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Stock-Based Compensation
 9 Months Ended
Sep. 30, 2021
Share-based Payment Arrangement [Abstract]  
Stock-Based Compensation Stock-Based Compensation
The Company's 2017 Stock Incentive Plan (the “2017 Plan”) and 2010 Stock Incentive Plan (the “2010 Plan”) provide for the issuance of 5,082,955 shares of the Company's common stock. The Company has granted stock options to executive officers, employees, members of the Company's board of directors, and certain outside consultants and restricted stock units ("RSUs") to employees. The terms and conditions upon which options become exercisable vary among grants; however, option rights expire no later than ten years from the date of grant and employee and Board of Director awards generally vest over one to four years on a straight-line basis. The terms and conditions upon which RSUs vest vary among grants; however, RSUs generally vest over four to five years on a straight-line basis. As of September 30, 2021, the Company had 3,628,250 stock options and RSUs outstanding and 97,961 shares reserved for future awards.
Stock-based compensation expense was $2.9 million and $1.8 million for the three months ended September 30, 2021 and 2020, respectively, and $8.9 million and $5.8 million for the nine months ended September 30, 2021 and 2020, respectively. The Company issued $0.4 million of common stock to one of the Company's executives during the quarter ended March 31, 2020 and it has been included in stock-based compensation expense for the nine months ended September 30, 2020.
The assumptions used in the Black-Scholes option-pricing model were as follows:

Nine Months Ended
September 30, 2021
Volatility
79.0% - 82.0%
Risk-free interest rate
0.19% - 0.98%
Expected life (in years)
2.75 - 6.08
Dividend yield0 %

The expected volatility assumptions have been based on the historical and expected volatility of our stock and comparable companies, measured over a period generally commensurate with the expected term or acceptable period to determine reasonable volatility. The weighted average expected option term for the nine months ended September 30, 2021 reflects the application of the simplified method prescribed in SEC Staff Accounting Bulletin (“SAB”) No. 107 (as amended by SAB 110), which defines the life as the average of the contractual term of the options and the weighted average vesting period for all option tranches.
Stock Options - Employees and Directors
A summary of stock option activity for employees, directors and consultants is as follows:
Number of Shares
Weighted Average
Exercise Price
Outstanding as of December 31, 20203,616,314 $14.66 
Granted738,628 24.08 
Exercised(395,181)14.13 
Forfeited(472,740)14.27 
Expired(271)48.00 
Outstanding as of September 30, 20213,486,750 16.77 
Options vested and exercisable as of September 30, 20211,115,549 $14.51 

As of September 30, 2021, there was $21.5 million of total unrecognized compensation cost related to non-vested stock compensation arrangements granted to employees, directors and consultants under the 2017 Amended Plan, which is expected to be recognized over a weighted-average period of approximately 1.84 years.
Restricted Stock Units - Employees
The Company estimates the fair value of RSUs based on the closing price of our common stock on the date of grant. The following table summarizes our RSU award activity issued under the 2017 Plan:

Restricted Stock UnitsWeighted-
Average
Grant Date Fair Value
Non-vested at December 31, 202030,000 $51.98 
Granted114,000 29.55 
Forfeited(2,500)33.41 
Non-vested at September 30, 2021141,500 34.24 


As of September 30, 2021, there was $4.3 million of unrecognized compensation cost related to unvested outstanding RSUs. We expect to recognize these costs over a weighted average period of 3.96 years.
Warrants - Non-employees
The Company has also granted warrants to purchase common stock that have been approved by our Board of Directors. A summary of warrants activity was as follows:
Number of Warrants
Weighted Average
Exercise Price
Outstanding as of December 31, 20201,465,927 $6.02 
Granted— — 
Exercised (1)(1,402,866)5.77 
Expired(13,258)4.80 
Outstanding as of September 30, 202149,803 13.51 
Warrants exercisable as of September 30, 202149,803 13.51 
____________
(1) Included in total number of warrants exercised are 218,225 shares that were net settled at the election of the warrant holders during the nine months ended September 30, 2021.

Performance-Based and Market-Based Awards
The Company’s Compensation Committee designed a compensation structure to align the compensation level of the Executive Chairman to the performance of the Company through the issuance of market-based stock options. The market-based options vest upon the Company’s stock price reaching a certain price at a specific performance period and the total amount of compensation expense recognized is based on a Monte Carlo simulation that factors in the probability of the award vesting. The following table summarizes the Company’s outstanding awards under this structure:

Grant DatePerformance MeasuresVesting TermPerformance Period# of SharesExercise Price
December 2017
Weighted Average Price of our common stock is $15.00 for at least twenty trading days within a period of thirty consecutive trading days ending on the trading day prior to January 1, 2023.
Fully vest on January 1, 2023January 1, 2023642,307 $7.50 
August 2018
Weighted Average Price of our common stock is $15.00 for at least twenty trading days within a period of thirty consecutive trading days ending on the trading day prior to January 1, 2023.
Fully vest on January 1, 2023January 1, 2023397,693 $7.50 
During the quarter ended March 31, 2020, the Company amended the option agreement of one of the Company's former executives to vest additional options previously forfeited and extend the period to exercise, resulting in $0.6 million of additional stock-based compensation expense, which was included in stock-based compensation expense for the nine months ended September 30, 2020.