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Stockholders' Equity
 6 Months Ended
Jun. 30, 2013
Stockholders' Equity Note [Abstract]  
Stockholders' Equity
Stockholders’ Equity
The following is a summary of the Company's authorized and issued common and preferred stock as of June 30, 2013 and December 31, 2012:
 
 
 
 
 
Outstanding as of
 
Authorized
 
Issued
 
June 30,
2013
 
December 31,
2012
Common Stock, par $0.001
600,000,000

 
180,058,605

 
180,058,605

 
144,313,005

Series A Preferred Stock, par $0.001
1,000

 
817

 
—

 
—

Series B Preferred Stock, par $0.001
1,000

 
750

 
—

 
—

Series C Preferred Stock, par $0.001
1,091

 
1,091

 
26

 
26

Series D Preferred Stock, par $0.001
1,966,292

 
1,966,292

 
—

 
—


Common Stock
In May 2013, the Company filed a Certificate of Amendment to the Certificate of Incorporation with the Delaware Secretary of State. The Certificate of Amendment increased the number of shares of common stock the Company has the authority to issue from 300,000,000 shares to 600,000,000 shares.
In March 2013, the Company completed an underwritten offering of 27,377,266 shares of common stock and warrants to purchase an aggregate of up to 13,688,633 shares of common stock. The shares and warrants were sold in units at a price of $0.55 per unit, with each unit consisting of one share of common stock and a warrant to purchase 0.50 share of common stock at an exercise price of $0.7936 per share. The warrants have a term of five and one-half years. The net proceeds, after deducting the underwriters' discounts and other offering expenses, were approximately $14.0 million. The Company valued the registered warrants issued in connection with the March 2013 financing as of the issuance date using the Black Scholes pricing model and recorded a current liability on the condensed consolidated balance sheet of $6.0 million. The warrants were subsequently revalued and the Company recorded the increase in fair value of $2.5 million and $3.1 million to change in fair value of common stock warrants on the condensed consolidated statement of operations for the three and six months ended June 30, 2013, respectively. As of June 30, 2013, none of these warrants had been exercised. Transaction costs associated with the issuance of the warrants were allocated by using the relative fair value approach. These transaction costs of $316,000 were immediately expensed and included as part of general and administrative expense in the Company's condensed consolidated statement of operations for the six months ended June 30, 2013.
In June 2012, the Company entered into an "at-the-market" (ATM) sales agreement (the “Sales Agreement”) with an outside placement agent (the “Placement Agent”) to sell shares of its common stock with aggregate gross proceeds of up to $25.0 million from time to time, through an ATM equity offering program under which the Placement Agent will act as sales agent. Under the Sales Agreement, the Company will set the parameters for the sale of shares, including the number of shares to be issued, the time period during which sales are requested to be made, limitation on the number of shares that may be sold in any one trading day and any minimum price below which sales may not be made. The Sales Agreement provides that the Placement Agent will be entitled to compensation for its services in an amount equal to 3.0% of the gross proceeds from the sales of shares sold through the Placement Agent under the Sales Agreement. The Company has no obligation to sell any shares under the Sales Agreement, and may at any time suspend solicitation and offers under the Sales Agreement.
During the six months ended June 30, 2013, the Company sold a total of 8,222,966 shares of common stock under the ATM Sales Agreement. The sales were made at a weighted average price of $0.70 per share with net proceeds to the Company of $5.6 million.
During the year ended December 31, 2012, the Company sold a total of 9,344,611 shares of common stock under the ATM Sales Agreement. The sales were made at a weighted average price of $0.59 per share with net proceeds to the Company of $5.3 million.
The Company accounts for registered common stock warrants issued in July 2009, January 2011, December 2011 and March 2013 under the authoritative guidance on accounting for derivative financial instruments indexed to, and potentially settled in, a company’s own stock, on the understanding that in compliance with applicable securities laws, the registered warrants require the issuance of registered securities upon exercise and do not sufficiently preclude an implied right to net cash settlement. The Company classifies registered warrants on the condensed consolidated balance sheet as a current liability which is revalued at each balance sheet date subsequent to the initial issuance. Determining the appropriate fair-value model and calculating the fair value of registered warrants requires considerable judgment, including estimating stock price volatility and expected warrant life. The Company develops its estimates based on historical data. A small change in the estimates used may have a relatively large change in the estimated valuation. The Company uses the Black-Scholes pricing model to value the registered warrants. Changes in the fair market value of the warrants are reflected in the condensed consolidated statement of operations as “Change in fair value of common stock warrants.”

Warrants
The following table summarizes the warrants outstanding as of June 30, 2013 and December 31, 2012:
 
 
 
 
 
 
 
As of June 30, 2013
 
As of December 31, 2012
Issued in Connection With:
 
Exercise
Price
 
Expiration
Date
 
Number of
Warrants
 
Common Stock
Warrant Liability
 
Number of
Warrants
 
Common Stock
Warrant Liability
March 2013 financing
 
$
0.79

 
September 12, 2018
 
13,688,633

 
$
9,102,940

 
—

 
$
—

December 2011 financing
 
$
0.65

 
December 6, 2016
 
5,774,784

 
2,309,913

 
5,774,784

 
2,078,921

January 2011 financing
 
$
1.40

 
January 27, 2016
 
10,565,200

 
2,039,084

 
10,565,200

 
779,711

July 2009 financing
 
$
3.38

 
July 1, 2014
 
333,333

 
2,000

 
333,333

 
1,267

Warrants assumed in June 2009 Merger
 
$0.05-$1.28

 
September 27, 2013 - April 28, 2016
 
4,863,616

 
—

 
4,920,527

 
—

Total
 
 
 
 
 
35,225,566

 
$
13,453,937

 
21,593,844

 
$
2,859,899


    

In March and April 2013, warrants expired to purchase 54,948 and 1,963 shares of the Company's common stock, respectively, which were assumed in the June 2009 Merger.

In August 2012, warrants expired to purchase 150,000 shares of the Company's common stock issued in connection with consulting services received in August 2007.
Stock Options
The Company has one active stock and cash-based incentive plan, the Amended and Restated 2007 Omnibus Incentive Plan (the “Incentive Plan”), pursuant to which the Company has granted stock options and restricted stock awards to executive officers, directors and employees. The Incentive Plan was adopted on March 31, 2007, approved by the stockholders on May 4, 2007, approved by the stockholders as amended on May 2, 2008, and approved by the stockholders as amended and restated on August 25, 2009 and May 14, 2010. On May 14, 2010 the stockholders approved to increase the aggregate number of shares available for grant under the Incentive Plan by 2,000,000 and to provide that the aggregate number of shares available for grant under the Incentive Plan will be increased on January 1 of each year beginning in 2011 by a number of shares equal to the lesser of (1) 2,055,331 or (2) such lesser number of shares as may be determined by the Board. At June 30, 2013, the Incentive Plan reserves 11,915,993 shares of common stock for issuance as or upon exercise of incentive awards granted and to be granted at future dates. At June 30, 2013, the Company had 1,289,493 shares of common stock available for future grant under the Incentive Plan, and 240,000 shares of vested restricted stock and options to purchase 10,063,287 shares of common stock outstanding under the Incentive Plan. The awards granted and available for future grant under the Incentive Plan generally vest over three years and have a maximum contractual term of ten years. The Incentive Plan terminates by its terms on March 31, 2017.
The Incentive Plan supersedes all of the Company’s previous stock option plans, which include the Amended 2000 Stock Option Plan and the VGX Equity Compensation Plan, under which the Company had options to purchase 1,276,435 and 7,058,240 shares of common stock outstanding at June 30, 2013, respectively. The terms and conditions of the options outstanding under these plans remain unchanged.