Stockholders Equity

6 Months Ended

Jun. 30, 2011

Stockholders' Equity [Abstract]

Stockholders' Equity

(10) Stockholders’ Equity

Preferred Stock

The Company has 3.0 million shares of preferred stock authorized and issuable from time to time in one or more series. As of June 30, 2011 and December 31, 2010, no shares of preferred stock were outstanding.

Common Stock

On July 12, 2011, the shareholders of the Company approved a one-for-ten reverse split of the common stock of the Company which became effective on July 13, 2011. All references in these financial statements to the number of common shares or options, price per share and weighted average number of common shares outstanding prior to the 1:10 reverse stock split have been adjusted to reflect this stock split on a retroactive basis, unless otherwise noted.

Also on July 12, 2011, the shareholders of the Company approved an amendment to the Company’s Amended and Restated Certificate of Incorporation to reduce the number of authorized shares of common stock to 200,000,000 from 600,000,000 shares. Presentation of authorized shares of common stock has been adjusted on a retroactive basis.

During the three months ended March 31, 2011 and 2010, the Company issued 98,800 and 48,078 fully vested shares to the non-employee members of the Board of Directors in consideration for their service on the Board for the years ended December 31, 2010 and 2009, respectively. On June 10, 2011, the Company granted 3,308 fully vested shares in conjunction with the resignation of a member of the Board of Directors in consideration for service in 2011 through the date of his resignation. On June 21, 2011, the Company granted 489,227 shares of non-vested common stock to certain employees. The shares vest in full on the earlier of a change in control or July 1, 2012. In conjunction with this grant, the Company agreed to establish a “floor” price for the value of the shares on the date of vesting equal to the value of the shares on the grant date ($5.50 per share). In the event that the market price of the shares on the date of vesting is lower than the floor price on the date of vesting, the difference will be paid to the employees in cash. The compensation expense for the shares consists of a fixed equity component ($5.50 per share) and a variable liability component (based on the difference between the market price of the shares, if lower, and the floor price of the shares), both of which are included as a component of general and administrative expense in the accompanying consolidated statements of operations.

Stock Based Compensation

The Company recognized stock compensation included in general and administrative expense as follows (in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2011		2010		2011		2010
Non-vested stock(1)	$	2,346	$	3,105	$	4,610	$	6,136
Performance shares		49		358		152		716
Total	$	2,395	$	3,463	$	4,762	$	6,852

⁽¹⁾ Non-vested stock includes $48,000 and $182,000 for the three months ended June 30, 2011 and 2010, respectively, and $96,000 and $363,000 for the six months ended June 30, 2011 and 2010, respectively, that relates to DHS which is included as a component of discontinued operations in the accompanying consolidated statements of operations.

The Company recognizes the cost of share based payments over the period during which the employee provides service. Exercise prices for options outstanding under the Company’s various plans as of June 30, 2011 ranged from $7.90 to $153.40 per share. At June 30, 2011, there was no unrecognized compensation cost related to stock options as all outstanding options are vested. At June 30, 2011, the Company had 150,300 options outstanding at a weighted average exercise price of $75.00 per share. At June 30, 2011, the Company had 1,211,902 non-vested shares outstanding and no performance shares outstanding. At June 30, 2011, the total unrecognized compensation cost related to the performance shares and the non-vested portion of restricted stock was $4.9 million which is expected to be recognized over a weighted average period of 0.6 years.