NOTE 4 – STOCK-BASED COMPENSATION

The following table shows total stock-based compensation expense recognized in the accompanying consolidated statements of operations (in thousands):


	Year Ended December 31,
	2017		2016		2015
Research and development	$	5,031	$	6,463	$	6,444
General and administrative		4,058		8,594		5,286
Total stock-based compensation expense	$	9,089	$	15,057	$	11,730

As of December 31, 2017, total stock-based compensation expense related to unvested stock options to be recognized in future periods was $16.1 million, which is expected to be expensed over a weighted-average period of 2.79 years. As of December 31, 2017, total stock-based compensation expense related to unvested RSUs to be recognized in future periods was $0.7 million, which is expected to be expensed over a weighted-average period of 1.03 years. There was no capitalized stock-based employee compensation expense as of either December 31, 2017, 2016 or 2015 respectively.

Valuation Assumptions

Employee stock-based compensation expense was determined using the Black-Scholes option valuation model. Option valuation models require the input of subjective assumptions and these assumptions can vary over time.

The Company bases its determination of expected volatility through its assessment of the historical volatility of its common stock. The Company relied on its historical exercise and post-vested termination activity for estimating its expected term for use in determining the fair value of these options.

The weighted-average estimated fair value per share of options granted during 2017, 2016 and 2015 was $4.10, $3.14, and $5.72, respectively, based upon the assumptions used in the Black-Scholes valuation model. The assumptions used for estimating the fair value of the employee stock options are as follows:

	Year Ended December 31,
	2017			2016			2015
Risk-free interest rate	1.81-2.28%			1.13-1.61%			1.46-1.58%
Expected life of option (in years)	5.73-5.83			5.28-5.29			5.25-5.31
Expected dividend yield of stock		0	%		0	%		0	%
Expected volatility	0.71-0.72			0.68-0.70			0.66-0.67

Employees purchased approximately 253,994, 202,711 and 128,181 shares of common stock through the 2010 Employee Stock Purchase Plan at an average exercise price of $3.22, $4.04, and $7.10 per share during 2017, 2016 and 2015, respectively. The weighted-average estimated fair value of shares purchased under the Company’s ESPP during 2017, 2016 and 2015 were $2.37, $2.27 and $4.42, respectively based upon the assumptions used in the Black-Scholes valuation model.

The weighted–average assumptions used for estimating the fair value of the ESPP purchase rights are as follows:

	Year Ended December 31,
	2017			2016			2015
Risk-free interest rate	0.44-0.76%			0.41-0.80%			0.06-0.33%
Expected life of option (in years)	0.5-2.0			0.5-2.0			0.5-2.0
Expected dividend yield of stock		0	%		0	%		0	%
Expected volatility	0.66-0.82			0.71-0.76			0.55-0.70