4. Stockholders’ Equity

Stock Option and Incentive Plans

The 2015 Plan became effective upon the effectiveness of the registration statement for the IPO in May 2015, and the Company ceased granting stock options under its 2014 Stock Plan (the 2014 Plan) upon the IPO.

Stock option activity is summarized as follows:


	Number of Options			Weighted Average Price
Balance at December 31, 2014		1,514,471		$	4.60
Granted		1,050,045		$	11.35
Exercised		(166,454	)	$	2.87
Canceled		(2,774	)	$	4.25

Balance at June 30, 2015		2,395,288		$	7.70

The allocation of stock-based compensation for all options and restricted stock awards is as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2015		2014		2015		2014
Research and development	$	441	$	50	$	796	$	93
General and administrative		375		115		623		219

	$	816	$	165	$	1,419	$	312

The assumptions used in the Black-Scholes option pricing model to determine the fair value of the employee stock option grants were as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2015			2014	2015			2014
Expected term (in years)		5.77 – 6.08		N/A		5.77 – 6.08			6.52 – 6.56
Risk-free interest rate		1.47%-1.78	%	N/A		1.47%-1.78	%		2.14	%
Expected volatility		81.60%-88.10	%	N/A		81.60%-100.9	%		111.1	%
Expected dividend yield		0.0%		N/A		0.0%			0.0%

Approval of 2015 Plan

On April 25, 2015, the Company’s board of directors adopted, and the Company’s stockholders approved, the 2015 Plan. The 2015 Plan became effective on May 6, 2015. A total of 1,574,566 shares of the Company’s common stock were initially reserved for issuance under the 2015 Plan. In addition, the number of shares reserved and available for issuance under the 2015 Plan will automatically increase each January 1, beginning on January 1, 2016 and thereafter until January 1, 2019, by the lesser of (i) 1,840,000 shares, (ii) 4% of the outstanding number of shares of the Company’s common stock on the immediately preceding December 31 or (iii) an amount determined by the Company’s board of directors. Shares underlying any awards under the 2015 Plan and any awards granted under the 2014 Plan prior to the Company’s IPO that are forfeited, canceled, reacquired by us prior to vesting, satisfied without the issuance of stock or otherwise terminated (other than by exercise) will be added to shares available for issuance under the 2015 Plan.

Approval of the Employee Stock Purchase Plan

On April 25, 2015, the Company’s board of directors adopted, and the Company’s stockholders approved, the Company’s 2015 Employee Stock Purchase Plan (the 2015 ESPP). The 2015 ESPP became effective on May 6, 2015. A total of 227,623 shares of the Company’s common stock were initially reserved for issuance under the 2015 ESPP. In addition, the number of shares reserved and available for purchase under the 2015 ESPP will automatically increase each January 1, beginning on January 1, 2016 and thereafter until January 1, 2019, by 1% of the outstanding number of shares of the Company’s common stock on the immediately preceding December 31 or such lesser number of shares as determined by the administrator of the 2015 ESPP.

Sale of Series E Redeemable Convertible Preferred Stock

On March 31, 2015, pursuant to a Series E stock purchase agreement, the Company issued an aggregate of 68,166,894 shares of its Series E redeemable convertible preferred stock at a purchase price of $1.119 per share, for aggregate cash consideration of $76.3 million and incurred $0.6 million of issuance costs. Each share of Series E redeemable convertible preferred stock was convertible into 0.12572 shares of the Company’s common stock. The purchase agreement also included an automatic conversion into approximately 0.10329 shares of common stock for each share of Series E redeemable convertible preferred stock upon completion of a qualified public offering on or before March 1, 2016. A qualified public offering must have resulted in listing on a U.S. national securities exchange and at least $50.0 million of gross proceeds at a per share price of not less than $13.00. On May 12, 2015, all outstanding shares of the Company’s redeemable convertible preferred stock converted into 7,040,991 shares of the Company’s common stock in connection with the Company’s IPO.

Common Stock Reserved for Future Issuance

Common stock reserved for future issuance is as follows:


	June 30, 2015		December 31, 2014
Conversion of redeemable convertible preferred stock		—		9,238,868
Conversion of redeemable convertible preferred stock issuable upon conversion of promissory note		—		94,455
Redeemable convertible preferred stock warrants		—		25,970
Common stock warrants		25,970		—
Common stock options outstanding		2,395,288		1,514,471
Shares available under the 2015 Plan		1,164,140		180,190
Shares available under the 2015 ESPP Plan		227,623		—

		3,813,021		11,053,954