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<div> <div style="margin-left:0pt;margin-right:0pt;">   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. As of June 30, 2014 and December 31, 2013, the Company accrued $400,000 and $1.1 million, respectively, for liabilities associated with these employee and executive bonus plans which are included in accrued liabilities in the Company’s condensed balance sheets.   </div> </div>

0.56

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<div> <div style="margin-left:0pt;margin-right:0pt;"> The unamortized balance of the co-promotion fee is reflected on the Company’s condensed balance sheets as follows (in thousands): <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 73.00%;margin-left:72pt;"> <tr> <td valign="bottom" style="width:64.58%;padding:0pt;">   </td> <td valign="bottom" style="width:03.40%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> June 30, 2014 </td> <td valign="bottom" style="width:03.40%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> December 31, 2013 </td> <td valign="bottom" style="width:01.34%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:64.58%;background-color: #CCEEFF;padding:0pt;"> Current liabilities: </td> <td valign="bottom" style="width:03.40%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.64%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;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:13.64%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.34%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:64.58%;padding:0pt;"> Deferred Genzyme co-promotion fee </td> <td valign="bottom" style="width:03.40%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> $ </td> <td valign="bottom" style="width:12.34%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,500  </td> <td valign="bottom" style="width:03.40%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> $ </td> <td valign="bottom" style="width:12.34%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,500  </td> <td valign="bottom" style="width:01.34%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:64.58%;background-color: #CCEEFF;padding:0pt;"> Long-term liabilities: </td> <td valign="bottom" style="width:03.40%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.64%;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:13.64%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.34%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:64.58%;padding:0pt;"> Deferred Genzyme co-promotion fee, net of current portion </td> <td valign="bottom" style="width:03.40%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,364  </td> <td valign="bottom" style="width:03.40%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.64%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,614  </td> <td valign="bottom" style="width:01.34%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:64.58%;background-color: #CCEEFF;padding:0pt;"> Total </td> <td valign="bottom" style="width:03.40%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:12.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>3,864  </td> <td valign="bottom" style="width:03.40%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:12.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>5,114  </td> <td valign="bottom" style="width:01.34%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> </table></div>   </div> </div>

2500000

2614000

1364000

72000

37000

428000

541000

<div> <div style="margin-left:0pt;margin-right:0pt;"> 9. 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: 100.00%;margin-left:0pt;"> <tr> <td valign="bottom" style="width:36.50%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;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:02.50%;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:02.50%;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:02.50%;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:02.50%;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:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;background-color: #CCEEFF;padding:0pt;"> Balance — December 31, 2013 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,787,802 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,359,287 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>3.07 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>7.84 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>26,964 </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;padding:0pt;"> Additional options authorized </td> <td valign="bottom" style="width:02.50%;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>845,732 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;"> — </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;background-color: #CCEEFF;padding:0pt;"> Granted </td> <td valign="bottom" style="width:02.50%;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>(1,033,842 </td> <td valign="bottom" style="width:02.50%;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>1,033,842 </td> <td valign="bottom" style="width:02.50%;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>14.77 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;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:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;padding:0pt;"> Canceled </td> <td valign="bottom" style="width:02.50%;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>119,822 </td> <td valign="bottom" style="width:02.50%;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>(119,822 </td> <td valign="bottom" style="width:02.50%;"> ) </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>8.16 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;background-color: #CCEEFF;padding:0pt;"> Exercised </td> <td valign="bottom" style="width:02.50%;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:02.50%;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;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(289,798 </td> <td valign="bottom" style="width:02.50%;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>1.87 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;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:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;padding:0pt;"> Balance — June 30, 2014 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,719,514 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,983,509 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>7.04 </td> <td valign="bottom" style="width:02.50%;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>7.88 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>30,223 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;background-color: #CCEEFF;padding:0pt;"> Options exercisable — June 30, 2014 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:2pt double #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:2pt double #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,823,787 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>3.06 </td> <td valign="bottom" style="width:02.50%;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>7.21 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>25,643 </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;padding:0pt;"> Options vested and expected to vest — June 30, 2014 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:2pt double #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,859,071 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>6.77 </td> <td valign="bottom" style="width:02.50%;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>7.83 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>29,731 </td> <td valign="bottom" style="width:01.00%;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 of $17.12 per share as of June 30, 2014.   Outstanding and exercisable stock options at June 30, 2014 are summarized as follows: <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 76.00%;margin-left:54pt;"> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;">   </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:34.56%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Options Outstanding </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:34.56%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Options Vested and Exercisable </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Exercise Price </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Number </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Weighted-Average Remaining Contractual Life (in Years) </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Number </td> <td valign="bottom" style="width:03.26%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Weighted-Average Remaining Contractual Life (in Years) </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $0.08 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>102,750  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> 4.15 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>102,750  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> 4.15 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;"> $0.80 </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>142,069  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 5.69 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>142,069  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 5.69 </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;background-color: #CCEEFF;padding:0pt;"> $2.36 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>346,830  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 6.32 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>335,863  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 6.33 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;"> $2.40 </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>160,862  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 5.07 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>143,579  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 4.82 </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;background-color: #CCEEFF;padding:0pt;"> $2.68 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>560,100  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 7.76 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>517,036  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 7.75 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;"> $4.00 </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>431,577  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 8.59 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>386,316  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 8.60 </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;background-color: #CCEEFF;padding:0pt;"> $6.04 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>196,004  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 8.97 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>162,424  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 8.96 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;"> $7.92 </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>9,000  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 9.20 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> — </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> — </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;background-color: #CCEEFF;padding:0pt;"> $12.12 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>39,625  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 9.26 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>33,750  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 9.26 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;"> $12.64-18.24 </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>994,692  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 9.05 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;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:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> — </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;background-color: #CCEEFF;padding:0pt;"> $0.08-18.24 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,983,509  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 7.88 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,823,787  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 7.21 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> </table></div>   The weighted-average fair value of stock options granted was $9.97 and $3.18 per share for the six months ended June 30, 2014 and 2013, respectively.   The weighted-average fair value of stock options vested was $2.89 and $2.10 per share for the six months ended June 30, 2014 and 2013, respectively. The aggregate estimated grant date fair value of employee options to purchase common stock vested during the six months ended June 30, 2014 and 2013 was $4.2 million and $1.6 million, respectively.   The weighted-average fair value of stock options exercised was $1.25 and $0.83 per share for the six months ended June 30, 2014 and 2013, respectively. The intrinsic value of stock options exercised was $2.8 million and $1.7 million for the six months ended June 30, 2014 and 2013, respectively.   Stock-based Compensation   The following table summarizes stock-based compensation expense related to stock options for the three and six months ended June 30, 2014 and 2013, and are included in the unaudited statements of operations and comprehensive loss as follows (in thousands): <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;margin-left:18pt;"> <tr> <td valign="bottom" style="width:34.48%;padding:0pt;">   </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:29.54%;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:02.78%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:29.02%;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:01.38%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:34.48%;padding:0pt;">   </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.44%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.78%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2013 </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.78%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.90%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2013 </td> <td valign="bottom" style="width:01.38%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.48%;background-color: #CCEEFF;padding:0pt;"> Cost of revenue </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:12.12%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:12.04%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:12.04%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:11.60%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>13  </td> <td valign="bottom" style="width:01.38%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.48%;padding:0pt;"> Research and development </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.44%;;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:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>58  </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;;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:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.90%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>103  </td> <td valign="bottom" style="width:01.38%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.48%;background-color: #CCEEFF;padding:0pt;"> Selling and marketing </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.44%;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>41  </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.90%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>76  </td> <td valign="bottom" style="width:01.38%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.48%;padding:0pt;"> General and administrative </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.44%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;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:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>177  </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;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:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>297  </td> <td valign="bottom" style="width:01.38%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.48%;background-color: #CCEEFF;padding:0pt;"> Total </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:12.12%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:12.04%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:12.04%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:11.60%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>489  </td> <td valign="bottom" style="width:01.38%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> </table></div>   As of June 30, 2014, the Company had $9.4 million of unrecognized compensation expense related to unvested stock options, which is expected to be recognized over an estimated weighted-average period of 3.3 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;margin-left:18pt;"> <tr> <td valign="bottom" style="width:34.46%;padding:0pt;">   </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:29.46%;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:02.78%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:29.46%;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:01.06%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:34.46%;padding:0pt;">   </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.78%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2013 </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.78%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2013 </td> <td valign="bottom" style="width:01.06%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.46%;background-color: #CCEEFF;padding:0pt;"> Weighted-average volatility </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> 73.20-76.87% </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> 80.42% </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> 73.20-78.54% </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> 80.42 – 81.41% </td> <td valign="bottom" style="width:01.06%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.46%;padding:0pt;"> Weighted-average expected term (years) </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;padding:0pt;"> 5.50-6.08 </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;padding:0pt;"> 6.08 </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;padding:0pt;"> 5.50-6.08 </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;padding:0pt;"> 5.0 - 6.08 </td> <td valign="bottom" style="width:01.06%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.46%;background-color: #CCEEFF;padding:0pt;"> Risk-free interest rate </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;background-color: #CCEEFF;padding:0pt;"> 1.66-2.00% </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;background-color: #CCEEFF;padding:0pt;"> 1.60% </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;background-color: #CCEEFF;padding:0pt;"> 1.66-2.00% </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;background-color: #CCEEFF;padding:0pt;"> 0.88 - 1.60% </td> <td valign="bottom" style="width:01.06%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.46%;padding:0pt;"> Expected dividend yield </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;padding:0pt;"> 0% </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;padding:0pt;"> 0% </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;padding:0pt;"> 0% </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td valign="bottom" style="width:13.34%;padding:0pt;"> 0% </td> <td valign="bottom" style="width:01.06%;padding:0pt;">   </td> </tr> </table></div>   Stock-based compensation related to stock options granted to non-employees is recognized as the stock options are earned. The fair value of the stock options granted is calculated at each reporting date using the Black-Scholes option-pricing model with the following assumptions: expected life is equal to the remaining contractual term of the award as of the measurement date ranging from 8.44 years to 9.26 years as of June 30, 2014 and 8.22 years to 9.43 years as of June 30, 2013; risk free rate is based on the U.S. Treasury Constant Maturity rate with a term similar to the expected life of the option at the measurement date ranging from 2.32% to 2.43% as of June 30, 2014 and 2.19% to 2.41% as of June 30, 2013; expected dividend yield of 0%; and volatilities ranging from 75.11% to 75.48% as of June 30, 2014 and 79.01% to 79.58% as of June 30, 2013. </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 on August 15, 2006 as Calderome, Inc. Calderome operated as an incubator until early 2008. On March 4, 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 collected in an outpatient setting. 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 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 financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the SEC regarding interim financial reporting. 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 balance sheet as of June 30, 2014, and the condensed statements of operations and comprehensive loss and cash flows for the three and six months ended June 30, 2014 and 2013, 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 balance sheet at December 31, 2013 has been derived from audited financial statements. The results for the three and six months ended June 30, 2014 are not necessarily indicative of the results expected for the full fiscal year or any other period.   The accompanying interim period condensed 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, 2013.   Use of Estimates   The preparation of the unaudited interim 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; the determination of fair value of the Company’s common stock prior to the Company’s initial public offering (“IPO”), stock options, preferred stock liability; 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 those 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 of America. 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 solution, 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. All of the Company’s accounts receivables are derived from sales of Afirma in the United States and Canada.   Through June 30, 2014, all of the Company’s revenues are derived from the sale of Afirma. The Company’s solution to date has been delivered primarily to physicians in the United States. The Company’s significant third-party payers and their related revenue as a percentage of total revenue are as follows: <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 76.00%;margin-left:54pt;"> <tr> <td valign="bottom" style="width:60.86%;padding:0pt;">   </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:34.56%;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:01.30%;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:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2013 </td> <td valign="bottom" style="width:01.30%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:60.86%;background-color: #CCEEFF;padding:0pt;"> Medicare </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;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:03.26%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>35  </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:60.86%;padding:0pt;"> Aetna </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;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:03.26%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>7  </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:60.86%;background-color: #CCEEFF;padding:0pt;"> United Healthcare </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;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:03.26%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;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:01.30%;background-color: #CCEEFF;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:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;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:03.26%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>56  </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> % </td> </tr> </table></div>   Accounts receivable from Medicare amounted to 81% and 78% of accounts receivable as of June 30, 2014 and December 31, 2013. No other third-party payer represented more than 10% of the Company’s accounts receivable balances for these periods.   Cash and Cash Equivalents   Cash equivalents consist of short-term, highly liquid investments with original maturities of three months or less from the date of purchase. Cash equivalents consist primarily of amounts invested in money market accounts.   Restricted Cash   Deposits of $118,000 as of June 30, 2014 and December 31, 2013, were restricted from withdrawal and held by a bank in the form of collateral for letters of credit. The balance for each respective period consists of a letter of credit totaling $118,000 held as security for the lease of the Company’s office space in South San Francisco, California.   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 other substantive evidence that the account will not be paid. If the financial condition of our customers deteriorates, resulting in an impairment of their ability to make payment, additional allowances may be required.   The balance of allowance for doubtful accounts as of June 30, 2014 and December 31, 2013, including charges to bad debt expense and write-offs, net of recoveries, was as follows: <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:70.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> June 30, 2014 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> December 31, 2013 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:26.50%;padding:0pt;"> (In thousands) </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;background-color: #CCEEFF;padding:0pt;"> Beginning balance </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.70%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>107 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.70%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>222 </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;padding:0pt;"> Charged to expense </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>39 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>109 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;background-color: #CCEEFF;padding:0pt;"> Write-offs, net of recoveries </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(34 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;"> ) </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(224 </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;"> ) </td> </tr> <tr> <td valign="bottom" style="width:70.00%;padding:0pt;"> Ending balance </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>112 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>107 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> </table></div>   Supplies Inventory   Supplies inventory consists of test reagents and other consumables used in the sample collection kits and in the GEC 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 $607,000, $259,000 and $348,000, respectively, as of June 30, 2014, and was $482,000, $195,000 and $287,000, respectively, as of December 31, 2013, and are included in property and equipment in the Company’s condensed balance sheets. During the six months ended June 30, 2014 and 2013, the Company capitalized $125,000 and $166,000, respectively, of software development costs. Amortization expense totaled $32,000 and $64,000 in the three and six months ended June 30, 2014, respectively, and $22,000 and $38,000, in the three and six months ended June 30, 2013, respectively.   Long-lived Assets   The Company annually reviews long-lived assets for impairment or whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. An impairment loss is recognized 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 were no impairments for the six months ended June 30, 2014 and 2013.   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. As of June 30, 2014 and December 31, 2013, the Company accrued $400,000 and $1.1 million, respectively, for liabilities associated with these employee and executive bonus plans which are included in accrued liabilities in the Company’s condensed 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 carriers on an accrual basis, net of contractual adjustments, when there is an agreement or a predictable pattern of collectability. Until a contract or agreement has been negotiated with a commercial carrier 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.   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; the fee is fixed or determinable; and collectability is reasonably assured.   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 the fixed or determinable nature of the fees charged for diagnostic testing performed and the collectability of those fees require significant judgment by management. Management believes that these two criteria have been met when there is a contracted reimbursement rate and/or a predictable pattern of collectability with individual third-party payers and accordingly, recognizes revenue 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 a contracted reimbursement coverage or a predictable pattern and history of collectability, the Company believes that the fee is fixed or determinable and collectability is reasonably assured only upon receipt of third-party payer notification of payment or when cash is received and, accordingly, recognizes revenue at that time.   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 tissue 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, but are not limited to, 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 greater than 50 percent likely 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 instruments issued to non-employees are valued using the Black-Scholes option-pricing model and are subject to remeasurement as the underlying equity instruments 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 convertible preferred stock and options to purchase common stock 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   On May 28, 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. Early adoption is not permitted. The updated standard becomes effective for the Company in the first quarter of fiscal 2017. The Company has not yet selected a transition method and is currently evaluating the potential effect of the updated standard on its financial statements.   In July 2013, the FASB issued ASU No. 2013-11, Presentation of an Unrecognized Tax Benefit when a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force). The amendments in this ASU provide guidance on the financial statements presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. An unrecognized tax benefit should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward with certain exceptions, in which case such an unrecognized tax benefit should be presented in the financial statements as a liability. The amendments in this ASU do not require new recurring disclosures and are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The Company adopted this guidance during the first quarter of 2014 and such adoption did not have a material impact on the Company’s condensed financial statements. </div> </div>

717000

890000

153000

142000

-2070000

-1068000

31000

19000

941000

904000

0.001

5000000

1477000

1450000

4877000

12998000

320000

475000

482000

607000

2952000

287000

3312000

348000

P5Y

P3Y

117000

109000

39000

130000

1250000

1300000

625000

1250000

1300000

625000

3912000

1902000

4369000

2243000

118000

-85649000

-98978000

9452000

5068000

16153000

8677000

<div> <div style="margin-left:0pt;margin-right:0pt;"> Accrued liabilities consist of the following (in thousands): <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:70.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> June 30, 2014 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> December 31, 2013 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;background-color: #CCEEFF;padding:0pt;"> Accrued compensation expenses </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,522  </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,962  </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;padding:0pt;"> Accrued Genzyme co-promotion fees </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,716  </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>4,915  </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;background-color: #CCEEFF;padding:0pt;"> Accrued other </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>890  </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>717  </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;padding:0pt;"> Accrued liabilities </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>5,128  </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> $ </td> <td valign="bottom" style="width:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>7,594  </td> <td valign="bottom" style="width:01.00%;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:70.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:26.50%;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 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> June 30, 2014 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> June 30, 2013 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;background-color: #CCEEFF;padding:0pt;"> Shares of common stock issuable upon conversion of preferred stock </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> — </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>14,997,312  </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;padding:0pt;"> Shares of common stock subject to outstanding options </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,983,509  </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,420,302  </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;background-color: #CCEEFF;padding:0pt;"> Warrants to purchase convertible preferred stock </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;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:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>24,801  </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:70.00%;padding:0pt;"> Total shares of common stock equivalents </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,983,509  </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>17,442,415  </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> </table></div>   </div> </div>

<div> <div style="margin-left:0pt;margin-right:0pt;"> The following table presents the calculation of basic and diluted net loss per common share for the three and six months ended June 30, 2014 and 2013 (in thousands, except share and per share amounts): <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:41.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:26.50%;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:02.50%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:26.50%;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:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:41.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.50%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2013 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.50%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2013 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.00%;background-color: #CCEEFF;padding:0pt;"> Net loss </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(6,655 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;"> ) </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(6,490 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;"> ) </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(13,329 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;"> ) </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(13,385 </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;"> ) </td> </tr> <tr> <td valign="top" style="width:41.00%;padding:0pt;"> Shares used to compute net loss per common share, basic and diluted </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>21,237,196 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>861,839 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>21,193,014 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>812,703 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:41.00%;background-color: #CCEEFF;padding:0pt;"> Net loss per common share, basic and diluted </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(0.31 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;"> ) </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(7.53 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;"> ) </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(0.63 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;"> ) </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:10.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(16.47 </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;"> ) </td> </tr> </table></div>   </div> </div>

<div> <div style="margin-left:0pt;margin-right:0pt;"> The following table summarizes stock-based compensation expense related to stock options for the three and six months ended June 30, 2014 and 2013, and are included in the unaudited statements of operations and comprehensive loss as follows (in thousands): <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;margin-left:18pt;"> <tr> <td valign="bottom" style="width:34.48%;padding:0pt;">   </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:29.54%;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:02.78%;padding:0pt;">   </td> <td colspan="5" valign="bottom" style="width:29.02%;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:01.38%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:34.48%;padding:0pt;">   </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.44%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.78%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2013 </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:02.78%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.90%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2013 </td> <td valign="bottom" style="width:01.38%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.48%;background-color: #CCEEFF;padding:0pt;"> Cost of revenue </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:12.12%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:12.04%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:12.04%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:11.60%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>13  </td> <td valign="bottom" style="width:01.38%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.48%;padding:0pt;"> Research and development </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.44%;;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:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>58  </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;;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:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.90%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>103  </td> <td valign="bottom" style="width:01.38%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.48%;background-color: #CCEEFF;padding:0pt;"> Selling and marketing </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.44%;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>41  </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.90%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>76  </td> <td valign="bottom" style="width:01.38%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.48%;padding:0pt;"> General and administrative </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.44%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;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:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>177  </td> <td valign="bottom" style="width:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:13.34%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;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:02.78%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:12.90%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>297  </td> <td valign="bottom" style="width:01.38%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:34.48%;background-color: #CCEEFF;padding:0pt;"> Total </td> <td valign="bottom" style="width:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:12.12%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:12.04%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:12.04%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;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:02.78%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;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:11.60%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>489  </td> <td valign="bottom" style="width:01.38%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> </table></div>   </div> </div>

<div> <div style="margin-left:0pt;margin-right:0pt;"> Future minimum lease payments under non-cancelable operating leases as of June 30, 2014 are as follows (in thousands): <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 66.00%;margin-left:72pt;"> <tr> <td valign="bottom" style="width:76.78%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Year Ending December 31, </td> <td valign="bottom" style="width:03.74%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:18.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Amount </td> <td valign="bottom" style="width:01.48%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:76.78%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> July through December 31, 2014 </td> <td valign="bottom" style="width:03.74%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:16.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>475  </td> <td valign="bottom" style="width:01.48%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:76.78%;padding:0pt;"> 2015 </td> <td valign="bottom" style="width:03.74%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:18.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>989  </td> <td valign="bottom" style="width:01.48%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:76.78%;background-color: #CCEEFF;padding:0pt;"> 2016 </td> <td valign="bottom" style="width:03.74%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:18.00%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>413  </td> <td valign="bottom" style="width:01.48%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:76.78%;padding:0pt;"> 2017 </td> <td valign="bottom" style="width:03.74%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:18.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>222  </td> <td valign="bottom" style="width:01.48%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:76.78%;background-color: #CCEEFF;padding:0pt;"> 2018 </td> <td valign="bottom" style="width:03.74%;background-color: #CCEEFF;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:18.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>130  </td> <td valign="bottom" style="width:01.48%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:76.78%;padding:0pt;"> Total minimum lease payments </td> <td valign="bottom" style="width:03.74%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> $ </td> <td valign="bottom" style="width:16.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,229  </td> <td valign="bottom" style="width:01.48%;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: 76.00%;margin-left:54pt;"> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;">   </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:34.56%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Options Outstanding </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:34.56%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Options Vested and Exercisable </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Exercise Price </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Number </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Weighted-Average Remaining Contractual Life (in Years) </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Number </td> <td valign="bottom" style="width:03.26%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> Weighted-Average Remaining Contractual Life (in Years) </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $0.08 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>102,750  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> 4.15 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>102,750  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> 4.15 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;"> $0.80 </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>142,069  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 5.69 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>142,069  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 5.69 </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;background-color: #CCEEFF;padding:0pt;"> $2.36 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>346,830  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 6.32 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>335,863  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 6.33 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;"> $2.40 </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>160,862  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 5.07 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>143,579  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 4.82 </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;background-color: #CCEEFF;padding:0pt;"> $2.68 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>560,100  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 7.76 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>517,036  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 7.75 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;"> $4.00 </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>431,577  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 8.59 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>386,316  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 8.60 </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;background-color: #CCEEFF;padding:0pt;"> $6.04 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>196,004  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 8.97 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>162,424  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 8.96 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;"> $7.92 </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>9,000  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 9.20 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> — </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> — </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;background-color: #CCEEFF;padding:0pt;"> $12.12 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>39,625  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 9.26 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>33,750  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 9.26 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;padding:0pt;"> $12.64-18.24 </td> <td valign="bottom" style="width:03.28%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>994,692  </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> 9.05 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;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:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;padding:0pt;"> — </td> <td valign="bottom" style="width:01.22%;padding:0pt;">   </td> </tr> <tr> <td valign="bottom" style="width:23.10%;background-color: #CCEEFF;padding:0pt;"> $0.08-18.24 </td> <td valign="bottom" style="width:03.28%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,983,509  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 7.88 </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,823,787  </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;background-color: #CCEEFF;padding:0pt;"> 7.21 </td> <td valign="bottom" style="width:01.22%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> </table></div>   </div> </div>

<div> <div style="margin-left:0pt;margin-right:0pt;"> 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: 100.00%;margin-left:0pt;"> <tr> <td valign="bottom" style="width:36.50%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;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:02.50%;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:02.50%;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:02.50%;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:02.50%;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:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;background-color: #CCEEFF;padding:0pt;"> Balance — December 31, 2013 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,787,802 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,359,287 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>3.07 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>7.84 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>26,964 </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;padding:0pt;"> Additional options authorized </td> <td valign="bottom" style="width:02.50%;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>845,732 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;"> — </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;background-color: #CCEEFF;padding:0pt;"> Granted </td> <td valign="bottom" style="width:02.50%;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>(1,033,842 </td> <td valign="bottom" style="width:02.50%;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>1,033,842 </td> <td valign="bottom" style="width:02.50%;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>14.77 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;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:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;padding:0pt;"> Canceled </td> <td valign="bottom" style="width:02.50%;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>119,822 </td> <td valign="bottom" style="width:02.50%;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>(119,822 </td> <td valign="bottom" style="width:02.50%;"> ) </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>8.16 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td colspan="2" valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;background-color: #CCEEFF;padding:0pt;"> Exercised </td> <td valign="bottom" style="width:02.50%;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:02.50%;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;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>(289,798 </td> <td valign="bottom" style="width:02.50%;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>1.87 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;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:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;padding:0pt;"> Balance — June 30, 2014 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,719,514 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,983,509 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>7.04 </td> <td valign="bottom" style="width:02.50%;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>7.88 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>30,223 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;background-color: #CCEEFF;padding:0pt;"> Options exercisable — June 30, 2014 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:2pt double #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:2pt double #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,823,787 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>3.06 </td> <td valign="bottom" style="width:02.50%;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>7.21 </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>25,643 </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:36.50%;padding:0pt;"> Options vested and expected to vest — June 30, 2014 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:10.00%;border-top:2pt double #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,859,071 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>6.77 </td> <td valign="bottom" style="width:02.50%;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>7.83 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> $ </td> <td valign="bottom" style="width:08.70%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>29,731 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> </table></div>   </div> </div>

75000

5318000

2615000

9437000

5101000

0.00

P6Y29D

P5Y

P6Y29D

P5Y6M

P6Y29D

P5Y6M

0.8042

0.8141

0.7958

0.7854

0.7548

0.7687

0.8042

0.7901

0.7320

0.7511

0.7320

0.0160

0.0241

0.0200

0.0243

0.0200

0.0088

0.0219

0.0166

0.0232

0.0166

845732

1787802

1719514

25643000

1823787

3.06

P9Y5M5D

P8Y2M19D

P7Y2M16D

P9Y3M4D

P8Y5M9D

1700000

2800000

119822

1033842

3.18

9.97

26964000

30223000

2359287

2983509

3.07

7.04

P7Y10M2D

P7Y10M17D

29731000

2859071

6.77

P7Y9M29D

1600000

4200000

2.10

2.89

1.87

8.16

14.77

P4Y1M24D

P5Y8M9D

P9Y3M4D

P6Y3M29D

P4Y9M26D

P7Y9M

P8Y7M6D

P8Y11M16D

P7Y2M16D

0.08

12.64

102750

142069

33750

335863

143579

517036

386316

162424

1823787

102750

142069

39625

346830

160862

560100

431577

196004

9000

2983509

994692

0.08

0.80

12.12

2.36

2.40

2.68

4.00

6.04

7.92

P4Y1M24D

P5Y8M9D

P9Y3M4D

P6Y3M26D

P5Y26D

P7Y9M4D

P8Y7M2D

P8Y11M19D

P9Y2M12D

P7Y10M17D

P9Y18D

18.24

17.12

56443000

45025000

289798

800000

812703

861839

21193014

21237196

24801 24801 3000000 600000 3700000 1800000 5500000 2700000 P4Y 500000 5 40 6700000 1800000 4900000 8100000 5400000 2700000 0.50 0.40 0.32 0.15 P6M <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 of America. 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 solution, 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. All of the Company’s accounts receivables are derived from sales of Afirma in the United States and Canada.   Through June 30, 2014, all of the Company’s revenues are derived from the sale of Afirma. The Company’s solution to date has been delivered primarily to physicians in the United States. The Company’s significant third-party payers and their related revenue as a percentage of total revenue are as follows: <div style="width:100%"><table cellpadding="0" cellspacing="0" style="border-collapse:collapse;width: 76.00%;margin-left:54pt;"> <tr> <td valign="bottom" style="width:60.86%;padding:0pt;">   </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td colspan="3" valign="bottom" style="width:34.56%;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:01.30%;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:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2014 </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> 2013 </td> <td valign="bottom" style="width:01.30%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:60.86%;background-color: #CCEEFF;padding:0pt;"> Medicare </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;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:03.26%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>35  </td> <td valign="bottom" style="width:01.30%;background-color: #CCEEFF;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:60.86%;padding:0pt;"> Aetna </td> <td valign="bottom" style="width:03.26%;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;;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:03.26%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.66%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>7  </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> % </td> </tr> <tr> <td valign="top" style="width:60.86%;background-color: #CCEEFF;padding:0pt;"> United Healthcare </td> <td valign="bottom" style="width:03.26%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:15.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;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:03.26%;background-color: #CCEEFF;padding:0pt;"> % </td> <td valign="bottom" style="width:15.66%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;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:01.30%;background-color: #CCEEFF;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:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;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:03.26%;padding:0pt;"> % </td> <td valign="bottom" style="width:15.66%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>56  </td> <td valign="bottom" style="width:01.30%;padding:0pt;"> % </td> </tr> </table></div>   Accounts receivable from Medicare amounted to 81% and 78% of accounts receivable as of June 30, 2014 and December 31, 2013. No other third-party payer represented more than 10% of the Company’s accounts receivable balances for these periods. </div> </div> 7.56 7.56 223000 0.0445 30 0.0075 0.0225 0.015 P18M P2Y 1748000 -2526000 40000 1 41000 21000 129000 <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:70.00%;padding:0pt;">   </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> June 30, 2014 </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;padding:0pt;"> December 31, 2013 </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:70.00%;background-color: #CCEEFF;padding:0pt;"> Options issued and outstanding </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,983,509  </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt none #D9D9D9 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>2,359,287  </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:70.00%;padding:0pt;"> Options available for grant under stock option plans </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,719,514  </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>1,787,802  </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:70.00%;background-color: #CCEEFF;padding:0pt;"> Common stock warrants issued and outstanding </td> <td valign="bottom" style="width:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;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:02.50%;background-color: #CCEEFF;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt none #D9D9D9 ;border-left:1pt none #D9D9D9 ;border-bottom:1pt solid #000000 ;border-right:1pt none #D9D9D9 ;background-color: #CCEEFF;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>24,801  </td> <td valign="bottom" style="width:01.00%;background-color: #CCEEFF;padding:0pt;">   </td> </tr> <tr> <td valign="top" style="width:70.00%;padding:0pt;"> Total </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>4,703,023  </td> <td valign="bottom" style="width:02.50%;padding:0pt;">   </td> <td valign="bottom" style="width:12.00%;border-top:1pt solid #000000 ;border-left:1pt none #D9D9D9 ;border-bottom:2pt double #000000 ;border-right:1pt none #D9D9D9 ;;font-family:Times New Roman;font-size:10pt;text-align:right;" nowrap="nowrap"><div style="float:left"></div>4,171,890  </td> <td valign="bottom" style="width:01.00%;padding:0pt;">   </td> </tr> </table></div>   </div> </div> 0.83 1.25 489000 1367000 13739 1500000 806000 1900000 966000 1 <div> <div style="margin-left:0pt;margin-right:0pt;"> 7. Convertible Preferred Stock Warrant   In June 2013, in conjunction with the execution of the loan and security agreement, as discussed in Note 6, the Company issued to the lender a warrant to purchase up to 49,602 shares of Series C convertible preferred stock with an exercise price of $7.56 per share. Upon the draw down of the $5.0 million term loan, the related warrant became exercisable for 24,801 shares. In November 2013, in connection with the Company’s IPO, the warrant automatically became exercisable for 24,801 shares of common stock at an exercise price of $7.56 per share. The lender exercised the warrant with respect to 24,801 shares through a cashless exercise in March 2014 resulting in the issuance of 13,739 shares of the Company’s common stock.   </div> </div>