Stock Option and Incentive Plans

9 Months Ended

Sep. 30, 2016

8. Stock Option and Incentive Plans

In 2005, we adopted the 2005 Stock Option and Incentive Plan (2005 Plan) that authorizes us to grant options, restricted stock and other equity-based awards. As of September 30, 2016, 430,922 options to purchase shares of common stock were outstanding pursuant to grants in connection with the 2005 Plan. No additional shares are available for issuance under the 2005 Plan.

Effective August 2014, we adopted our 2014 Equity Incentive Plan (2014 Plan) that authorizes us to grant options, restricted stock, and other equity-based awards, subject to adjustment in accordance with the 2014 Plan. The amount, terms of grants, and exercisability provisions are determined and set by our board of directors. As of September 30, 2016, 1,807,275 options to purchase shares of common stock and 196,275 shares of nonvested stock were outstanding pursuant to grants in connection with the 2014 Plan, and 22,023 shares of common stock were available for future issuance. The amount, terms of grants, and exercisability provisions are determined and set by our board of directors.

Stock Options

There were 2,238,197 stock options outstanding as of September 30, 2016 at a weighted-average exercise price of $6.60 per share. During the nine months ended September 30, 2015, 596,475 options were granted to employees, directors and consultants at a weighted-average exercise price of $2.44 per share, 118,365 options were exercised at a weighted-average exercise price of $1.04 per share, and 39,139 options were forfeited at a weighted-average exercise price of $12.42 per share.

Total compensation cost recognized for all stock option awards in the statements of operations is as follows (in thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Research and development	$	265	$	179	$	710	$	436
General and administrative		487		418		1,518		932
Total	$	752	$	597	$	2,228	$	1,368

Nonvested Stock

All issued and outstanding nonvested shares of common stock are time-based, and become vested one year after the grant date. Compensation expense is recorded ratably over the requisite service period. Compensation expense related to nonvested stock is measured based on the fair value using the closing market price of our common stock on the date of the grant.

During the three and nine months ended September 30, 2016, we issued 196,275 nonvested shares of common stock to employees, directors and consultants, pursuant to the 2014 Plan. As of September 30, 2016 there was $0.2 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements. That cost is expected to be recognized over a weighted average period of 0.84 years. No shares vested during the three and nine months ended September 30, 2016.

Total compensation cost recognized for all nonvested stock awards in the statements of operations is as follows (in thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Research and development	$	19	$	—	$	19	$	—
General and administrative		29		—		29		—
Total	$	48	$	—	$	48	$	—