Share-Based Payments

The Company records the fair value of stock options issued to employees and non-employees as of the grant date as stock-based compensation expense. Stock-based compensation expense for employees and non-employees is recognized over the requisite service period, which is typically the vesting period. Stock-based compensation costs included in the consolidated statements of operations are presented below:



	Year Ended December 31,
	2015		2014		2013
Cost of products	$	95	$	14	$	—
Cost of services	354		142		—
Research and development	8,614		4,817		514
Selling, general and administrative	29,604		16,876		2,407
Total	$	38,667	$	21,849	$	2,921

Intrexon Stock Option Plans

In April 2008, Intrexon adopted the 2008 Equity Incentive Plan (the "2008 Plan") for employees and nonemployees pursuant to which Intrexon's board of directors may grant share based awards, including stock options, to officers, key employees and nonemployees. Upon the effectiveness of the 2013 Omnibus Incentive Plan (the "2013 Plan"), no new awards may be granted under the 2008 Plan. As of December 31, 2015, there were 1,261,192 stock options outstanding under the 2008 Plan.

Intrexon adopted the 2013 Plan for employees and nonemployees pursuant to which Intrexon's board of directors may grant share based awards, including stock options and shares of common stock, to employees, officers, consultants, advisors, and nonemployee directors. The 2013 Plan became effective upon the closing of the of the Company's initial public offering in August 2013, and as of December 31, 2015, there were 13,000,000 shares authorized for issuance under the 2013 Plan, of which 9,782,336 stock options were outstanding and 2,534,542 shares were available for grant.

Stock options may be granted with an exercise price equal to or greater than the stock's fair market value at the date of grant. Stock options may be granted with an exercise price less than the stock's fair market value at the date of grant if the stock options are replacement options in accordance with certain U.S. Treasury regulations. Virtually all stock options have ten-year terms and vest four years from the date of grant.

Stock option activity under Intrexon's award plans was as follows for the periods presented:



	Number of Shares		Weighted Average Exercise Price			Weighted Average Remaining Contractual Term (Years)
Balances at December 31, 2012	2,313,526		$	5.90		7.87
Granted	989,709		13.06
Exercised	(88,764	)	(6.04		)
Forfeited	(335,746	)	(6.94		)
Expired	(38,077	)	(5.17		)
Balances at December 31, 2013	2,840,648		8.27			7.75
Granted	7,655,050		27.51
Exercised	(315,964	)	(4.80		)
Forfeited	(1,855,578	)	(24.00		)
Expired	(612	)	(7.12		)
Balances at December 31, 2014	8,323,544		22.59			8.64
Granted	5,051,500		45.82
Adjustment due to dividend (Note 13)	312,795		25.40
Exercised	(1,029,291	)	(15.16		)
Forfeited	(1,610,335	)	(26.75		)
Expired	(4,685	)	(28.29		)
Balances at December 31, 2015	11,043,528		32.66			8.49
Exercisable at December 31, 2015	2,494,426		18.31			6.82
Vested and Expected to Vest at December 31, 2015(1)	9,235,535		31.52			8.13


(1)	The number of stock options expected to vest takes into account an estimate of expected forfeitures.

Total unrecognized compensation costs related to unvested awards at December 31, 2015, 2014 and 2013 were $113,655, $62,281 and $9,639, respectively, and are expected to be recognized over a weighted-average period of approximately three years.

The weighted average grant date fair value of options granted during 2015, 2014 and 2013 was $25.96, $16.40 and $12.91, respectively. The aggregate intrinsic value of options exercised during 2015, 2014 and 2013 was $24,675, $6,350 and $1,136, respectively. The aggregate intrinsic value of options is calculated as the difference between the exercise price of the underlying options and the fair value of Intrexon's common stock for those shares where the exercise price was lower than the fair value of Intrexon's common stock on the date of exercise.

The following table summarizes additional information about stock options outstanding as of December 31, 2015:



					Options Outstanding						Options Exercisable
Range of Exercise Prices					Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Life (Years)	Aggregate Intrinsic Value		Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Life (Years)	Aggregate Intrinsic Value
$	0.38	—	$	9.34	1,261,192	$	6.40	5.40	$	29,956	1,147,978	$	6.19	5.25	$	27,507
$	15.21	—	$	28.93	2,682,516	24.25		8.43	15,831		602,023	24.43		8.36	3,445
$	29.14	—	$	29.68	2,895,885	29.63		8.44	1,508		635,743	29.68		7.99	299
$	30.10	—	$	56.77	3,118,935	44.48		9.46	—		108,682	45.87		8.02	—
$	57.95	—	$	65.34	1,085,000	58.07		9.55	—		—	—		—	—
					11,043,528	$	32.66	8.49	$	47,295	2,494,426	$	18.31	6.82	$	31,251

The following table summarizes additional information about stock options outstanding as of December 31, 2014:



					Options Outstanding						Options Exercisable
Range of Exercise Prices					Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Life (Years)	Aggregate Intrinsic Value		Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Life (Years)	Aggregate Intrinsic Value
$	0.39	—	$	9.67	1,747,494	$	6.49	6.25	$	36,772	1,293,184	$	6.07	5.90	$	27,746
$	15.39	—	$	22.77	2,603,300	21.74		9.32	15,084		57,000	19.77		9.05	442
$	24.73	—	$	28.69	260,750	26.21		9.74	363		8,250	28.25		8.63	1
$	29.95				1,000,000	29.95		9.21	—		—	—		—	—
$	30.72				2,712,000	30.72		9.22	—		90,000	30.72		9.22	—
					8,323,544	$	22.59	8.64	$	52,219	1,448,434	$	8.27	6.25	$	28,189

Intrexon currently uses authorized and unissued shares to satisfy share award exercises.

In October 2015, the Compensation Committee and the independent members of the Intrexon Board of Directors approved a compensation arrangement whereby the Company's Chief Executive Officer ("CEO") would receive a monthly salary. Previously, the CEO did not receive compensation for his services as an employee of the Company other than through his participation in the Company's Annual Executive Incentive Plan which became effective January 1, 2015 (Note 17). Pursuant to the compensation agreement, the CEO receives a base salary of $200 per month payable in fully-vested shares of Intrexon common stock with such shares subject to a three year lock-up on resale. The monthly number of shares of common stock is calculated based on the closing price on the last trading day of each month and the shares are issued pursuant to the terms of a Restricted Stock Unit Agreement (the "RSU Agreement") which was executed between Intrexon and the CEO pursuant to the terms of the 2013 Plan. The RSU Agreement became effective in November 2015, has an initial term of 12 months, and is renewable annually at the discretion of the Board of Directors of the Company. The fair value of the shares issued as compensation for services is included in selling, general, and administrative expenses in the Company's consolidated statement of operations for the year ended December 31, 2015 and totaled $314.

Prior to 2015, the CEO did not receive compensation for his services as CEO, and as a result, the Company recorded $1,991 and $1,550 in compensation expense for the years ended December 31, 2014 and 2013, respectively, based on the estimated salary and benefits appropriate for the role.

Other Plans

As of December 31, 2015, there were 5,382,000 options, which are exercisable into shares of AquaBounty common stock, outstanding under the AquaBounty 2006 Equity Incentive Plan at a weighted average exercise price of $0.26 per share of which 4,320,333 were exercisable. As of December 31, 2014, there were 7,347,000 options outstanding under the AquaBounty 2006 Equity Incentive Plan at a weighted average exercise price of $0.31 per share of which 6,171,520 were exercisable.