9. Stock Option and Compensation Plans

The Company adopted its 2007 Stock Incentive Plan (the “2007 Plan”) for employees, non-employee directors and consultants for the purpose of advancing the interests of the Company’s stockholders by enhancing its ability to attract, retain and motivate persons who are expected to make important contributions to the Company. The 2007 Plan provided for the granting of stock option awards, RSUs, and other stock-based and cash-based awards. Following the effectiveness of the 2013 Stock Incentive Plan described below in connection with the closing of the Company’s initial public offering, the Company is no longer granting additional awards under the 2007 Plan.

In August 2013, the Company’s board of directors adopted and the Company’s stockholders approved the 2013 stock incentive plan (the “2013 Plan”), which became effective immediately prior to the closing of the Company’s initial public offering. In June 2015, the Company’s board of directors adopted a first amendment to the 2013 Plan. The 2013 Plan provides for the grant of incentive stock options, nonstatutory stock options, stock appreciation rights, RSUs, restricted stock awards and other stock-based awards. Upon the effectiveness of the 2013 Plan, the number of shares of the Company’s common stock that were reserved for issuance under the 2013 Plan was the sum of (1) such number of shares (up to approximately 3,359,641 shares) as is equal to the sum of 739,317 shares (the number of shares of the common stock then available for issuance under the 2007 Plan), and such number of shares of the Company’s common stock that are subject to outstanding awards under the 2007 Plan that expire, terminate or are otherwise surrendered, canceled, forfeited or repurchased by the Company at their original issuance price pursuant to a contractual repurchase right plus (2) an annual increase, to be added the first business day of each fiscal year, beginning with the fiscal year ending December 31, 2014 and continuing until, and including, the fiscal year ending December 31, 2023, equal to the lowest of 2,542,372 shares of the Company’s common stock, 4% of the number of shares of the Company’s common stock outstanding on the first day of the fiscal year and an amount determined by its board of directors. The Company’s employees, officers, directors, consultants and advisors are eligible to receive awards under the 2013 Plan. However, incentive stock options may only be granted to employees of the Company.

Annual increases under the evergreen provisions of the 2013 Plan have resulted in the addition of an aggregate of approximately 5,454,000 additional shares to the 2013 Plan, including for 2017, an increase of approximately 1,429,000 shares, or 4% of the total number of shares of the Company's common stock outstanding as of January 1, 2017. As of June 30, 2017, the Company had approximately 1,927,000 shares available for grant under the 2013 Plan.

In April 2016, the board of directors adopted the ESPP pursuant to which the Company may sell up to an aggregate of 1,000,000 shares of common stock. The ESPP was approved by the Company’s stockholders in June 2016. The ESPP allows eligible employees to purchase common stock at a price per share equal to 85% of the lower of the fair market value of the common stock at the beginning or end of each six month offering period during the term of the ESPP. The first offering period began in September 2016.

A summary of the stock option activity, weighted average exercise prices, options outstanding and exercisable as of June 30, 2017 is as follows:



	Common Stock Options		Weighted Average Exercise Price

Outstanding, December 31, 2016	3,359		$	39.92
Granted	1,231		$	4.33
Exercised	(20	)	$	1.64
Expired or forfeited	(765	)	$	41.96
Outstanding, June 30, 2017	3,805		$	28.18

Options exercisable at June 30, 2017			1,831
Weighted average grant date fair value (per share) of options granted during the period			$	3.00

As of June 30, 2017, there were approximately 3,537,000 options outstanding, net of estimated forfeitures, that had vested or are expected to vest. The weighted average exercise price of these options was $28.73 per option; the weighted average remaining contractual life of these options was 7.7 years; and the aggregate intrinsic value of these options was approximately $0.1 million. A summary of the stock options outstanding and exercisable as of June 30, 2017 is as follows:



			As of June 30, 2017
			Options Outstanding			Options Exercisable
Range of Exercise Prices	Total Options Outstanding		Weighted Average Remaining Life (Years)	Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price

$0.12-$10.03	1,346		9.0	$	4.72	181		$	7.25
$10.04-$20.00	255		6.0	$	13.46	196		$	13.51
$20.01-$30.00	127		6.4	$	25.13	112		$	25.12
$30.01-$40.00	910		6.1	$	32.70	779		$	32.84
$40.01-$55.00	754		8.0	$	46.43	390		$	45.83
$55.01-$73.22	413		8.5	$	71.41	173		$	70.78
	3,805		7.8	$	28.18	1,831		$	34.12

Aggregate Intrinsic Value	$	83				$	78

Cash proceeds from, and the aggregate intrinsic value of, stock options exercised during the three and six months ended June 30, 2017 and 2016, respectively, were as follows:



	Three months ended June 30,				Six months ended June 30,
	2017		2016		2017		2016

Cash proceeds from options exercised	$	15	$	3,039	$	46	$	3,808
Aggregate intrinsic value of options exercised	$	6	$	5,206	$	43	$	7,421

In connection with stock option awards granted to employees, the Company recognized approximately $3.6 million and $5.5 million in share-based compensation expense during the three months ended June 30, 2017 and 2016, respectively, net of expected forfeitures. In connection with stock option awards granted to employees, the Company recognized approximately $8.0 million and $11.6 million in share-based compensation expense during the six months ended June 30, 2017 and 2016, respectively, net of expected forfeitures. As of June 30, 2017, there were approximately $19.6 million of unrecognized compensation costs, net of estimated forfeitures, related to stock option awards granted to employees, which are expected to be recognized over a remaining weighted average period of 2.3 years.

In connection with stock option awards granted to consultants, the Company recognized approximately $0.1 million and $0.5 million in share-based compensation expense during the three months ended June 30, 2017 and 2016, respectively, net of expected forfeitures. In connection with stock option awards granted to consultants, the Company recognized approximately $0.2 million and $0.9 million in share-based compensation expense during the six months ended June 30, 2017 and 2016, respectively, net of expected forfeitures. As of June 30, 2017, there were approximately $0.3 million of unrecognized compensation costs, net of estimated forfeitures, related to stock option awards granted to consultants, which are expected to be recognized over a remaining weighted average period of 2.1 years.

The following table presents a summary of the Company’s outstanding RSU awards granted as of June 30, 2017:



	Restricted Stock Units		Weighted Average Grant-Date Fair Value

Outstanding, December 31, 2016	721		$	55.33
Awarded	248		$	4.42
Vested	(174	)	$	31.75
Forfeited	(260	)	$	50.32
Outstanding, June 30, 2017	535		$	38.03

As of June 30, 2017, there were approximately 365,000 RSUs outstanding, net of estimated forfeitures, that are expected to vest. The weighted average fair value of these RSUs was $31.83 per share; and the aggregate intrinsic value of these RSUs was approximately $0.9 million.

In connection with RSUs granted to employees, the Company recognized approximately $1.3 million and $2.3 million in share-based compensation expense during the three months ended June 30, 2017 and 2016, respectively, net of expected forfeitures. In connection with RSUs granted to employees, the Company recognized approximately $2.6 million and $4.1 million in share-based compensation expense during the six months ended June 30, 2017 and 2016, respectively, net of expected forfeitures. As of June 30, 2017, there were approximately $8.9 million of unrecognized compensation costs, net of estimated forfeitures, related to RSUs granted to employees, which are expected to be recognized over a remaining weighted average period of 2.4 years.

In connection with RSUs granted to consultants, the Company recognized a de minimis amount of share-based compensation expense during the three months ended June 30, 2017, net of expected forfeitures. In connection with RSUs granted to consultants, the Company recognized $0.1 million of share-based compensation expense during the six months ended June 30, 2017, net of expected forfeitures. There were no RSUs granted to consultants during the three and six months ended June 30, 2016. As of June 30, 2017, there were approximately $0.1 million of unrecognized compensation costs, net of estimated forfeitures, related to RSUs granted to consultants, which are expected to be recognized over a remaining weighted average period of 2.2 years.

In connection with the ESPP made available to employees, the Company recognized a de minimis amount of share-based compensation expense during the three months ended June 30, 2017. In connection with the ESPP made available to employees, the Company recognized $0.1 million of share-based compensation expense during the six months ended June 30, 2017. The Company did not recognize any share-based compensation expense during the three and six months ended June 30, 2016. As of June 30, 2017, there was a de minimis amount of unrecognized compensation costs, net of estimated forfeitures, related to the ESPP, which are expected to be recognized over 0.3 years. Additionally, there were 4,746 shares of common stock issued under the ESPP during the six months ended June 30, 2017. There were no shares of common stock issued under the ESPP plan during the six months ended June 30, 2016. As of June 30, 2017, 995,254 shares were available for future purchases under the ESPP.