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Common Stock Warrant Liability
6 Months Ended
Jun. 30, 2015
Common Stock Warrant Liability [Abstract]  
Common Stock Warrant Liability
Note 5 – Common Stock Warrant Liability

We account for common stock warrants in accordance with applicable accounting guidance provided in ASC Topic 815, Derivatives and Hedging – Contracts in Entity’s Own Equity (ASC 815), either as derivative liabilities or as equity instruments depending on the specific terms of the warrant agreement.

On February 22, 2011, we issued registered warrants that expire on February 22, 2016 and had a fair value at issuance of $8.0 million.  As of June 30, 2015, there were 4.6 million warrant shares with a fair value of $0.8 million potentially issuable upon exercise of these warrants.  These warrants contain anti-dilution provisions that adjust the exercise price if we issue any common stock, securities convertible into common stock, or other securities (subject to certain exceptions) at a value below the then-existing exercise price of the warrants.  Although by their express terms, these warrants are not subject to potential cash settlement, due to the nature of the anti-dilution provisions, they are classified as derivative liabilities and reported, at each balance sheet date, at estimated fair value determined using a trinomial pricing model.  The exercise price of these warrants as of June 30, 2015 was $1.50 per share.  The exercise price was recently adjusted to $0.19 per share in connection with our July 2015 public offering (see, Note 8, “Subsequent Events – July 2015 Registered Public Offering”).  Changes in the estimated fair value of warrants classified as derivative liabilities are reported in the accompanying Consolidated Statement of Operations as the “Change in fair value of common stock warrants.”

No warrants were exercised during the six months ended June 30, 2015.  During the six months ended June 30, 2014, holders of the February 2011 warrants exercised warrants to purchase 282,350 shares of common stock for total proceeds of $0.4 million.