Preferred Stock and Stockholders' Equity

12 Months Ended

Dec. 31, 2014

Equity [Abstract]

Preferred Stock and Stockholders' Equity

Preferred Stock and Stockholders’ Equity

Preferred Stock

Under the Company’s amended and restated certificate of incorporation, as of December 31, 2014 and 2013, the Company is authorized to issue 10,000,000 shares of preferred stock with a $0.001 par value. As of December 31, 2014 and 2013, there were no shares of preferred stock issued or outstanding.

Common Stock

Under the Company’s amended and restated certificate of incorporation, as of December 31, 2014 and 2013, the Company was authorized to issue 200,000,000 shares of common stock with a $0.001 par value. Each share of common stock is entitled to one vote. The holders of common stock are also entitled to receive dividends whenever funds are legally available, when declared by the board of directors, subject to the prior rights of holders of convertible preferred stock.

Common stock reserved for future issuance is as follows (in thousands):

	December 31,
	2014	2013
Stock options and restricted stock units outstanding	16,913	14,859
Warrants to purchase common stock	16,232	16,189
Shares authorized for future issuance under equity and purchase plans	4,826	2,595
	37,971	33,643

Common Stock Warrants

In July 2012, in connection with a public offering of common stock and warrants, the Company sold warrants to purchase 15,784,200 shares of common stock (including over-allotment purchase). The warrants are exercisable at an exercise price of $2.50 per share and will expire on July 27, 2017, which is five years from the date of issuance. As the warrants contain a cash settlement feature upon the occurrence of certain events that may be outside of the Company's control, the warrants are recorded as a current liability and are marked to market at each reporting date (see Note 2). During the years ended December 31, 2014 and 2013, warrants to purchase 465,250 and 103,500 shares of common stock were exercised, respectively. The fair value of the warrants outstanding was approximately $4,978,000 and $30,849,000 as of December 31, 2014 and 2013, respectively.

In July 2011, upon the closing of and in connection with the Financing Agreement (see Note 9), the Company issued to Healthcare Royalty a warrant exercisable into 225,000 shares of common stock. The warrant is exercisable at $9.00 per share of common stock and has a term of 10 years. As the warrant contains covenants where compliance with such covenants may be outside of the Company’s control, the warrant was recorded as a current liability and is marked to market at each reporting date (see Note 2). The fair value of the warrant was approximately $114,000 and $492,000 as of December 31, 2014 and 2013, respectively.

In June 2011, and in connection with entering into an amendment to the second amended and restated loan and security agreement with Oxford and CIT Healthcare LLC (the Oxford Agreement), the Company issued to Oxford and SVB warrants exercisable into an aggregate of 26,455 shares of common stock. The warrants are exercisable at $3.78 per share of common stock and have a term of 7 years. The value of the warrants of approximately $76,000 was recorded as debt discount and additional paid in capital in the consolidated balance sheet as of December 31, 2011.

In December 2014, and in connection with entering into the 2014 Loan and Security Agreement (see Note 9), the Company issued to Oxford and SVB warrants exercisable into an aggregate of 508,476 shares of common stock. The warrants are exercisable at $1.18 per share of common stock and have a term of 10 years. The value of the warrants of approximately $558,000 was recorded as debt discount and additional paid in capital in the consolidated balance sheet as of December 31, 2014.

Convertible Preferred Stock Warrants

In connection with the execution of the amended Oxford Agreement in July 2010, the Company issued warrants to Oxford and SVB to purchase 1,145,455 and 445,455 shares, respectively, of Series B convertible preferred stock at an exercise price of $1.10 per share. The warrants expire in November 2015. In connection with the Company’s initial public offering (IPO) in November 2010, these warrants were converted to 159,090 warrants for common stock at an exercise price of $11.00 per share.

In accordance with accounting guidance for warrants for shares in redeemable securities, the Company classified warrants for convertible preferred stock as liabilities on the consolidated balance sheet based on fair value and increases or decreases in the fair value of such warrants were recorded as other income (expense) in the consolidated statement of operations and comprehensive income (loss). Upon the closing of the Company's IPO on November 29, 2010, all preferred stock converted into common stock. The warrants were converted into warrants to purchase common stock and reclassed from a liability to equity.