Quarterly report pursuant to Section 13 or 15(d)

Equity Incentive Plan

v3.2.0.727
Equity Incentive Plan
 6 Months Ended
Jun. 30, 2015
Share Based Compensation Option And Incentive Plan [Abstract]  
Shareholders' Equity and Share-based Payments [Text Block]
11. Equity Incentive Plan
 
In 2005, the Company approved the 2005 Equity Incentive Plan (the “2005 Plan”). The 2005 Plan provides for the granting of options, restricted stock or other stock-based awards to employees, officers, directors, consultants and advisors. During 2010, the maximum number of common shares that may be issued pursuant to the 2005 Plan was increased to 891,222 shares. The Board is responsible for administration of the 2005 Plan. The Board determines the term of each option, the option exercise price, the number of shares for which each option is granted and the rate at which each option is exercisable. Incentive stock options may be granted to any officer or employee at an exercise price per share of not less than the fair value per common share on the date of the grant (not less than 110% of fair value in the case of holders of more than 10% of the Company’s voting stock) and with a term not to exceed ten years from the date of the grant (five years for incentive stock options granted to holders of more than 10% of the Company’s voting stock). Nonqualified stock options may be granted to any officer, employee, consultant or director at an exercise price per share of not less than the par value per share.
 
The Company’s Board adopted the 2014 Equity Incentive Plan, or the (“2014 Plan”) and the Employee Stock Purchase Plan the (“ESPP”), and the Company’s stockholders approved the 2014 Plan and the ESPP Plan in February 2015. The maximum number of Common Shares that may be issued pursuant to the 2014 Plan and the ESPP is 728,597 and 70,567, respectively.
 
The following is a summary of stock option activity for the six months ended June 30, 2015:
 
 
 
 
 
Weighted- Average
 
Weighted-Average
 
 
 
Number of Options
 
Exercise Price
 
Contractual Life (In Years)
 
Outstanding at beginning of year
 
 
752,372
 
$
0.91
 
 
4.55
 
Granted
 
 
435,393
 
 
5.80
 
 
9.63
 
Exercised
 
 
(23,075)
 
$
0.65
 
 
 
 
Expired (Forfeited)
 
 
(8,600)
 
$
0.65
 
 
 
 
Outstanding at end of period
 
 
1,156,090
 
$
2.69
 
 
4.84
 
Exercisable at end of period
 
 
841,031
 
$
2.70
 
 
4.75
 
Vested and expected to vest at end of period
 
 
841,031
 
$
2.70
 
 
4.75
 
 
No options were granted in 2014. In September 2014, the Company entered into two consulting arrangements that provided for 60,358 shares of common stock options issuable in connection with the Company’s IPO in February 2015.
 
The total stock-based compensation expense for employees and non-employees is included in the accompanying consolidated statements of operations and as follows:
 
 
 
Six months Ended
 
 
 
June 30,
 
 
 
2015
 
2014
 
Research and development
 
$
202,191
 
$
8,949
 
General and administrative
 
 
573,104
 
 
15,140
 
 
 
$
775,295
 
$
24,089
 
 
As of June 30, 2015, there is approximately $832,000 of total unrecognized compensation expense related to unvested stock-based compensation arrangements granted. That cost is expected to be recognized over a weighted average period of 3.38 years. The intrinsic value of stock options outstanding and exercisable at June 30, 2015 is approximately $1,537,000. The intrinsic value of the stock options exercised during 2015 was approximately $123,000.
 
At June 30, 2015 there were 445,771 options available under the 2005 and 2014 Plans. On May 1, 2015 the Board approved the issuance of 125,412 restricted shares under the 2014 Plan to two executives and seven members of the Board. The restricted shares vest 13 % on the issuance date and 29% on each of the following-June 30, 2015, September 30, 2015 and December 31, 2015.