STOCK-BASED COMPENSATION

3 Months Ended

Jun. 30, 2012

Stock Bonus Plan

Under the Company’s Stock Bonus Plan, employees, directors, officers, consultants and advisors are eligible to receive a grant of the Company’s shares, provided that bona fide services are rendered by consultants or advisors and such services must not be in connection with the offer or sale of securities in a capital-raising transaction. On April 19, 2012, the Company increased the number of shares issuable pursuant to this plan from 20,000,000 shares to 40,000,000 shares with 4,267,394 common shares available for future issuance as of June 30, 2012.

8. STOCK-BASED COMPENSATION (continued)

Non-Qualified Stock Option Plan

The Company’s Non-Qualified Stock Option Plan authorizes the issuance of common shares to persons that exercise stock options granted. The Company’s employees, directors, officers, consultants and advisors are eligible to be granted stock options pursuant to this plan, provided that bona fide services are rendered by such consultants or advisors and such services must not be in connection with the offer or sale of securities in a capital-raising transaction. The stock option exercise price is determined by a committee and cannot be less than $0.001.

On November 30, 2010, the Company increased the number of shares issuable pursuant to this plan from 17,500,000 shares to 22,500,000 shares with 8,870,666 common shares available for future issuance as of June 30, 2012.

Management stock options

In January 2010, the Company granted 28,500,000 stock options to five directors and one officer at an exercise price of $0.0714 per share. As of June 30, 2012, a total of 26,500,000 management stock options were outstanding. The stock options expire on December 31, 2020. Holders of the management stock options may exercise the options by paying the exercise price to the Company or on a cashless basis upon the approval of the Company’s board of directors. Should the options be exercised on a cashless basis, the Company will issue common shares of the Company with a market value equal to the intrinsic value of the options at the close of trading on the date of exercise. The management stock options were not issued under the Company’s Non-Qualified Stock Option Plan and as at July 1, 2010, the Company filed a registration statement under the Securities Act of 1933 to register the underlying shares. Accordingly, any shares issuable upon the exercise of these options will be free trading securities.

A summary of the changes in the Company’s stock options is presented below:

Number of

Weighted

Average

Exercise Price

Weighted Average Remaining Contractual Life (Years)

Aggregate

Intrinsic Value


Outstanding, December 31, 2011	30,806,600	0.066	7.56	20,759
Forfeited and cancelled	(2,000,000)	0.0714
Exercised	(675,000)	0.001
Outstanding, June 30, 2012	28,131,600	0.067	7.21	10,380

The compensation cost of shares vested was $17,317 and 196,654 for the six months ended June 30, 2012 and 2011, respectively. Compensation cost has been included in general and administration expense in the statement of operations.

A summary of the status of the Company’s non-vested options as of June 30, 2012, and changes during the six months ended of June 30, 2012, is presented below:

	Number of	Weighted Average
Non-vested	Options	Exercise Price

Non-vested at December 31, 2011	9,500,000	0.0714
Vested during period	(9,500,000)	0.0714
Non-vested at June 30, 2012	-	-

BIOCUREX INC 10-Q