9. STOCK-BASED COMPENSATION

Employee Stock Purchase Plan

In July 2016, we commenced administration of the ANI Pharmaceuticals, Inc. 2016 Employee Stock Purchase Plan. As of March 31, 2020, we have 0.2 million shares of common stock available under the ESPP. Under the ESPP, participants can purchase shares of our stock at a 15% discount.

The following table summarizes ESPP expense incurred under the 2016 Employee Stock Purchase Plan and included in our accompanying unaudited interim condensed consolidated statements of operations:


(in thousands)	Three Months Ended March 31,
	2020		2019
Cost of sales	$	4	$	3
Research and development		7		5
Selling, general, and administrative		18		22
	$	29	$	30

Stock Incentive Plan

All equity-based service awards are granted under the ANI Pharmaceuticals, Inc. Amended and Restated 2008 Stock Incentive Plan (the “2008 Plan”). As of March 31, 2020, 0.3 million shares of our common stock remained available for issuance under the 2008 Plan.

The following table summarizes stock-based compensation expense incurred under the 2008 Plan and included in our accompanying unaudited interim condensed consolidated statements of operations:


(in thousands)	Three Months Ended March 31,
	2020		2019
Cost of sales	$	26	$	21
Research and development		187		113
Selling, general, and administrative		2,182		1,546
	$	2,395	$	1,680

A summary of stock option and restricted stock activity under the 2008 Plan during the three months ended March 31, 2020 and 2019 is presented below:


(in thousands)	Options	RSAs
Outstanding December 31, 2018	759	117
Granted	157	122
Options Exercised/RSAs Vested	(58)	(11)
Forfeited	(18)	(2)
Expired	(1)	—
Outstanding March 31, 2019	839	226

Outstanding December 31, 2019	757	192
Granted	8	—
Options Exercised/RSAs Vested	(7)	(49)	(1)
Forfeited	(3)	—
Expired	—	—
Outstanding March 31, 2020	755	143

⁽¹⁾

Includes 13 thousand shares purchased from employees to cover employee income taxes related to income earned upon vesting of restricted stock. The shares purchased are held in treasury and the $488 thousand total purchase price for the shares is included in Treasury stock in our accompanying unaudited interim condensed consolidated balance sheets.

On January 17, 2020, we entered into employment agreements with our Named Executive Officers ("NEOs"), (i)President and Chief Executive Officer, Arthur S. Przybyl, (ii) Vice President of Finance and Chief Financial Officer, Stephen P. Carey, (iii) Senior Vice President of Business Development and Specialty Sales, Robert Schrepfer and (iv) Senior Vice President of Operations and Product Development, James G. Marken. As part of the employment agreements, the NEOs' Non-Statutory Stock Option, Incentive Option and Restricted Stock Grant agreements ("NEO Stock Agreements") were modified to provide for accelerated vesting of unvested non-statutory stock options and restricted stock awards in the event of a termination for any reason other than "cause" as defined in the employment agreements or by the NEOs for "good reason" as defined in the employment agreements. Additionally, any vested incentive or non-statutory stock options and unvested non-statutory stock options subject to acceleration and held unexercised by the NEOs at the time of such termination will retain their normal term, which is generally 10 years from grant date. We did not recognize any incremental share-based compensation expense associated with these modifications, as no assumptions regarding the assumed probability of these awards' future vests were changed on the modification date.

As noted in our Form 8-K, Item 5.02 filed on April 14, 2020 with a report date of April 10, 2020, Arthur S. Przybyl will depart as President and Chief Executive Officer on May 10, 2020. Mr. Przybyl's departure will constitute a Termination Without Good Cause as defined in his employment agreement, which agreement has previously been disclosed, and he will receive separation payments and benefits under his employment agreement in respect of a termination without good cause, including those related to his incentive stock options, non-statutory stock options and restricted stock awards as discussed above.