On March 28, 2022, Marc DeBevoise began as the Company’s CEO. Effective February 8, 2022, the Company adopted the 2022 Inducement Plan (“2022 Plan”). The 2022 Plan provides for the grant of “employment inducement awards” within the meaning of NASDAQ Listing Rule 5635(c)(4). In connection with the commencement of his employment, the Company granted 800,000 restricted stock units to the CEO under the 2022 Plan, of which 300,000 are subject solely to service-based vesting conditions (the “RSUs”) and 500,000 are subject to both market-based and service-based vesting conditions (the

“PSUs”). The RSUs vest in equal annual installments over three years following March 28, 2022. The market-based vesting conditions applicable to the PSUs are achieved only if the volume weighted average price of the Company’s common stock during any 20 consecutive trading day period in the four year performance period following the CEO’s start date, March 28, 2022, equals or exceeds stock price hurdles ranging from $12.50 to $30.00, increasing in seven increments of $2.50. The percentage of the award that is earned upon achievement of each stock price hurdle is 10% of the PSUs for each of the first two achievement tiers, 12.5% for each of the next four achievement tiers and 15% for each of the final two achievement tiers. The PSUs vest 50% upon achievement of a stock price hurdle and 50% upon the earlier of the one-year anniversary of such achievement date or March 28, 2025, subject to the CEO’s continued employment through the applicable vesting date.

For restricted stock units with market-based performance conditions, the cost of the awards is recognized as the requisite service is rendered by the employee, regardless of when, if ever, the market-based performance conditions are satisfied. The Monte-Carlo simulation model is used to estimate fair value of market-based performance restricted stock units. The Monte-Carlo simulation model calculates multiple potential outcomes for an award and establishes a fair value based on the most likely outcome. Key assumptions for the Monte-Carlo simulation model include the risk-free rate, expected volatility, expected dividends and the correlation coefficient.

The weighted-average assumptions utilized to determine the weighted-average fair value of options are presented in the following table:


	Six Months Ended June 30,
	2022		2021

Weighted-average fair value of options granted during the period	$	—	$	7.72
Risk-free interest rate		—		1.16	%
Expected volatility		—		48	%
Expected life (in years)		—		6.2
Expected dividend yield		—		—

As of June 30, 2022, there was $39 million of unrecognized stock-based compensation expense related to stock-based awards that is expected to be recognized over a weighted-average period of 2.74 years. The following table summarizes stock-based compensation expense as included in the consolidated statement of operations for the three and six months ended June 30, 2022 and 2021:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
	(in thousands)
Stock-based compensation:
Cost of subscription and support revenue	$	144	$	187	$	253	$	344
Cost of professional services and other revenue		139		118		258		186
Research and development		935		531		1,657		853
Sales and marketing		899		762		1,842		1,499
General and administrative		1,527		1,011		2,864		2,019
Other expense (benefit)		-		—		249		0
	$	3,644	$	2,609	$	7,123	$	4,901

The following is a summary of the stock option activity during the six months ended June 30, 2022.


	Number of Shares			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (In Years)		Aggregate Intrinsic Value (1)
Outstanding at December 31, 2021		1,681,477		$	9.59
Granted		—			—
Exercised		(15,900	)		6.31			$	33,483
Canceled		(117,286	)		12.11
Outstanding at June 30, 2022		1,548,291		$	9.42		5.28	$	82,101
Exercisable at June 30, 2022		1,350,807		$	9.08		4.90	$	81,296

(1)

The aggregate intrinsic value was calculated based on the positive difference between the fair value of the Company’s common stock on June 30, 2022 of $6.32 per share, or the date of exercise, as appropriate, and the exercise price of the underlying options.

The following table summarizes the restricted stock unit activity for our service-based awards (“S-RSU”) and our performance-based awards (“P-RSU”) during the six months ended June 30, 2022:


	S-RSU Shares			Weighted Average Grant Date Fair Value		P-RSU Shares			Weighted Average Grant Date Fair Value		Total RSU Shares			Weighted Average Grant Date Fair Value
Unvested at December 31, 2021		2,915,720		$	11.66		1,021,172		$	11.04		3,936,892		$	11.50
Granted		2,755,385			7.31		500,000			8.11		3,255,385			7.43
Vested and issued		(416,525	)		12.18		—			—		(416,525	)		12.18
Canceled		(599,184	)		10.37		(284,298	)		12.80		(883,482	)		11.15
Unvested at June 30, 2022		4,655,396		$	9.21		1,236,874		$	9.46		5,892,270		$	9.26