presented below:

			Weighted
			Average
	Number of		Grant Date
	Options		Fair Value
			$
Non-vested at December 31, 2010	75,000		1.16
Granted	1,979,500		2.54
Vested	(2,029,500	)	2.51
Non-vested at June 30, 2011	25,000		0.98

As at June 30, 2011, there was $5,264 in total unrecognized compensation cost related to non-vested stock option agreements. This cost is expected to be recognized over a weighted average period of 0.11 years.