9. Stock Based Awards

Equity Incentive Plans

The Company adopted an equity incentive plan (the “2007 Plan”) in 2007 under which 53,599,046 shares of common stock have been reserved for issuance to employees, nonemployee directors and consultants of the Company. Recipients of incentive stock options shall be eligible to purchase shares of the Company’s common stock at an exercise price equal to no less than the estimated fair market value of such stock on the date of grant. The maximum term of options granted under the 2007 Plan is ten years. The options generally vest 25% after one year, with the balance vesting monthly over the remaining three years. As of December 31, 2016, 1,638,000 shares remain under this plan.

The Company adopted a second equity incentive plan (the “2015 Plan”) in 2015 under which 50,000,000 shares of common stock have been reserved for issuance to employees, directors and consultants of the Company. Recipients of incentive stock options shall be eligible to purchase shares of the Company’s common stock at an exercise price equal to no less than the estimated fair market value of such stock on the date of grant. The maximum term of options granted under the 2015 Plan is ten years. The options generally vest 25% after one year, with the balance vesting monthly over the remaining three years. As of December 31, 2016, 46,730,000 shares of common stock remain available for future grant under the 2015 Plan.

The following table summarizes stock option transactions for the 2007 and 2015 Plans for the year ended December 31, 2016 (amounts in thousands, except per share amounts):

 The Company recognizes compensation expense using a fair-value-based method for costs related to stock-based payments, including stock options. The fair value of options awarded to employees is measured on the date of grant using the Black-Scholes option pricing model and is recognized as expense over the requisite service period on a straight-line basis. The Black-Scholes option pricing model includes the following weighted average assumptions:

The Company did not grant any options during the year ended December 31, 2016. During 2015, the Company granted 21,970,000 options under the 2015 Plan and 1,750,000 under the 2007 Plan with exercise prices ranging from $0.70 to $1.17 per share. In the merger with RFS Pharma during 2014, the Company issued 16,542,538 options with a weighted average exercise price of $0.10 per share in exchange for RFS options then outstanding.  These were the only options issued in 2014.  The weighted average fair value of options granted during 2014 was $0.45. Exercise prices under the 2015 Plan reflect the market price of Cocrystal Pharma, Inc. stock on the grant date.

The Company uses historical data to estimate forfeitures at the time of grant and is required to record stock-based compensation only for those awards that are expected to vest. The Company has assumed a zero-forfeiture rate in the valuation of awarded stock options. The Company recorded employee stock-based compensation expense of $548,000 and $2,934,000 for the years ended December 31, 2016 and 2015, respectively.

As of December 31, 2016, there was $1,725,000 of total unrecognized compensation expense related to non-vested employee stock options that is expected to be recognized over a weighted average period of 2.2 years. For options granted and outstanding, there were 24,351,000 options outstanding which were fully vested or expected to vest, with an aggregate intrinsic value of $5,589,000 and a weighted average remaining contractual term of 6.0 years at December 31, 2016. For vested and exercisable options, outstanding shares totaled 21,323,860, with an aggregate intrinsic value of $5,286,000. These options had a weighted-average exercise price of $0.22 per share and a weighted-average remaining contractual term of 5.4 years at December 31, 2016.

The aggregate intrinsic value of outstanding and exercisable options at December 31, 2016 was calculated based on the closing price of the Company’s common stock as reported on the Over-the-Counter Bulletin Board and the OTCQx markets on December 31, 2016 of approximately $0.39 per share less the exercise price of the options. The aggregate intrinsic value is calculated based on the positive difference between the closing fair market value of the Company’s common stock and the exercise price of the underlying options.

Common Stock Reserved for Future Issuance

The following table present information concerning common stock available for future issuance (in thousands):