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Stockholders' Equity Common Stock
6 Months Ended
Jun. 30, 2018
Equity [Abstract]  
Stockholders' Equity Common Stock

7.

Stockholders’ Equity Common Stock

Stock Options

The following table summarizes the Company’s stock option activity since December 31, 2017:

 

 

 

Number of

Shares

 

 

Weighted

Average

Exercise

Price

 

 

Weighted

Average

Remaining

Contractual

Term

 

 

Aggregate

Intrinsic

Value

 

 

 

 

 

 

 

 

 

 

 

(in years)

 

 

 

 

 

Outstanding as of December 31, 2017

 

 

6,125,692

 

 

$

13.00

 

 

 

7.70

 

 

$

15,808

 

Granted

 

 

1,732,276

 

 

 

10.16

 

 

 

 

 

 

 

 

 

Exercised

 

 

(140,066

)

 

 

0.68

 

 

 

 

 

 

 

 

 

Forfeited

 

 

(236,424

)

 

 

16.95

 

 

 

 

 

 

 

 

 

Outstanding as of June 30, 2018

 

 

7,481,478

 

 

$

12.45

 

 

 

7.75

 

 

$

11,509

 

Options vested and expected to vest as of June 30, 2018

 

 

7,481,478

 

 

 

12.45

 

 

 

7.75

 

 

 

11,509

 

Options exercisable as of June 30, 2018

 

 

3,987,920

 

 

$

11.87

 

 

 

6.78

 

 

$

11,390

 

 

The weighted average grant-date fair value of stock options granted during the three and six months ended June 30, 2018 and 2017 was $6.89, $5.82, $7.44 and $6.98 per share, respectively.

Restricted Stock Units

The Company has granted restricted stock units with time-based vesting conditions.  The table below summarizes the Company’s restricted stock unit activity since December 31, 2017:

 

 

 

Number

of Shares

 

 

Weighted

Average Grant

Date Fair

Value

 

Unvested restricted stock units as of December 31, 2017

 

 

356,778

 

 

$

10.01

 

Granted

 

 

 

 

$

 

Forfeited

 

 

(6,030

)

 

$

9.78

 

Vested

 

 

(61,500

)

 

$

10.12

 

Unvested restricted stock units as of June 30, 2018

 

 

289,248

 

 

$

10.00

 

 

Stock-based Compensation Expense

The Company recorded stock-based compensation expense related to stock options, restricted stock units and ESPP plan in the following expense categories of its condensed consolidated statements of operations and comprehensive loss:

 

 

 

Three Months Ended

June 30,

 

 

Six Months Ended

June 30,

 

 

 

2018

 

 

2017

 

 

2018

 

 

2017

 

Research and development expenses

 

$

2,262

 

 

$

2,094

 

 

$

4,190

 

 

$

3,967

 

General and administrative expenses

 

 

2,072

 

 

 

2,409

 

 

 

4,380

 

 

 

4,814

 

 

 

$

4,334

 

 

$

4,503

 

 

$

8,570

 

 

$

8,781

 

 

 

Employee Stock Purchase Plan

 

The Company’s Employee Stock Purchase Plan (“ESPP”) provides that eligible employees may contribute up to 15% of their eligible earnings toward the semi-annual purchase of the Company' common stock. The ESPP is qualified under Section 423 of the Internal Revenue Code. The employee's purchase price is derived from a formula based on the closing price of the common stock on the first day of the offering period versus the closing price on the date of purchase (or, if not a trading day, on the immediately preceding trading day).  The offering period under the ESPP has a duration of six months, and the purchase price with respect to each offering period beginning on or after such date is, until otherwise amended, equal to 85% of the lesser of (i) the fair market value of the Company's common stock at the commencement of the applicable six-month offering period or (ii) the fair market value of the Company's common stock on the purchase date. The Company estimates the fair value of common stock under the ESPP using a Black-Scholes valuation model. The fair value was estimated on the date of grant using the Black-Scholes option valuation model and the straight-line attribution approach with the following weighted-average assumptions: risk-free interest rate (1.89%); expected term (0.5 years); expected volatility (65.5%); and an expected dividend yield (0%).  The Company recorded an immaterial amount of stock-based compensation expense under the ESPP for the three and six months ended June 30, 2018

The total number of available ESPP shares is increased annually, beginning in 2016 and ending in 2025. The ESPP allows for share replenishment equal to the lesser of (i) 400,000 shares and (ii) 1% of the number of shares of the Company’s common stock outstanding on the last day of the preceding calendar year, or an amount determined by the Company’s Board of Directors. As of June 30, 2018, a total of 1.6 million shares were reserved and available for issuance under the ESPP.