Share-Based Payments

9 Months Ended

Sep. 30, 2016

10. Share-Based Payments

The Company has adopted the Supernus Pharmaceuticals, Inc. 2012 Equity Incentive Plan (the 2012 Plan), which is stockholder approved, and provides for the grant of stock options and certain other awards, including stock appreciation rights (SAR), restricted and unrestricted stock, stock units, performance awards, cash awards and other awards that are convertible into or otherwise based on the Company’s common stock, to the Company’s key employees, directors, and consultants and advisors. The 2012 Plan is administered by the Company’s Board of Directors and provides for the issuance of up to 8,000,000 shares of the Company’s common stock upon the exercise of stock awards. Option awards are granted with an exercise price equal to the estimated fair value of the Company’s common stock at the grant date. Those option awards generally vest in four annual installments, starting on the first anniversary of the date of grant and have ten year contractual terms. Option awards granted to the directors generally vest over a one-year-term. Share-based compensation recognized related to the grant of employee and non-employee stock options, SAR, potential Employee Stock Purchase Plan (ESPP) awards and non-vested stock was as follows, in thousands:

	Three Months ended September 30,				Nine Months ended September 30,
	2016		2015		2016		2015
	(unaudited)				(unaudited)

Research and development	$	253	$	236	$	882	$	646
Selling, general and administrative	1,230		896		3,572		2,365

Total	$	1,483	$	1,132	$	4,454	$	3,011

The following table summarizes stock option and SAR activity:

	Number of Options		Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)

Outstanding, December 31, 2015	2,699,007		$	8.94	7.92
Granted (unaudited)	1,036,600		13.12
Exercised (unaudited)	(74,882	)	6.24
Forfeited or expired (unaudited)	(26,575	)	12.41

Outstanding, September 30, 2016 (unaudited)	3,634,150		$	10.16	7.82


As of December 31, 2015:
Vested and expected to vest	2,654,381		$	8.93	7.90
Exercisable	901,672		$	7.95	6.86

As of September 30, 2016:
Vested and expected to vest (unaudited)	3,571,887		$	10.13	7.80
Exercisable (unaudited)	1,494,199		$	8.59	6.74

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

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