Stockholders' Equity

12 Months Ended

Dec. 31, 2015

Stockholders' Equity

Note 12. Stockholders’ Equity

Public Offering of Common Stock

In January 2015, the Company issued 14,636,363 shares of its common stock, par value $0.001 per share, in an underwritten public offering. The price to the public in the offering was $5.50 per share. The net proceeds from this offering were approximately $75.3 million, net of the underwriting discount and other issuance costs.

Common Stock and Associated Warrant Liability

In November 2010, the Company issued warrants to purchase 3.7 million shares of common stock, exercisable at an exercise price of $3.20 per share. The warrants issued in November 2010 (“2010 Warrants”) became exercisable on May 15, 2011, and were exercisable for a period of five years from the issue date. In 2015, all outstanding 2010 Warrants were exercised in full.

The fair value of the 2010 Warrants was recorded on the consolidated balance sheets as a liability pursuant to ASC Topic 480-10“Distinguishing Liabilities from Equity” and were adjusted to fair value at each financial reporting date thereafter until exercise, at which time, these warrants were reclassified into stockholders’ equity. The Company classified the 2010 Warrants as a liability as these warrants contained certain provisions that, under certain circumstances, could have been out of the Company’s control and could have required the Company to pay cash to settle the exercise of the 2010 Warrants or required the Company to redeem the 2010 Warrants.

The fair value of the 2010 Warrants was based on option valuation model and using the following assumptions at December 31, 2015 and 2014:

	December 31, 2015	December 31, 2014
2010 Warrants:
Expected term (in years)	—	0.86
Estimated volatility	—	55%
Risk-free interest rate	—	0.25%
Expected dividend yield	—	—

The Company recorded non-cash gains or losses in “Gain (loss) from revaluation of warrant liability” on the consolidated statements of operations due to the changes in fair value of the 2010 Warrants. During the years ended December 31, 2015, 2014 and 2013, the 2010 Warrants to purchase 3.3 million, 2.6 million and 0.2 million shares of common stock, respectively, were exercised. At December 31, 2015, the Company had no outstanding warrants remaining.

Sales Agreement

On March 21, 2014, the Company entered into Amendment No. 1 to the Controlled Equity Offering^SM Sales Agreement, dated August 31, 2012 (as amended, the “Amended Cantor Agreement”) with Cantor Fitzgerald & Co. (“Cantor”) that provides for the issuance and sale of shares of its common stock over the term of the Amended Cantor Agreement having an aggregate offering price of up to $70 million through Cantor. Under the Amended Cantor Agreement, Cantor also acts as the Company’s sales agent and receives compensation based on an aggregate of 2% of the gross proceeds on the sale price per share of its common stock. The issuance and sale of these shares by the Company pursuant to the Amended Cantor Agreement are deemed an “at-the-market” offering and are registered under the Securities Act of 1933, as amended. During the year ended December 31, 2015 and 2014, zero and approximately 4.3 million shares, respectively, of the Company’s common stock were sold under the Amended Cantor Agreement for aggregate net proceeds of zero and $18.6 million, respectively. At December 31, 2015, the Company had approximately $22.5 million of common stock registered to be sold under the Amended Cantor Agreement.

Stockholder Rights Plan

In October 2009, the Company’s Board of Directors adopted an amendment to its 1999 stockholder rights plan, commonly referred to as a “poison pill,” to reduce the exercise price, extend the expiration date and revise certain definitions under the plan. The stockholder rights plan is intended to deter hostile or coercive attempts to acquire the Company. The stockholder rights plan enables stockholders to acquire shares of the Company’s common stock, or the common stock of an acquirer, at a substantial discount to the public market price should any person or group acquire more than 15% of the Company’s common stock without the approval of the Board of Directors under certain circumstances. The Company has designated 250,000 shares of Series C Junior Participating preferred stock for issuance in connection with the stockholder rights plan. As of December 31, 2015, no Series C Junior Participating preferred stock has been issued.