The Company’s Employee Stock Purchase Plan (“ESPP”) provides participating employees with the opportunity to purchase the Company’s common stock at 85% of the market price at the lesser of the date the purchase right is granted or exercisable. Eligible employees can contribute up to 15% of their gross base earnings for purchases under the ESPP through regular payroll deductions, limited to $25 thousand worth of the Company’s shares of common stock for each calendar year in which the purchase right is outstanding. The Company currently holds offerings consisting of six-month periods commencing on January 1st and July 1st of each calendar year, with a single purchase date at the end of the purchase period on June 30th and December 31st of each calendar year.

The Company did not issue any shares upon exercise of purchase rights during the three months ended March 31, 2024 and 2023. The Company recognizes compensation expense on a straight-line basis over the service period. During the three months ended March 31, 2024 and 2023, the Company recognized $80 and $122, respectively, of compensation expense related to the ESPP. Stock-based compensation expenses are recorded in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

The following summarizes the Company’s stock option plan and the activity for the three months ended March 31, 2024.


	Shares			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (Years)
Outstanding, December 31, 2023		5,943,898		$	10.28		6.53
Granted		—			—
Exercised or released		(48,750	)		6.11
Forfeited or expired		(100,430	)		13.79
Outstanding, March 31, 2024		5,794,718		$	10.25		6.34
Exercisable, March 31, 2024		4,461,561		$	8.79		5.96
Vested and expected to vest at March 31, 2024		5,790,110		$	10.25		6.34

During the three months ended March 31, 2024 and 2023, the Company recognized $935 and $1,756, respectively, of compensation expense related to stock options. Stock-based compensation expenses are recorded in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

The following table summarizes the Company's restricted stock units activity for the three months ended March 31, 2024:


	Restricted Stock Units			Weighted-Average Fair Value
Outstanding, December 31, 2023		1,317,402		$	17.06
Granted		1,315,860			12.94
Vested		(106,564	)		17.87
Forfeited or expired		(9,923	)		16.08
Outstanding, March 31, 2024		2,516,775		$	14.87
Vested and expected to vest at March 31, 2024		2,414,023		$	14.94

During the three months ended March 31, 2024 and 2023, the Company recognized $2,153 and $1,426, respectively, of compensation expense related to RSUs. Stock-based compensation expenses are recorded in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

On March 8, 2024, the Company granted 241,881 performance shares to certain executives which will vest based on the Company's achievement level relative to Adjusted Free Cash Flow for the trailing twelve months ending December 31, 2026. Adjusted Free Cash Flow is defined as Total Operating Cash Flow plus Investing Cash Flow adjusted for certain nonrecurring items. Upon achievement of the minimum threshold performance metric, the grantee may earn a pro rata portion of their respective target shares and up to 200% of their target shares upon maximum achievement.

The performance shares based on Adjusted Free Cash Flow for the trailing twelve months ending December 31, 2026, have a performance condition. The probability of achieving the performance condition is assessed at each reporting period. If it is deemed probable that the performance condition will be met, compensation cost will be recognized based on the closing price per share of the Company's common stock on the date of the grant multiplied by the number of awards expected to be earned. If it is deemed that it is not probable that the performance condition will be met, the Company will discontinue the recognition of compensation cost and any compensation cost previously recorded will be reversed. At March 31, 2024, achievement of the performance condition for the performance shares was deemed probable, and the expense recorded in the current period was immaterial.