Quarterly report pursuant to sections 13 or 15(d)

Stock Option Plan

v2.3.0.11
Stock Option Plan
6 Months Ended
Jun. 30, 2011
Notes to Financial Statements  
Stock Option Plan

 

The Company’s Board of Directors has approved the 2008 Stock Plan (the “Plan”). Under the Plan, the Board of Directors may grant up to 10,742,127 shares of incentive stock options, nonqualified stock options, or stock awards to eligible persons, including employees, nonemployees, members of the Board of Directors, consultants, and other independent advisors who provide services to the Company. In general, options are granted with an exercise price equal to the fair value of the underlying common stock on the date of the grant. Options generally have a contractual life of 10 years and vest over periods ranging from being fully vested as of the grant dates to four years.

 

A summary of option activity under the Plan is as follows:

 

     Outstanding Options
        Weighted-  Weighted-
  Shares     Average  Average
  Available for  Number of  Exercise  Remaining
  Grant  Shares  Price  Contractual Term
                    
Balance – January 14, 2008                   
  (date of inception)                   
                    
  Shares added to the plan  6,085,136                
                    
Balance – December 31, 2008  6,085,136                
                    
Balance – December 31, 2009  6,085,136                
                    
  Shares added to the plan  4,656,991         0.01      
                    
Options granted (weighted average fair values of $0.05)  (3,206,494)    3,206,494    0.01    9.2 
                    
Balance – December 31, 2010  7,535,633    3,206,494           
                    
  Shares added to the plan                   
                    
  Options granted (weighted average                   
  Fair value of $0.01)                   
      Employee  (4,610,422)   4,610,422    0.01      
      Non-Employee  (3,601,407)   3,601,407    0.01      
                    
      Cancelled Shares  2,212,071    (2,212,071)   0.01      
                    
      Options exercised                   
                    
Balance   - June 30, 2011  1,535,876    9,206,251           
                    
Options vested-                   
  June 30,2011  3,467,195                
                    
Options vested and expected to vest-                   
  June 30, 2011  8,211,823                

 

 

Stock-based compensation expense for the three and six month periods ended June 30, 2011 and June 30, 2010, and the period from January 14, 2008 (date of inception) to June 30, 2011, is classified in the statements of operations as follows:

 

 

              (Unaudited)
  (Unaudited)  (Unaudited)  (Unaudited)  (Unaudited)  Period From
  Three  Three  Six  Six  January 14, 2008
  Months Ended  Months Ended  Months Ended  Months Ended  Date of Inception
  June 30,  June 30,  June 30,  June 30,  to June 30,
  2011  2010  2011  2010  2011
               
Research and development $1,524,614   $2,150   $1,547,584   $4,301   $1,556,186 
General and administrative  258,113    4,654    285,083    9,308    301,658 
                         
Total $1,782,727   $6,804   $1,832,667   $13,609   $1,857,843 

At June 30, 2011, there was a total of $60,837 of unrecognized compensation cost, net of estimated forfeitures, related to non-vested employee stock option awards, which is expected to be recognized over a weighted-average period of approximately 03.5 years.

 

Also at June 30, 2011, options to purchase 1,863,443 shares granted to nonemployees were unvested and subject to remeasurement at future reporting dates.

 

The fair value of the Company’s stock-based awards during the six months ended June 30, 2011, the year ended December 31, 2010, and the period from January 14, 2008 (date of inception) to June 30, 2011, was estimated using the following weighted-average assumptions:

 

        (Unaudited)
        Period From
  (Unaudited)  (Unaudited)  January 14, 2008
  Six Months Ended  Year Ended  (Date of Inception)
  June 30,  December 31,  to December 31, 2008
  2011  2010  2008
               
Weighted-average volatility  83.3%   83.3%   83.3%
Expected term (in years)  5    5    5 
Expected dividends  None    None    None 
Risk-free interest rate  2.3%   2.6%   2.6%