Stock-Based Compensation

9 Months Ended

Sep. 30, 2020

Text Block [Abstract]

Stock-Based Compensation

8. Stock-Based Compensation

The Company recognized stock-based compensation expense on all employee and non-employee awards as follows:

	For the three months ended September 30,				For the nine months ended September 30,
(in thousands)	2020		2019		2020		2019
Research and development	$	522	$	339	$	1,587	$	1,068
General and administrative		1,270		1,147		3,806		3,673
Stock-based compensation expense	$	1,792	$	1,486	$	5,393	$	4,741

The Company granted an aggregate of 203,178 and 1,252,178 stock options during the three and nine months ended September 30, 2020 with a weighted-average grant date fair value of $1.96 and $2.45 per share, respectively. The Company granted an aggregate of 140,000 and 1,835,755 stock options during the three and nine months ended September 30, 2019 with a weighted average grant date fair value of $3.05 and $1.90 per share, respectively.

On January 6, 2019, the Company settled an accrued annual performance bonus by issuing 446,428 shares of common stock.

On May 26, 2020, the Company extended the contractual life of 448,130 fully vested stock options and 31,220 stock options that vested on June 30, 2020, held by an officer of the Company. Additionally, on May 26, 2020, the Company accelerated the vesting of 45,277 shares of restricted stock held by an officer. These extensions and acceleration of vesting resulted in additional stock compensation expense of $65 thousand and $154 thousand in the three and nine months ended September 30, 2020, respectively.

On September 18, 2020, the Company extended the contractual life of 113,350 fully vested stock options and 25,281 stock options that vested on September 18, 2020, held by a director of the Company. Additionally, on September 18, 2020, the Company accelerated the vesting of 25,281 stock options and 15,890 shares of restricted stock held by a director of the Company. These extensions and acceleration of vesting resulted in additional stock compensation expense of $(250) in the three and nine months ended September 30, 2020.

For the three months ended September 30, 2020 and 2019, the fair value of stock options was estimated on the date of grant using a Black-Scholes option valuation model with the following assumptions:

	For the three months ended September 30,
	2020	2019
Risk-free interest rate	0.36 - 0.39%	1.39 - 1.92%
Expected life in years	5.75 - 6.25	6.25
Expected volatility	73.59 - 74.18%	72.87 - 78.34%
Expected dividend yield	0%	0%

Stock option activity under the Company’s stock option plans for the nine months ended September 30, 2020 is as follows:

(in thousands, except share and per share data)	Number of Shares			Weighted- Average Exercise Price		Weighted- Average Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding, December 31, 2019		5,842,879		$	3.21
Granted		1,252,178			3.89
Exercised		(22,916	)		1.87
Cancelled		(499,950	)		3.84
Outstanding, September 30, 2020		6,572,191		$	3.93		7.82	$	978
Options exercisable, September 30, 2020		3,711,684		$	4.10		6.96	$	704
Options exercisable, December 31, 2019		2,765,357		$	4.39		6.70	$	3,603
Options available for future grant		6,986,610

At September 30, 2020, total unrecognized compensation costs related to unvested stock options outstanding amounted to $8.0 million. The cost is expected to be recognized over a weighted-average period of 1.82 years.

A summary of the status of unvested restricted stock for the nine months ended September 30, 2020 is as follows:

	Number of Shares			Weighted-Average Grant Date Fair Value
Non-vested, December 31, 2019		939,636		$	2.93
Granted		555,900			4.21
Vested		(64,917	)		3.42
Cancelled		(141,230	)		3.15
Non-vested, September 30, 2020		1,289,389		$	3.43

At September 30, 2020, total unrecognized compensation costs related to unvested restricted stock outstanding amounted to $3.0 million. The cost is expected to be recognized over a weighted-average period of 1.57 years.

At the Company’s annual meeting held on June 29, 2020, the shareholders approved the 2020 Equity Incentive Plan, or the 2020 Plan, which is a successor to and continuation of the Company’s 2012 Equity Incentive Plan, or the 2012 plan. The 2020 Plan had 21 million shares authorized, plus the shares remaining for issuance under the 2012 Plan. Our ability to utilize the total shares authorized under the 2020 Plan will be limited by the total number of shares authorized in our certificate of incorporation. As of September 30, 2020, there are 6,986,610 Shares available to grant from the 2020 plan. No additional awards can be granted from the 2012 Plan or the Company’s 2003 Stock Option Plan.