Fair Value Of Financial Instruments

9 Months Ended

Sep. 30, 2011

Fair Value Of Financial Instruments [Abstract]

Fair Value Of Financial Instruments

4. Fair Value of Financial Instruments

The carrying values of our financial instruments including cash equivalents, marketable securities, accounts receivable and accounts payable approximate their fair value due to their short-term nature. As a basis for determining the fair value of certain of our assets and liabilities, we established a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows: (Level I) observable inputs such as quoted prices in active markets; (Level II) inputs other than the quoted prices in active markets that are observable either directly or indirectly; and (Level III) unobservable inputs in which there is little or no market data which requires us to develop our own assumptions. This hierarchy requires us to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. Our financial assets that are measured at fair value on a recurring basis consist of cash equivalents and marketable securities. Our liabilities that are measured at fair value on a recurring basis consist of our common stock warrant liability.

All of our cash equivalents and current restricted cash, which are comprised primarily of money market funds, are classified within Level I of the fair value hierarchy because they are valued using quoted market prices or market prices for similar securities. Our short-term marketable securities are classified within Level II of the fair value hierarchy. Our common stock warrant liability (see Note 6) is classified within Level III of the fair value hierarchy.

As of September 30, 2011 and December 31, 2010, the fair value hierarchy for our financial assets and financial liabilities that are carried at fair value was as follows (in thousands):

	September 30, 2011								December 31, 2010
	Fair Value		Level I		Level II		Level III		Fair Value		Level I		Level II		Level III
Money market funds	$	235,381	$	235,381	$	—	$	—	$	145,708	$	145,708	$	—	$	—
Corporate note		10,111		—		10,111		—		—		—		—		—
Commercial paper		54,949		—		54,949		—		—		—		—		—
Total	$	300,441	$	235,381	$	65,060	$	—	$	145,708	$	145,708	$	—	$	—
Common stock warrant liability	$	8,189	$	—	$	—	$	8,189	$	6,088	$	—	$	—	$	6,088
Total	$	8,189	$	—	$	—	$	8,189	$	6,088	$	—	$	—	$	6,088

Our available-for-sale marketable securities classified by security type as of September 30, 2011 consisted of the following (in thousands):

	September 30, 2011
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Corporate note	$	10,116	$	—	$	(5	)	$	10,111
Commercial paper		54,968		—		(19	)		54,949
Total	$	65,084	$	—	$	(24	)	$	65,060

All of our marketable securities with continuous unrealized losses have been in an unrealized loss position for less than twelve months as of September 30, 2011. We have determined that the gross unrealized losses on our marketable securities as of September 30, 2011 were temporary in nature.

The changes in the fair value of our common stock and convertible preferred stock warrant liability were as follows (in thousands):

	Three Months Ended September 30,					Nine Months Ended September 30,
	2011		2010			2011		2010
Fair value, beginning of period	$	7,849	$	16,709		$	6,088	$	1,734
Issuances		—		—			—		6,293
Settlements and Extinguishments		—		(6,962	)		—		(6,962	)
Change in fair value		340		(3,072	)		2,101		5,610
Fair value, end of period	$	8,189	$	6,675		$	8,189	$	6,675

The estimated fair value of our long-term debt was approximately $171.7 million (par value of $225.0 million) and $53.4 million (par value of $71.8 million) as of September 30, 2011 and December 31, 2010, respectively.