STOCK-BASED COMPENSATION

In May 2017, our board of directors and stockholders approved an increase in the total number of shares of common stock issuable under our 2008 Stock Plan ("2008 Plan") from 3,120,000 to 3,495,000 shares. In January 2018, our board of directors and stockholders approved an increase in the total number of shares of common stock issuable under our 2008 Plan to 4,020,000 shares.

Our board of directors has adopted and our stockholders have approved our 2018 Equity Incentive Plan ("2018 Plan"). Our 2018 Plan became effective on February 8, 2018, the date our registration statement in connection with our IPO was declared effective. We do not expect to grant any additional awards under the 2008 Stock Plan. Any awards granted under the 2008 Plan will remain subject to the terms of our 2008 Plan and applicable award agreements.

Initially, the aggregate number of shares of our common stock that may be issued pursuant to stock awards under the 2018 Plan is the sum of (i) 1,875,000 shares plus (ii) 61,247 shares reserved, and remaining available for issuance, under our 2008 Plan at the time our 2018 Plan became effective and (iii) the number of shares subject to stock options or other stock awards granted under our 2008 Plan that would have otherwise returned to our 2008 Plan (such as upon the expiration or termination of a stock award prior to vesting). The number of shares of our common stock reserved for issuance under our 2018 Plan will automatically increase on January 1 of each year, beginning on January 1, 2019 and continuing through and including January 1, 2028, by 5% of the total number of shares of our capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by our board of directors.

The 2018 Plan provides for the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance-based stock awards and other forms of equity compensation, which are collectively referred to as stock awards. Additionally, the 2018 Plan provides for the grant of performance cash awards.

The following table summarizes the allocation of stock-based compensation in the consolidated statements of operations (in thousands):



	Three Months Ended March 31,
	2017		2018
Delivery costs	$	41	$	85
Sales and marketing expense	344		943
Research and development expense	171		470
General and administration expense	427		1,402
Total stock-based compensation expense	$	983	$	2,900

Common Stock Options

Options to purchase shares of common stock generally vest over four years and expire 10 years following the date of grant. A summary of common stock option activity is as follows (in thousands, except per share amounts):



	Shares		Weighted-Average Exercise Price
Options outstanding — December 31, 2016	2,137		$	15.00
Granted	124		11.81
Exercised	(76	)	3.57
Forfeited	(9	)	20.59
Cancelled	(6	)	14.21
Options outstanding — March 31, 2017	2,170		$	15.20



	Shares		Weighted-Average Exercise Price
Options outstanding — December 31, 2017	2,514		$	18.42
Granted	29		24.24
Exercised	(26	)	4.22
Forfeited	(103	)	25.65
Cancelled	(35	)	15.88
Options outstanding — March 31, 2018	2,379		$	18.37

The weighted-average grant-date fair value of options granted during the three months ended March 31, 2017 and 2018 was $7.32 and $10.00. respectively. The total fair value of options vested during the three months ended March 31, 2017 and 2018 was approximately $0.6 million and $1.2 million, respectively. As of March 31, 2018, $10.4 million of unrecognized compensation expense related to unvested options will be recognized over a weighted-average period of 2.7 years.

Restricted Stock Units

A summary of restricted stock unit activity is as follows (in thousands, except per share amounts):



	Shares		Weighted-Average Grant Date Fair Value
Unvested — December 31, 2017	—		$	—
Granted	1,210		20.80
Vested	—		—
Forfeited	(2	)	16.80
Unvested — March 31, 2018	1,208		$	20.81

During the first quarter of 2018, we granted 335,562 restricted stock units ("RSUs") to employees and our non-employee directors, which have annual vesting periods ranging from one to four years.

We also granted two separate tranches of performance-based restricted share units ("PSUs") to receive 437,500 shares of common stock to employees. The vesting of the PSUs was contingent upon the completion of our IPO and includes other performance-based conditions. The performance condition in the first tranche will be satisfied if we attain 70.0 million of FI monthly active users ("FI MAUs") within three years of the grant date. The performance condition in the second tranche will be satisfied if we attain 85.0 million of FI MAUs within five years of the grant date. FI MAUs is a performance metric defined within "Management's Discussion and Analysis of Financial Condition and Results of Operations."

As of March 31, 2018, there was approximately $24.3 million of unrecognized compensation expense related to restricted stock units, which is expected to be recognized over a weighted-average period of 4.3 years.

During the second quarter of 2018, we granted 32,070 RSUs to employees, which have annual vesting periods of four years. The unamortized stock-based compensation expense related to these RSUs is $0.5 million, which will be recognized as stock-based compensation expense over the vesting periods of the awards.

Restricted Securities Units

During 2016, we granted $1.0 million of restricted securities units to certain executives in lieu of cash bonuses. Upon issuance, the restricted securities units were indexed to the convertible promissory notes. As a result of the Series G Stock financing, the restricted securities units became indexed to our Series G’ Stock on the same terms as the Series G’ Stock issued upon conversion of the convertible promissory notes. Upon the completion of our IPO in February 2018, the restricted securities units became indexed to our common stock.

Vesting requirements include both a service-based condition and a performance-based condition. The service-based condition requires each recipient to remain employed until the earlier of i) the date 6 months from the restricted securities unit grant date, ii) the date of a qualified liquidity event, or iii) date of termination without cause. The performance-based condition requires a sale of the Company or IPO event within a fixed period of time not more than 5 years from the restricted securities units grant date. The restricted securities units are considered liability classified awards, but due to the performance condition relating to sale of the Company or IPO, no compensation cost was recognized until one of these events occured. These warrants vested upon the completion of our IPO in February 2018 resulting in a non-cash expense of $0.5 million.

Employee Stock Purchase Plan

Our board of directors has adopted and our stockholders have approved our 2018 Employee Stock Purchase Plan ("2018 ESPP"). Our 2018 ESPP became effective on February 8, 2018, the date our registration statement in connection with our IPO was declared effective and enables eligible employees to purchase shares of our common stock at a discount. Purchases will be accomplished through participation in discrete offering periods. On each purchase date, eligible employees will purchase our common stock at a price per share equal to 85% of the lesser of the fair market value of our common stock on the first trading day of the offering period or the date of purchase. No shares of common stock have been purchased under the 2018 ESPP as the initial offering period has not yet ended.

The maximum number of shares of our common stock that may be issued under our 2018 ESPP is 375,000 shares. Additionally, the number of shares of our common stock reserved for issuance under our 2018 ESPP will automatically increase on January 1 of each year, beginning on January 1, 2019 and continuing through and including January 1, 2026, by the lesser of (i) 1% of the total number of shares of our common stock outstanding on December 31 of the preceding calendar year, (ii) 500,000 shares of our common stock or (iii) such lesser number of shares of common stock as determined by our board of directors. Shares subject to purchase rights granted under our 2018 ESPP that terminate without having been exercised in full will not reduce the number of shares available for issuance under our 2018 ESPP.