Share-Based Payments

6 Months Ended

Jun. 30, 2022

Share-Based Payment Arrangement [Abstract]

The Company measures the fair value of stock options and restricted stock units ("RSUs") issued to employees and nonemployees as of the grant date for recognition of stock-based compensation expense. Stock-based compensation expense for employees and nonemployees is recognized over the requisite service period, which is typically the vesting period. Stock-based compensation costs included in the condensed consolidated statements of operations are presented below:


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Cost of products	$	7	$	6	$	15	$	15
Cost of services	23		24		48		78
Research and development	589		581		1,134		1,610
Selling, general and administrative	1,660		2,870		4,606		7,065
Discontinued operations	30		76		68		204
Total	$	2,309	$	3,557	$	5,871	$	8,972

Precigen Stock Option Plans

In April 2008, Precigen adopted the 2008 Equity Incentive Plan (the "2008 Plan") for employees and nonemployees pursuant to which Precigen's board of directors granted share-based awards, including stock options, to officers, key employees and nonemployees. Upon the effectiveness of the 2013 Omnibus Incentive Plan (the "2013 Plan"), no new awards may be granted under the 2008 Plan. As of June 30, 2022, there were 14,843 stock options outstanding under the 2008 Plan.

Precigen adopted the 2013 Plan for employees and nonemployees pursuant to which Precigen's board of directors may grant share-based awards, including stock options and shares of common stock, to employees, officers, consultants, advisors, and nonemployee directors. The 2013 Plan became effective in August 2013, and as of June 30, 2022, there were 37,000,000 shares authorized for issuance under the 2013 Plan, of which 13,579,288 stock options and 98,927 RSUs were outstanding and 12,641,525 shares were available for grant.

In April 2019, Precigen adopted the 2019 Incentive Plan for Non-Employee Service Providers (the "2019 Plan"), which became effective upon shareholder approval in June 2019. The 2019 Plan permits the grant of share-based awards, including stock options, restricted stock awards, and RSUs, to non-employee service providers, including board members. As of June 30, 2022, there were 12,000,000 shares authorized for issuance under the 2019 Plan, of which 1,898,208 stock options and 615,760 RSUs were outstanding and 7,243,025 shares were available for grant.

Stock option activity was as follows:


	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)
Balances at December 31, 2021	12,260,187	$	14.06	6.79
Granted	4,172,390	2.23

Exercised	(375)	2.28
Forfeited	(365,552)	5.42
Expired	(574,311)	23.31
Balances at June 30, 2022	15,492,339	10.73		7.28
Exercisable at June 30, 2022	8,768,295	14.00		6.15

RSU activity was as follows:


	Number of Restricted Stock Units	Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Term (Years)
Balances at December 31, 2021	468,481	$	8.47	0.33
Granted	1,387,831	2.12
Vested	(1,125,785)	4.29
Forfeited	(15,840)	7.26
Balances at June 30, 2022	714,687	2.77		0.63

Precigen currently uses authorized and unissued shares to satisfy share award exercises.

The Company's Executive Chairman ("Executive Chairman"), who previously served as an employee and executive officer until September 24, 2020, received a base salary of $200 per month through March 31, 2020, payable in fully-vested shares of Precigen common stock with such shares subject to a three-year lock-up on resale. In September 2020, the Company's board of directors, upon the recommendation of the compensation committee of the board, approved a new compensation arrangement for the Executive Chairman consisting of (i) an annual retainer of $100 payable in cash or, at the Executive Chairman's election, shares of Precigen common stock; (ii) an annual grant of fully vested stock options having a grant date fair value of $250; and (iii) an annual grant of RSUs having a grant date fair value of $250 vesting over one year. The new compensation arrangement began in calendar year 2021 and was prorated for the nine months of 2020 not covered by the Executive Chairman's previous compensation arrangement discussed above. Expense associated with the arrangements above is included in selling, general, and administrative expenses in the Company's condensed consolidated statements of operations and totaled $62 and $109 for the three months ended June 30, 2022 and 2021, respectively, and $495 and $509 for the six months ended June 30, 2022 and 2021, respectively.