Stockholders' Equity - Common and Preferred Shares

3 Months Ended

Mar. 31, 2013

Stockholders' Equity - Common and Preferred Shares [Abstract]

Stockholders' Equity - Common and Preferred Shares

2. Stockholders’ Equity — Common and Preferred Shares

On July 21, 2010, the Company entered into an “at the market” equity offering sales agreement (the ATM Agreement) with MLV & Co. LLC, or MLV, pursuant to which the Company may issue and sell shares of its common stock from time to time through MLV acting as sales agent and underwriter. The Company is limited as to how many shares it can sell under the ATM Agreement due to SEC limitations on the number of shares issuable pursuant to a Form S-3 registration statement in a primary offering by smaller reporting companies such as the Company. Further, the Company is restricted from using this facility until 90 days following the effectiveness of a registration statement for the private placement as described in Note 4. Subject to this restriction, as of April 30, 2013 the total dollar amount of common stock that the Company could sell under the ATM Agreement, during the next twelve months is approximately $264,000 under its current registration statement. The Company may be able to sell more shares under this agreement over the next twelve months depending on several factors including the Company’s stock price, number of shares outstanding, when the sales take place and the effectiveness of a registration statement for the private placement described in Note 4.

In connection with the ATM Agreement, the Company issued approximately 323,000 shares of common stock for proceeds of approximately $1,510,000 net of issuance costs, during the three months ended March 31, 2013 and issued no shares of common stock during the three months ended March 31, 2012. Additionally, the Company issued approximately 99,000 shares of common stock under this agreement for gross proceeds of approximately $406,000 during the month of April 2013.

In November 2011, the Company entered into a purchase agreement (the LPC Purchase Agreement) for the sale, from time to time, of up to $20,000,000 of its common stock to Lincoln Park Capital Fund, LLC or LPC, over a 36 month term. The Company can only sell shares under this arrangement if it maintains a minimum stock price of $6.00 and maintains the effectiveness of a registration statement filed with the Securities and Exchange Commission. Further, the Company is restricted from using this facility until 90 days following the effectiveness of a registration statement for the private placement as described in Note 4. Subject to this restriction, if the Company’s stock price does rise above $6.00 and the other conditions of the arrangement are met, the Company generally controls the timing and amount of any sales to LPC in accordance with the purchase agreement. LPC has no right to require the Company to sell any shares to LPC, but LPC is obligated to make purchases as the Company directs, subject to certain conditions including the minimum stock price of $6.00 and the continuing effectiveness of a registration statement filed with the Securities and Exchange Commission covering the resale of the shares that may be issued to LPC. There are no upper limits to the price LPC may pay to purchase the Company’s common stock and the purchase price of the shares related to any future sales will be based on the prevailing market prices of the Company’s shares immediately preceding the notice of sale to LPC without any fixed discount. The agreement may be terminated by the Company at any time, at its sole discretion, without any cost or penalty. Assuming that the purchase price per share is $6.00 or greater, the total dollar amount of common stock that the Company could sell under the LPC Purchase Agreement during the next twelve months is approximately $17,400,000, provided that the Company would be required to file and have declared effective an additional registration statement in order to sell more than an additional 66,862 shares of its common stock under the LPC Purchase Agreement.

In connection with the LPC Purchase Agreement, the Company issued 81,990 shares of common stock for proceeds of approximately $959,000, net of issuance costs, during the three months ended March 31, 2012, including 2,498 shares issued as a commitment fee. No shares were issued under this agreement during the three months ended March 31, 2013.

Warrants

Warrant Summary Information

The following is a summary of the Company’s outstanding common stock warrants as of March 31, 2013 and December 31, 2012:

				Number of Warrants outstanding as of: (In thousands)
Warrants Issued in Connection with:	Date of Issuance	Exercise Price		March 31, 2013		December 31, 2012
Committed Equity Financing Facility	February 19, 2008	$	657.60		1		1
Direct Registration Series I Warrants	July 20, 2009	$	504.00		12		12
Total Warrants Outstanding					13		13

Effective with a warrant exchange, the Committed Equity Financing Facility warrants, issued by the Company on February 19, 2008, were reclassified as equity in January 2011. Previously they were recorded as a liability at their fair value in March 2010 and were last recorded as a liability on December 31, 2010. These warrants expire on August 19, 2013.

The Direct Registration Series I warrants, issued by the Company on July 20, 2009, were recorded as a liability at their fair value as of the date of their issuance in July 2009 and are revalued at each subsequent reporting date. The value of these warrants recorded on the Company’s balance sheet was approximately $0 at both March 31, 2013 and December 31, 2012. These warrants expire on July 20, 2014.

Options

The Company’s 2005 Stock Plan, as amended at the 2012 Annual Meeting of Stockholders in May 2012 (the “2005 Plan”) provides for the award of options, restricted stock and stock appreciation rights to acquire up to 333,333 shares of the Company’s common stock in the aggregate. Currently, the 2005 Plan allows for awards of up to 16,666 shares that may be granted to any one participant in any fiscal year. For options subject to graded vesting, the Company elected the straight-line method of expensing these awards over the service period.

The following is a summary of the Company’s stock option activity under its 2005 Plan for the three months ended March 31, 2013:

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
	(In thousands)					(Years)		(In thousands)
Options outstanding at December 31, 2012		143		$	19.73		8.64	$	—
Granted		76		$	4.38
Forfeited and expired		(29	)	$	13.95
Options outstanding at March 31, 2013		190		$	14.49		7.96	$	—
Options exercisable at March 31, 2013		83		$	20.65		5.92	$	—
Options vested or expected to vest at March 31, 2013		146		$	16.21		7.38	$	—

As of March 31, 2013 there was approximately $190,174 of unrecognized compensation cost related to stock option awards that is expected to be recognized as expense over a weighted average period of approximately 2.43 years.

The fair values for the stock options granted were estimated at the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions for the three months ended March 31, 2013:

Weighted Average Assumptions
Risk-free interest rate	0.77	%
Expected life (years)	4
Expected volatility	101	%
Dividend yield	0.00	%