Accounting for Stock-Based Compensation

9 Months Ended

Sep. 30, 2013

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Accounting for Stock-Based Compensation

5. Accounting for Stock-Based Compensation

We have one stock option plan under which we can issue both nonqualified and incentive stock options to employees, officers, consultants and scientific advisors of the Company. At September 30, 2013, the 2005 Stock Incentive Plan (the “2005 Plan”) provided for the issuance of options, restricted stock, restricted stock units, stock appreciation rights or other stock-based awards to purchase 3,450,000 shares of our common stock. The 2005 Plan contains a provision that allows for an annual increase in the number of shares available for issuance under the 2005 Plan on the first day of each of the Company’s fiscal years during the period beginning in fiscal year 2006 and ending on the second day of fiscal year 2014. The annual increase in the number of shares shall be equal to the lowest of 400,000 shares; 4% of the Company’s outstanding shares on the first day of the fiscal year; and an amount determined by the Board of Directors. No increase in the number of shares available for issuance was made in January 2013.

We also have outstanding stock options in three other stock option plans, the 1998 Omnibus Plan, the Amended and Restated Omnibus Stock Option Plan and the Amended and Restated 1990 Non-Employee Directors’ Non-Qualified Stock Option Plan. These plans have expired and no future issuance of awards is permissible.

Our Board of Directors determines the term, vesting provisions, price, and number of shares for each award that is granted. The term of each option cannot exceed ten years.

We use the Black-Scholes option-pricing model to calculate the fair value of each option grant on the date of grant. No stock options were granted during the three months ended September 30, 2013 and 2012.

A summary of our outstanding stock options for the nine months ended September 30, 2013 and 2012 is presented below.

	2013					2012
	Shares			Weighted Average Exercise Price		Shares			Weighted Average Exercise Price
Outstanding at beginning of period		3,002,980		$	1.50		3,636,480		$	1.55
Granted		—			—		—			—
Exercised		—			—		—			—
Forfeited and expired		(500	)	$	5.00		(625,000	)		1.75
Outstanding at end of period		3,002,480		$	1.50		3,011,480		$	1.51
Options exercisable at end of period		3,002,480		$	1.50		3,011,480		$	1.51

The following table summarizes information about stock options outstanding and exercisable at September 30, 2013:

Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price
$1.15 — $1.36		2,287,500		0.7 years	$	1.15
$2.00 — $3.00		539,980		2.0 years		2.33
$3.10 — $4.65		155,000		4.1 years		3.17
$4.99 — $6.96		20,000		.6 years		5.68
		3,002,480		1.1 years	$	1.50

There was no intrinsic value of outstanding options and exercisable options as of September 30, 2013. As of September 30, 2013, 809,172 shares were available for grant under the 2005 Stock Incentive Plan.