3000000
45863422
2805000
7.31
6.78
39502000
3173000
2487000
2487000
45000
361539000
2507000
31942000
33000
100000000
392000
6.26
45864000
1900000
171000
21000
70000
153000
389000
-330055000
32836000
5.86
32836000
31159000
45864000
824000
894000
2935000
458000
0.01
31746000
1090000
126000
41000
81000
2014-08
3.40
3
458000
45864000
-330055000
361539000
1658000
1658000
1500000
0.50
150
50
200
30000000
3000000
5.40
24045000
4243000
3316000
3267000
73000
361733000
36643000
42000
100000000
104000
45320000
191000
21000
53000
153000
218000
-325543000
37173000
6.41
37173000
35685000
45320000
477000
530000
3556000
453000
0.01
36129000
1044000
60000
28000
59000
453000
45320000
-325543000
361733000
2487000
2487000
5938000
0.0336
14528000
2473000
0
-15000
0.000
1883000
3.46
0.30
3.38
1091000
173000
P10Y
217000
16042000
51000
-466000
1.33
53000
15457000
291000
20000000
47547000
191000
44710000
1076000
14513000
0.30
2283000
-532000
69000
1830000
5000
1.15
47183000
300000
20466000
69000
-3000
26000
2477000
14172000
3655000
-126000
90000
341000
268000
3.26
278000
1000000
466000
0.000
500000
430000
75000
355000
1453000
228000
1225000
0
0
0
829000
0
49000
0
829000
877000
1230000
377000
226000
923000
320000
953000
3000
540000
288000
829000
1000
600000
2100000
0
2477000
ACUR
ACURA PHARMACEUTICALS, INC
false
Non-accelerated Filer
Q2
2012
10-Q
2012-06-30
0000786947
--12-31
4533000
0.0197
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Computation of basic earnings (loss) per share of common stock is
based on the sum of the weighted average number of outstanding
common shares and vested RSUs during the period. Computation of
diluted earnings (loss) per share is based on the sum of the common
shares and vested RSUs used in the basic earnings (loss)
computation, adjusted for the effect of other potentially dilutive
securities. Excluded from the diluted earnings (loss) per share
computation at June 30, 2012 and 2011 are 4.8 million and 2.5
million, respectively, of potentially dilutive securities, as the
effect of including these securities would be antidilutive.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 100%; BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0">
<tr style="VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify"> </td>
<td> </td>
<td style="TEXT-ALIGN: center" colspan="6">Six Months Ended<br />
June 30,</td>
<td> </td>
<td> </td>
<td style="TEXT-ALIGN: center" colspan="6">Three Months Ended<br />
June 30,</td>
<td> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: justify">(in
thousands, except per share data)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2012</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2011</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2012</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2011</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">Basic income (loss) per share
computation</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Numerator:</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt; WIDTH: 52%">
Net income (loss)</td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
(4,512</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">)</td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
14,172</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
(2,179</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">)</td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
17,029</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">
Denominator:</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Common
shares (weighted)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">45,861</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">44,710</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">45,863</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">44,880</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Vested
RSUs (weighted)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,658</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,473</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,658</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,484</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Weighted average
number of shares outstanding</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,519</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,183</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,521</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,364</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Basic income
(loss) per common share</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(0.10</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0.30</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(0.05</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0.36</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify">Diluted income per share
computation</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Numerator:</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Net
income (loss)</td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">(4,512</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">14,172</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">(2,179</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">17,029</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">
Denominator:</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Common
shares (weighted)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">45,861</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">44,710</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">45,863</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">44,880</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Vested
RSUs (weighted)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1,658</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,473</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1,658</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,484</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Common
stock options</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">173</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">240</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Common
stock warrants</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
191</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
405</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Weighted average
number of shares outstanding</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,519</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,547</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,521</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
48,009</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Diluted income
(loss) per common share</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(0.10</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0.3</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(0.05</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0.35</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify">Excluded potentially dilutive
securities:</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify">Common shares issuable (1):</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 9pt">
  Common stock options (vested and nonvested)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,935</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,477</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,935</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,477</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 9pt">
  Common stock warrants</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,856</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,856</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify; PADDING-BOTTOM: 1pt">Total excluded
dilutive common stock equivalents</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
4,791</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,477</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
4,791</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,477</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
</table>
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 100%; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0">
<tr style="VERTICAL-ALIGN: top">
<td style="TEXT-ALIGN: left; PADDING-LEFT: 9pt; PADDING-RIGHT: 9pt">
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
(1) Number of shares issuable represents those securities which
were either i) nonvested at period end or ii) were vested but
antidilutive. The number of shares is based on maximum number of
shares issuable on exercise at period end. Such amounts have not
been adjusted for the treasury stock method or weighted average
outstanding calculations as required if the securities were
dilutive.</p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
</td>
</tr>
</table>
</div>
<div style="font: 10pt Times New Roman, Times, Serif">
<table cellpadding="0" cellspacing="0" style="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt">
<tr style="vertical-align: top; text-align: justify">
<td style="width: 0in"></td>
<td style="width: 0.5in; text-align: left"><b>NOTE 7</b></td>
<td style="text-align: justify"><b>COMMON STOCK WARRANTS</b></td>
</tr>
</table>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">
 </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.7in">
The Company has outstanding common stock purchase warrants at June
30, 2012 exercisable for 1.9 million shares of common stock having
an exercise price of $3.40 per share and expiration date of August
2014. These warrants contain a cashless exercise feature.</p>
</div>
-4533000
1658000
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
A summary of the RSU Plan as of June 30, 2012 and 2011 and for the
six months then ended consisted of the following:</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<table style="WIDTH: 65%; BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0" align="center">
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="14" nowrap="nowrap">Six
Months Ended June 30,</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">
2012</td>
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">
2011</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="14" nowrap="nowrap">(in thousands)</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number<br />
of RSUs</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number<br />
of Vested<br />
RSUs</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number<br />
of RSUs</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number<br />
of Vested<br />
RSUs</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 52%">
Outstanding, beginning</td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
2,487</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
2,487</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
3,316</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
3,267</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-LEFT: 0.24in">Granted</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-LEFT: 0.24in">Distributed</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(829</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(829</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(829</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(829</td>
<td style="TEXT-ALIGN: left">)</td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-LEFT: 0.24in">Vested</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">49</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.24in">
Forfeited or expired</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt">Outstanding, ending</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,658</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,658</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,487</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,487</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
</table>
</div>
17000
21000
848000
0.000
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: bold 10pt Times New Roman, Times, Serif">
NOTE 8 EARNINGS (LOSS) PER SHARE</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: bold 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Computation of basic earnings (loss) per share of common stock is
based on the sum of the weighted average number of outstanding
common shares and vested RSUs during the period. Computation of
diluted earnings (loss) per share is based on the sum of the common
shares and vested RSUs used in the basic earnings (loss)
computation, adjusted for the effect of other potentially dilutive
securities. Excluded from the diluted earnings (loss) per share
computation at June 30, 2012 and 2011 are 4.8 million and 2.5
million, respectively, of potentially dilutive securities, as the
effect of including these securities would be antidilutive.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 100%; BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0">
<tr style="VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify"> </td>
<td> </td>
<td style="TEXT-ALIGN: center" colspan="6">Six Months Ended<br />
June 30,</td>
<td> </td>
<td> </td>
<td style="TEXT-ALIGN: center" colspan="6">Three Months Ended<br />
June 30,</td>
<td> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: justify">(in
thousands, except per share data)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2012</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2011</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2012</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2">2011</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">Basic income (loss) per share
computation</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Numerator:</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt; WIDTH: 52%">
Net income (loss)</td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
(4,512</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">)</td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
14,172</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
(2,179</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">)</td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
17,029</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">
Denominator:</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Common
shares (weighted)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">45,861</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">44,710</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">45,863</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">44,880</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Vested
RSUs (weighted)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,658</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,473</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,658</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,484</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Weighted average
number of shares outstanding</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,519</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,183</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,521</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,364</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Basic income
(loss) per common share</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(0.10</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0.30</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(0.05</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0.36</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify">Diluted income per share
computation</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Numerator:</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Net
income (loss)</td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">(4,512</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">14,172</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">(2,179</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">17,029</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">
Denominator:</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Common
shares (weighted)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">45,861</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">44,710</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">45,863</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">44,880</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Vested
RSUs (weighted)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1,658</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,473</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1,658</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,484</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Common
stock options</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">173</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">240</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 18pt">Common
stock warrants</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
191</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
405</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Weighted average
number of shares outstanding</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,519</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,547</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
47,521</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
48,009</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
 </td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 8pt">Diluted income
(loss) per common share</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(0.10</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0.3</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(0.05</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0.35</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify">Excluded potentially dilutive
securities:</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify">Common shares issuable (1):</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 9pt">
  Common stock options (vested and nonvested)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,935</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,477</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,935</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">2,477</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 9pt">
  Common stock warrants</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,856</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,856</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify; PADDING-BOTTOM: 1pt">Total excluded
dilutive common stock equivalents</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
4,791</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,477</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
4,791</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,477</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
</table>
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 100%; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0">
<tr style="VERTICAL-ALIGN: top">
<td style="TEXT-ALIGN: left; PADDING-LEFT: 9pt; PADDING-RIGHT: 9pt">
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
(1) Number of shares issuable represents those securities which
were either i) nonvested at period end or ii) were vested but
antidilutive. The number of shares is based on maximum number of
shares issuable on exercise at period end. Such amounts have not
been adjusted for the treasury stock method or weighted average
outstanding calculations as required if the securities were
dilutive.</p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
</td>
</tr>
</table>
</div>
848000
3.48
-0.10
8.44
23000
0
P10Y
8000
-3379000
0
0
1.30
110000
-4526000
143000
0
47519000
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Our stock option award activity during the six months ended June
30, 2012 and 2011 is as follows:</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 65%; BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0" align="center">
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="14" nowrap="nowrap">
Six Months Ended June 30,</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2012</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2011</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number <br />
of <br />
Options<br />
(000’s)</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Weighted<br />
Average<br />
Exercise <br />
Price</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number <br />
of <br />
Options<br />
(000’s)</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Weighted<br />
Average<br />
Exercise<br />
Price</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 52%">
Outstanding, beginning</td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
3,556</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
6.41</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
4,243</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
5.40</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-LEFT: 9pt">Granted</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">105</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">3.48</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">90</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">3.46</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-LEFT: 9pt">Exercised</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(23</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1.30</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(1,091</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1.33</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 9pt">
Forfeited or expired</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(703</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
8.44</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(69</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
3.38</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt">Outstanding, ending</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,935</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
5.86</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
3,173</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
6.78</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">Options
exercisable</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,507</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
6.26</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,805</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
7.31</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
</table>
</div>
0
45861000
8000
0
-4512000
-0.10
1822000
-1037000
703000
1046000
1000
1.14
47519000
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b>NOTE 4 INCOME TAXES</b></p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The Company accounts for income taxes under the liability method.
Under this method, deferred income tax assets and liabilities are
determined based on differences between financial reporting and
income tax basis of assets and liabilities and are accounted for
using the enacted income tax rates and laws that will be in effect
when the differences are expected to reverse. Additionally, net
operating loss and tax credit carryforwards are reported as
deferred income tax assets. The realization of deferred income tax
assets is dependent upon future earnings. A valuation allowance is
required against deferred income tax assets if, based on the weight
of available evidence, it is more likely than not that some or all
of the deferred income tax assets may not be realized. At both June
30, 2012 and December 31, 2011, all our remaining net deferred
income tax assets were offset by a valuation allowance due to
uncertainties with respect to future utilization of net operating
loss carryforwards. If in the future it is determined that
additional amounts of our deferred income tax assets would likely
be realized, the valuation allowance would be reduced in the period
in which such determination is made and an additional benefit from
income taxes in such period would be recognized.</p>
</div>
300000
<div style="font: 10pt Times New Roman, Times, Serif">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">
Accrued expenses are summarized as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">
 </p>
<table cellpadding="0" cellspacing="0" align="center" style="border-collapse: collapse; width: 65%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td colspan="2" nowrap="nowrap" style="text-align: center">
Jun 30,</td>
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td colspan="2" nowrap="nowrap" style="text-align: center">
Dec 31,</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="text-align: center"> </td>
<td nowrap="nowrap"> </td>
<td colspan="2" nowrap="nowrap" style="text-align: center">
2012</td>
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td colspan="2" nowrap="nowrap" style="text-align: center">
2011</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="text-align: center"> </td>
<td nowrap="nowrap" style="padding-bottom: 1pt"> </td>
<td colspan="6" nowrap="nowrap" style="text-align: center; border-bottom: Black 1pt solid">
(in thousands)</td>
<td nowrap="nowrap" style="padding-bottom: 1pt"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: rgb(204,255,204)">
<td style="width: 76%; text-align: left; text-indent: -5.05pt; padding-left: 5.05pt">
Payroll, payroll taxes, bonus and benefits</td>
<td style="width: 1%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 9%; text-align: right">392</td>
<td style="width: 1%; text-align: left"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 9%; text-align: right">104</td>
<td style="width: 1%; text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; text-indent: -5.05pt; padding-left: 5.05pt">
Professional services</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">171</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">191</td>
<td style="text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: rgb(204,255,204)">
<td style="text-align: left; text-indent: -5.05pt; padding-left: 5.05pt">
Franchise taxes</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">126</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">60</td>
<td style="text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; text-indent: -5.05pt; padding-left: 5.05pt">
Property taxes</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">21</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">21</td>
<td style="text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: rgb(204,255,204)">
<td style="text-align: left; text-indent: -5.05pt; padding-left: 5.05pt">
Clinical and  regulatory services</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">81</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">59</td>
<td style="text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 1pt; text-indent: -5.05pt; padding-left: 5.05pt">
Other fees and services</td>
<td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">
 </td>
<td style="border-bottom: Black 1pt solid; text-align: right">
33</td>
<td style="padding-bottom: 1pt; text-align: left"> </td>
<td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">
 </td>
<td style="border-bottom: Black 1pt solid; text-align: right">
42</td>
<td style="padding-bottom: 1pt; text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: rgb(204,255,204)">
<td style="padding-bottom: 1pt">Total</td>
<td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td>
<td style="border-bottom: Black 1pt solid; text-align: right">
824</td>
<td style="padding-bottom: 1pt; text-align: left"> </td>
<td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td>
<td style="border-bottom: Black 1pt solid; text-align: right">
477</td>
<td style="padding-bottom: 1pt; text-align: left"> </td>
</tr>
</table>
</div>
0
64000
0
0
<div style="FONT: 10pt Times New Roman, Times, Serif">
<table style="MARGIN-TOP: 0px; FONT: bold 10pt Times New Roman, Times, Serif; MARGIN-BOTTOM: 0pt" cellspacing="0" cellpadding="0">
<tr style="TEXT-ALIGN: justify; VERTICAL-ALIGN: top">
<td style="WIDTH: 0in"></td>
<td style="TEXT-ALIGN: left; WIDTH: 0.5in">NOTE 9</td>
<td style="TEXT-ALIGN: justify">COMMITMENTS AND CONTINGENCIES</td>
</tr>
</table>
<p style="TEXT-INDENT: 31.5pt; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
                                                                                                     </p>
<p style="TEXT-INDENT: 31.5pt; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b>Reglan</b>®<b>/Metoclopramide Litigation</b></p>
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Halsey Drug Company, as predecessor to us, has been named along
with numerous other companies as a defendant in cases filed in
three separate state coordinated litigations pending in
Pennsylvania, New Jersey and California, respectively captioned In
re: Reglan®/Metoclopramide Mass Tort Litigation, Philadelphia
County Court of Common Pleas, January Term, 2010, No. 01997; In re:
Reglan® Litigation, Superior Court of New Jersey, Law
Division, Atlantic County, Case No. 289, Master Docket No.
ATL-L-3865-10; and Reglan®/Metoclopramide Cases, Superior
Court of California, San Francisco County, Judicial Council
Coordination Proceeding No. 4631, Superior Court No.:
CJC-10-004631.  In this product liability litigation against
numerous pharmaceutical product manufacturers and distributors,
including us, plaintiffs claim injuries from their use of the
Reglan brand of metoclopramide and generic metoclopramide.  In
the Pennsylvania state court mass tort proceeding, over 200
lawsuits have been filed against us and Halsey Drug Company
alleging that plaintiffs developed neurological disorders as a
result of their use of the Reglan brand and/or generic
metoclopramide.  Plaintiffs have filed approximately 150
lawsuits against us, but have served less than 50 individual
lawsuits upon us in the New Jersey action. In the California
action, we were not served with any complaints until the Spring of
2011 when a single complaint including over 400 plaintiffs was
served.  To date, Acura has not been served with any
metoclopramide lawsuits in jurisdictions other than Philadelphia,
New Jersey and California state courts.</p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
In the lawsuits filed to date, plaintiffs have not confirmed they
ingested any of the generic metoclopramide manufactured by
us.  We discontinued manufacture and distribution of generic
metoclopramide more than 15 years ago.  In addition, we
believe the June 23, 2011 decision by the U.S. Supreme Court in
<i>PLIVA v. Mensing (“Mensing</i> decision”) holding
that state tort law failure to warn claims against generic drug
companies are pre-empted by the 1984 Hatch-Waxman Act Amendments
and federal drug regulations will assist us in favorably resolving
these cases. We have consistently maintained the position that
these claims are without merit and intend to vigorously defend
these actions.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<font style="COLOR: black">In New Jersey, Generic Defendants,
including Acura, have filed dispositive motions based on the
<i>Mensing</i> decision.</font> In June 2012, the New Jersey trial
court dismissed Acura with prejudice.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<font style="COLOR: black"> </font></p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<font style="COLOR: black">In Philadelphia, and California, Generic
Defendants, including Acura, have filed dispositive motions based
on the <i>Mensing</i> decision. On November 18, 2011, the
Philadelphia trial court denied Generic Defendants’
dispositive motion. In December 2011, the Generic Defendants
appealed this ruling, which the trial court refused to modify on
reconsideration. Nonetheless, the trial court has approved
certification of the federal preemption issues based on the
<i>Mensing</i> decision for immediate appeal to the Pennsylvania
Superior Court.</font> In addition, on April 17, 2012, the
California trial court also denied Generic Defendants’
dispositive motions and this ruling has been appealed. <font style="COLOR: black">Decisions on these appeals should be issued later
this year or in 2013, which could result in dismissal of all of the
Philadelphia and California cases against Generic Defendants,
although there can be no assurance in this regard. As any potential
loss is neither probable nor estimable, we have not accrued for any
potential loss related to this matter as of June 30, 2012. Legal
fees related to this matter are currently covered by our insurance
carrier.</font></p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b>Statutory Minimum Withholding Tax Obligations</b></p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px 0pt 0.5in; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Under the terms of our stock option plans and our 2005 RSU plan,
our employees may elect to have shares withheld upon their option
exercises and their RSU exchanges whereby requiring the Company to
satisfy their statutory minimum withholding tax obligations from
these transactions. During each of the six months ended June 30,
2012 and 2011, approximately 0.3 million shares were withheld from
these transactions in satisfaction of $1.0 million of withholding
tax obligations.</p>
</div>
<div style="font: 10pt Times New Roman, Times, Serif">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">
<b>NOTE 5 ACCRUED EXPENSES</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">
<b> </b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">
Accrued expenses are summarized as follows:</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.7in">
 </p>
<table cellpadding="0" cellspacing="0" align="center" style="border-collapse: collapse; width: 65%; font: 10pt Times New Roman, Times, Serif">
<tr style="vertical-align: bottom">
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td colspan="2" nowrap="nowrap" style="text-align: center">
Jun 30,</td>
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td colspan="2" nowrap="nowrap" style="text-align: center">
Dec 31,</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="text-align: center"> </td>
<td nowrap="nowrap"> </td>
<td colspan="2" nowrap="nowrap" style="text-align: center">
2012</td>
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td colspan="2" nowrap="nowrap" style="text-align: center">
2011</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="vertical-align: bottom">
<td nowrap="nowrap" style="text-align: center"> </td>
<td nowrap="nowrap" style="padding-bottom: 1pt"> </td>
<td colspan="6" nowrap="nowrap" style="text-align: center; border-bottom: Black 1pt solid">
(in thousands)</td>
<td nowrap="nowrap" style="padding-bottom: 1pt"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: rgb(204,255,204)">
<td style="width: 76%; text-align: left; text-indent: -5.05pt; padding-left: 5.05pt">
Payroll, payroll taxes, bonus and benefits</td>
<td style="width: 1%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 9%; text-align: right">392</td>
<td style="width: 1%; text-align: left"> </td>
<td style="width: 1%"> </td>
<td style="width: 1%; text-align: left">$</td>
<td style="width: 9%; text-align: right">104</td>
<td style="width: 1%; text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; text-indent: -5.05pt; padding-left: 5.05pt">
Professional services</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">171</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">191</td>
<td style="text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: rgb(204,255,204)">
<td style="text-align: left; text-indent: -5.05pt; padding-left: 5.05pt">
Franchise taxes</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">126</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">60</td>
<td style="text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; text-indent: -5.05pt; padding-left: 5.05pt">
Property taxes</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">21</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">21</td>
<td style="text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: rgb(204,255,204)">
<td style="text-align: left; text-indent: -5.05pt; padding-left: 5.05pt">
Clinical and  regulatory services</td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">81</td>
<td style="text-align: left"> </td>
<td> </td>
<td style="text-align: left"> </td>
<td style="text-align: right">59</td>
<td style="text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: White">
<td style="text-align: left; padding-bottom: 1pt; text-indent: -5.05pt; padding-left: 5.05pt">
Other fees and services</td>
<td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">
 </td>
<td style="border-bottom: Black 1pt solid; text-align: right">
33</td>
<td style="padding-bottom: 1pt; text-align: left"> </td>
<td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">
 </td>
<td style="border-bottom: Black 1pt solid; text-align: right">
42</td>
<td style="padding-bottom: 1pt; text-align: left"> </td>
</tr>
<tr style="vertical-align: bottom; background-color: rgb(204,255,204)">
<td style="padding-bottom: 1pt">Total</td>
<td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td>
<td style="border-bottom: Black 1pt solid; text-align: right">
824</td>
<td style="padding-bottom: 1pt; text-align: left"> </td>
<td style="padding-bottom: 1pt"> </td>
<td style="border-bottom: Black 1pt solid; text-align: left">$</td>
<td style="border-bottom: Black 1pt solid; text-align: right">
477</td>
<td style="padding-bottom: 1pt; text-align: left"> </td>
</tr>
</table>
</div>
1000
4791000
-4512000
2711000
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Our non-cash share-based compensation expense is comprised of the
following:</p>
<p style="TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 85%; BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0" align="center">
<tr style="VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">
Six Months Ended<br />
June 30,</td>
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">
Three Months Ended<br />
June  30,</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2011</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2011</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">
Research and development</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-LEFT: 9pt; WIDTH: 52%">Stock
options</td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">182</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">355</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">91</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">110</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 9pt">RSUs</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
-</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
75</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
-</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
17</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
182</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
430</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
91</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
127</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">General and administrative</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-LEFT: 9pt">Stock options</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">666</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1,225</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">333</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">400</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 9pt">RSUs</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
-</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
228</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
-</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
57</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
666</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,453</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
333</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
457</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt">Total</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
848</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,883</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
424</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
584</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
</table>
</div>
0
105000
0
<div style="font: 10pt Times New Roman, Times, Serif">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">
<b>NOTE 1 BASIS OF PRESENTATION</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">
 </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.7in">
Acura Pharmaceuticals, Inc., a New York corporation, and its
subsidiary (the “Company”, “We”, or
“Our”) is a specialty pharmaceutical company engaged in
research, development and commercialization of products intended to
address medication abuse and misuse, utilizing its proprietary
Aversion® and Impede™ Technologies.</p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">
 </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.7in">
The accompanying unaudited consolidated financial statements of the
Company were prepared in accordance with generally accepted
accounting principles for interim financial information and
instructions to Form 10-Q and Rule 10-01 of Regulation S-X.
Accordingly, these financial statements do not include all of the
information and footnotes required by accounting principles
generally accepted in the United States of America for complete
financial statements. In the opinion of management, all adjustments
considered necessary to present fairly the Company’s
financial position, results of operations and cash flows have been
made. The results of operations for the six months ended June 30,
2012 are not necessarily indicative of results expected for the
full year ending December 31, 2012. These unaudited consolidated
financial statements should be read in conjunction with the audited
consolidated financial statements and footnotes thereto for the
year ended December 31, 2011 included in the Company's Annual
Report on Form 10-K filed with the Securities and Exchange
Commission. The 2011 year-end consolidated balance sheet presented
in this Report was derived from the Company’s 2011 year-end
audited consolidated financial statements, but does not include all
disclosures required by generally accepted accounting
principles.</p>
</div>
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Assumptions used in the Black-Scholes model to determine fair value
for the stock option awards granted during the six months ended
June 30, 2012 and 2011 were:</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 75%; BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0" align="center">
<tr style="VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: center" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2011</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt; WIDTH: 76%">
Dividend yield</td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">0.0</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">%</td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">0.0</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">%</td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt">Average
risk-free interest rate</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1.97</td>
<td style="TEXT-ALIGN: left">%</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">3.36</td>
<td style="TEXT-ALIGN: left">%</td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt">Average
volatility</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">114</td>
<td style="TEXT-ALIGN: left">%</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">115</td>
<td style="TEXT-ALIGN: left">%</td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt">
Expected forfeitures</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0.0</td>
<td style="TEXT-ALIGN: left">%</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0.0</td>
<td style="TEXT-ALIGN: left">%</td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt" nowrap="nowrap">Expected holding period</td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: left" nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: right" nowrap="nowrap">10 years</td>
<td style="TEXT-ALIGN: left" nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: left" nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: right" nowrap="nowrap">10 years</td>
<td style="TEXT-ALIGN: left" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt">Weighted
average grant date fair value</td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">3.25</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">3.26</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
</table>
</div>
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b>NOTE 6 SHARE-BASED COMPENSATION</b></p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The Company has share-based compensation plans including stock
options and restricted stock units (“RSUs”) for its
employees and directors. The Company accounts for compensation cost
related to share-based payments based on fair value of the stock
options and RSUs when awarded to an employee or director. The value
of the portion of the award that is ultimately expected to vest is
recognized as expense in the relevant accounting periods in the
Company’s consolidated financial statement. The Company uses
the straight line amortization method for calculating share-based
compensation expense. The Company determines the estimated fair
value of share-based stock option awards using the Black-Scholes
option pricing model. Option valuation models require the input of
highly subjective assumptions including the expected volatility of
the market price of the Company’s common stock as determined
by reviewing its historical public market closing prices, risk-free
interest rate and expected dividend yields. The Company does not
consider implied volatility because of a lack of an established
market in option trading in our stock. The risk – free
interest rate assumption is based on observed interest rates
appropriate for the estimated term of the employee stock options.
The dividend yield assumption is based on the Company’s
history and current expectation of dividend payouts on common
stock. The expected term of the award represents the period that
the employees and directors are expected to hold the award before
exercise and issuance using historical exercise activity. The
Company’s accounting for share-based compensation for RSUs is
also based on the fair-value method. The fair value of the RSUs is
based on the closing market price of the Company’s common
stock on the date of the RSU award.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Our non-cash share-based compensation expense is comprised of the
following:</p>
<p style="TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 85%; BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0" align="center">
<tr style="VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: justify" nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">
Six Months Ended<br />
June 30,</td>
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">
Three Months Ended<br />
June  30,</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2011</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2011</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">
Research and development</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-LEFT: 9pt; WIDTH: 52%">Stock
options</td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">182</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">355</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">91</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">$</td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">110</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 9pt">RSUs</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
-</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
75</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
-</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
17</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
182</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
430</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
91</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
127</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left">General and administrative</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right"> </td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-LEFT: 9pt">Stock options</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">666</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1,225</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">333</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">400</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt; PADDING-LEFT: 9pt">RSUs</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
-</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
228</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
-</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
57</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
666</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,453</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
333</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
457</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt">Total</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
848</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,883</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
424</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
584</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
</table>
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b> </b></p>
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b><i>Stock Option Award Plans</i></b></p>
<p style="MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<i> </i></p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
At June 30, 2012, the Company has stock options issued and
outstanding under three stock option plans. The Company’s
1995 and 1998 Stock Option Plans have expired but stock options
awarded under such plans remain outstanding under the terms of
those plans. The Company’s 2008 Stock Option Plan remains in
effect. To date, approximately 50% of the vested non-incentive
stock options (“NonISO”) under the 1998 and 2008 stock
option plans have been exercised. Absent a change in control, the
balance of NonISOs may be exercised in equal amounts during each of
calendar years 2013 and 2014.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Exercise of NonISOs by employees may require the Company to make
minimum statutory withholding tax (“withholding tax”)
payments for such employee on any gain on such shares at the time
of exercise. The employee is responsible for providing sufficient
funds to the Company to make such withholding tax payments.
However, under the Company’s stock option plans, the employee
may elect to take a partial distribution of the exercised NonISO
shares and have the Company retain the balance of the exercised
shares in satisfaction of the employee’s withholding tax
payments. In such event, the Company becomes obligated to directly
pay the withholding taxes of such employee and will retain a
sufficient number of exercised shares such that the fair market
value of the retained shares will offset the employee’s
withholding taxes. The Company has not reflected this obligation as
a liability in its consolidated financial statements as the
withholding tax payments are contingent upon the timing and number
of NonISOs exercised by employees and the closing market price of
our common stock at the time of exercise. Such withholding tax will
be paid and charged against additional paid in capital as the
NonISOs are exercised.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
During the six months ended June 30, 2012, 23 thousand NonISOs were
exercised by our employees. Our employees’ elections to have
10 thousand shares withheld in satisfaction of $34 thousand for
both exercise costs and withholding tax obligations resulted in the
net issuance of 13 thousand shares. During the six months ended
June 30, 2011, 1.1 million NonISOs were exercised by our employees.
Our employees’ elections to have 0.60 million shares withheld
in satisfaction of $2.1 million for both exercise costs and
withholding tax obligations resulted in the net issuance of 0.50
million shares.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
As of June 30, 2012 the Company had $1.5 million of unrecognized
share-based compensation expense from stock option grants, which
will be recognized in our consolidated financial statements over
their remaining vesting periods over the next 1.5 years. Under the
stock option plans, if a change in control occurs, an acceleration
of unvested shares will occur and any remaining unrecognized
share-based compensation expense will be recognized in our
consolidated financial statements.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Our stock option award activity during the six months ended June
30, 2012 and 2011 is as follows:</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 65%; BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0" align="center">
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="14" nowrap="nowrap">
Six Months Ended June 30,</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2012</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="6" nowrap="nowrap">2011</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number <br />
of <br />
Options<br />
(000’s)</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Weighted<br />
Average<br />
Exercise <br />
Price</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number <br />
of <br />
Options<br />
(000’s)</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Weighted<br />
Average<br />
Exercise<br />
Price</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 52%">
Outstanding, beginning</td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
3,556</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
6.41</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
4,243</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
5.40</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-LEFT: 9pt">Granted</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">105</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">3.48</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">90</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">3.46</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-LEFT: 9pt">Exercised</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(23</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1.30</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(1,091</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1.33</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 9pt">
Forfeited or expired</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(703</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
8.44</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
(69</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">)</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
3.38</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt">Outstanding, ending</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,935</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
5.86</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
3,173</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
6.78</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt">Options
exercisable</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,507</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
6.26</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,805</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">$</td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
7.31</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
</table>
<p style="MARGIN: 0pt 0px 0pt 0.2in; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="MARGIN: 0pt 0px 0pt 0.2in; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Assumptions used in the Black-Scholes model to determine fair value
for the stock option awards granted during the six months ended
June 30, 2012 and 2011 were:</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<table style="WIDTH: 75%; BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0" align="center">
<tr style="VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: center" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2012</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">2011</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt; WIDTH: 76%">
Dividend yield</td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">0.0</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">%</td>
<td style="WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: left; WIDTH: 1%"> </td>
<td style="TEXT-ALIGN: right; WIDTH: 9%">0.0</td>
<td style="TEXT-ALIGN: left; WIDTH: 1%">%</td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt">Average
risk-free interest rate</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">1.97</td>
<td style="TEXT-ALIGN: left">%</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">3.36</td>
<td style="TEXT-ALIGN: left">%</td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt">Average
volatility</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">114</td>
<td style="TEXT-ALIGN: left">%</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">115</td>
<td style="TEXT-ALIGN: left">%</td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt">
Expected forfeitures</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0.0</td>
<td style="TEXT-ALIGN: left">%</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0.0</td>
<td style="TEXT-ALIGN: left">%</td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt" nowrap="nowrap">Expected holding period</td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: left" nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: right" nowrap="nowrap">10 years</td>
<td style="TEXT-ALIGN: left" nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: left" nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: right" nowrap="nowrap">10 years</td>
<td style="TEXT-ALIGN: left" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="TEXT-INDENT: -5.05pt; PADDING-LEFT: 5.05pt">Weighted
average grant date fair value</td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">3.25</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left">$</td>
<td style="TEXT-ALIGN: right">3.26</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
</table>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b><i> </i></b></p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b><i>Restricted Stock Unit Award Plan</i></b></p>
<p style="TEXT-ALIGN: justify; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<b><i> </i></b></p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
The Company has RSUs issued and outstanding under a Restricted
Stock Unit Award Plan (“2005 RSU Plan”) for its
employees and directors. A RSU represents the contingent obligation
of the Company to deliver a share of its common stock to the
holders of a vested RSU on a specified distribution date. To date,
50% of RSU awards under the 2005 RSU Plan have been distributed.
Absent a change of control, the balance of the RSU awards will be
distributed in equal amounts on January 1 of each of 2013 and 2014.
<font style="COLOR: black">Distribution of RSU shares to employees
may require the Company to make minimum statutory withholding tax
(“withholding tax”) payments for such employee on any
gain on such shares at the time of distribution. The employee is
responsible for providing sufficient funds to the Company to make
such withholding tax payments. However, under the 2005 RSU Plan,
the employee may elect to take a partial distribution of shares and
have the Company retain the balance of the share distribution in
satisfaction of the withholding tax payments. In such event, the
Company becomes obligated to directly pay the withholding taxes of
such employee and will retain a sufficient number of shares such
that the fair market value of the retained shares will offset the
employee’s withholding taxes. The Company has not reflected
this obligation as a liability in its consolidated financial
statements as the withholding tax payments are contingent upon the
timing and number of RSU shares distributed to employees and the
closing market price of our common stock at the time of
distribution. Such withholding taxes will be paid and charged
against additional paid-in capital as the RSU shares are
distributed.</font></p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
On each of January 1, 2012 and 2011, 0.83 million RSUs were
distributed to our employees and directors. Our employees’
elections to withhold 0.30 million shares in satisfaction of $1.0
million withholding tax obligations resulted in the net issuance of
0.53 million shares in January 2012. Our employees’ elections
to withhold 0.29 million shares in satisfaction of $1.0 million
withholding tax obligations resulted in the net issuance of 0.54
million shares in January 2011.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
A summary of the RSU Plan as of June 30, 2012 and 2011 and for the
six months then ended consisted of the following:</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<table style="WIDTH: 65%; BORDER-COLLAPSE: collapse; FONT: 10pt Times New Roman, Times, Serif" cellspacing="0" cellpadding="0" align="center">
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="14" nowrap="nowrap">Six
Months Ended June 30,</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">
2012</td>
<td nowrap="nowrap"> </td>
<td nowrap="nowrap"> </td>
<td style="TEXT-ALIGN: center" colspan="6" nowrap="nowrap">
2011</td>
<td nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="14" nowrap="nowrap">(in thousands)</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="VERTICAL-ALIGN: bottom">
<td nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number<br />
of RSUs</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number<br />
of Vested<br />
RSUs</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number<br />
of RSUs</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: center" colspan="2" nowrap="nowrap">Number<br />
of Vested<br />
RSUs</td>
<td style="PADDING-BOTTOM: 1pt" nowrap="nowrap"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 52%">
Outstanding, beginning</td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
2,487</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
2,487</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
3,316</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
<td style="PADDING-BOTTOM: 1pt; WIDTH: 1%"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left; WIDTH: 1%">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right; WIDTH: 9%">
3,267</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; WIDTH: 1%">
 </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-LEFT: 0.24in">Granted</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="PADDING-LEFT: 0.24in">Distributed</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(829</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(829</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(829</td>
<td style="TEXT-ALIGN: left">)</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">(829</td>
<td style="TEXT-ALIGN: left">)</td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-LEFT: 0.24in">Vested</td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">0</td>
<td style="TEXT-ALIGN: left"> </td>
<td> </td>
<td style="TEXT-ALIGN: left"> </td>
<td style="TEXT-ALIGN: right">49</td>
<td style="TEXT-ALIGN: left"> </td>
</tr>
<tr style="BACKGROUND-COLOR: rgb(204,255,204); VERTICAL-ALIGN: bottom">
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt; PADDING-LEFT: 0.24in">
Forfeited or expired</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
0</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
<tr style="BACKGROUND-COLOR: white; VERTICAL-ALIGN: bottom">
<td style="PADDING-BOTTOM: 1pt">Outstanding, ending</td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,658</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
1,658</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,487</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
<td style="PADDING-BOTTOM: 1pt"> </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: left">
 </td>
<td style="BORDER-BOTTOM: black 1pt solid; TEXT-ALIGN: right">
2,487</td>
<td style="TEXT-ALIGN: left; PADDING-BOTTOM: 1pt"> </td>
</tr>
</table>
</div>
347000
3.25
0
1000000
0
<div style="FONT: 10pt Times New Roman, Times, Serif">
<p style="TEXT-INDENT: -27pt; MARGIN: 0pt 0px 0pt 27pt; FONT: 10pt Times New Roman, Times, Serif">
<b>NOTE 3 REVENUE RECOGNITION AND DEFERRED PROGRAM FEE
REVENUE</b></p>
<p style="TEXT-INDENT: -27pt; MARGIN: 0pt 0px 0pt 27pt; FONT: 10pt Times New Roman, Times, Serif">
<b>  </b></p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
<font style="COLOR: black">We recognize revenue when there is
persuasive evidence that an agreement exists, performance specified
in the agreement has occurred, the price is fixed and determinable,
and collection is reasonably assured. In connection with our
License, Development, and Commercialization Agreement dated October
30, 2007 (the “Pfizer Agreement”) with King
Pharmaceuticals Research and Development, Inc.
(“King”), a subsidiary of Pfizer, Inc.
(“Pfizer”), we recognize program fee revenue and
milestone revenue.</font> On July 27, 2012 Pfizer provided us with
notice of the exercise of its right to terminate the license to
three development-stage products using our Aversion®
Technology and return such products to us.</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.5in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Program fee revenue is derived from amortized upfront payments,
such as the $30.0 million upfront payment under the Pfizer
Agreement received in December 2007, and license fees, such as the
$3.0 million option exercise fee paid to us in each of May and
December 2008 upon the exercise of Pfizer’s option to license
a third and fourth opioid analgesic product candidate under the
Pfizer Agreement. We have assigned an equal portion of the $30.0
million upfront payment to each of three product candidates
identified in the Pfizer Agreement and recognize the upfront
payment as program fee revenue ratably over our estimate of the
development period for each identified product candidate.  The
recognition of the program fee revenue for two of the three product
candidates was completed by June 2008. During the second quarter
2011, <font style="COLOR: black">we recognized the remaining
program fee revenue which was assigned to the third product
candidate under the Pfizer Agreement.</font></p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
 </p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
</p>
<p style="TEXT-ALIGN: justify; TEXT-INDENT: 0.7in; MARGIN: 0pt 0px; FONT: 10pt Times New Roman, Times, Serif">
Milestone revenue is contingent upon the achievement of certain
pre-defined events in the Pfizer Agreement. <font style="COLOR: black">Milestone payments received under the Pfizer
Agreement are recognized as revenue upon achievement of the
“at risk” milestone events. Milestone payments are
triggered either by the results of our R&D efforts or by events
external to us, such as regulatory approval to market a product. As
such, the milestones were substantially at risk at the inception of
the Pfizer Agreement and the amounts of the revenue correspond to
the milestone payments set forth in the Pfizer Agreement. In
addition, upon the achievement of a milestone event, we have no
future performance obligations related to that milestone. Milestone
revenue is non-refundable and non-creditable upon payment. With the
July 27, 2012 termination by Pfizer, the Company anticipates no
further receipt of milestones under the Agreement.</font></p>
</div>
<div style="font: 10pt Times New Roman, Times, Serif">
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">
<b>NOTE 2 RESEARCH AND DEVELOPMENT</b></p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">
 </p>
<p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.7in">
Research and Development (“R&D”) expenses
include internal R&D activities, external Contract Research
Organization (“CRO”) services and their clinical
research sites, and other activities.  Internal R&D
activity expenses include facility overhead, equipment and facility
maintenance and repairs, laboratory supplies, pre-clinical
laboratory experiments, depreciation, salaries, benefits, and
share-based compensation expenses. CRO activity expenses include
preclinical laboratory experiments, clinical trial studies or other
contracted development services. Other activity expenses include
regulatory consulting, and regulatory legal counsel. Internal
R&D activities and other activity expenses are charged to
operations as incurred.  We make payments to the CRO's based
on agreed upon terms and may include payments in advance of a study
or service starting date. We review and accrue CRO activity
expenses based on services performed and rely on estimates of those
costs applicable to the stage of completion as provided by the CRO.
 Accrued CRO activity expenses are subject to revisions as
such services progress to completion. Revisions are charged to
expense in the period in which the facts that give rise to the
revision become known. At June 30, 2012 and December 31, 2011 we
had accrued $41 thousand and $28 thousand of CRO activity expenses,
respectively.</p>
</div>
0.000
13000
182000
0
182000
666000
0
666000
0
6000
0
8000
0
827000
0
3000
296000
10000
0
0
3000
0
0
0
-4512000
0
0
0
848000
8000
-7000
0
1031000
0
12000
0
0
0
829000
0
0
0
829000
12000
22000
7000
3000
17000
7000
1034000
7000
531000
296000
829000
2000
1034000
10000
34000
0
12000
1856000
2935000
400
P1Y183D
540000
290000
1000000
830000
530000
300000
1000000
830000
2871000
17362000
2484000
5000
584000
0.35
240000
20000000
48009000
405000
44880000
17367000
0.36
1142000
47364000
20233000
2477000
17029000
1729000
338000
233000
127000
17000
110000
457000
57000
400000
0
2477000
2189000
-2189000
1658000
10000
424000
-0.05
0
0
47521000
0
45863000
-2179000
-0.05
919000
47521000
0
4791000
-2179000
1270000
0
0
91000
0
91000
333000
0
333000
1856000
2935000
0000786947
us-gaap:StockOptionsMember
2012-04-01
2012-06-30
0000786947
us-gaap:WarrantMember
2012-04-01
2012-06-30
0000786947
us-gaap:StockOptionsMemberus-gaap:GeneralAndAdministrativeExpenseMember
2012-04-01
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:GeneralAndAdministrativeExpenseMember
2012-04-01
2012-06-30
0000786947
us-gaap:GeneralAndAdministrativeExpenseMember
2012-04-01
2012-06-30
0000786947
us-gaap:StockOptionsMemberus-gaap:ResearchAndDevelopmentExpenseMember
2012-04-01
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:ResearchAndDevelopmentExpenseMember
2012-04-01
2012-06-30
0000786947
us-gaap:ResearchAndDevelopmentExpenseMember
2012-04-01
2012-06-30
0000786947
2012-04-01
2012-06-30
0000786947
us-gaap:StockOptionsMember
2011-04-01
2011-06-30
0000786947
us-gaap:WarrantMember
2011-04-01
2011-06-30
0000786947
us-gaap:StockOptionsMemberus-gaap:GeneralAndAdministrativeExpenseMember
2011-04-01
2011-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:GeneralAndAdministrativeExpenseMember
2011-04-01
2011-06-30
0000786947
us-gaap:GeneralAndAdministrativeExpenseMember
2011-04-01
2011-06-30
0000786947
us-gaap:StockOptionsMemberus-gaap:ResearchAndDevelopmentExpenseMember
2011-04-01
2011-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:ResearchAndDevelopmentExpenseMember
2011-04-01
2011-06-30
0000786947
us-gaap:ResearchAndDevelopmentExpenseMember
2011-04-01
2011-06-30
0000786947
2011-04-01
2011-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMember
2012-01-01
2012-01-31
0000786947
us-gaap:RestrictedStockUnitsRSUMember
2011-01-01
2011-01-31
0000786947
us-gaap:StockOptionMember
2012-06-01
2012-06-30
0000786947
acur:CaliforniaStateMember
2012-01-01
2012-06-30
0000786947
us-gaap:StockOptionsMember
2012-01-01
2012-06-30
0000786947
us-gaap:WarrantMember
2012-01-01
2012-06-30
0000786947
acur:OptionNonCashExerciseOneMember
2012-01-01
2012-06-30
0000786947
us-gaap:StockOptionsMember
2012-01-01
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMember
2012-01-01
2012-06-30
0000786947
acur:RestrictedStockUnitMember
2012-01-01
2012-06-30
0000786947
us-gaap:StockOptionsMember
2012-01-01
2012-06-30
0000786947
acur:VestedRestrictedStockUnitsMember
2012-01-01
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMember
2012-01-01
2012-06-30
0000786947
acur:OptionNonCashExerciseOneMemberus-gaap:AdditionalPaidInCapitalMember
2012-01-01
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:AdditionalPaidInCapitalMember
2012-01-01
2012-06-30
0000786947
us-gaap:AdditionalPaidInCapitalMember
2012-01-01
2012-06-30
0000786947
acur:OptionNonCashExerciseOneMemberus-gaap:RetainedEarningsMember
2012-01-01
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:RetainedEarningsMember
2012-01-01
2012-06-30
0000786947
us-gaap:RetainedEarningsMember
2012-01-01
2012-06-30
0000786947
acur:OptionNonCashExerciseOneMemberus-gaap:CommonStockMember
2012-01-01
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:CommonStockMember
2012-01-01
2012-06-30
0000786947
us-gaap:CommonStockMember
2012-01-01
2012-06-30
0000786947
us-gaap:StockOptionsMemberus-gaap:GeneralAndAdministrativeExpenseMember
2012-01-01
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:GeneralAndAdministrativeExpenseMember
2012-01-01
2012-06-30
0000786947
us-gaap:GeneralAndAdministrativeExpenseMember
2012-01-01
2012-06-30
0000786947
us-gaap:StockOptionsMemberus-gaap:ResearchAndDevelopmentExpenseMember
2012-01-01
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:ResearchAndDevelopmentExpenseMember
2012-01-01
2012-06-30
0000786947
us-gaap:ResearchAndDevelopmentExpenseMember
2012-01-01
2012-06-30
0000786947
2012-01-01
2012-06-30
0000786947
us-gaap:StockOptionsMember
2011-01-01
2011-06-30
0000786947
us-gaap:WarrantMember
2011-01-01
2011-06-30
0000786947
us-gaap:StockOptionsMember
2011-01-01
2011-06-30
0000786947
acur:RestrictedStockUnitMember
2011-01-01
2011-06-30
0000786947
us-gaap:StockOptionsMember
2011-01-01
2011-06-30
0000786947
acur:VestedRestrictedStockUnitsMember
2011-01-01
2011-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMember
2011-01-01
2011-06-30
0000786947
us-gaap:StockOptionsMemberus-gaap:GeneralAndAdministrativeExpenseMember
2011-01-01
2011-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:GeneralAndAdministrativeExpenseMember
2011-01-01
2011-06-30
0000786947
us-gaap:GeneralAndAdministrativeExpenseMember
2011-01-01
2011-06-30
0000786947
us-gaap:StockOptionsMemberus-gaap:ResearchAndDevelopmentExpenseMember
2011-01-01
2011-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMemberus-gaap:ResearchAndDevelopmentExpenseMember
2011-01-01
2011-06-30
0000786947
us-gaap:ResearchAndDevelopmentExpenseMember
2011-01-01
2011-06-30
0000786947
2011-01-01
2011-06-30
0000786947
acur:VestedRestrictedStockUnitsMember
2011-12-31
0000786947
us-gaap:RestrictedStockUnitsRSUMember
2011-12-31
0000786947
us-gaap:AdditionalPaidInCapitalMember
2011-12-31
0000786947
us-gaap:RetainedEarningsMember
2011-12-31
0000786947
us-gaap:CommonStockMember
2011-12-31
0000786947
2011-12-31
0000786947
acur:VestedRestrictedStockUnitsMember
2010-12-31
0000786947
us-gaap:RestrictedStockUnitsRSUMember
2010-12-31
0000786947
2010-12-31
0000786947
acur:LicenseFeesMember
2008-12-31
0000786947
us-gaap:UpFrontPaymentArrangementMember
2007-12-31
0000786947
acur:PennsylvaniaStateMember
2012-06-30
0000786947
acur:NewJerseyStateMember
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMember
2012-06-30
0000786947
us-gaap:StockOptionMember
2012-06-30
0000786947
acur:VestedRestrictedStockUnitsMember
2012-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMember
2012-06-30
0000786947
us-gaap:AdditionalPaidInCapitalMember
2012-06-30
0000786947
us-gaap:RetainedEarningsMember
2012-06-30
0000786947
us-gaap:CommonStockMember
2012-06-30
0000786947
2012-06-30
0000786947
acur:VestedRestrictedStockUnitsMember
2011-06-30
0000786947
us-gaap:RestrictedStockUnitsRSUMember
2011-06-30
0000786947
2011-06-30
0000786947
2012-07-27
0000786947
acur:LicenseFeesMember
2008-05-31
iso4217:USD
shares
iso4217:USD
shares
acur:OptionPlan
pure
acur:LegalMatter
acur:Plaintiff
Number of shares issuable represents those securities which were either i) nonvested at period end or ii) were vested but antidilutive. The number of shares is based on maximum number of shares issuable on exercise at period end. Such amounts have not been adjusted for the treasury stock method or weighted average outstanding calculations as required if the securities were dilutive.