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Stock-Based Compensation
 3 Months Ended
Mar. 31, 2012
Stock-Based Compensation [Abstract]  
Stock-Based Compensation

Note 11. Stock-Based Compensation

The Company maintains an equity compensation plan to provide long-term incentives for employees, contractors, and members of its Board of Directors. The Company currently grants equity awards from one plan, the 2008 Equity Incentive Plan (the "2008 Plan"). The 2008 Plan allows for the issuance of non-statutory and incentive stock options, restricted stock, restricted stock units, stock appreciation rights, other stock-related awards, and performance awards which may be settled in cash, stock, or other property. The Company continues to have equity awards outstanding under its previous stock plans: 1998 Non-Officer Stock Option Plan and 1999 Equity Incentive Plan (collectively, the "Prior Plans") and 1996 Equity Incentive Plan (the "1996 Plan"). Equity awards issued under the Prior Plans and the 1996 Plan continue to adhere to the terms of those respective stock plans and no further options may be granted under those previous plans. However, at June 2, 2008, any shares that remained available for future grants under the Prior Plans became available for issuance under the 2008 Plan. At March 31, 2012, the Company had an aggregate of approximately 10.1 million shares of its common stock reserved for issuance under the 2008 Plan, the Prior Plans and the 1996 Plan, of which approximately 9.0 million shares were subject to outstanding options and other stock-based awards, and approximately 1.1 million shares were available for future issuance under the 2008 Plan.

The Company also maintains an Employee Stock Purchase Plan (the "Purchase Plan") which is intended to qualify as an employee stock purchase plan within the meaning of Section 423(b) of the Internal Revenue Code. Under the Purchase Plan, the Company's Board of Directors may authorize participation by eligible employees, including officers, in periodic offerings. At March 31, 2012, the Company had 97,261 shares available for future issuance.

The Company has granted restricted stock units to its senior management in accordance with the 2008 Plan. Subject to each grantee's continued employment, the restricted stock units vest in three annual installments from the date of grant and are generally issuable at the end of the three-year vesting term.

Activity under the Company's equity incentive plans related to stock options is set forth below (in thousands except per share amounts):

 

     Number of Options
Outstanding		     Weighted
Average
Exercise
Price per
Share		  

Balances at December 31, 2011

      7,362      $ 4.70   

Granted

      1,714        3.69   

Forfeited

      (19 )      2.26   

Expired

      (193 )      49.66   

Exercised

      (6 )      0.92   
  

 

 

    

Balances at March 31, 2012

      8,858      $ 3.53   
  

 

 

    

The Company currently uses the Black-Scholes option pricing model to determine the grant-date fair value of stock options and employee stock purchase plan shares. The Black-Scholes option pricing model is affected by the Company's stock price, as well as assumptions regarding a number of complex and subjective variables, which include the expected term of the grants, actual and projected employee stock option exercise behaviors, including forfeitures, the Company's expected stock price volatility, the risk-free interest rate and expected dividends. The Company recognizes the grant-date fair value of the stock award as stock-based compensation expense on a straight-line basis over the requisite service period, which is the vesting period, and is adjusted for estimated forfeitures.

Stock-based compensation recognized on the Company's condensed consolidated statements of operations for the three months ended March 31, 2012 and 2011, was as follows (in thousands):

 

     Three Months Ended  
     March 31,  
     2012      2011  

Stock-based compensation expense by caption:

      

Research and development

    $ 131       $ 109   

Selling, general and administrative

      411         363   
  

 

 

     

 

 

  

Total stock-based compensation expense

    $ 542       $ 472   
  

 

 

     

 

 

  

The Company did not record any stock-based compensation associated with performance-based stock options during the three months ended March 31, 2012 and 2011 as the performance criteria was not probable of being achieved. Performance-based stock options of 100,000 remained outstanding at March 31, 2012.