Stock-Based Compensation

6 Months Ended

Jun. 30, 2022

Equity incentive plans. In February 2011, the Company’s stockholders approved the Gevo, Inc. 2010 Stock Incentive Plan (as amended and restated to date, the "2010 Plan"), and the Employee Stock Purchase Plan (the "ESPP").

The 2010 Plan provides for the grant of non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock awards, restricted stock units and other equity awards to employees and directors of the Company. On June 9, 2021, upon approval of stockholders at the 2021 Annual Meeting of Stockholders, the 2010 Plan was amended and restated, which increased the number of shares of common stock reserved for issuance under the 2010 Plan to 22,980,074 shares. On June 30, 2022, 7,645,467 shares remained available for awards under the 2010 Plan.

Restricted common stock and non-qualified stock option activity during the six months ended June 30, 2022, consisted of the following:


Period	Total Number of Restricted Shares Issued	Total Number of Non-qualified Stock Options Granted	Vesting Periods Years
January 1, 2022 to March 31, 2022 (1)	(340,502)	—	N/A
April 1, 2022 to June 30, 2022 (1)	(165,174)	—	N/A
Total	(505,676)	—

(1)Includes shares of common stock cancelled in relation to unvested restricted stock awards.

Employee Stock Purchase Plan ("ESPP"). The offering periods for the ESPP are from January 1 to June 30 and from July 1 to December 31 of each calendar year. The Company has reserved 190 shares of common stock for issuance under the ESPP, of which 190 shares as of June 30, 2022, are available for future issuance. The purchase price of the common stock under the ESPP is 85% lower than the fair market value of a share of common stock on the first or last day of the purchase period. There were no purchases of common stock under the ESPP during the six months ended June 30, 2022, or 2021.

Stock Appreciation Rights. The Company granted 67,739 stock appreciation rights valued at an aggregate of $0.1 million on the respective dates of grant during the year ended December 31, 2018. The vesting period for stock appreciation rights granted are based upon a service period. The stock appreciation rights have the potential to be cash settled in the event there are insufficient shares available from the 2010 Plan and are therefore classified as a liability and remeasured at each reporting period based on the price of the Company's common stock.

Stock-based compensation expense. The Company records stock-based compensation expense during the requisite service period for share-based payment awards granted to employees and non-employees. Our stock-based compensation is classified as either an equity award or a liability award in accordance with generally accepted accounting principles. The fair value of an equity-classified award is determined at the grant date and is amortized on a straight-line basis over the vesting life of the award. The fair-value of a liability-classified award is determined on a quarterly basis through the final vesting date and is amortized based on the current fair value of the award and the percentage of vesting period incurred to date.

The following table sets forth the Company’s stock-based compensation expense for the periods indicated (in thousands):


	Three months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Equity Classified Awards
Stock options
Cost of goods sold	$	89	$	—	$	174	$	—
Research and development	83		—		134		—
Selling, general and administrative	1,625		—		3,069		—
Preliminary stage projects	3		—		8		—
Other	99		—		193		—
Restricted stock
Cost of goods sold	109		—		217		—
Research and development	95		121		153		246
Selling, general and administrative	1,963		737		4,013		1,174
Preliminary stage projects	13		—		24		—
Other	141		—		279		—
Total equity classified awards	4,220		858		8,264		1,420
Liability Classified Awards
Restricted stock
Selling, general and administrative	(381)		—		(188)		—
Stock appreciation rights
Research and development	(126)		(159)		(126)		189
Selling, general and administrative	(26)		(7)		(5)		8
Total liability classified awards	(533)		(166)		(319)		197
Total stock-based compensation	$	3,687	$	692	$	7,945	$	1,617

Stock option award activity. Stock option activity under the Company’s stock incentive plans and changes during the six months ended June 30, 2022, were as follows:


	Number of Options	Weighted-Average Exercise Price (1)		Weighted-Average Remaining Contractual Term (years)	Aggregate Intrinsic Value
Options outstanding at December 31, 2021	4,746,368	$	5.11	9.6	$	—
Granted	16,791	$	3.68		$	—
Canceled or forfeited	(220,255)	$	5.56		$	—
Exercised	—				$	—
Options outstanding at June 30, 2022	4,542,904	$	—	9.1	$	—
Options vested and expected to vest at June 30, 2022	18,186	$	39.69	0.5	$	—

(1) Exercise price of options outstanding range from $2.73 to $19,620.00 as of June 30, 2022. The higher range end of the range is due to historical stock reverse splits.

As of June 30, 2022, the total unrecognized compensation expense, net of estimated forfeitures, relating to stock options was $14.6 million, which is expected to be recognized over the remaining weighted-average period of approximately 3.3 years.

Restricted stock. Non-vested restricted stock awards and the changes during the six months ended June 30, 2022, were as follows:


	Number of Shares	Weighted-Average Grant-Date Fair Value
Outstanding at December 31, 2021	6,882,502	$	3.77
Granted	165,174	$	4.45
Exercised	(209,398)	$	2.63
Canceled or forfeited	(252,801)	$	4.87
Vested	(364)	$	2.30
Non-vested at June 30, 2022	6,585,113	$	4.01

The total fair value of restricted stock that vested during the six months ended June 30, 2022, was $0.6 million. As of June 30, 2022, the total unrecognized compensation expense, net of estimated forfeitures, relating to restricted stock awards was $17.2 million, which is expected to be recognized over the remaining weighted-average period of approximately 2.7 years. As of June 30, 2022, we had recorded a liability of $0.5 million for earned and unvested liability-classified restricted stock awards based on the fair value of our common stock as of June 30, 2022.