During 2017, the Company adopted a stock option plan (the “2017 Plan”), which replaced the Company’s 2007 stock option plan (the “2007 Plan”). Following the adoption of the 2017 Plan, no stock options were granted under the 2007 Plan. The exercise price of options granted under the 2017 Plan were set at fair market value at the date of the grant as estimated by the Company’s Board with an exercise price of no less than 100% of estimated fair market value on the date of grant.

In November 2021, in connection with its IPO, the Company adopted the 2021 Equity Incentive Plan (the "2021 Plan"). The types of awards that may be granted under the 2021 Plan include stock options, including incentive stock options and nonqualified stock options, restricted stock, dividend equivalents, RSUs, stock appreciation rights, and other stock or cash awards. Under the 2021 Plan, the vesting of stock awards is typically over four years. Following the adoption of the 2021 Plan, no further awards will be made under the 2017 Plan.

Under the Company's ESPP, eligible employees may authorize payroll deduction of up to 15% of their eligible compensation, subject to IRS limitations, during prescribed offering periods to purchase the Company's common stock at 85% of the fair market value of common stock either at the beginning of that offering period or on the exercise date, whichever is less. Each offering period is generally six months.

The following tables present the Company's stock-based compensation for stock-settled awards by type (i.e., stock options and RSUs granted under the Company's incentive plans, and rights to purchase shares of common stock issued under the Company's ESPP and financial statement lines included in the accompanying consolidated statement of operations and comprehensive loss for the years ended December 31, 2022 and 2021:


	2022		2021
	(in thousands)
Options	$	3,975	$	2,258
RSUs		3,407	114
ESPP		100		—
Total stock-based compensation expense	$	7,482	$	2,372

	2022		2021
	(in thousands)
Cost of sales	$	562	$	230
Selling, general and administrative		5,729		1,574
Research and development		1,191	568
Total stock-based compensation expense	$	7,482	$	2,372

On December 2, 2022, the Company's board of directors approved a stock option modification that reduced certain employees' stock option exercise prices. The original options to purchase approximately 2.0 million shares were canceled and replaced by the same number of new options granted with an exercise price of $2.34 with no other terms modified. The modification to the existing options resulted in $1.0 million of incremental value of the stock options, $0.6 million of which was immediately recognized related to vested options as of December 31,2022. The remaining incremental fair value of $0.4 million will be recognized over the remaining requisite service period.

Compensation cost related to unvested stock options and RSUs will generally be amortized on a straight-line basis over the remaining average service period. The following table presents the unamortized compensation cost and weighted average service period of all unvested outstanding awards as of December 31, 2022.

As of December 31, 2022, the unamortized compensation cost related to the ESPP was not material.

The following table summarizes stock option activity under the Company's incentive plans:


	Number of Shares			Weighted Average Exercise Price Per Share		Weighted- Average Remaining Contractual Life	Aggregate Intrinsic Value
						(in years)	(in thousands)
Options outstanding, December 31, 2020		2,247,136		$	5.13
Granted		1,130,249		$	11.98
Forfeited		(175,030	)	$	6.44
Exercised		(79,076	)	$	3.39		$	669
Expired		(3,286	)	$	0.73
Options outstanding, December 31, 2021		3,119,993		$	7.59	7.6	$	2,325
Granted		297,516		$	1.73
Forfeited		(327,720	)	$	9.45
Expired		(262,222	)	$	5.76
Exercised		(71,199	)	$	3.54		$	142
Options outstanding, December 31, 2022		2,756,368		$	2.83	6.9	$	1,510
Options vested and exercisable, December 31, 2022		1,638,280		$	2.75	5.7	$	829
Vested and expected to vest after December 31, 2022		2,627,362		$	2.83	6.8	$	1,432

The weighted-average grant-date fair value of options granted during the years ended December 31, 2022 and 2021 was $1.16 per share and $8.34 per share per share, respectively.

The total fair value of shares vested during the years ended December 31, 2022 and 2021 was $6.9 million and $2.0 million, respectively.

Certain stock option grants under the 2017 Plan allow the recipient to exercise the options prior to the options becoming fully vested. Under the 2017 Plan, the Company retains the right to repurchase common shares that have

been issued upon early exercise of options at the original issue price. During the year ended December 31, 2022, the Company did not repurchase shares. There was no material number of shares of common stock subject to repurchase as of December 31, 2022. Cash received for the early exercise of unvested stock options is initially recorded as a liability and are released to equity over the vesting period. During 2022 and 2021, early exercised stock options vested were immaterial.

The following table summarizes RSU activity under the Company's incentive plans:


	Number of Shares			Weighted Average Grant Date Fair Value
RSUs outstanding, December 31, 2021		338,149		$	9.37
Granted		3,547,603		$	4.33
Vested		(440,952	)	$	5.72
Forfeited		(586,151	)	$	5.39
RSUs outstanding, December 31, 2022		2,858,649		$	4.49

The fair value of the Company's stock options awards is estimated at the date of grant or modification, using the Black-Scholes option-pricing model with the following input assumptions during the years ended December 31, 2022 and 2021:


	2022		2021
	Range	Weighted Average	Range	Weighted Average
Expected volatility	78.37% - 85.14%	83.28%	80.49% - 83.14%	81.82%
Dividend yield	0.00%		0.00%
Risk-free interest rates	3.13% - 4.28%	3.75%	0.87% - 1.31%	1.19%
Expected term (in years)	2.25 - 5.91	4.46	5.49 - 6.64	6.05

The fair value of the Company's RSU awards is determined based upon the closing price of the Company's stock price on the date of grant.

As of December 31, 2022, 7.4 million shares of common stock were reserved for issuance under the Company's incentive plans.