EMPLOYEE EQUITY-BASED COMPENSATION

9 Months Ended

Sep. 30, 2023

Share-Based Payment Arrangement [Abstract]

EMPLOYEE EQUITY-BASED COMPENSATION

NOTE 12. EMPLOYEE EQUITY-BASED COMPENSATION

The following table summarizes option activity under the Company's equity-based compensation plans for the nine months ended September 30, 2023:

	Number of Shares	Weighted Average Exercise Price per Share
Options outstanding January 1, 2023	540,732	$	146.03
Granted	10,000	5.10
Forfeited	(10,979)	82.65
Exercised	—	—
Expired	(160,475)	135.82
Options outstanding September 30, 2023	379,278	$	148.47

The following table shows summary information for outstanding options and options that are exercisable (vested) as of September 30, 2023:

	Options Outstanding		Options Exercisable
Number of options	379,278		313,234
Weighted average remaining contractual term (in years)	5.31		4.92
Weighted average exercise price	$	148.47	$	161.19
Weighted average fair value	$	90.28	$	96.99
Aggregate intrinsic value (in thousands)	$	—	$	—

The following table summarizes RSU and restricted stock award activity for the nine months ended September 30, 2023:

	Number of Shares	Weighted Average Grant Date Fair Value per Share
Outstanding January 1, 2023	435,488	$	42.91
Granted	1,305,220	7.14
Forfeited	(79,577)	42.39
Released	(347,740)	28.73
Outstanding September 30, 2023	1,313,391	$	11.15

The table below summarizes equity-based compensation expense for the three and nine months ended September 30, 2023 and 2022 (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cost of sales	$	58	$	167	$	247	$	570
Research and development	269		151		1,130		1,052
Sales, general and administrative	1,488		911		2,646		6,557
	$	1,815	$	1,229	$	4,023	$	8,179

The table below summarizes share-based compensation cost capitalized to inventory for the three and nine months ended September 30, 2023 and 2022 (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cost capitalized to inventory	$	17	$	69	$	126	$	186

As of September 30, 2023, unrecognized equity-based compensation expense related to unvested stock options and unvested RSUs was $0.6 million and $8.2 million, respectively. This is expected to be recognized over the years 2023 through 2028.

Included in the above-noted RSU and restricted stock award outstanding amounts are performance-based RSUs which vest only upon the achievement of certain targets. Performance-based RSUs contingently vest over a period of 1 to 3 years, depending on the nature of the performance goal. These units were valued in the same manner as other RSUs, based on the published closing market price on the day before the grant date. However, the Company only recognizes stock compensation expense to the extent that the targets are determined to be probable of being achieved, which triggers the vesting of the performance options.

During 2021, the Company granted performance-based RSUs of which 10,330 were outstanding as of September 30, 2023. No activity occurred during the nine months ended September 30, 2023, and the targets associated with the performance-based RSUs are not considered probable of being achieved. No share-based compensation cost was recorded for the performance-based RSUs for the nine months ended September 30, 2023 and 2022.

2022 Omnibus Equity Incentive Plan

At the Company’s 2023 Annual Meeting of Stockholders, the Company’s stockholders approved an amendment to the Company’s 2022 Omnibus Equity Incentive Plan increasing the number of shares of common stock reserved and available for grant under the plan by 1.6 million, resulting in a total of 3.0 million reserved shares as of September 30, 2023.