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Stock Based Compensation
 3 Months Ended
Mar. 31, 2017
Disclosure Of Compensation Related Costs Share-Based Payments [Abstract]  
Stock Based Compensation
6. Stock Based Compensation

 

ASC 718 requires compensation expense associated with share-based awards to be recognized over the requisite service period, which for the Company is the period between the grant date and the date the award vests or becomes exercisable. Most of the awards granted by the Company (and still outstanding) vest ratably over one to four years. The Company recognizes all share-based awards under the straight-line attribution method, assuming that all granted awards will vest. Forfeitures will be recognized in the periods when they occur.

 

Stock based compensation has been reported within expense line items on the consolidated statement of operations for the three months ended March 31, 2016 and 2017 as shown in the following table (in $000s):

   

    Three Months Ended
March 31,		  
    2016     2017  
General and administrative   $ 142     $ 50  
Research and development     79       19  
Stock-based compensation costs before income taxes   $ 221     $ 69  

 

2015 Plan

 

On May 22, 2015, the Company’s stockholders approved the 2015 Equity Incentive Plan (the “2015 Plan”), under which Cyclacel may make equity incentive grants to its officers, employees, directors and consultants. The company has reserved 291,667 shares of the Company’s common stock under the 2015 Plan. The 2015 Plan replaces the 2006 Equity Incentive Plan (the “2006 Plan”), under which there were no remaining reserved shares to be granted. Stock option awards granted under the Company’s equity incentive plans have a maximum life of 10 years and generally vest over a one to four-year period from the date of grant.

 

There were no options granted during the three months ended March 31, 2017. 

 

In 2016, 189,091 options were granted that are performance based. These options will vest upon the fulfillment of certain clinical conditions and will terminate if they have not vested by December 31, 2020. The Company determined that the satisfaction of the vesting criteria was not probable as of March 31, 2017 and, as a result, did not record any expense related to these awards for the three months ended March 31, 2017.

 

There were no stock options exercised during each of the three months ended March 31, 2016 and 2017, respectively. The Company does not expect to be able to benefit from the deduction for stock option exercises that may occur during the year ended December 31, 2017 because the company has tax loss carryforwards from prior periods that would be expected to offset any potential taxable income for the year ended December 31, 2017.

 

Outstanding Options

 

A summary of the share option activity and related information is as follows:

 

    Number of
Options
Outstanding		     Weighted
Average
Exercise
Price Per Share		     Weighted
Average
Remaining
Contractual
Term (Years)		     Aggregate
Intrinsic
Value ($000)		  
Options outstanding at December 31, 2016     389,379       25.80       5.83       121  
Granted     -       -                  
Cancelled/forfeited     (1,860 )     655.18                  
Options outstanding at March 31, 2017     387,519       22.78       5.61       —  
Unvested at March 31, 2017     (258,124 )     5.28       5.08       —  
Vested and exercisable at March 31, 2017     129,395       57.68       6.68       —  

 

The fair value of the stock options granted is calculated using the Black-Scholes option-pricing model as prescribed by ASC 718.