XML 44 R15.htm IDEA: XBRL DOCUMENT v3.3.1.900
Stockholders' Equity
12 Months Ended
Dec. 31, 2015
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]  
Stockholders' Equity

8.

Stockholders’ Equity

Our authorized capital stock consists of 520,000,000 shares, all with a par value of $0.0001 per share, of which 500,000,000 shares are designated as common stock and 20,000,000 shares are designated as preferred stock. There were no shares of preferred stock outstanding as of December 31, 2015 and 2014.

The following shares of common stock were reserved for future issuance as of December 31, 2015:

 

 

Total Shares Reserved

 

2014 Equity Incentive Plan

 

3,916,362

 

2014 Employee Stock Purchase Plan

 

432,898

 

Total reserved shares of common stock

 

4,349,260

 

 

Restricted Stock Awards

In August 2012, in connection with our formation, our CEO purchased 9,595,384 shares of restricted common stock at a nominal per share purchase price. The shares were issued subject to certain vesting conditions, restrictions on transfer and a Company right of repurchase of any unvested share at their original purchase price. These shares are placed in escrow until vested, and have rights to vote and participate in dividends and distributions. The combined grant date intrinsic value for this award was $1.7 million, and 7,996,153 of the shares had service and fundraising vesting conditions. Under the service vesting condition, shares vest monthly over 48 months, commencing from the first closing of Series A convertible preferred stock financing on October 22, 2012. The remaining 1,599,231 of these shares were subject to performance milestones and fundraising vesting conditions. The fundraising vesting conditions for all shares were satisfied as of December 31, 2013. All shares subject to service vesting conditions are subject to accelerated vesting in the event of certain change of control transactions.

In March 2013, an Atara employee purchased 2,423,074 shares of restricted common stock for $0.3 million. The shares were issued under our 2012 Equity Incentive Plan and are subject to certain vesting conditions, restrictions on transfer and a Company right of repurchase of any unvested shares at their original purchase price. These shares are placed in escrow until vested, and have rights to vote and participate in dividends and distributions. Under these agreements, the shares vest as follows: 2,319,228 shares vest over four years, with one-quarter vesting after one year of service and the remainder vesting in equal installments over the subsequent thirty-six months, and 103,846 shares vest upon achievement of certain performance milestones. Vesting of all shares is subject to acceleration of vesting in the event of certain change of control transactions.

The amounts paid for both RSAs were initially recorded as other long-term liabilities. As the shares vest, we reclassify liabilities to equity and report shares as outstanding in the financial statements. On March 31, 2014, these shares were exchanged for 1,335,384 shares of Atara common stock. As of December 31, 2015, 1,101,972 of these shares had vested and are reported as shares outstanding in the financial statements. The remaining 233,413 shares are expected to fully vest in 2016. As both the Chief Executive Officer and the Atara employee were consultants of Nina, Pinta and Santa Maria through the Recapitalization date, we accounted for these RSAs as non-employee stock-based awards. Following the Recapitalization, these RSAs were accounted for as employee awards based upon the fair market value of common stock on March 31, 2014.  

The weighted average grant date fair value of RSAs granted during the year ended December 31, 2013 was $0.40. There were no grants of RSAs in the years ended December 31, 2015 and 2014. Stock-based compensation expense related to the RSAs is recorded using accelerated graded vesting model and was $0.8 million, $5.2 million and $1.7 million for the years ended December 31, 2015, 2014 and 2013, respectively. The unrecognized stock-based compensation expense related to unvested RSAs was $0.2 million as of December 31, 2015 and this expense is expected to be recognized in 2016. The aggregate intrinsic value of unvested RSAs was $6.1 million as of December 31, 2015.

Equity Incentive Plan

In March 2014, we adopted the 2014 Equity Incentive Plan (the “2014 EIP”) as part of our Recapitalization. In connection with the Recapitalization, Atara assumed the plans of Nina, Pinta and Santa Maria and all outstanding RSAs and RSUs granted under such plans.  At the date of Recapitalization, RSAs and RSUs issued by Nina, Pinta and Santa Maria to Atara employees became employee awards and the awards’ grant dates were established as the Recapitalization date.  In May 2014, our board of directors amended and restated our 2014 EIP and the amended plan became effective on October 15, 2014 upon the pricing of our IPO.

The 2014 EIP provides for annual increases in the number of shares available for issuance thereunder on the first business day of each fiscal year, beginning with 2015 and ending in 2024, equal to five percent of the number of shares of the Company’s common stock outstanding as of such date or a lesser number of shares as determined by our board of directors.

As of December 31, 2015, a total of 3,916,362 shares of common stock were reserved for issuance under the 2014 Plan, of which 326,393 shares were available for future grant and 3,589,969 were subject to outstanding options and RSUs.

Under the terms of the 2014 EIP, we may grant options, RSAs and RSUs to employees, directors, consultants and other service providers. RSUs typically require settlement by the earlier of seven years from the date of grant or the service termination (or, for RSUs granted prior to February 2014, two years following the service termination date). Stock options are granted at prices no less than 100% of the estimated fair value of the shares on the date of grant as determined by the board of directors, provided, however, that the exercise price of an option granted to a 10% shareholder cannot be less than 110% of the estimated fair value of the shares on the date of grant. Options granted to employees and non-employees generally vest over four years and expire in seven years.

Restricted Stock Units and Awards

The RSUs granted prior to our October 2014 IPO had a time-based service condition and a liquidity-based performance condition, and vest when both conditions are met. Prior to our IPO, we determined that the liquidity-based performance condition was not probable of occurring and recorded no stock-based compensation expense related to these RSUs. Upon the closing of our IPO, we recorded $3.8 million of stock-based compensation expense in our statement of operations and comprehensive loss. The weighted average grant date fair value of RSUs granted during the year ended December 31, 2015, 2014 and 2013 was $25.15, $6.53 and $1.99, respectively. As of December 31, 2015, there was $1.9 million of unrecognized stock-based compensation expense related to RSUs that is expected to be recognized over a weighted average period of 1.1 years. The aggregate intrinsic value of the RSUs outstanding as of December 31, 2015 was $11.9 million.

The following is a summary of RSAs and RSUs activity under our 2014 EIP:

 

 

 

RSAs

 

 

RSUs

 

 

 

Shares

 

 

Weighted Average Grant Date Fair Value

 

 

Shares

 

 

Weighted Average Grant Date Fair Value

 

Unvested as of December 31, 2014

 

 

112,740

 

 

$

0.40

 

 

 

619,303

 

 

$

4.64

 

Granted

 

 

 

 

 

 

 

 

87,600

 

 

$

25.15

 

Forfeited

 

 

 

 

 

 

 

 

(2,645

)

 

$

8.59

 

Vested

 

 

(64,423

)

 

$

0.40

 

 

 

(276,653

)

 

$

6.12

 

Unvested as of December 31, 2015

 

 

48,317

 

 

$

0.40

 

 

 

427,605

 

 

$

7.86

 

Vested and unreleased

 

 

 

 

 

 

 

 

 

 

24,835

 

 

 

 

 

Outstanding as of December 31, 2015

 

 

 

 

 

 

 

 

452,440

 

 

 

 

 

 

Under our RSU net settlement procedures, we withhold shares at settlement to cover the minimum payroll withholding tax obligations. During 2015, we settled 451,306 RSUs, of which 327,383 RSUs were net settled by withholding 123,923 shares.  The value of the RSUs withheld was $4.6 million, based on the closing price of our common stock on the settlement date. This amount was remitted to the appropriate taxing authorities and has been reflected as a financing activity in our statements of cash flows.

Stock Options

The following is a summary of option activity under our 2014 EIP:

 

 

 

Number of shares

 

 

Weighted Average Exercise Price

 

 

Weighted Average Remaining Contractual Term (Years)

 

 

Aggregate Intrinsic Value

(in thousands)

 

Outstanding as of December 31, 2014

 

 

623,936

 

 

$

13.69

 

 

 

 

 

 

 

 

 

Granted

 

 

2,610,174

 

 

$

28.95

 

 

 

 

 

 

 

 

 

Exercised

 

 

(23,822

)

 

$

18.44

 

 

 

 

 

 

 

 

 

Forfeited or expired

 

 

(72,759

)

 

$

37.11

 

 

 

 

 

 

 

 

 

Outstanding as of December 31, 2015

 

 

3,137,529

 

 

$

25.81

 

 

 

6.42

 

 

$

12,978

 

Vested and expected to vest as of December 31, 2015

 

 

3,137,529

 

 

$

25.81

 

 

 

6.42

 

 

$

12,978

 

Exercisable as of December 31, 2015

 

 

276,909

 

 

$

17.75

 

 

 

5.75

 

 

$

2,470

 

 

Aggregate intrinsic value represents the difference between the closing stock price of our common stock on December 31, 2015 and the exercise price of outstanding, in-the-money options. As of December 31, 2015, there was $40.4 million of unrecognized stock-based compensation expense related to stock options that is expected to be recognized over a weighted average period of 3.4 years.

Options for 23,822 shares of our common stock were exercised during the year ended December 31, 2015, with an intrinsic value of $0.6 million. No options were exercised during 2014 and 2013. As we believe it is more likely than not that no stock option related tax benefits will be realized, we do not record any net tax benefits related to exercised options.

The fair value of each option issued was estimated at the date of grant using the Black-Scholes valuation model. The following table summarizes the weighted-average assumptions used as inputs to the Black-Scholes model, and resulting weighted-average grant date fair values of employee and consultant stock options granted during the periods indicated:

 

 

Year Ended December 31, 2015

 

 

Year Ended December 31, 2014

 

 

Employees

 

 

Consultants

 

 

Employees

 

 

Consultants

 

Assumptions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expected term (years)

 

4.5

 

 

 

7.0

 

 

4.5

 

 

 

7.0

 

Expected volatility

 

72.4

%

 

 

71.5

%

 

 

65.7

%

 

 

65.8

%

Risk-free interest rate

 

1.6

%

 

 

2.0

%

 

 

1.6

%

 

 

2.2

%

Expected dividend yield

 

0.0

%

 

 

0.0

%

 

 

0.0

%

 

 

0.0

%

Weighted-average estimated grant date fair value per share

$

16.63

 

 

$

27.82

 

 

$

7.29

 

 

$

8.61

 

 

The estimated fair value of stock options that vested in the years ended December 31, 2015, 2014 and 2013 was $2.9 million, $0.1 million and zero, respectively.

Employee Stock Purchase Plan

In May 2014, we adopted the 2014 Employee Stock Purchase Plan (“2014 ESPP”), which became effective on October 15, 2014 upon the pricing of our IPO. The 2014 ESPP permits eligible employees to purchase common stock at a discount through payroll deductions during defined offering periods. No offerings commenced and there were no purchases of shares under the 2014 ESPP in the year ended December 31, 2015.

The 2014 ESPP provides for annual increases in the number of shares available for issuance thereunder on the first business day of each fiscal year, beginning with 2015 and ending in 2024, equal to the lower of (i) one percent of the number of shares of our common stock outstanding as of such date, (ii) 230,769 shares of our common stock, or (iii) a lesser number of shares as determined by our board of directors. As of December 31, 2015, there were 432,898 shares authorized for issuance under the 2014 ESPP.

Stock-based Compensation Expense

Total stock-based compensation expense related to all employee and non-employee awards was as follows:

 

 

 

Year ended December 31,

 

 

 

2015

 

 

2014

 

 

2013

 

 

 

 

 

 

 

(in thousands)

 

 

 

 

 

Research and development

 

$

4,822

 

 

$

3,258

 

 

$

251

 

General and administrative

 

 

5,429

 

 

 

6,843

 

 

 

1,462

 

Total stock-based compensation

 

$

10,251

 

 

$

10,101

 

 

$

1,713