Quarterly report pursuant to Section 13 or 15(d)

Stock Plans

 v2.3.0.11
Stock Plans
 6 Months Ended
Jun. 30, 2011
Stock Plans  
Stock Plans

2. Stock Plans

The following table summarizes the share-based compensation expense recorded for awards under the stock option plans for the three and six month periods ended June 30, 2011 and 2010:

 

.    Three Months Ended
June 30,		     Six Months Ended
June 30, 		 

(in thousands, except per share amounts)

    2011      2010     2011      2010  

Research and development

    $ 103       $ (45 )    $ 159       $ (30 ) 

General and administrative

      327         119        410         241   
  

 

 

     

 

 

    

 

 

     

 

 

  

Total share-based compensation expenses

    $ 430       $ 74      $ 569       $ 211   
  

 

 

     

 

 

    

 

 

     

 

 

  

No tax benefit was recognized related to share-based compensation expense since we have incurred operating losses and we have established a full valuation allowance to offset all the potential tax benefits associated with our deferred tax assets.

We use the Black-Scholes-Merton option-pricing model with the following assumptions to estimate the share-based compensation expense for the three and six month periods ended June 30, 2011 and 2010:

 

     Three Months Ended
June 30, 		    Six months Ended
June 30, 		 
     2011     2010     2011     2010  

Weighted-average risk-free interest rate

      2.3 %      1.4 %      2.3 %      2.3 % 

Expected dividend payments

      —          —          —          —     

Expected holding period (years)1

     5.4        4.1        5.4        4.2   

Weighted-average volatility factor2

     1.71        1.94        1.71        1.89   

Estimated forfeiture rates for options granted to management3

     23 %      23 %      23 %      23 % 

Estimated forfeiture rates for options granted to non-management3

     41 %      41 %      41 %      41 % 

(1) Expected holding periods are based on historical data for the three and six months ended June 30, 2010. For the three and six month periods ended June 30, 2011, we used the simplified method provided in Staff Accounting Bulletin No. 107 for "plain vanilla options."
(2) Weighted average volatility is based on the historical volatility of our common stock.
(3) Estimated forfeiture rates are based on historical data.

Based upon the above methodology, the weighted-average fair value of options and awards granted during the three month period ended June 30, 2011 was $1.38. No options or awards were granted during the three month period ended June 30, 2010.

The following table summarizes option activity for the six month period ended June 30, 2011:

 

(in thousands, except per share amounts)

    Options     Weighted
Average
Exercise
Price 		     Weighted
Average
Remaining
Option
Term 		     Aggregate
Intrinsic
Value 		 

Outstanding at January 1, 2011

      4,976      $ 2.29         5.99       $ 968   

Granted

      734        1.44         

Exercised

      —          —           

Expired or cancelled

      (72 )      22.98         

Forfeited

      (55 )      1.77         
  

 

 

    

 

 

        

Outstanding at June 30, 2011

      5,583      $ 1.91         6.83       $ 3,086   
  

 

 

    

 

 

     

 

 

     

 

 

  

Exercisable at June 30, 2011

      3,970      $ 2.21         6.10       $ 2,009   
  

 

 

    

 

 

     

 

 

     

 

 

  

As of June 30, 2011 there was approximately $1.6 million of total unrecognized compensation expense related to non-vested stock options. This expense is expected to be recognized over a weighted-average period of 1.8 years.

During the three month period ended June 30, 2011, 180,710 shares of restricted stock were awarded to employees, directors and consultants. The following table summarizes restricted stock activity for the six month period ended June 30, 2011:

 

(in thousands, except per share amounts)

    Shares     Weighted
Average
Exercise
Price 		     Weighted
Average
Remaining
Contractual
Term 		     Aggregate
Intrinsic
Value 		 

Outstanding at January 1, 2011

      139      $ 0.04         9.3       $ 167   

Awarded

      181        —           

Exercised or released

      (138 )      0.04         

Cancelled

      —          —           
  

 

 

    

 

 

     

 

 

     

 

 

  

Outstanding at June 30, 2011

      182      $ —           9.8       $ 330   
  

 

 

    

 

 

     

 

 

     

 

 

  

Vested at June 30, 2011

      —        $ —           —         $ —     
  

 

 

    

 

 

     

 

 

     

 

 

  

As of June 30, 2011 there was approximately $0.2 million of total unrecognized compensation expense related to non-vested awards. This expense is expected to be recognized over a weighted-average period of 0.8 years.