14. STOCK INCENTIVE PLANS

Stock Options and Restricted Stock Units

The following table summarizes option and unvested RSU activity under the Company’s 2014 Equity Incentive Plan and 2016 Inducement Plan and related information:

	Shares Available for Grant			Stock Options Outstanding			Weighted- Average Exercise Price		Number of RSU Shares			Weighted- Average Grant Date Fair Value
Balance—December 31, 2017		156,429			1,941,473		$	4.21		439,926		$	4.39
Additional options authorized		357,075			—			—		—			—
Restricted stock grants		(8,846	)		—			—		—			—
RSUs granted		(78,934	)		—			—		78,934			6.31
RSUs forfeited		7,500			—			—		(7,500	)		5.20
RSUs vested		—			—			—		(69,556	)		4.24
Options granted		(159,534	)		159,534			3.61		—			—
Options exercised		—			(141,387	)		0.57		—			—
Options forfeited		17,792			(17,792	)		4.58		—			—
Options expired		1,817			(1,817	)		3.55		—			—
Balance—March 31, 2018		293,299			1,940,011		$	4.64		441,804		$	4.79

The total intrinsic value of options exercised was $0.7 million in the three months ended March 31, 2018.

As of March 31, 2018, the total intrinsic value of outstanding RSUs was approximately $0.8 million and there were $1.6 million of unrecognized compensation costs related to RSUs, which are expected to be recognized over a weighted-average period of 2.17 years.

As of March 31, 2018, the total intrinsic value of outstanding options was approximately $3.2 million and there were $1.9 million of unrecognized compensation costs related to options, which are expected to be recognized over a weighted-average period of 6.85 years.

Options outstanding that have vested and are expected to vest at March 31, 2018 are as follows:

	Number of Shares Issued		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value (In Thousands)
Vested		927,362	$	4.89		6.85	$	3,022
Expected to vest		894,857		4.41		8.22		3,188
Total		1,822,219					$	6,210

2014 Employee Stock Purchase Plan

During the offering period in 2017 that ended on December 31, 2017, 34,176 shares were purchased for aggregate proceeds of $0.1 million from the issuance of shares, which occurred on January 4, 2018. During the offering period in 2017 that ended on June 30, 2017, 52,612 shares were purchased for aggregate proceeds of $0.1 million from the issuance of shares, which occurred on July 5, 2017.

Valuation Assumptions

The estimated fair values of employee stock options and ESPP shares were estimated using the Black-Scholes option-pricing model based on the following weighted-average assumptions:

	Three Months Ended March 31,
	2018			2017
Employee stock options
Expected term (in years)		6.0			6.0
Expected volatility		79.96	%	53.07%-53.36%
Risk-free interest rate		2.51	%	2.08%-2.12%
Expected dividend yield		—	%		—	%
Employee stock purchase plan
Expected term (in years)		0.5			0.5
Expected volatility		105.32	%		62.27	%
Risk-free interest rate		1.61	%		0.65	%
Expected dividend yield		—	%		—	%

Risk-free Interest Rate: The Company based the risk-free interest rate over the expected term of the award based on the constant maturity rate of U.S. Treasury securities with similar maturities as of the date of grant.

Volatility: The Company used an average historical stock price volatility of comparable public companies that were deemed to be representative of future stock price trends as the Company does not have sufficient trading history for its common stock.

Expected Term: The expected term represents the period for which the Company’s stock-based awards are expected to be outstanding and is based on analyzing the vesting and contractual terms of the awards and the holders’ historical exercise patterns and termination behavior.

Expected Dividends: The Company has not paid and does not anticipate paying any dividends in the near future.

Stock-based Compensation Expense

The following table summarizes stock-based compensation expense relating to employee and nonemployee stock options, RSUs and ESPP shares for the three months ended March 31, 2018 and 2017, included in the statements of operations as follows (in thousands):

	Three Months Ended March 31,
	2018		2017
Cost of testing	$	61	$	55
Research and development		213		64
Sales and marketing		64		38
General and administrative		368		234
Total	$	706	$	391

No tax benefit was recognized related to share-based compensation expense since the Company has never reported taxable income and has established a full valuation allowance to offset all of the potential tax benefits associated with its deferred tax assets. In addition, no amounts of stock-based compensation were capitalized for the periods presented.