The Company has stock-based compensation plans under which it grants stock options, RSUs, and PRSUs to officers, directors and third parties. Total stock-based compensation for the periods presented are as follows (in thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
Cost of sales	$	735	$	310	$	1,440	$	489
Research and development		1,653		1,440		3,987		2,602
Sales, general and administrative		8,689		9,004		25,037		23,633
Total	$	11,077	$	10,754	$	30,464	$	26,724

As of September 30, 2022, there is $47.8 million of unrecognized compensation expense for RSUs and PRSUs to be recognized over a weighted average period of 1.65 years.

The Company issued approximately 563,000 and 3,103,000 shares of common stock, before net share settlement, upon vesting of RSUs and PRSUs during the three and nine months ended September 30, 2022, respectively, and issued approximately 504,000 and 2,581,000 shares of common stock, before net share settlement, upon vesting of RSUs and PRSUs during the three and nine months ended September 30, 2021, respectively.

Employees are eligible to participate in the Employee Stock Purchase Plan ("ESPP") approved by its shareholders. During the three months ended September 30, 2022, there were no shares issued under the ESPP. During the nine months ended September 30, 2022, there were approximately 222,000 shares issued under the ESPP. During the three months ended September 30, 2021, there were no shares issued under the ESPP. During the nine months ended September 30, 2021, there were approximately 112,000 shares issued under the ESPP.

The Company estimates the fair value of shares issued to employees under the ESPP using the Black-Scholes option-pricing model. The assumptions used to estimate the fair value of stock options granted and stock purchase rights under the ESPP are as follows:


	Three and Nine Months Ended
	September 30,
	2022		2021
Risk-free interest rate	0.07% - 1.54%		0.04% - 0.10 %
Expected dividend yield		—		—
Expected term (years)		0.50		0.50
Volatility	50.29% - 64.53%		49.98% - 78.51%

The 2017 common stock warrants (the “2017 PIPE Warrants”) had a five-year life and were exercisable by cash exercise only. During the nine months ended September 30, 2022, there were approximately 2,312,000 2017 PIPE Warrant exercises for total cash proceeds of $3.5 million. During the three and nine months ended September 30, 2021, there were approximately 275,000 and 795,000 2017 PIPE Warrant exercises, respectively, for total cash proceeds of $0.6 million and $1.6 million, respectively. As of September 30, 2022, the 2017 PIPE Warrants were expired, and no 2017 PIPE Warrants remained outstanding.

The 2018 common stock warrants (the “2018 PIPE Warrants”) have a five-year life and are exercisable by cash or cashless exercise. During the three months ended September 30, 2022, there were approximately 14,000 2018 PIPE Warrant cashless exercises. During the nine months ended September 30, 2022, there were approximately 140,000 2018 PIPE Warrant exercises for total cash proceeds of $0.4 million. During the three and nine months ended September 30, 2021, there were approximately 40,000 and 2,881,000 2018 PIPE Warrant exercises, respectively, for total cash proceeds of $0.1 million and $1.5 million, respectively. As of September 30, 2022, approximately 8,340,000 2018 PIPE Warrants remained outstanding.

The SafeOp common stock warrants (the “SafeOp Warrants”), have a five-year life and are exercisable by cash or cashless exercise. During the three months ended September 30, 2022, there were no SafeOp Warrant exercises. During the nine months ended September 30, 2022, there were approximately 257,000 SafeOp Warrant cashless exercises. There were no SafeOp Warrant exercises during the three months ended September 30, 2021. During the nine months ended September 30, 2021, there were approximately 970,000 SafeOp Warrant exercises for total cash proceeds of $0.1 million. As of September 30, 2022, approximately 938,000 SafeOp Warrants remained outstanding.

In connection with debt financing entered into with Squadron Medical in 2018, and amended in 2019 and 2020, the Company issued common stock warrants to Squadron Medical and a participant lender (the “Squadron Medical Warrants”). The Squadron Medical Warrants expire in May 2027 and are exercisable by cash exercise. No Squadron Medical Warrants have been exercised as of September 30, 2022.

The Company issued warrants to Mr. Patrick S. Miles, the Company’s Chairman and Chief Executive Officer (the “Executive Warrants”). The Executive Warrants have a five-year term and are exercisable by cash or cashless exercise. No Executive Warrants have been exercised as of September 30, 2022.

A summary of all outstanding warrants for common stock as of September 30, 2022, are as follows (in thousands, except for strike price data):


	Number of Warrants		Strike Price		Expiration
2018 PIPE Warrants		8,340	$	3.50	May 2023
SafeOp Surgical Merger Warrants		938	$	3.50	May 2023
2018 Squadron Medical Warrants		845	$	3.15	May 2027
2019 Squadron Medical Warrants		4,839	$	2.17	May 2027
2020 Squadron Medical Warrants		1,076	$	4.88	May 2027
Executive Warrants		1,327	$	5.00	December 2022
Other(1)		121	$	6.28	Various through February 2026
Total		17,486

(1)

Weighted-average strike price.

All outstanding warrants were deemed to qualify for equity classification under authoritative accounting guidance.