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Equity (Tables)

9 Months Ended

Sep. 30, 2016

A summary of the stock option activity under the Company’s plans for the nine months ended September 30, 2016 is as follows:

	Number of		Weighted average
	shares		exercise price
Options outstanding at December 31, 2015		5,326,505	$	3.07
Options granted		2,542,527		7.10
Less:
Options exercised		2,395,015		1.61
Options canceled or expired		258,155		3.32
Options outstanding at September 30, 2016		5,215,862		5.67
Exercisable at September 30, 2016		1,162,128		3.74

Fair Value of Each Stock Option Award Granted

The fair value of each stock option award granted during the nine months ended September 30, 2016 was estimated as of the grant date using a trinomial lattice model with the following weighted average assumptions:

	Nine Months Ended September 30, 2016
Expected term (in years)	1.0 - 4.5
Risk-free interest rate (%)		1.1%
Expected volatility (%)	46.5% - 56.7%
Dividend yield (%)		0.0%
Weighted average fair value/share at grant date	$	2.56

Summary of Stock-Based Compensation Expense Recognized for Stock Options and Restricted Stock Included in Consolidated Statements of Operations

Stock based compensation expense recognized for stock options and restricted stock and included in the consolidated statements of operations was allocated as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2016		2015		2016		2015
Research and development expense	$	187	$	161	$	550	$	339
General and administrative expense		1,499		667		3,484		1,395
Total stock based compensation expense	$	1,686	$	828	$	4,034	$	1,734

Summary of Warrant Activity

Common Stock Warrants

A summary of the warrant activity for the nine months ended September 30, 2016 is as follows:

	Number of			Weighted average
	shares			exercise price
Warrants outstanding at December 31, 2015		650,000		$	1.48
Warrants granted		—			—
Less:
Warrants exercised		(200,000	)		1.50
Warrants canceled or expired		—			—
Warrants outstanding at September 30, 2016		450,000			1.50
Exercisable at September 30, 2016		450,000			1.50

- Definition

Tabular disclosure of warrants or rights issued. Warrants and rights outstanding are derivative securities that give the holder the right to purchase securities (usually equity) from the issuer at a specific price within a certain time frame. Warrants are often included in a new debt issue to entice investors by a higher return potential. The main difference between warrants and call options is that warrants are issued and guaranteed by the company, whereas options are exchange instruments and are not issued by the company. Also, the lifetime of a warrant is often measured in years, while the lifetime of a typical option is measured in months. Disclose the title of issue of securities called for by warrants and rights outstanding, the aggregate amount of securities called for by warrants and rights outstanding, the date from which the warrants or rights are exercisable, and the price at which the warrant or right is exercisable.

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