Equity Incentive Plan and Employee Stock Purchase Plan

12 Months Ended

Dec. 31, 2011

Equity Incentive Plan and Employee Stock Purchase Plan

Note 8. Equity Incentive Plan and Employee Stock Purchase Plan

On May 25, 1999, CCI stockholders approved the establishment of the 1999 Equity Incentive Plan effective as of June 1, 1999 (the “Plan”). The Plan provided that the Board may grant various forms of equity incentives to directors and employees, including but not limited to Incentive Stock Options, Non-Qualified Stock Options, Stock Appreciation Rights, and Restricted Stock Awards. Grants under the Plan are exercisable at fair market value determined as of the date of grant in accordance with the terms of the Plan. Grants vest to recipients immediately or ratably over periods ranging from two to five years, and expire five to ten years from the date of grant.

On May 23, 2000, stockholders approved an amendment to the Plan, which increased the number of shares of common stock allocated for use in the Plan from 200,000 shares to 300,000 shares. On June 21, 2002, stockholders approved a second amendment to the Plan, which increased the number of shares allocated for use in the Plan from 300,000 shares to 550,000 shares. On July 29, 2004, stockholders approved a third amendment to the Plan, which increased the number of shares for use in the Plan from 550,000 to 2,000,000 shares. The Plan terminated in June 2009.

The Board of Directors has also granted warrants to purchase common stock of CCI that are not covered by the terms of the Plan.

During the year ended December 31, 2011, the Company issued a non-executive employee warrants to purchase an aggregate 13,000 shares of common stock with an exercise prices of $0.01 per share. The Company valued these warrants at $238 using the Black-Scholes valuation model. The warrants have a term of three years and are immediately exercisable.

During the year ended December 31, 2010, the Company issued a non-executive employee warrants to purchase an aggregate 13,000 shares of common stock with exercise prices of $0.03 and $0.10 per share. The Company valued these warrants at $1,000 using the Black-Scholes valuation model. The warrants have a term of three years and are immediately exercisable.

The fair value of each stock option and warrant award was determined as of the date of grant using the Black-Scholes option-pricing model with the following assumptions in each of the years ended December 31:

	2011			2010
Expected volatility		389% - 420	%		141% - 265	%
Expected term (years)		3			.21 - 3
Risk-free interest rate		1.00	%		1.00	%
Expected dividend yield		0	%		0	%
Forfeiture rate		0	%		0	%
Resulting weighted average grant date fair value	$	0.02		$	0..09

Expected volatility is based solely on historical volatility of our common stock over the period commensurate with the expected term of the warrants or stock options. The expected term calculation is based upon the expected term the warrant or option is to be held, which in most cases is one-half of the term of the warrant or option. The risk-free interest rate is based upon the U.S. Treasury yield in effect at the time of grant for an instrument with a maturity that is commensurate with the expected term of the stock options. The dividend yield of zero is based on the fact that we have never paid cash dividends on our common stock and we have no present intention to pay cash dividends.

As of December 31, 2011, there were no unrecognized compensation costs related to unvested share-based compensation arrangements since all costs related to grants in 2011 or previous years were fully recognized as of December 31, 2011.

A summary of the Company’s stock option activity and related information follows:

1999 Stock Option Plan

	Options			Weighted Average Exercise Price		Aggregate Intrinsic Value		Weighted Average Remaining Contractual Life (Years)
Outstanding at December 31, 2009		10,000		$	11.94	$	0.00		1.42
Granted		—
Exercised		—
Forfeited		—
Outstanding at December 31, 2010		10,000		$	11.940	$	0.00		0.42
Granted		—
Exercised		—			—
Forfeited		(10,000	)
Outstanding at December 31, 2011		—

Warrants and options issued outside of the Plan for employee compensation

	Options and Warrants			Weighted Average Exercise Price		Aggregate Intrinsic Value		Weighted Average Remaining Contractual Life (Years)
Outstanding at December 31, 2009		802,000		$	2.05		—
Granted		13,000		$	0.10
Exercised		—
Forfeited		(180,000	)
Outstanding at December 31, 2010		635,000		$	1.91		—
Granted		13,000		$	0.02
Exercised		—
Forfeited		(609,000	)
Outstanding at December 31, 2011		39,000		$	0.08		—		1.64