The Company maintains the 2010 Omnibus Long-Term Incentive Plan, the 2010 Employee Stock Purchase Plan, the 2000 Stock Option and Incentive Plan and the 2000 Employee Stock Purchase Plan (collectively, the "Stock Plans").

2000 Stock Option and Incentive Plan The Company adopted the 2000 Option and Incentive Plan (the "2000 Option Plan") on October 17, 2000. At December 31, 2010, there were no shares of common stock available for future grants under the 2000 Option Plan. The 2000 Option Plan expired October 17, 2010 and after such date no further awards could be granted under the plan. Under the terms of the 2000 Option Plan, the Company was authorized to grant incentive stock options, as defined under the Internal Revenue Code, non-qualified options, restricted stock awards and other stock awards to employees, officers, directors, consultants and advisors. Options granted under the 2000 Option Plan expire ten years from the date of grant. Grants made from the 2000 Option Plan generally vest over a period of three to four years.

The 2000 Option Plan was administered by the compensation committee of the Company's board of directors, which selected the individuals to whom equity-based awards would be granted and determined the option exercise price and other terms of each award, subject to the provisions of the 2000 Option Plan. The 2000 Option Plan provides that upon an acquisition of the Company, all options to purchase common stock will accelerate by a period of one year. In addition, upon the termination of an employee without cause or for good reason prior to the first anniversary of the completion of the acquisition, all options then outstanding under the 2000 Option Plan held by that employee will immediately become exercisable. At December 31, 2011, options to purchase 5,417,404 shares were outstanding under the 2000 Option Plan and 81,000 shares of restricted stock remained unreleased.

2000 Employee Stock Purchase Plan The 2000 Employee Stock Purchase Plan (the "2000 Purchase Plan") was initially adopted by the Company in October 2000, was subsequently amended and restated, and expired on October 31, 2010. The 2000 Purchase Plan provided participating employees the right to purchase common stock at a discount through a series of offering periods. At December 31, 2011, there were no shares of common stock available for purchase by participating employees under the 2000 Purchase Plan.

The compensation committee of the Company's board of directors administered the 2000 Purchase Plan. Generally, all employees whose customary employment was more than 20 hours per week and more than five months in any calendar year were eligible to participate in the 2000 Purchase Plan. Participating employees authorized an amount, between 1% and 15% of the employee's compensation, to be deducted from the employee's pay during the offering period. On the last day of the offering period, the employee was deemed to have exercised the option, at the option exercise price, to the extent of accumulated payroll deductions. Under the terms of the 2000 Purchase Plan, the option exercise price is an amount equal to 85% of the fair market value, as defined under the 2000 Purchase Plan and no employee was permitted to purchase more than $25,000 of the Company common stock under the 2000 Purchase Plan in any calendar year. Rights granted under the 2000 Purchase Plan terminate upon an employee's voluntary withdrawal from the 2000 Purchase Plan at any time or upon termination of employment. The Company issued the following shares of common stock under the 2000 Purchase Plan for the year ended December 31, 2010. No shares were issued under the 2000 Purchase Plan in 2009.

2010 Omnibus Long-Term Incentive Plan The Company adopted the 2010 Omnibus Long-Term Incentive Plan (the "2010 Stock Plan") on July 16, 2010. The 2010 Stock Plan will expire on July 16, 2020 and after such date no further awards may be granted under the plan. Under the terms of the 2010 Stock Plan, the Company is authorized to grant incentive stock options, as defined under the Internal Revenue Code, non-qualified options, restricted stock awards and other stock awards to employees, officers, directors, consultants and advisors. Options granted under the 2010 Stock Plan expire ten years from the date of grant. Grants made from the 2010 Stock Plan generally vest over a period of three to four years.

The 2010 Stock Plan is administered by the compensation committee of the Company's board of directors, which selects the individuals to whom equity-based awards will be granted and determines the option exercise price and other terms of each award, subject to the provisions of the 2010 Stock Plan. The 2010 Stock Plan provides that upon an acquisition of the Company, all equity will accelerate by a period of one year. In addition, upon the termination of an employee, who remains an employee of the Company or the acquiring entity immediately following consummation of the acquisition, without cause or for good reason prior to the first anniversary of the completion of the acquisition, all equity awards then outstanding under the 2010 Stock Plan held by that employee will immediately vest. At December 31, 2011, options to purchase 1,036,240 shares were outstanding under the 2010 Stock Plan, and 320,490 restricted stock and restricted stock unit shares remained unreleased. At December 31, 2011, there were 2,716,475 shares available for future grant under the 2010 Stock Plan.

2010 Employee Stock Purchase Plan The 2010 Employee Stock Purchase Plan (the "2010 Purchase Plan") was adopted by the Company on July 16, 2010. The 2010 Purchase Plan provides participating employees the right to purchase common stock at a discount through a series of offering periods. The 2010 Purchase Plan will expire on October 31, 2020. At December 31, 2011, there were 248,143 shares of common stock available for purchase by participating employees under the 2010 Purchase Plan.

The compensation committee of the Company's board of directors administers the 2010 Purchase Plan. Generally, all employees whose customary employment is more than 20 hours per week and for more than five months in any calendar year are eligible to participate in the 2010 Purchase Plan. Participating employees authorize an amount, between 1% and 15% of the employee's compensation, to be deducted from the employee's pay during the offering period. On the last day of the offering period, the employee is deemed to have exercised the option, at the option exercise price, to the extent of accumulated payroll deductions. Under the terms of the 2010 Purchase Plan, the option exercise price is an amount equal to 85% of the fair market value, as defined under the 2010 Purchase Plan and no employee can purchase more than $25,000 of the Company common stock under the 2010 Purchase Plan in any calendar year. Rights granted under the 2010 Purchase Plan terminate upon an employee's voluntary withdrawal from the 2010 Purchase Plan at any time or upon termination of employment. At December 31, 2011, there were 51,857 shares issued under the 2010 Purchase Plan.

The Company recorded approximately $4.0 million in stock-based compensation expense during the year ended December 31, 2011, in connection with the amortization of restricted stock and restricted stock unit awards, stock purchase rights granted under the Company's employee stock purchase plans and stock options granted to employees and non-employee directors. The Company recorded $2.2 million in stock-based compensation expense during the year ended December 31, 2010 in connection with the amortization of awards of common stock, restricted common stock and stock options granted to employees, non-employee directors and non-employee consultants. The Company recorded approximately $2.6 million in stock-based compensation expense during the year ended December 31, 2009 in connection with the amortization of awards of common stock, restricted common stock and stock options granted to employees, non-employee directors and non-employee consultants and collaborators, as well as the modification of certain stock options. Non-cash stock-based compensation expense by department for the years ended December 31, 2011, 2010, and 2009 are as follows. Amounts included in the table are in thousands.

In connection with the December 31, 2011 resignation of John Krayacich as the Company's Senior Vice President of Sales and Marketing, the Company accelerated the vesting of 131,250 shares under Mr. Krayacich's previously unvested stock options. This acceleration was done in accordance with Mr. Krayacich's employment agreement. Mr. Krayacich will have a two year period from December 31, 2011 to exercise these options. The remaining 168,750 stock options from his initial grant will be forfeited. As a result of this accelerated vesting, the Company recorded additional stock compensation expense in 2011 to ensure that the total grant date fair value of the actual vested award was amortized to expense.

Valuation and Recognition—The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing model based on the assumptions in the table below. The estimated fair value of employee stock options is recognized to expense using the straight-line method over the vesting period.

Expected Term—The Company uses the simplified calculation of expected life, described in the SEC's Staff Accounting Bulletins 107 and 110, as the Company does not currently have sufficient historical exercise data on which to base an estimate of expected life. Using this method, the expected term is determined using the average of the vesting period and the contractual life of the stock options granted.

Expected Volatility—Expected volatility is based on the Company's historical stock volatility data over the expected term of the awards.

Risk-Free Interest Rate—The Company bases the risk-free interest rate used in the Black-Scholes valuation method on the implied yield currently available on U.S. Treasury zero-coupon issues with an equivalent expected term.

Forfeitures—The Company records stock-based compensation expense only for those awards that are expected to vest. Awards granted in 2011 and 2010 are all expected to vest and no forfeiture rate was utilized.

The fair value of each restricted stock and restricted stock unit award is determined on the date of grant using the closing stock price on that day. The fair value of each option award is estimated on the date of grant using the Black-Scholes option pricing model based on the assumptions in the following table.

	December 31,

	2011		2010		2009
Option Plan Shares
Risk-free interest rates		0.88% - 2.3%		1.17% - 2.69%		1.76% - 2.69%
Expected term (in years)		6		6		6
Expected volatility		92%		91% - 92%		85 - 92%
Dividend yield		0%		0%		0%
Weighted average fair value per share of options granted during the period	$	4.78	$	3.07	$	0.89
ESPP Shares
Risk-free interest rates		0.13% - 0.61%		0.16% - 0.38%			(1)
Expected term (in years)		0.5 - 2		0.5 - 2			(1)
Expected volatility		48% - 63%		53% - 127%			(1)
Dividend yield		0%		0%			(1)
Weighted average fair value per share of stock purchase rights granted during the period	$	2.83	$	2.03			(1)

A summary of stock option activity under the Stock Plans during the years ended 2011, 2010 and 2009 is as follows:

Options			Weighted Average Exercise Price

(Aggregate intrinsic value in thousands)
Outstanding, January 1, 2009	3,518,899		$	4.20
Granted	4,860,000			1.19
Exercised	(380,355	)		1.92
Cancelled	(2,086,525	)		4.51

Outstanding, December 31, 2009	5,912,019			1.76
Granted	518,566			4.09
Exercised	(213,386	)		2.19

Outstanding, December 31, 2010	6,217,199			1.93
Granted	814,424			6.26
Exercised	(325,477	)		2.11
Forfeited	(252,502	)		7.15

Outstanding, December 31, 2011	6,453,644		$	2.27	7.2	38,309

Exercisable, December 31, 2011	3,965,380		$	1.95	6.8	24,938

Vested and expected to vest, December 31, 2011	6,453,644		$	2.27	7.2	38,309

(1): The aggregate intrinsic value of options outstanding at December 31, 2011 is calculated as the difference between the exercise price of the underlying options and the market price of the Company's common stock for the 6,222,470 options that had exercise prices that were lower than the $8.12 market price of our common stock at December 31, 2011. The aggregate intrinsic value of options exercisable at December 31, 2011 is calculated as the difference between the exercise price of the underlying options and the market price of the Company's common stock for the 3,860,380 options that had exercise prices that were lower than the $8.12 market price of our common stock at December 31, 2011. The total intrinsic value of options exercised during the years ended December 31, 2011, 2010 and 2009 was $1.9 million, $0.4 million, $0.2 million, respectively, determined as of the date of exercise.

A summary of restricted stock and restricted stock unit activity under the Stock Plans during the years ended 2011, 2010 and 2009 is as follows:

			Weighted Average Grant Date Fair Value

Outstanding, January 1, 2009	185,000		$	0.39
Granted	411,127			0.98
Released	(510,181	)		0.77
Cancelled	(45,946	)		0.37

Outstanding, December 31, 2009	40,000			1.72
Granted	326,197			5.73
Released	(102,567	)		2.94

Outstanding, December 31, 2010	263,630			6.20
Granted	335,716			6.06
Released	(192,856	)		5.89
Forfeited	(5,000	)		5.61

Outstanding, December 31, 2011	401,490		$	6.24

As of December 31, 2011, there was approximately $6.6 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under all equity compensation plans. Total unrecognized compensation cost will be adjusted for future changes in forfeitures. The Company expects to recognize that cost over a weighted average period of 2.4 years.

The Company received approximately $0.7 million, $0.5 million, $0.7 million from stock option exercises during the years ended December 31, 2011, 2010 and 2009, respectively. During the years ended December 31, 2011, 2010 and 2009, 51,857, zero, and zero shares, respectively of common stock were issued under the Company's 2010 Purchase Plan resulting in proceeds to the Company of $0.3 million, $0, and $0, respectively. During the years ended December 31, 2011, 2010 and 2009, zero, 58,709, and zero shares, respectively, of common stock were issued under the Company's 2000 Purchase Plan resulting in proceeds to the Company of $0, $0.1 million, and $0, respectively.

The following table summarizes information relating to currently outstanding and exercisable stock options as of December 31, 2011:

	Outstanding						Exercisable

Exercise Price	Number of Options		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number of Options		Weighted Average Exercise Price
$ — - $1.00		3,795,000		7.2	$	0.83		2,623,125	$	0.83
$1.01 - $2.00		211,163		7.3	$	1.44		64,911	$	1.44
$2.01 - $3.00		1,069,553		6.9	$	2.79		717,052	$	2.76
$3.01 - $4.00		187,066		6.7	$	3.55		132,979	$	3.54
$4.01 - $5.00		395,500		7.6	$	4.26		147,625	$	4.42
$5.01 - $7.00		480,500		9.0	$	5.83		150,000	$	5.64
$7.01 - $9.00		209,862		8.6	$	8.15		24,688	$	7.76
$9.01 - $14.00		105,000		1.3	$	12.73		105,000	$	12.73

		6,453,644		7.2	$	2.27		3,965,380	$	1.95

2009 Modifications In connection with the March 18, 2009 resignation of Jeffrey R. Luber as the Company's President and Chief Executive Officer and Charles R. Carelli, Jr. as the Company's Chief Financial Officer, the Company's board of directors approved the following stock option modifications: On April 2, 2009, the effective date of Mr. Luber's resignation from the Company, the Company accelerated the vesting of 114,896 shares under Mr. Luber's previously unvested stock options, with a fair value of the share price on the original grant date. On April 2, 2009, the effective date of Mr. Carelli's resignation from the Company, the Company accelerated the vesting of 70,556 shares under Mr. Carelli's previously unvested stock options, with a fair value of the share price on the original grant date. As a result of these modifications, the Company recorded one-time non-cash stock-based compensation expense of approximately $0.3 million during the quarter ended March 31, 2009. In addition, the Company repurchased 804,026 shares for $50,000.

During 2009, the restriction for all 445,181 shares of the Board of Directors restricted stock award grants was lifted. The restriction for the awards was lifted before their one year term which is considered a modification under financial accounting standards. The Company recognized the incremental fair value on the date the restriction was lifted, thus resulting in approximately $0.9 million of non-cash stock-based compensation expense related to the modification.

The Company has reserved shares of its authorized common stock for issuance pursuant to its employee stock purchase and stock option plans, including all outstanding stock option grants noted above at December 31, 2011, as follows: