11. Stock-Based Compensation

Stock based compensation has been reported within the following expense line items on the consolidated statement of operations for the years ended 2016 and 2017, as shown in the following table (in thousands):

	Year Ended December 31, 2016			Year Ended December 31, 2017
Research and development		$	305		$	72
General and administrative			477			194
Stock-based compensation costs before income taxes		$	782		$	266

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 458,753 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.

During 2016, the Company granted 197,841 options to employees and directors with a grant date fair value of approximately $0.7 million. Of these options, 189,091 are performance based, which will vest upon the fulfilment 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 throughout 2016 and 2017 and, as a result, did not record any expense related to these awards for the years ended December 31, 2016 and 2017.

There were 170,853 options granted during the year ended December 31, 2017. Of these options, 158,853 are performance based, which will vest upon the fulfillment of certain clinical conditions. The Company determined that the satisfaction of one of the conditions was probable as of December 31, 2017, but that the other vesting criteria related to these awards were not probable as of December 31, 2017. As such, the Company recognized compensation cost for these grants under the expectation that 25% of these awards will vest.

The weighted average grant-date fair values of options granted during the years ended December 31, 2016 and 2017 were $3.66 and $1.59, respectively.

As of December 31, 2017, the total remaining unrecognized compensation cost related to the non-vested stock options with service conditions amounted to approximately $0.2 million, which will be amortized over the weighted-average remaining requisite service period of 0.9 years.

During the years ended December 31, 2016 and 2017, the Company did not settle any equity instruments with cash.

There were no stock option exercises during the years ended 2016 and 2017. No income tax benefits were recorded for the years ended December 31, 2016 and 2017 because the Company has accumulated net operating losses for tax purposes and is not likely to benefit from any deductions associated with exercises of granted option awards.

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 ($000s)
Options outstanding at December 31, 2015		206,298		$	72.60		8.09		$	—
Granted		197,841		$	4.68
Exercised		—
Cancelled/forfeited		(14,760)		$	396.83
Options outstanding at December 31, 2016		389,379		$	25.80		5.83		$	121
Granted		170,853		$	1.93
Exercised		—
Cancelled/forfeited		(24,615)		$	179.92
Options outstanding at December 31, 2017		535,617		$	11.10		8.23		$	—
Unvested at December 31, 2017		386,682		$	3.64		8.84		$	—
Vested and exercisable at December 31, 2017		148,755		$	30.49		6.65		$	—