Quarterly report pursuant to Section 13 or 15(d)

Stockholders' Equity

v2.4.0.6
Stockholders' Equity
 14 Months Ended
Mar. 31, 2013
Equity [Abstract]  
Stockholders' Equity

NOTE 4— STOCKHOLDERS’ EQUITY

Common Stock Warrants

The Company accounts for its common stock warrants under guidance now codified in ASC 815 that clarifies the determination of whether an instrument (or an embedded feature) is indexed to an entity’s own stock, which would qualify for classification as liabilities. The guidance required the Company’s outstanding warrants to be classified as liabilities and to be fair valued at each reporting period, with the changes in fair value recognized as other income (expense) in the Company’s consolidated statements of operations.

At March 31, 2013 and December 31, 2012, the Company had warrants outstanding to purchase 3,049,007 and 3,058,811 shares of common stock, respectively, from the August 2008 offering. The fair value of these warrants on March 31, 2013 and December 31, 2012 was determined using a Black-Scholes valuation model with the following level 3 inputs:

 

     March 31,
2013		     December 31,
2012		  

Risk-free interest rate

      0.11 %      0.16 % 

Expected life (in years)

      0.41        0.66   

Dividend yield

      —          —     

Volatility

      66 %      118 % 

Stock price

    $ 4.61      $ 4.21   

During the three months ended March 31, 2013, the change in fair value of $0.4 million related to the August 2008 warrants was recorded as other expense in the Company’s consolidated statement of operations.

 

At March 31, 2013 and December 31 2012, the Company had warrants outstanding to purchase 4,287,940 shares of common stock, respectively from the October 2009 offering. The fair value of these warrants on March 31, 2013 and December 31, 2012 was determined using a Black Scholes valuation model with the following level 3 inputs:

 

     March 31,
2013		     December 31,
2012		  

Risk-free interest rate

      0.25 %      0.25 % 

Expected life (in years)

      1.52        1.76   

Dividend yield

      —          —     

Volatility

      103 %      98 % 

Stock price

    $ 4.61      $ 4.21   

During the three months March 31, 2013 the change in fair value of $1.4 million related to the October 2009 warrants was recorded as other expense in the Company’s consolidated statement of operations.

At March 31, 2013 and December 31, 2012, the Company had warrants outstanding to purchase 4,236,083 shares of common stock, respectively from the March 2011 offering. The fair value of these warrants on March 31, 2013 and December 31, 2012 was determined using a Black Scholes valuation model with the following level 3 inputs:

 

     March 31,
2013		     December 31,
2012		  

Risk-free interest rate

      0.36 %      0.72 % 

Expected life (in years)

      2.96        3.21   

Dividend yield

      —          —     

Volatility

      95 %      94 % 

Stock price

    $ 4.61      $ 4.21   

During the three months ended March 31, 2013, the change in fair value of $1.3 million related to the March 2011 warrants was recorded as other expense in the Company’s consolidated statement of operations.

The following table sets forth the Company’s financial liabilities, related to warrants issued in the August 2008, October 2009 and March 2011 offerings, subject to fair value measurements as of March 31, 2013 and December 31, 2012:

 

(in thousands)    Fair Value as of
March 31,
2013		      Basis of Fair Value Measurements  
      Level 1      Level 2      Level 3  

August 2008 warrants

    $ 8,415       $ —        $ —        $ 8,415   

October 2009 warrants

      13,379         —           —           13,379   

March 2011 warrants

      13,852         —           —           13,852   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total common stock warrants

    $ 35,646       $ —         $ —         $ 35,646   
  

 

 

     

 

 

     

 

 

     

 

 

  

 

(in thousands)    Fair Value as of
December 31,
2012		      Basis of Fair Value Measurements  
      Level 1      Level 2      Level 3  

August 2008 warrants

    $ 8,014       $ —        $ —         $ 8,014   

October 2009 warrants

      11,963         —           —           11,963   

March 2011 warrants

      12,581         —           —           12,581   
  

 

 

     

 

 

     

 

 

     

 

 

  

Total common stock warrants

    $ 32,558       $ —         $ —        $ 32,558   
  

 

 

     

 

 

     

 

 

     

 

 

  

The following table is a reconciliation of the warrant liability measured at fair value using level 3 inputs (in thousands):

 

     Warrant Liability  

Balance at December 31, 2012

    $ 32,558   

Change in fair value of common stock warrants during three months ended March 31, 2013

      3,116   

Exercise of warrants during three months ended March 31, 2013

      (28 ) 
  

 

 

  

Balance at March 31, 2013

    $ 35,646