Employee Stock Benefit Plans

6 Months Ended

Jun. 30, 2020

Disclosure Text Block

Employee Stock Benefit Plans

9. Employee Stock Benefit Plans

The Company has several share-based compensation plans under which stock options, restricted stock awards, restricted stock units and other share-based awards are available for grant to employees, officers, directors and consultants of the Company.

The following table summarizes share-based compensation expense (in thousands):

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2020		2019		2020		2019
Research and development	$	1,405	$	1,179	$	2,801	$	4,098
Selling, general and administrative		5,686		5,021		10,654		15,519
Restructuring expenses		—		137		—		654
	$	7,091	$	6,337	$	13,455	$	20,271

In February 2019, following further analysis of the Company’s strategy and core business needs, and in an effort to further strengthen the operational efficiency of the organization, the Company commenced a reduction in workforce by approximately 35 employees, primarily based in the home office. Certain share-based payment awards were modified in connection with the reduction in workforce. As a result of the modifications, the Company recorded an insignificant amount of share-based compensation expense and approximately $0.7 million to restructuring expenses for the three and six months ended June 30, 2019, respectively.

In April 2019, in connection with the Separation, all outstanding share-based payment awards were modified in accordance with the equity conversion-related provisions of the employee matters agreement with Cyclerion. No share-based compensation expense was recognized in connection with the modifications. Additionally, modifications with respect to the Company’s Employee Stock Purchase Plan (“ESPP”) were made due to the change in share price as a result of the Separation. As a result of the modification to the ESPP, the Company recorded share-based compensation expense of approximately $0.3 million during each of the three and six months ended June 30, 2019.

In connection with certain other modifications of share-based payment awards for the six months ended June 30, 2020, the Company recognized an insignificant amount in share-based compensation expense. In connection with certain other modifications of share-based payment awards during the three and six months ended June 30, 2019, the Company recognized no expense and approximately $2.4 million in share-based compensation expense.