ACHN 2017 Annual Report

Achillion Pharmaceuticals, Inc. Notes to Financial Statements—(Continued) (in thousands, except per share amounts) 9. Accrued Expenses and Other Long-Term Liabilities Accrued expenses consist of the following: As of December 31, 2017 2016 Accrued compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $4,014 $3,810 Accrued research and development expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,384 1,441 Accrued professional expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 735 972 Other accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 328 544 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $7,461 $6,767 Accrued research and development expenses are comprised of amounts owed to third-party contract research organizations, (“CROs”), clinical investigators, laboratories and data managers for research and development work performed on behalf of the Company. 10. Capital Structure Preferred Stock At December 31, 2017, the Company had 5,000 authorized shares of undesignated preferred stock of which no shares were issued and outstanding. Common Stock At December 31, 2017, the Company had 200,000 authorized shares of $0.001 par value common stock of which 137,894 shares were issued and outstanding and 18,961 shares were reserved for future issuance. Warrants At December 31, 2017, there were 21 warrants outstanding with an exercise price of $4.68 and a remaining contractual life of 0.2 years. 11. Stock-Based Compensation 2006 Stock Incentive Plan The Company’s 2006 Stock Incentive Plan (“the 2006 Plan”) was adopted by the Company’s board of directors in May 2006, amended by its board of directors in September 2006, approved by its stockholders in September 2006 and became effective in October 2006, upon the closing of the Company’s initial public offering. The Company originally reserved for issuance 750 shares of common stock under the 2006 Plan. In addition, the Plan contained an “evergreen” provision, which allowed for an annual increase in the number of shares available for issuance under the Plan on the first day of each fiscal year during the period beginning on the first day of fiscal year 2007 and ending on the second day of fiscal year 2010. Under the evergreen provision, the Company registered an additional 2,673 shares of common stock to be issued under the 2006 Plan. On June 10, 2010, stockholders of the Company approved an amendment to the 2006 Plan to increase by 3,000 shares the number of shares of common stock reserved for issuance under the 2006 Plan from 3,423 shares to 6,423 shares. F-20