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<div> <div style="margin-left:0pt;margin-right:0pt;"> 8. Stock Incentive Plans   The following table summarizes activity under the Company’s stock option plans (aggregate intrinsic value in thousands):   <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 93.00%;margin-left:18pt;"> <tr> <td valign="bottom" style="width:37.88%;padding:0pt;">   </td> <td valign="bottom" style="width:00.52%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Shares  Available for  Grant </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Stock  Options  Outstanding </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Weighted  Average  Exercise  Price </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Weighted  Average  Remaining  Contractual  Life (Years) </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Aggregate  Intrinsic  Value </td> <td valign="bottom" style="width:00.90%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:37.88%;background-color: #CCEEFF;padding:0pt;"> Balance - December 31, 2014 </td> <td valign="bottom" style="width:00.52%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,341,252 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>3,249,469 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.80%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>7.59 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>7.88 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.80%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>12,400 </td> <td valign="bottom" style="width:00.90%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:37.88%;padding:0pt;"> Additional options authorized </td> <td valign="bottom" style="width:00.52%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>900,941 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;"> — </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:00.90%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:37.88%;background-color: #CCEEFF;padding:0pt;"> Granted </td> <td valign="bottom" style="width:00.52%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(1,204,300 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;"> ) </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,204,300 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>8.89 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:00.90%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:37.88%;padding:0pt;"> Canceled </td> <td valign="bottom" style="width:00.52%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>66,035 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(66,035 </td> <td valign="bottom" style="width:02.68%;"> ) </td> <td colspan="2" valign="bottom" style="width:10.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>9.48 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:00.90%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:37.88%;background-color: #CCEEFF;padding:0pt;"> Exercised </td> <td valign="bottom" style="width:00.52%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;"> — </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(164,467 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;"> ) </td> <td colspan="2" valign="bottom" style="width:10.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2.99 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:00.90%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:37.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:00.52%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:00.90%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:37.88%;padding:0pt;"> Balance - June 30, 2015 </td> <td valign="bottom" style="width:00.52%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,103,928 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>4,223,267 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.80%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>8.11 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>8.04 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.80%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>16,689 </td> <td valign="bottom" style="width:00.90%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:37.88%;padding:0pt;">   </td> <td valign="bottom" style="width:00.52%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;padding:0pt;">   </td> <td valign="bottom" style="width:08.80%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;padding:0pt;">   </td> <td valign="bottom" style="width:08.80%;padding:0pt;">   </td> <td valign="bottom" style="width:00.90%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:37.88%;background-color: #CCEEFF;padding:0pt;"> Options vested and exercisable - June 30, 2015 </td> <td valign="bottom" style="width:00.52%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,719,030 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.80%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>5.45 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>6.64 </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.80%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11,046 </td> <td valign="bottom" style="width:00.90%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:37.88%;padding:0pt;"> Options vested and expected to vest - June 30, 2015 </td> <td valign="bottom" style="width:00.52%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>4,223,243 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.80%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>8.11 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>8.04 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.78%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>16,689 </td> <td valign="bottom" style="width:00.90%;padding:0pt;">   </td> </tr> </table></div>   The aggregate intrinsic value was calculated as the difference between the exercise price of the options to purchase common stock and the fair market value of the Company’s common stock, which was $11.14 per share as of June 30, 2015.   The weighted average fair value of options to purchase common stock granted was $5.36 and $9.97 for the six months ended June 30, 2015 and 2014, respectively.   The weighted-average fair value of stock options exercised was $2.12 and $1.25 for the six months ended June 30, 2015 and 2014, respectively. The intrinsic value of stock options exercised was $1.2 million and $2.8 million for the six months ended June 30, 2015 and 2014.   Stock-based Compensation   The following table summarizes stock-based compensation expense related to stock options for the three and six months ended June 30, 2015 and 2014, and are included in the condensed consolidated statements of operations and comprehensive loss as follows (in thousands):   <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 93.00%;margin-left:18pt;"> <tr> <td valign="bottom" style="width:36.98%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:28.40%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Three Months Ended June 30, </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:28.40%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Six Months Ended June 30, </td> <td valign="bottom" style="width:00.88%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:36.98%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:00.88%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.98%;background-color: #CCEEFF;padding:0pt;"> Cost of revenue </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:11.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>15  </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:11.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>14  </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:11.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>32  </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:11.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>23  </td> <td valign="bottom" style="width:00.88%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.98%;padding:0pt;"> Research and development </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>342  </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>155  </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>595  </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>262  </td> <td valign="bottom" style="width:00.88%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.98%;background-color: #CCEEFF;padding:0pt;"> Selling and marketing </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>321  </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>192  </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>590  </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>285  </td> <td valign="bottom" style="width:00.88%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.98%;padding:0pt;"> General and administrative </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>811  </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>514  </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,495  </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>797  </td> <td valign="bottom" style="width:00.88%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.98%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:00.88%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.98%;background-color: #CCEEFF;padding:0pt;"> Total </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:11.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,489  </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:11.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>875  </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:11.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,712  </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:11.64%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,367  </td> <td valign="bottom" style="width:00.88%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.98%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:11.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:11.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:11.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.20%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:11.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:00.88%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> </table></div>   As of June 30, 2015, the Company had $13.6 million of unrecognized compensation expense related to unvested stock options, which is expected to be recognized over an estimated weighted-average period of 2.9 years.   The estimated grant date fair value of employee stock options was calculated using the Black-Scholes option-pricing model, based on the following assumptions:   <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 93.00%;margin-left:18pt;"> <tr> <td valign="bottom" style="width:36.82%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:28.40%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Three Months Ended June 30, </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:28.40%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Six Months Ended June 30, </td> <td valign="bottom" style="width:01.04%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:36.82%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:01.04%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.82%;background-color: #CCEEFF;padding:0pt;"> Weighted-average volatility </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 59.10 - 65.28% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 73.20-76.87% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 59.10 - 68.82% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 73.20 - 78.54% </td> <td valign="bottom" style="width:01.04%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.82%;padding:0pt;"> Weighted-average expected term (years) </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> 5.50 - 6.08 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> 5.50 - 6.08 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> 5.50 - 6.08 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> 5.50 - 6.08 </td> <td valign="bottom" style="width:01.04%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.82%;background-color: #CCEEFF;padding:0pt;"> Risk-free interest rate </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 1.58 - 2.03% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 1.66 - 2.00% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 1.55 - 2.03% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 1.66 - 2.00% </td> <td valign="bottom" style="width:01.04%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.82%;padding:0pt;"> Expected dividend yield </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> — </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> — </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> — </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> — </td> <td valign="bottom" style="width:01.04%;padding:0pt;">   </td> </tr> </table></div>   There were no stock options granted to non-employees during the six months ended June 30, 2015. The estimated grant-date fair value of stock options granted to non-employees during the six months ended June 30, 2014 was calculated using the Black-Scholes option-pricing model, based on the following assumptions: weighted-average volatility from 75.11% to 75.48%, weighted-average expected term from 8.44 years to 9.26 years, risk-free interest rate from 2.32% to 2.43%, and expected dividend yield of 0%.   </div> </div>

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<div> <div style="margin-left:0pt;margin-right:0pt;">   1. Organization and Summary of Significant Accounting Policies   Veracyte, Inc. (the “Company”) was incorporated in the state of Delaware in August 2006 as Calderome, Inc. Calderome operated as an incubator until early 2008. In March 2008, the Company changed its name to Veracyte, Inc. Veracyte is a diagnostics company pioneering the field of molecular cytology to improve patient outcomes and lower healthcare costs. The Company specifically targets diseases that often require invasive procedures for an accurate diagnosis—diseases where many healthy patients undergo costly interventions that ultimately prove unnecessary. The Company improves the accuracy of diagnosis at an earlier stage of patient care by deriving clinically actionable genomic information from cytology samples.   The Company’s first commercial solution, the Afirma® Thyroid FNA Analysis, includes as its centerpiece the Gene Expression Classifier (“GEC”). The GEC helps physicians reduce the number of unnecessary surgeries by employing a proprietary 142-gene signature to preoperatively determine whether thyroid nodules previously classified by cytopathology as indeterminate can be reclassified as benign. The comprehensive offering also includes cytopathology testing and the Afirma Malignancy Classifiers, launched in May 2014. The Company markets and sells Afirma through a co-promotion agreement with Genzyme Corporation, a subsidiary of Sanofi.   In September 2014, the Company acquired Allegro Diagnostics Corp. (“Allegro”) to accelerate its entry into pulmonology, the Company’s second planned clinical area. Allegro was focused on the development of genomic tests to improve the preoperative diagnosis of lung cancer.  In April 2015, the Company entered the lung cancer diagnostics market with the Percepta™ Bronchial Genomic Classifier, a new genomic test to resolve ambiguity in lung cancer diagnosis.   In April 2015, the Company received $37.3 million in net proceeds from the sale of its common stock in a private placement. See Note 7.   The Company’s operations are based in South San Francisco, California and Austin, Texas, and it operates in one segment in the United States.   Basis of Presentation   The accompanying interim period condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All intercompany accounts and transactions have been eliminated in consolidation. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The condensed consolidated balance sheet as of June 30, 2015, the condensed consolidated statements of operations and comprehensive loss and the condensed consolidated statements of cash flows for the three and six months ended June 30, 2015 and 2014, are unaudited, but include all adjustments, consisting only of normal recurring adjustments, which the Company considers necessary for a fair presentation of its financial position, operating results and cash flows for the periods presented. The condensed consolidated balance sheet at December 31, 2014 has been derived from audited financial statements. The results for the three and six months ended June 30, 2015 are not necessarily indicative of the results expected for the full fiscal year or any other period.   The accompanying interim period condensed consolidated financial statements and related financial information included in this Quarterly Report on Form 10-Q should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014.   Use of Estimates   The preparation of the unaudited interim consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Significant items subject to such estimates include: revenue recognition; contractual allowances; allowance for doubtful accounts; the useful lives of property and equipment; the recoverability of long-lived assets; stock options; income tax uncertainties, including a valuation allowance for deferred tax assets; and contingencies. The Company bases these estimates on historical and anticipated results, trends, and various other assumptions that the Company believes are reasonable under the circumstances, including assumptions as to future events. These estimates form the basis for making judgments about the carrying values of assets and liabilities and recorded revenue and expenses that are not readily apparent from other sources. Actual results could differ from these estimates and assumptions.   Concentrations of Credit Risk and Other Risks and Uncertainties   The Company’s cash and cash equivalents are deposited with one major financial institution in the United States, as required by the loan and security agreement discussed in Note 6. Deposits in this institution may exceed the amount of insurance provided on such deposits. The Company has not experienced any losses on its deposits of cash and cash equivalents.   Several of the components of the Company’s sample collection kit and test reagents are obtained from single-source suppliers. If these single-source suppliers fail to satisfy the Company’s requirements on a timely basis, it could suffer delays in being able to deliver its diagnostic solutions, a possible loss of revenue, or incur higher costs, any of which could adversely affect its operating results.   The Company is also subject to credit risk from its accounts receivable related to its sales of Afirma. The Company generally does not perform evaluations of customers’ financial condition and generally does not require collateral.   Through June 30, 2015, all of the Company’s revenues have been derived from the sale of Afirma. To date, Afirma has been delivered primarily to physicians in the United States. The Company’s third-party payers in excess of 10% of revenue and their related revenue as a percentage of revenue were as follows:   <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 80.00%;margin-left:54pt;"> <tr> <td valign="bottom" style="width:26.28%;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:33.12%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Three Months Ended June 30, </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:33.12%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Six Months Ended June 30, </td> <td valign="bottom" style="width:01.24%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:26.28%;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:01.24%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:26.28%;background-color: #CCEEFF;padding:0pt;"> Medicare </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>28  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>27  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>26  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>28  </td> <td valign="bottom" style="width:01.24%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.28%;padding:0pt;"> Aetna </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>9  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>12  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>9  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11  </td> <td valign="bottom" style="width:01.24%;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.28%;background-color: #CCEEFF;padding:0pt;"> UnitedHealthcare </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>14  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>16  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>14  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>16  </td> <td valign="bottom" style="width:01.24%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.24%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:26.28%;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>51  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>55  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>49  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>55  </td> <td valign="bottom" style="width:01.24%;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.28%;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:01.24%;padding:0pt;">   </td> </tr> </table></div>   As the number of payers reimbursing for Afirma increases, the percentage of revenue derived from Medicare and other significant third-party payers has changed and will continue to change as a percentage of revenue.   The Company’s significant third-party payers and their related accounts receivable balance at June 30, 2015 and December 31, 2014 as a percentage of total accounts receivable are as follows:   <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 60.00%;margin-left:54pt;"> <tr> <td valign="bottom" style="width:49.94%;padding:0pt;">   </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;padding:0pt;"> June 30, </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;padding:0pt;"> December 31, </td> <td valign="bottom" style="width:01.68%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:49.94%;padding:0pt;">   </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:01.68%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:49.94%;padding:0pt;">   </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;padding:0pt;">   </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;padding:0pt;">   </td> <td valign="bottom" style="width:01.68%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:49.94%;background-color: #CCEEFF;padding:0pt;"> Medicare </td> <td valign="bottom" style="width:04.18%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>30  </td> <td valign="bottom" style="width:04.18%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:20.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>64  </td> <td valign="bottom" style="width:01.68%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:49.94%;padding:0pt;"> Aetna </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>25  </td> <td valign="bottom" style="width:04.18%;padding:0pt;"> % </td> <td valign="bottom" style="width:20.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>12  </td> <td valign="bottom" style="width:01.68%;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:49.94%;background-color: #CCEEFF;padding:0pt;"> UnitedHealthcare </td> <td valign="bottom" style="width:04.18%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>28  </td> <td valign="bottom" style="width:04.18%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:20.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>14  </td> <td valign="bottom" style="width:01.68%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> </table></div>   No other third-party payer represented more than 10% of the Company’s accounts receivable balances at those dates.   Cash Equivalents   Cash equivalents consist of amounts invested in a money market account primarily consisting of U.S. Treasury reserves.   Restricted Cash   The Company had deposits of $118,000 as of June 30, 2015 and December 31, 2014, restricted from withdrawal and held by a bank in the form of collateral for irrevocable standby letters of credit totaling $118,000 held as security for the lease of the Company’s headquarters and laboratory facilities in South San Francisco that expires March 31, 2016. This restricted cash is included in current assets as of June 30, 2015 and in long-term assets as of December 31, 2014 on the Company’s condensed consolidated balance sheets.  The Company also had deposits of $603,000 included in long-term assets as of June 30, 2015, restricted from withdrawal and held by a bank in the form of collateral for an irrevocable standby letter of credit totaling $603,000 held as security for the lease of the Company’s new headquarters and laboratory facilities in South San Francisco signed on April 29, 2015.   The Company reserved $70,000 in cash as of December 31, 2014 to cover liabilities associated with the acquisition of Allegro. This amount was paid in March 2015. This restricted cash was included in current assets on the Company’s condensed consolidated balance sheet at December 31, 2014.   Allowance for Doubtful Accounts   The Company estimates an allowance for doubtful accounts against its individual accounts receivable based on estimates of expected reimbursement consistent with historical payment experience in relation to the amounts billed. Bad debt expense is included in general and administrative expense on the Company’s statements of operations and comprehensive loss. Accounts receivable are written off against the allowance when there is substantive evidence that the account will not be paid.   The balance of allowance for doubtful accounts as of June 30, 2015 and December 31, 2014 was $92,000 and $84,000, respectively.  Bad debt expense was $32,000 and $54,000 for the three and six months ended June 30, 2015, respectively, and $11,000 and $39,000 for the three and six months ended June 30, 2014, respectively.  Write offs for doubtful accounts of $26,000 and $46,000 were recorded against the allowance during the three and six months ended June 30, 2015, respectively.  Write offs for doubtful accounts of $34,000 were recorded against the allowance during the three and six months ended June 30, 2014.   Supplies Inventory   Supplies inventory consists of test reagents and other consumables used in the sample collection kits and in cytopathology and GEC test processing and are valued at the lower of cost or market value. Cost is determined using actual costs on a first-in, first-out basis.   Property and Equipment   Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally between three and five years. Leasehold improvements are amortized using the straight-line method over the shorter of the estimated useful life of the asset or the term of the lease. Maintenance and repairs are charged to expense as incurred, and improvements and betterments are capitalized. When assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the balance sheet and any resulting gain or loss is reflected in the statements of operations and comprehensive loss in the period realized.   Internal-use Software   The Company capitalizes costs incurred in the application development stage to design and implement the software used in the tracking and reporting of laboratory activity. Costs incurred in the development of application software are capitalized and amortized over an estimated useful life of three years on a straight-line basis. The total cost, accumulated depreciation and net book value was $1.1 million, $440,000 and $654,000, respectively, as of June 30, 2015, and was $927,000, $330,000 and $597,000, respectively, as of December 31, 2014, and are included in property and equipment in the Company’s condensed consolidated balance sheets. During the six months ended June 30, 2015 and 2014, the Company capitalized $167,000 and $125,000, respectively, of software development costs. Amortization expense totaled $55,000 and $109,000 in the three and six months ended June 30, 2015, respectively, and $32,000 and $64,000 in the three and six months ended June 30, 2014, respectively.   Business Combination   The Company accounts for acquisitions using the acquisition method of accounting which requires the recognition of tangible and identifiable intangible assets acquired and liabilities assumed at their estimated fair values as of the business combination date. The Company allocates any excess purchase price over the estimated fair value assigned to the net tangible and identifiable intangible assets acquired and liabilities assumed to goodwill. Transaction costs are expensed as incurred in general and administrative expenses. Results of operations and cash flows of acquired companies are included in the Company’s operating results from the date of acquisition.   Finite-lived Intangible Assets   Finite-lived intangible assets relates to intangible assets reclassified from indefinite-lived intangible assets, following the launch of Percepta in April 2015.  The Company amortizes finite-lived intangible assets using the straight-line method over their estimated useful life.  The estimated useful life of 15 years was used for the intangible asset related to the Percepta test based on management’s estimate of product life, product life of other diagnostic tests and patent life, The Company reviews this finite-lived intangible asset for impairment when facts or circumstances indicate a reduction in the fair value below its carrying amount.   Indefinite-lived Intangible Assets — In-process Research and Development   The Company’s indefinite-lived intangible assets are comprised of acquired in-process research and development (“IPR&D”). The fair value of IPR&D acquired through a business combination is capitalized as an indefinite-lived intangible asset until the completion or abandonment of the related research and development activities. When research and development is complete, the associated assets are amortized on a straight-line basis over their estimated useful lives. IPR&D is tested for impairment annually or more frequently if events or circumstances indicate that the fair value may be below the carrying value of the asset. The Company recognizes an impairment loss when the total of estimated future undiscounted cash flows expected to result from the use of the asset and its eventual disposition are less than its carrying amount. Impairment, if any, would be assessed using discounted cash flows or other appropriate measures of fair value. There was no impairment for the six months ended June 30, 2015.   Goodwill   Goodwill, derived from the Company’s acquisition of Allegro, is reviewed for impairment annually or more frequently if events or circumstances indicate that it may be impaired. The Company’s goodwill evaluation is based on both qualitative and quantitative assessments regarding the fair value of goodwill relative to its carrying value. The Company has determined that it operates in a single segment and has a single reporting unit associated with the development and commercialization of diagnostic products. In the event the Company determines that it is more likely than not the carrying value of the reporting unit is higher than its fair value, quantitative testing is performed comparing recorded values to estimated fair values. If impairment is present, the impairment loss is measured as the excess of the recorded goodwill over its implied fair value. The Company performs its annual evaluation of goodwill during the fourth quarter of each fiscal year. There was no impairment for the six months ended June 30, 2015.   Bonus Accruals   The Company accrues for liabilities under discretionary employee and executive bonus plans. These estimated compensation liabilities are based on progress against corporate objectives approved by the Board of Directors, compensation levels of eligible individuals, and target bonus percentage levels. The Board of Directors and the Compensation Committee of the Board of Directors review and evaluate the performance against these objectives and ultimately determine what discretionary payments are made. The Company accrued $1.3 million and $1.1 million as of June 30, 2015 and December 31, 2014, respectively, for liabilities associated with these employee and executive bonus plans which are included in accrued liabilities in the Company’s condensed consolidated balance sheets.   Fair Value of Financial Instruments   The carrying amounts of certain financial instruments including cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued liabilities approximate fair value due to their relatively short maturities.   Revenue Recognition   The Company’s revenue is generated from the provision of diagnostic services using the Afirma solution. The Company’s service is completed upon the delivery of test results to the prescribing physician which triggers the billing for the service. The Company recognizes revenue related to billings for Medicare and commercial payers on an accrual basis, net of contractual adjustments, when a reasonable estimate of reimbursement can be made. These contractual adjustments represent the difference between the list price (the billing rate) and the reimbursement rate for each payer. Upon ultimate collection, the amount received from Medicare and commercial payers where reimbursement was estimated is compared to previous estimates and the contractual allowance is adjusted accordingly. Until a contract has been negotiated with a commercial payer or governmental program, the Afirma solution may or may not be covered by these entities’ existing reimbursement policies. In addition, patients do not enter into direct agreements with the Company that commit them to pay any portion of the cost of the tests in the event that their insurance declines to reimburse the Company. In the absence of an agreement with the patient or other clearly enforceable legal right to demand payment from the patient, the related revenue is only recognized upon the earlier of payment notification, if applicable, or cash receipt.   For all services performed, the Company considers whether or not the following revenue recognition criteria are met: persuasive evidence of an arrangement exists; delivery has occurred or services have been rendered; and a reasonable estimate of reimbursement can be made.   Persuasive evidence of an arrangement exists and delivery is deemed to have occurred upon delivery of a patient report to the prescribing physician. The assessment of whether a reasonable estimate of reimbursement can be made requires significant judgment by management. Where management’s judgment indicates a reasonable estimate of reimbursement can be made, revenue is recognized upon delivery of the patient report. Some patients have out-of-pocket costs for amounts not covered by their insurance carrier, and the Company may bill the patient directly for these amounts in the form of co-payments and co-insurance in accordance with their insurance carrier and health plans. Some payers may not cover the Company’s GEC as ordered by the prescribing physician under their reimbursement policies. The Company pursues reimbursement from such patients on a case-by-case basis. In the absence of contracted reimbursement coverage or the ability to reasonably estimate reimbursement, the Company recognizes revenue upon receipt of third-party payer notification of payment or when cash is received.   Revenue recognized when cash is received and on an accrual basis for the three and six months ended June 30, 2015 and 2014 was as follows (in thousands):   <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 86.00%;margin-left:36pt;"> <tr> <td valign="bottom" style="width:41.14%;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:25.96%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Three Months Ended June 30, </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:25.96%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Six Months Ended June 30, </td> <td valign="bottom" style="width:01.16%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:41.14%;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:01.16%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.14%;background-color: #CCEEFF;padding:0pt;"> Revenue recognized when cash is received </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>5,321  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>6,046  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11,153  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11,163  </td> <td valign="bottom" style="width:01.16%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.14%;padding:0pt;"> Revenue recognized on an accrual basis </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>6,587  </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,631  </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11,973  </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>4,990  </td> <td valign="bottom" style="width:01.16%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.14%;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:01.16%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.14%;background-color: #CCEEFF;padding:0pt;"> Total </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11,908  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>8,677  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>23,126  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>16,153  </td> <td valign="bottom" style="width:01.16%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.14%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.24%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.24%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.24%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.24%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.16%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> </table></div>   Cost of Revenue   Cost of revenue is expensed as incurred and includes material and service costs, cytopathology testing services performed by a third-party pathology group, stock-based compensation expense, direct labor costs, equipment and infrastructure expenses associated with testing samples, shipping charges to transport samples, and allocated overhead including rent, information technology, equipment depreciation and utilities.   Research and Development   Research and development costs are charged to operations as incurred. Research and development costs include payroll and personnel-related expenses, stock-based compensation expense, prototype materials, laboratory supplies, consulting costs, costs associated with setting up and conducting clinical studies at domestic and international sites, and allocated overhead including rent, information technology, equipment depreciation and utilities.   Income Taxes   The Company accounts for income taxes under the liability method. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized.   The Company assesses all material positions taken in any income tax return, including all significant uncertain positions, in all tax years that are still subject to assessment or challenge by relevant taxing authorities. The Company’s assessment of an uncertain tax position begins with the initial determination of the position’s sustainability and is measured at the largest amount of benefit that is more-likely-than-not of being realized upon ultimate settlement. As of each balance sheet date, unresolved uncertain tax positions must be reassessed, and the Company will determine whether (i) the factors underlying the sustainability assertion have changed and (ii) the amount of the recognized tax benefit is still appropriate. The recognition and measurement of tax benefits requires significant judgment. Judgments concerning the recognition and measurement of a tax benefit may change as new information becomes available.   Stock-based Compensation   Stock-based compensation expense for equity instruments issued to employees is measured based on the grant-date fair value of the awards. The fair value of each employee stock option is estimated on the date of grant using the Black-Scholes option-pricing model. The Company recognizes compensation costs on a straight-line basis for all employee stock-based compensation awards that are expected to vest over the requisite service period of the awards, which is generally the awards’ vesting period. Forfeitures are required to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.   Equity awards issued to non-employees are valued using the Black-Scholes option-pricing model and are subject to re-measurement as the underlying equity awards vest.   Net Loss per Common Share   Basic net loss per common share is calculated by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period, without consideration of common stock equivalents. Diluted net loss per common share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common share equivalents outstanding for the period determined using the treasury stock method. Potentially dilutive securities consisting of options to purchase common stock of 4,223,267 and 2,983,509 for the six months ended June 30, 2015 and 2014, respectively, are considered to be common stock equivalents and were excluded from the calculation of diluted net loss per common share because their effect would be anti-dilutive for all periods presented.   Recent Accounting Pronouncements   In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, requiring an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The updated standard will replace most existing revenue recognition guidance in GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. Adoption is permitted as early as the first quarter of 2017 and is required by the first quarter of 2018. The Company has not yet selected a transition method and is currently evaluating the potential effect of the updated standard on its consolidated financial statements.   In April 2015, the FASB issued ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs, to require debt issuance costs to be presented as an offset against debt outstanding. The ASU is effective for interim and annual periods beginning after December 15, 2015. Adoption of the ASU is retrospective to each prior period presented. The Company does not anticipate that the adoption of the ASU will have a material impact on its condensed consolidated balance sheets.   </div> </div>

1869000

2255000

155000

185000

31000

19000

58000

28000

110000

129000

2725000

904000

852000

0.001

5000000

1218000

1735000

37258000

37300000

5000000

475000

491000

2000000

1900000

927000

1100000

4161000

597000

4211000

654000

P5Y

P3Y

39000

11000

54000

32000

500000

1250000

1300000

600000

949000

900000

500000

4369000

2243000

5890000

3103000

70000

118000

603000

-115022000

-131768000

16153000

8677000

23126000

11908000

<div> <div style="margin-left:0pt;margin-right:0pt;"> <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 100.00%;margin-left:0pt;"> <tr> <td valign="bottom" style="width:36.82%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:28.40%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Three Months Ended June 30, </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:28.38%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Six Months Ended June 30, </td> <td valign="bottom" style="width:01.02%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:36.82%;padding:0pt;">   </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:01.02%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.82%;background-color: #CCEEFF;padding:0pt;"> Weighted-average volatility </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 59.10 - 65.28% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 73.20-76.87% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 59.10 - 68.82% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 73.20 - 78.54% </td> <td valign="bottom" style="width:01.02%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.82%;padding:0pt;"> Weighted-average expected term (years) </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> 5.50 - 6.08 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> 5.50 - 6.08 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> 5.50 - 6.08 </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> 5.50 - 6.08 </td> <td valign="bottom" style="width:01.02%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.82%;background-color: #CCEEFF;padding:0pt;"> Risk-free interest rate </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 1.58 - 2.03% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 1.66 - 2.00% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 1.55 - 2.03% </td> <td valign="bottom" style="width:02.68%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;background-color: #CCEEFF;padding:0pt;"> 1.66 - 2.00% </td> <td valign="bottom" style="width:01.02%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.82%;padding:0pt;"> Expected dividend yield </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> — </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> — </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> — </td> <td valign="bottom" style="width:02.68%;padding:0pt;">   </td> <td valign="bottom" style="width:12.86%;padding:0pt;"> — </td> <td valign="bottom" style="width:01.02%;padding:0pt;">   </td> </tr> </table></div>   </div> </div>

<div> <div style="margin-left:0pt;margin-right:0pt;"> <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 100.00%;margin-left:0pt;"> <tr> <td valign="bottom" style="width:26.16%;padding:0pt;">   </td> <td valign="bottom" style="width:03.00%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:32.78%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Three Months Ended June 30, </td> <td valign="bottom" style="width:03.02%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:32.80%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Six Months Ended June 30, </td> <td valign="bottom" style="width:02.24%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:26.16%;padding:0pt;">   </td> <td valign="bottom" style="width:03.00%;padding:0pt;">   </td> <td valign="bottom" style="width:14.88%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:03.02%;padding:0pt;">   </td> <td valign="bottom" style="width:14.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:03.02%;padding:0pt;">   </td> <td valign="bottom" style="width:14.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:03.02%;padding:0pt;">   </td> <td valign="bottom" style="width:14.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.24%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:26.16%;background-color: #CCEEFF;padding:0pt;"> Medicare </td> <td valign="bottom" style="width:03.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:14.88%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>28  </td> <td valign="bottom" style="width:03.02%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>27  </td> <td valign="bottom" style="width:03.02%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>26  </td> <td valign="bottom" style="width:03.02%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>28  </td> <td valign="bottom" style="width:02.24%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.16%;padding:0pt;"> Aetna </td> <td valign="bottom" style="width:03.00%;padding:0pt;">   </td> <td valign="bottom" style="width:14.88%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>9  </td> <td valign="bottom" style="width:03.02%;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>12  </td> <td valign="bottom" style="width:03.02%;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>9  </td> <td valign="bottom" style="width:03.02%;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11  </td> <td valign="bottom" style="width:02.24%;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.16%;background-color: #CCEEFF;padding:0pt;"> UnitedHealthcare </td> <td valign="bottom" style="width:03.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:14.88%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>14  </td> <td valign="bottom" style="width:03.02%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>16  </td> <td valign="bottom" style="width:03.02%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>14  </td> <td valign="bottom" style="width:03.02%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>16  </td> <td valign="bottom" style="width:02.24%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.16%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:14.88%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.02%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:14.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.02%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:14.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.02%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:14.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.24%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:26.16%;padding:0pt;">   </td> <td valign="bottom" style="width:03.00%;padding:0pt;">   </td> <td valign="bottom" style="width:14.88%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>51  </td> <td valign="bottom" style="width:03.02%;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>55  </td> <td valign="bottom" style="width:03.02%;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>49  </td> <td valign="bottom" style="width:03.02%;padding:0pt;"> % </td> <td valign="bottom" style="width:14.90%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>55  </td> <td valign="bottom" style="width:02.24%;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.16%;padding:0pt;">   </td> <td valign="bottom" style="width:03.00%;padding:0pt;">   </td> <td valign="bottom" style="width:14.88%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:03.02%;padding:0pt;">   </td> <td valign="bottom" style="width:14.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:03.02%;padding:0pt;">   </td> <td valign="bottom" style="width:14.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:03.02%;padding:0pt;">   </td> <td valign="bottom" style="width:14.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.24%;padding:0pt;">   </td> </tr> </table></div>   </div> </div>

118000

75000

603000

118000

75000

9437000

5101000

12557000

6937000

1367000

2712000

0.0000

P6Y29D

P5Y6M

P9Y3M4D

P8Y5M9D

P6Y29D

P5Y6M

P6Y29D

P5Y6M

P6Y29D

P5Y6M

0.7854

0.7548

0.7687

0.6882

0.6528

0.7320

0.7511

0.7320

0.5910

0.0200

0.0243

0.0200

0.0203

0.0166

0.0232

0.0166

0.0155

0.0158

2500

900941

1341252

1103928

750000

1103928

11046000

1719030

5.45

P6Y7M21D

2800000

1200000

66035

1204300

9.97

5.36

12400000

16689000

3249469

4223267

7.59

8.11

P7Y10M17D

P8Y15D

16689000

4223243

8.11

P8Y15D

0.85

2.99

9.48

8.89

8.15

11.14

41374000

65088000

164467

1600000

21193014

21237196

24304022

26048934

P12M 1 2700000 964377 7000 16000000 5500000 2700000 3400000 1700000 P4Y 0.50 0.40 0.32 0.32 0.15 0.25 500000 40 5 6000000 2700000 3300000 1700000 1700000 P5Y <div> <div style="margin-left:0pt;margin-right:0pt;">   Concentrations of Credit Risk and Other Risks and Uncertainties   The Company’s cash and cash equivalents are deposited with one major financial institution in the United States, as required by the loan and security agreement discussed in Note 6. Deposits in this institution may exceed the amount of insurance provided on such deposits. The Company has not experienced any losses on its deposits of cash and cash equivalents.   Several of the components of the Company’s sample collection kit and test reagents are obtained from single-source suppliers. If these single-source suppliers fail to satisfy the Company’s requirements on a timely basis, it could suffer delays in being able to deliver its diagnostic solutions, a possible loss of revenue, or incur higher costs, any of which could adversely affect its operating results.   The Company is also subject to credit risk from its accounts receivable related to its sales of Afirma. The Company generally does not perform evaluations of customers’ financial condition and generally does not require collateral.   Through June 30, 2015, all of the Company’s revenues have been derived from the sale of Afirma. To date, Afirma has been delivered primarily to physicians in the United States. The Company’s third-party payers in excess of 10% of revenue and their related revenue as a percentage of revenue were as follows:   <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 80.00%;margin-left:54pt;"> <tr> <td valign="bottom" style="width:26.28%;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:33.12%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Three Months Ended June 30, </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:33.12%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Six Months Ended June 30, </td> <td valign="bottom" style="width:01.24%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:26.28%;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:01.24%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:26.28%;background-color: #CCEEFF;padding:0pt;"> Medicare </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>28  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>27  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>26  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>28  </td> <td valign="bottom" style="width:01.24%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.28%;padding:0pt;"> Aetna </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>9  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>12  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>9  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11  </td> <td valign="bottom" style="width:01.24%;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.28%;background-color: #CCEEFF;padding:0pt;"> UnitedHealthcare </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>14  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>16  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>14  </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>16  </td> <td valign="bottom" style="width:01.24%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.24%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:26.28%;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>51  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>55  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>49  </td> <td valign="bottom" style="width:03.12%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>55  </td> <td valign="bottom" style="width:01.24%;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:26.28%;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:03.12%;padding:0pt;">   </td> <td valign="bottom" style="width:15.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:01.24%;padding:0pt;">   </td> </tr> </table></div>   As the number of payers reimbursing for Afirma increases, the percentage of revenue derived from Medicare and other significant third-party payers has changed and will continue to change as a percentage of revenue.   The Company’s significant third-party payers and their related accounts receivable balance at June 30, 2015 and December 31, 2014 as a percentage of total accounts receivable are as follows:   <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 60.00%;margin-left:54pt;"> <tr> <td valign="bottom" style="width:49.94%;padding:0pt;">   </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;padding:0pt;"> June 30, </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;padding:0pt;"> December 31, </td> <td valign="bottom" style="width:01.68%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:49.94%;padding:0pt;">   </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:01.68%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:49.94%;padding:0pt;">   </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;padding:0pt;">   </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;padding:0pt;">   </td> <td valign="bottom" style="width:01.68%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:49.94%;background-color: #CCEEFF;padding:0pt;"> Medicare </td> <td valign="bottom" style="width:04.18%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>30  </td> <td valign="bottom" style="width:04.18%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:20.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>64  </td> <td valign="bottom" style="width:01.68%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:49.94%;padding:0pt;"> Aetna </td> <td valign="bottom" style="width:04.18%;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>25  </td> <td valign="bottom" style="width:04.18%;padding:0pt;"> % </td> <td valign="bottom" style="width:20.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>12  </td> <td valign="bottom" style="width:01.68%;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:49.94%;background-color: #CCEEFF;padding:0pt;"> UnitedHealthcare </td> <td valign="bottom" style="width:04.18%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:20.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>28  </td> <td valign="bottom" style="width:04.18%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:20.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>14  </td> <td valign="bottom" style="width:01.68%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> </table></div>   No other third-party payer represented more than 10% of the Company’s accounts receivable balances for these periods.   </div> </div> 225000 110000 237500 0.0475 40000 40000 20000 39000 39000 20000 30 24 0.0075 0.000 0.0225 0.0200 0.0150 0.010 P18M P24M 75000 45000 1100000 -2526000 -569000 16000000 59000 5003000 5042000 1 3 500000 41000 21000 45000 22000 4300000 2700000 40000000 100000 4990000 2631000 11973000 6587000 11163000 6046000 11153000 5321000 <div> <div style="margin-left:0pt;margin-right:0pt;"> <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 100.00%;margin-left:0pt;"> <tr> <td valign="bottom" style="width:60.86%;padding:0pt;">   </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;padding:0pt;"> June 30, </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;padding:0pt;"> December 31, </td> <td valign="bottom" style="width:01.32%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:60.86%;padding:0pt;">   </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:01.32%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:60.86%;background-color: #CCEEFF;padding:0pt;"> Options issued and outstanding </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>4,223,267  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>3,249,469  </td> <td valign="bottom" style="width:01.32%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:60.86%;padding:0pt;"> Options available for grant under stock option plans </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,103,928  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,341,252  </td> <td valign="bottom" style="width:01.32%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:60.86%;background-color: #CCEEFF;padding:0pt;"> Shares available for issuance under the ESPP </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>750,000  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;background-color: #CCEEFF;padding:0pt;"> — </td> <td valign="bottom" style="width:01.32%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:60.86%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.32%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:60.86%;padding:0pt;"> Total </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>6,077,195  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>4,590,721  </td> <td valign="bottom" style="width:01.32%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:60.86%;padding:0pt;">   </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:01.32%;padding:0pt;">   </td> </tr> </table></div>   </div> </div> <div> <div style="margin-left:0pt;margin-right:0pt;">   <a name="mrllPB7"></a>The acquisition consideration was comprised of (in thousands): <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 100.00%;margin-left:0pt;"> <tr> <td valign="top" style="width:78.86%;background-color: #CCEEFF;padding:0pt;"> Stock </td> <td valign="bottom" style="width:03.40%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.54%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:14.82%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>10,078  </td> <td valign="bottom" style="width:01.38%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:78.86%;padding:0pt;"> Cash </td> <td valign="bottom" style="width:03.40%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:16.36%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,725  </td> <td valign="bottom" style="width:01.38%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:78.86%;background-color: #CCEEFF;padding:0pt;"> Payment of outstanding indebtedness </td> <td valign="bottom" style="width:03.40%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:16.36%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>4,290  </td> <td valign="bottom" style="width:01.38%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:78.86%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:03.40%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:16.36%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.38%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:78.86%;padding:0pt;"> Total acquisition consideration </td> <td valign="bottom" style="width:03.40%;padding:0pt;">   </td> <td valign="bottom" style="width:01.54%;padding:0pt;"> $ </td> <td valign="bottom" style="width:14.82%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>17,093  </td> <td valign="bottom" style="width:01.38%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:78.86%;padding:0pt;">   </td> <td valign="bottom" style="width:03.40%;padding:0pt;">   </td> <td valign="bottom" style="width:01.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:14.82%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:01.38%;padding:0pt;">   </td> </tr> </table></div>   </div> </div> <div> <div style="margin-left:0pt;margin-right:0pt;"> Revenue recognized when cash is received and on an accrual basis for the three and six months ended June 30, 2015 and 2014 was as follows (in thousands):   <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 86.00%;margin-left:36pt;"> <tr> <td valign="bottom" style="width:41.14%;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:25.96%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Three Months Ended June 30, </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:25.96%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Six Months Ended June 30, </td> <td valign="bottom" style="width:01.16%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:41.14%;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:01.16%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.14%;background-color: #CCEEFF;padding:0pt;"> Revenue recognized when cash is received </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>5,321  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>6,046  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11,153  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11,163  </td> <td valign="bottom" style="width:01.16%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.14%;padding:0pt;"> Revenue recognized on an accrual basis </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>6,587  </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,631  </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11,973  </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>4,990  </td> <td valign="bottom" style="width:01.16%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.14%;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:11.54%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:01.16%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.14%;background-color: #CCEEFF;padding:0pt;"> Total </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>11,908  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>8,677  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>23,126  </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.24%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>16,153  </td> <td valign="bottom" style="width:01.16%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.14%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.24%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.24%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.24%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.88%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.24%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.16%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> </table></div>   </div> </div> 125000000 25000 P12M 1.25 2.12 25000000 5000000 4907975 3300000 1900000 1000000 2300000 1200000 1