Fair Value Measurements

12 Months Ended

Dec. 31, 2011

Fair Value Measurements

Fair Value Measurements

9. Fair Value Measurements

The following table presents the Company’s liabilities that are measured and recognized at fair value on a recurring basis classified under the appropriate level of the fair value hierarchy as of December 31, 2010 and December 31, 2011:

Description	Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Balance as of December 31, 2010		Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Balance as of December 31, 2011
Derivative liabilities related to Warrants	$	—	$	—	$	3,487,959	$	3,487,959	$	—	$	—	$	3,325,114	$	3,325,114

The following table sets forth a summary of changes in the fair value of the Company’s Level 3 liabilities for the twelve months ended December 31, 2011 and December 31, 2010:

Description	Balance at December 31, 2009	Fair Value of warrants upon issuance		Unrealized (gains) or losses			Balance as of December 31, 2010		Fair value of warrants exercised and reclassified to additional paid in capital			Fair Value of warrants upon issuance		Unrealized (gains) or losses			Balance as ofDecember 31,2011
Derivative liabilities related to Warrants	—	$	3,784,743	$	(296,784	)	$	3,487,959	$	(2,193,645	)	$	7,287,831	$	(5,257,031	)	$	3,325,114

The unrealized gains or losses on the derivative liabilities are recorded as a change in fair value of derivative liabilities in the Company’s statement of operations. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. At each reporting period, the Company reviews the assets and liabilities that are subject to ASC Topic 815-40. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs or instruments which trade infrequently and therefore have little or no price transparency are classified as Level 3.