Total share-based payments related to stock options, restricted stock units (“RSUs”), common stock awards, and non-financing warrants were $0.3 million during both the three months ended September 30, 2018 and 2017, respectively, and $1.2 million and 1.5 million for the nine months ended September 30, 2018 and 2017, respectively.

Share-based compensation expense is classified in the unaudited condensed consolidated statements of operations as follows:

Employee Stock Options

No employee stock options or RSUs were granted nor exercised during the nine months ended September 30, 2018. During the nine months ended September 30, 2017, the Company granted 350,000 employee stock options. The key valuation assumptions used consisted of the Company’s stock price, a risk-free rate of 0.19% and an expected volatility of approximately 110%. In addition, during the nine months ended September 30, 2017, the Company extended the exercise expiration date of certain former employee stock option awards resulting in a change in incremental value of approximately $4,000, which was charged to administrative expense. The Company recognized a total of $0.3 million of compensation expense related to employee stock options for both the three months ended September 30, 2018 and 2017, respectively, and $1.1 million and $1.4 million during the nine months ended September 30, 2018 and 2017, respectively.

Non-Employee Stock Options

During the nine months ended September 30, 2018, the Company granted 10,000 non-employee stock options. The key valuation assumptions used consisted of the Company’s stock price, a risk-free rate of 1.70% and an expected volatility of 118.1%. No non-employee stock options were exercised during the nine months ended September 30, 2018. There were no non-employee stock options granted or exercised during the nine months ended September 30, 2017. The Company recognized approximately $1,000 and $36,000 of expense related to non-employee stock options during the three and nine months ended September 30, 2018, respectively, and approximately $8,000 and $80,000 of expense during the three and nine months ended September 30, 2017, respectively.

Common Stock Awards

During the three months ended September 30, 2018 and 2017, the Company granted 4,477 and 14,091 common stock awards, respectively, and 19,495 and 26,801 common stock awards during the nine months ended September 30, 2018 and 2017, respectively, based on the value of the professional services provided and the average stock price during each respective quarter. As all services were rendered in each respective quarter, approximately $17,000 and $38,000 of compensation expense related to common stock awards was recognized during the three months ended September 30, 2018 and 2017, respectively, and approximately $52,000 and $0.1 million during the nine months ended September 30, 2018 and 2017, respectively. The common stock awards were not issued as of September 30, 2018.

Warrants

In connection with certain of the Company’s collaboration agreements and consulting arrangements, the Company has issued warrants to purchase shares of common stock as payment for services. As of September 30, 2018 and December 31, 2017, warrants to purchase 539,202 and 646,249 shares of common stock were outstanding, respectively. The fair value of these warrants was determined at each issuance date using the Black-Scholes option pricing model. The warrants are subject to re-measurement at each reporting period until the measurement date is reached. Expense is recognized on a straight-line basis over the expected service period or at the date of issuance, if there is not a service period. The Company recognized a gain of approximately $39,000 and $22,000 related to collaboration and consulting warrants during the three months ended September 30, 2018 and 2017, respectively. For the nine months ended September 30, 2018 and 2017, the Company recognized expense of approximately $25,000 and a gain of approximately $0.1 million, respectively, related to collaboration and consulting warrants.

No collaboration or consulting service warrants were issued or exercised during the first nine months of 2018 and 2017. These warrants have expiration dates ranging from December 2019 through May 2021.