Stock-based Compensation

9 Months Ended

Sep. 30, 2011

Stock-based Compensation [Abstract]

Stock-based Compensation

Note 10—Stock-based Compensation

Total stock-based compensation expense recognized using the straight-line attribution method in the consolidated statement of operations is as follows:

	Three months ended
	September 30,		September 30,
	2011		2010
Stock option compensation expense for employees and directors	$	225,235	$	183,231
Restricted stock expense		12,000		18,000
Equity awards for nonemployees issued for services		—		7,724
Total stock-based compensation expense	$	237,235	$	208,955

	Nine months ended
	September 30,		September 30,
	2011		2010
Stock option compensation expense for employees and directors	$	2,303,289	$	729,619
Restricted stock expense		48,000		54,000
Equity awards for nonemployees issued for services		288,676		59,321
Total stock-based compensation expense	$	2,639,965	$	842,940

						Weighted-
						average
				Weighted-		remaining
				average		contractual		Aggregate
	Number of			exercise		term (in		intrinsic
	shares			price		years)		value
Outstanding at December 31, 2010		5,677,000		$	0.86		7.46	$	—
Granted		9,598,000		$	0.72
Exercised		(600,000	)	$	0.75
Forfeited		(1,020,000	)	$	0.77
Outstanding at September 30, 2011		13,655,000		$	0.77		8.59	$	600
Exercisable at September 30, 2011		8,390,642		$	0.79		8.19	$	—

The total fair value of shares vested during the nine months ended September 30, 2011 was $3.8 million. As of September 30, 2011, there was $1.9 million of total unrecognized compensation cost, related to non-vested stock options which vest over time. That cost is expected to be recognized over a weighted-average period of 1.6 years. As of September 30, 2011, there was approximately $0.1 million of total unrecognized compensation expense related to performance-based, non-vested employee and consultant stock options. That cost will be recognized when the performance criteria within the respective performance-based option grants become probable of achievement.

During the three months ended September 30, 2011 and 2010, the weighted average fair market value using the Black-Scholes option-pricing model of the options granted was $0.36 and $0.34, respectively. The fair market value of the options was computed using the Black-Scholes option-pricing model with the following key weighted average assumptions for the three months ended as of the dates indicated:

	September 30,	September 30,
	2011	2010
Expected life (years)	6.0 years	4.9 years
Interest rate	2.4%	1.5%
Dividend yield	—	—
Volatility	61%	63%

There were 600,000 cashless stock options exercised during the year ended September 30, 2011, which resulted in the issuance of 246,141 shares of common stock.