Stock-Based Compensation

9 Months Ended

Sep. 30, 2020

Share-based Payment Arrangement [Abstract]

Stock Options

The Company recognized $0.1 million and $0.2 million of compensation expense related to stock options during the three months ended September 30, 2020 and 2019, respectively, and $0.7 million during the nine months ended September 30, 2020 and 2019, respectively.

On May 25, 2016, the Board of Directors approved the Company’s 2016 Equity Incentive Plan (the “2016 Plan”). On May 21, 2018, the Board of Directors adopted, and the Company’s stockholders subsequently approved, an amendment and restatement of the 2016 Plan that increased the number of shares of Common Stock available for grant under such plan to 4,000,000 shares by adding 2,000,000 shares of Common Stock (the "Amended 2016 Plan"). The 4,000,000 shares of Common Stock available for issuance pursuant to the Amended 2016 Plan was reduced to 400,000 shares when the one-for-ten Reverse Stock Split effectuated on May 28, 2020. On July 15, 2020, the Board of Directors adopted and the Company’s stockholders approved an amendment of its existing 2016 Equity Incentive Plan (the "July 2020 Amendment"). The July 2020 Amendment increases the number of shares available to be granted under the 2016 Plan from 400,000 shares to 4,400,000 shares, plus any shares of its common stock that are represented by awards granted under its 1999 Director Plan and 2009 Equity Incentive Plan that are forfeited, expire or are cancelled without delivery of shares of common stock or which result in the forfeiture of shares of common stock back to the Company on or after May 25, 2016. Generally, shares of common stock reserved for awards under the 2016 Plan that lapse or are canceled will be added back to the share reserve available for future awards. However, shares of common stock tendered in payment for an award or shares of common stock withheld for taxes will not be available again for grant. The 2016 Plan provides that no participant may receive awards for more than 1,000,000 shares of common stock in any fiscal year.

As of September 30, 2020, there were 1,362 RSUs outstanding, 18,561 shares of common stock outstanding and 331,803 stock options under the 2016 Plan. As of December 31, 2019, there were 6,268 RSUs outstanding, 13,655 shares of common stock outstanding and 283,559 stock options outstanding under the 2016 Plan. As of September 30, 2020, there were a total of 4,341,349 options available under the 2016 plan after the July 2020 Amendment as discussed above and there were 233,416 options available under the Plan as of December 31, 2019.

In the interest of maintaining consistency with the Company's 2016 Equity Incentive Plan, on March 13, 2017, the Company entered into (i) an amendment to the option agreements governing each option grant currently outstanding under the Company's 2009 Equity Incentive Plan, and (ii) an amendment to the RSU, agreements governing each RSU grant currently outstanding under the 2009 Plan. The amendments provide for the automatic vesting upon a change of control of the Company of each option grant and RSU grant, as applicable, outstanding under the 2009 Plan. The amendments had a de minimis value to the holders as of September 30, 2020, and therefore no additional stock compensation expense was recognized related to the amendments.

The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing formula that uses assumptions noted in the following table. Expected volatilities and risk-free interest rates are based upon the expected life of the grant.


	Nine Months Ended September 30,
Assumptions	2020	2019
Expected dividends	—	—
Risk-free rate	0.20% - 1.60%	1.38%-2.47%
Expected volatility	78.56% - 158.21%	64.3% - 75.2%
Expected term (in years)	3.2 - 3.3 years	3.2 - 3.3 years

Expected volatility was calculated using the historical volatility of the Company's stock over the expected life of the options. The expected life of the options was estimated based on the Company's historical data. The risk free interest rate is based on U.S. Treasury yields for securities with terms approximating the terms of the grants. Forfeitures are recognized in the period they occur. The assumptions used in the Black-Scholes options valuation model are highly subjective, and can materially affect the resulting valuation.

A summary of option activity under the 1999 Director Stock Option Plan, 2009 Equity Incentive Plan, and the 2016 Equity Incentive Plan as of September 30, 2020 and changes during the period are presented below:


	Number of Options	Weighted Average Exercise Price
Outstanding as of January 1, 2020	516,820	$	33.40
Issued	348,612	3.87
Exercised	—	—
Forfeited	(40,911)	10.19
Expired	(229,309)	33.23
Outstanding as of September 30, 2020	595,212	$	17.76

Exercisable as of September 30, 2020	201,851	$	40.54

The following tables summarize information regarding options outstanding and exercisable at September 30, 2020:

Outstanding:


	Stock Options	Weighted Average		Weighted Average Remaining
Range of Exercise Prices	Outstanding	Exercise Price		Contractual Life
$0.00 - $7.80	343,796	$	3.96	9.23
$7.81 - $15.0	59,528	10.30		6.71
$15.1 - $55.0	118,450	24.03		7.19
$55.1 - $106.7	73,438	78.31		5.35
Total	595,212	$	17.76	8.09

Exercisable:


Range of Exercise Prices	Stock Options Exercisable	Weighted Average Exercise Price
$0.00 - $7.80	10,951	$	6.52
$7.81 - $15.0	49,318	10.59
$15.1 - $55.0	68,368	27.11
$55.1 - $106.7	73,214	78.35
Total	201,851	$	40.54

As of September 30, 2020, the intrinsic value of the options outstanding was none. As of September 30, 2020, there was $0.6 million of total unrecognized compensation expense related to non-vested share-based compensation arrangements granted under the Plan. The costs will be recognized through July 2023.

Restricted Stock and RSUs

The Company periodically grants restricted stock and RSU awards to certain officers and other employees that typically vest one to three years from their grant date. The Company recognized $14.1 thousand and $57.1 thousand of compensation expense during the three months ended September 30, 2020 and 2019, respectively and $89.8 thousand and $190.6 thousand of compensation expense during the nine months ended September 30, 2020 and 2019, respectively, related to restricted stock and RSU awards. Stock compensation expense is recognized over the vesting period of the restricted stock and RSUs. At September 30, 2020, the Company had approximately $66.5 thousand of total unrecognized compensation cost related to RSUs, all of which will be recognized through June 2023. The following table summarizes the number of unvested RSUs and their weighted average exercise price for the nine months ended September 30, 2020.


	Number of RSUs		Weighted Average Grant Date Fair Value
Non-vested balance at January 1, 2020	6,268		$	40.69
Changes during the period:
Shares granted	23,505	*	2.34
Shares vested	(4,908)		43.58
Shares forfeited	—		—
Non-vested balance at September 30, 2020	24,865		$	3.87

•Represents shares granted not accounted for under the 2016 plan.