In September 2021, the Company’s Board of Directors adopted, and its stockholders approved, the 2021 Incentive Award Plan (“2021 Plan”), which became effective in connection with the IPO. The 2021 Plan provides for granting stock options, including incentive stock options ("ISOs") and nonqualified stock options ("NSOs"), restricted stock, dividend equivalents, restricted stock units ("RSUs"), other stock-based awards, and cash awards to eligible employees, consultants and directors. A total of 14,798,186 shares of the Company’s common stock have been reserved for issuance under the 2021 Plan. The number of shares initially available for issuance will be increased annually on January 1 of each calendar year beginning in 2022 and ending in 2031 by an amount equal to the lesser of (i) 5% of the shares of the Company's common stock outstanding on the final day of the immediately preceding calendar year or (ii) a smaller number of shares as determined by the Company's Board of Directors. As of December 31, 2021, there were 14,459,679 remaining shares available for the Company to grant under the 2021 Plan.

The Company’s Amended and Restated 2015 Stock Option Plan ("2015 Plan”) provided for the granting of ISOs and NSOs to the Company's employees, consultants, and nonemployee directors. In conjunction with the effectiveness of the 2021 Plan, the Company’s Board of Directors voted that no further awards would be granted under the 2015 Plan but any awards under the 2015 Plan that were outstanding as of the date of the IPO shall remain outstanding and continue to be subject to the terms and conditions of the 2015 Plan.

Stock-based awards granted to employees generally vest over a four-year period, and, in the case of stock options, expire ten years from the date of grant.

In September 2021, the Company’s Board of Directors adopted, and its stockholders approved, the 2021 Employee Stock Purchase Plan (“2021 ESPP”), which became effective in connection with the IPO. The 2021 ESPP authorizes the issuance of shares of common stock pursuant to purchase rights granted to employees. A total of 2,219,728 shares of the Company’s common stock have been reserved for future issuance under the 2021 ESPP. The number of shares available for issuance under the 2021 ESPP will be annually increased on January 1 of each calendar year beginning in 2022 and ending in 2031, by an amount equal to the lesser of: (i) 1% of the aggregate number of shares of the Company's common stock outstanding on the final day of the immediately preceding calendar year or (ii) such smaller number of shares as is determined by the Company's Board of Directors. As of December 31, 2021, the Company has not commenced any offering period under the 2021 ESPP.

The Company estimates the fair value of stock options granted using the Black-Scholes option-pricing model, which requires the input of subjective assumptions, including the risk-free interest rate, expected volatility, expected dividend yield and expected term. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. The Company

estimates its expected share volatility based on the historical volatility of a publicly traded set of peer companies. Expected dividend yield is based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. The expected term of the Company’s options has been determined based on the average of the vesting term and the contractual lives of all options awarded.

The following table presents, on a weighted average basis, the assumptions used in the Black-Scholes option-pricing model to determine the grant-date fair value of options granted:


	Year Ended December 31,
	2021			2020
Fair value of common stock/shares	$	7.67		$	3.68
Risk-free interest rate		1.2	%		0.6	%
Expected volatility		27.3	%		27.0	%
Expected dividend yield		—			—
Expected term (in years)		9.3			8.1

The following table summarizes the Company’s option activity for the year ended December 31, 2021:


						Weighted
				Weighted		Average
				Average		Remaining		Aggregate
	Number			Exercise		Contractual		Intrinsic
	of Shares			Price		Term		Value
						(in years)		(in thousands)
Outstanding as of December 31, 2020		9,333,218		$	2.72		8.41	$	16,882
Granted		3,005,910			8.58
Exercised		(832,791	)		1.90
Forfeited		(1,684,158	)		3.86
Outstanding as of December 31, 2021		9,822,179		$	4.39		7.44	$	193,789
Options exercisable as of December 31, 2021		4,405,641		$	2.66		5.91	$	94,555

As of December 31, 2021, the total compensation cost related to the unvested stock option awards not yet recognized was $14.4 million, which will be recognized over a weighted-average period of 2.6 years. The weighted average grant-date fair value per share of options granted during the years ended December 31, 2021 and 2020, was $2.39 and $1.26, respectively.

The aggregate intrinsic value of options exercised during the years ended December 31, 2021 and 2020 was $10.0 million and $9.6 million, respectively. For the years ended December 31, 2021 and 2020, $1.6 million and $5.0 million of cash was received as the result of the exercise of options granted under share-based payment arrangements, respectively.

The Company recognizes stock-based compensation expense over the vesting term of restricted stock units. The fair value is measured based on the closing price of the Company’s common stock underlying such units on the dates of grant. Upon vesting and settlement, each restricted stock unit entitles the holder to receive one share of common stock. The following table summarizes the Company's restricted stock unit activity for the year ended December 31, 2021:


				Weighted
				Average
	Number			Grant Date
	of Shares			Fair Value
Outstanding as of December 31, 2020		—		$	—
Granted		377,363			26.42
Vested		(1,602	)		26.00
Forfeited		(38,856	)		26.09
Outstanding as of December 31, 2021		336,905		$	26.46

As of December 31, 2021, there was $8.4 million of unrecognized stock-based compensation expense related to unvested restricted stock units that is expected to be recognized over a weighted-average period of 3.7 years. The aggregate fair

value of restricted stock units that vested during the year ended December 31, 2021 was not material. No restricted stock units vested during the year ended December 31, 2020.

Stock-based compensation expense is reflected on the consolidated statement of operations and comprehensive loss as follows (in thousands):


	Year Ended December 31,
	2021		2020
Cost of revenue	$	247	$	14
General and administrative		8,070		519
Selling and marketing		813		81
Research and development		338		27
Total	$	9,468	$	641

The Company has not capitalized any stock-based compensation expense as part of the cost of an asset in any of the periods presented.

In June 2021, the Company entered into an amended employment agreement with an employee. Under the terms of the amended agreement, the employee would continue to vest in his outstanding equity awards, despite changes to his day-to-day responsibilities over time. As a result of the employment change, certain awards were considered to be modified in accordance with ASC 718. This resulted in a $12.1 million increase in unamortized stock-based compensation expense, which will be recognized over the remaining weighted-average period of the modified awards of 2.6 years from the modification date.

Upon the Company's IPO in September 2021, as specified in the 2015 Plan, all awards with performance-based vesting conditions converted into awards with service-based vesting, with vesting measured from each awards' respective grant date. Upon the Company's IPO, the Company recognized $5.7 million of accelerated stock-based compensation expense related to awards with performance-based vesting conditions that converted into service-based vesting, of which $3.6 million related to the above-mentioned modified awards.