Fair Value Measurements and Available for Sale Investments (Tables)

9 Months Ended

Sep. 30, 2017

Schedule of Assets and Liabilities that Require Fair Value Measurements on a Recurring Basis

The following table summarizes our assets and liabilities that require fair value measurements on a recurring basis and their respective input levels based on the fair value hierarchy:



	Fair Value Measurements at End of Period Using:
(in thousands)	Fair Value		Quoted Market Prices for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
At September 30, 2017
Money market funds⁽¹⁾	$	17,936	$	17,936	$	—	$	—
Mutual funds⁽¹⁾	3,149		3,149		—		—
U.S. treasury securities⁽³⁾	44,023		44,023		—		—
Agency securities⁽²⁾	12,712		—		12,712		—
Commercial and corporate obligations⁽³⁾	33,317		—		33,317		—
At December 31, 2016
Money market funds⁽¹⁾	$	31,955	$	31,955	$	—	$	—
Mutual funds⁽¹⁾	17,620		17,620		—		—
Preferred stock warrant liabilities	3,241		—		—		3,241


⁽¹⁾	Included in cash and cash equivalents, and restricted cash in the accompanying consolidated balance sheets.


⁽²⁾	Included in short-term or long-term investments in the accompanying consolidated balance sheets depending on the respective maturity date.


⁽³⁾	Included in short-term investments in the accompanying consolidated balance sheets.

Schedule of Weighted-average Assumptions for Liabilities for Series C Preferred Stock Warrants

The following weighted-average assumptions were employed in estimating the value of the liabilities for Series C preferred stock warrants using the Black-Scholes option-pricing model as of January 31, 2017, the conversion date, and December 31, 2016:



	January 31, 2017			December 31, 2016
Fair value of preferred stock	$	16.95		$	12.67
Exercise price	$	4.55		$	4.55
Risk-free interest rate	1.4		%	1.5		%
Volatility	88.8		%	88.6		%
Dividend Yield	—		%	—		%
Contractual term (in years)	3.8			3.8
Weighted-average measurement date fair value per share	$	13.71		$	9.65

Summary of Activity in Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs

The following table summarizes the activity in liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3 Inputs):



	Nine Months Ended September 30,
(in thousands)	2017			2016
Preferred Stock Warrant Liabilities:
Beginning balance	$	(3,241	)	$	(1,549	)
Net gains (losses) included in other expense	(1,366		)	335
Reclassification of warrant liabilities to equity	4,607			—
Ending balance	$	—		$	(1,214	)

Fair Value of Other Financial Instruments

The fair value of our other financial instruments estimated as of September 30, 2017 and December 31, 2016 are presented below:



	September 30, 2017				December 31, 2016
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Notes payable	$	14,269	$	15,642	$	13,809	$	15,531

Available-for-sale Investments

The aggregate market value, cost basis, and gross unrealized gains and losses of available-for-sale investments by security type, classified in cash equivalents, short-term and long-term investments, as of September 30, 2017 are as follows:



(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Total Fair Value
Agency securities⁽¹⁾	$	12,724	$	—	$	(12	)	$	12,712
Commercial and corporate obligations⁽²⁾	33,330		—		(13		)	33,317
US Treasury securities⁽³⁾	44,041		1		(19		)	44,023
Total available-for-sale investments	$	90,095	$	1	$	(44	)	$	90,052


⁽¹⁾	Of our outstanding agency securities, $11.7 million have maturity dates of less than one year and $1.0 million have a maturity date of between one to two years as of September 30, 2017.


⁽²⁾	Of our outstanding commercial and corporate obligations, $33.3 million have maturity dates of less than one year as of September 30, 2017.


⁽³⁾	Of our outstanding U.S. Treasury securities $44.0 million have maturity dates of less than one year as of September 30, 2017.