Stock-Based Compensation

3 Months Ended

Mar. 31, 2020

Share-based Payment Arrangement [Abstract]

12.	Stock-Based Compensation

In the accompanying condensed consolidated statements of operations, the Company recognized stock-based compensation expense for its employees and

non-employees

as follows:


	Three Months Ended March 31,
	2020		2019
Research and development	$	546	$	1,184
General and administrative		372		515

Total stock-based compensation	$	918	$	1,699

Determination of Fair Value

The estimated grant-date fair values of all of the Company’s stock-based awards were calculated using the Black-Scholes option pricing model, based on assumptions as follows:


	Three Months Ended March 31,
	2020	2019
Expected term (in years)	5.7 – 6.7	5.3 – 6.9
Expected volatility	88 – 90 %	91 – 94 %
Risk-free interest rate	0.6 – 1.2 %	2.5 – 2.6 %
Expected dividend rate	— %	— %

Equity Incentive Plans

2018 Equity Inducement Plan

In September 2018, the Company’s Compensation Committee approved the 2018 Equity Inducement Plan (2018 Plan). The number of shares available for awards under the 2018 Plan was set to 37,500. The exercise price of each stock-based award issued under the 2018 Plan is required to be no less than the fair value of the Company’s capital stock. The vesting and exercise provisions of options or restricted awards granted are determined individually with each grant. Stock options have a

10-year

life and expire if not exercised within that period or if not exercised within three months of cessation of employment with the Company or such longer period of time as specified in the option agreement.

2015 Plan

The 2015 Equity Incentive Plan (2015 Plan) became effective on July 14, 2015. On January 21, 2020 the Company’s stockholders approved the following amendments to the 2015 Plan: (i) increase to the authorized number of shares available for issuance by 4,312,500 shares and proportionately increase the share limit related to incentive stock options, (ii) provide limits on the total value of compensation that may be granted to any

non-employee

director in each calendar year, and (iii) eliminate the annual individual grant limit to reflect changes to the tax law in 2017 tax legislation.

As of March 31, 2020, 4,678,379 shares were reserved for issuance under the 2015 Plan. The number of shares reserved for issuance under the 2015 Plan will increase automatically on January 1 of each calendar year 2016 through 2025 by the number of shares equal to 4% of the total outstanding shares of the Company’s common stock as of the immediately preceding December 31. The Company’s Board of Directors or Compensation Committee may reduce the amount of the increase in any particular year. The exercise price of each stock-based award issued under the 2015 Plan is required to be no less than the fair value of the Company’s capital stock. The vesting and exercise provisions of options or restricted awards granted are determined individually with each grant. Stock options have a

10-year

2008 Plan

The Company granted options under the 2008 Stock Plan (2008 Plan) until July 2015 when it was terminated as to future awards, although it continues to govern the terms of options that remain outstanding under the 2008 Plan. The 2008 Plan provided for the granting of Incentive Stock Options (ISO), nonqualified stock options and stock purchase rights. In connection with the Board of Director’s approval of the 2015 Plan, all remaining shares available for future award under the 2008 Plan were transferred to the 2015 Plan, and the 2008 Plan was terminated.

A summary of activity under the 2008 Plan, 2015 Plan and 2018 Plan and related information is as follows:


				Options Outstanding
	Shares Available for Grant			Number of Shares Outstanding			Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value of Outstanding Options (in thousands)
Outstanding - December 31, 2019		51,514			326,023		$	102.56		7.45	$	11
Awards authorized		4,387,187
Options granted		(1,435,857	)		1,435,857			13.31
Options forfeited/cancelled		23,053			(23,053	)		52.35

Outstanding - March 31, 2020		3,025,897			1,738,827		$	29.52		9.37	$	—

Exercisable - March 31, 2020					220,647		$	114.63		6.23	$	—

Vested and expected to vest - March 31, 2020					1,738,827		$	29.52		9.37	$	—

The weighted-average grant date fair values of options granted during the three months ended March 31, 2020 was $9.81 per share, and $58.80 per share during the three months ended March 31, 2019. The aggregate intrinsic values of options exercised were $0.1 million for the three months ended March 31, 2019.

No options were exercised for the three months ended March 31, 2020.

The total grant date fair value of options vested for the three months ended March 31, 2020 was $1.6 million and $2.7 million during the three months ended March 31, 2019.

As of March 31, 2020, total unrecognized stock-based compensation related to unvested stock options was $18.9 million. These costs are expected to be recognized over a remaining weighted-average period of 3.4 years as of March 31, 2020.