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12. SHARE-BASED COMPENSATION | 12 Months Ended
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Dec. 31, 2021
Share-based Payment Arrangement [Abstract] |
12. SHARE-BASED COMPENSATION | 12. SHARE-BASED COMPENSATION We use the straight-line attribution method to allocate the fair value of share-based compensation awards over the requisite service period for each award. The valuation of and accounting for share-based awards includes a number of complex and subjective estimates. These estimates include, but are not limited to, the future volatility of our stock price, future stock option exercise behaviors, estimated employee turnover, and award forfeiture rates. Description of Incentive Plan Our 2020 Incentive Plan has 17.3 million shares authorized, of which 5.3 million shares were available for awards as of December 31, 2021. Options Valuation Methodology and Assumptions We use the Black-Scholes option valuation model to determine the fair value of options granted and use the closing price of our common stock as the fair market value of our stock on that date. We consider historical stock price volatilities, volatilities of similar companies and other factors in determining estimates of future volatilities. We use historical lives, including post-termination exercise behavior, as the basis for estimating expected lives. Risk-free rates are based on the U.S. Treasury Yield Curve, as published by the U.S. Treasury. The following table summarizes the weighted-average valuation assumptions and weighted-average grant date fair value of options granted during the periods shown below: Schedule of Valuation Assumptions for Stock Options
|  |  | Year Ended December 31,
|  |  | 2021 |  |  | 2020 |  |  | 2019
Assumptions (weighted-average) |  |  |  |  |  |  |  |  |
Volatility |  |  | 120% |  |  | 111% |  |  | 78%
Expected term (in years) |  |  | 4.0 |  |  | 4.0 |  |  | 4.0
Risk-free rate |  |  | 0.9% |  |  | 0.3% |  |  | 1.9%
Expected dividends |  |  | 0.0% |  |  | 0.0% |  |  | 0.0%
Pre-vest forfeiture rate |  |  | 8.5% |  |  | 8.5% |  |  | 8.5%
Grant date fair value of options granted |  | $ | 11.72 |  | $ | 1.20 |  | $ | 0.37
Options Activity and Positions The following table summarizes activity and positions with respect to options for the periods shown below (in thousands): Schedule of Valuation Assumptions for Stock Options
|  |  |  |  |  | Weighted- |  |  | Weighted-average |  |  |
|  |  |  |  |  | average |  |  | remaining |  |  | Aggregate
|  |  |  |  |  | exercise |  |  | contractual |  |  | intrinsic
Options |  |  | Shares |  |  | price |  |  | term (in years) |  |  | value
Outstanding as of December 31, 2018 |  |  | 4,646 |  | $ | 2.27 |  |  | 7.0 |  | $ | -
Granted |  |  | 1,636 |  |  | 0.65 |  |  | - |  |  | -
Exercised |  |  | - |  |  | - |  |  | - |  |  | -
Forfeited or expired |  |  | (1,178) |  |  | 2.66 |  |  | - |  |  | -
Outstanding as of December 31, 2019 |  |  | 5,104 |  |  | 1.66 |  |  | 7.4 |  |  | 122
Granted |  |  | 68 |  |  | 1.60 |  |  | - |  |  | -
Exercised |  |  | (693) |  |  | 1.44 |  |  | - |  |  | -
Forfeited or expired |  |  | (1,198) |  |  | 2.20 |  |  | - |  |  | -
Outstanding as of December 31, 2020 |  |  | 3,281 |  |  | 1.51 |  |  | 6.6 |  |  | 12,784
Granted |  |  | 8 |  |  | 14.04 |  |  | - |  |  | -
Exercised |  |  | (1,519) |  |  | 1.75 |  |  | - |  |  | -
Forfeited or expired |  |  | (237) |  |  | 1.23 |  |  | - |  |  | -
Outstanding as of December 31, 2021 |  |  | 1,533 |  | $ | 1.37 |  |  | 5.6 |  | $ | 5,645
Vested and expected to vest as of December 31, 2021 |  |  | 1,518 |  | $ | 1.55 |  |  | 5.6 |  | $ | 5,584
Exercisable as of December 31, 2021 |  |  | 1,226 |  | $ | 1.55 |  |  | 5.1 |  | $ | 4,306
The total grant date fair value of options vested during the years ended December 31, 2021, 2020 and 2019 was $508,000, $604,000 and $801,000, respectively. As of December 31, 2021, our unrecognized share-based compensation was $61,000 related to options, which we plan to expense over the next 0.5 years. We issued 475,000 stock options to our executives on May 22, 2019, that vest one-third on each of the first three anniversaries of May 22, 2019. Restricted stock activity and positions The following table summarizes activity and positions with respect to RSUs and PSUs for the three years ended December 31, 2021: Restricted Stock Unit Activity
|  |  |  |  |  | Weighted-average
|  |  | Shares |  |  | price
Unvested as of December 31, 2018 |  |  | 1,149 |  | $ | 0.64
Granted |  |  | 1,044 |  |  | 0.60
Vested |  |  | (978) |  |  | 0.89
Forfeited |  |  | - |  |  | -
Unvested as of December 31, 2019 |  |  | 1,215 |  |  | 0.40
Granted |  |  | 1,462 |  |  | 1.08
Vested |  |  | (219) |  |  | 0.88
Forfeited |  |  | (475) |  |  | 0.77
Unvested as of December 31, 2020 |  |  | 1,983 |  |  | 0.76
Granted |  |  | 4,179 |  |  | 12.92
Vested |  |  | (2,380) |  |  | 3.11
Forfeited |  |  | (1,157) |  |  | 11.97
Unvested as of December 31, 2021 |  |  | 2,625 |  | $ | 13.05
In 2021, an equity award was granted to the Chief Executive Officer in the form of 1.2 million restricted stock units. These shares were valued based on the closing price of our common stock on the dates of grant. On the date of grant, 300,000 shares vested immediately, and subsequent grants of 300,000 RSUs will be made on an annual basis in each of April 2022, April 2023 and April 2024. In 2021, we issued 1.5 million shares of performance stock units to non-executive employees. These shares were valued based on the closing price of our common stock on the dates of grant. The shares vest one-eighth upon achievement of performance milestones with the remainder vesting quarterly over the following seven quarters. In 2021, 1.1 million of the performance stock units were canceled because of modifications to or failure to achieve performance milestones. In 2021, we issued 1.1 million RSUs to non-executive employees for promotion, retention and new hire grants. These shares were valued based on the closing price of our common stock on the dates of grant. These shares vest annually over one to four years from the date of grant. In 2020, we issued 111,000 RSUs as new hire grants to non-executive employees. These shares were valued based on the closing price of our common stock on the dates of grant. These shares vest on the earlier of a change of control of the Company or the one-year anniversary of the grant date. In June 2020, we issued 1.2 million RSUs to non-executive employees for retention purposes. These shares were valued based on the closing price of our common stock on the date of grant. These shares vest on the earlier of a change of control of the Company or the one-year anniversary of the grant date. In the fourth quarter of 2019, we issued 384,751 vested RSUs to our executives in lieu of cash for payment of short-term incentive bonuses earned in 2018. On May 22, 2019, we issued 195,000 PSUs to our executive officers. The performance criteria for PSUs issued in May 2019 is the achievement of the Company’s share price of $2.50 sustained for 60 of trailing 90 days before the PSUs are earned (“Earned PSUs”). To the extent the PSUs become Earned PSUs, the PSUs shall be eligible to vest as to one-third (1/3) of the PSUs subject to the Award on the each of the first three (3) anniversaries of May 22, 2019. If there are outstanding but unearned PSUs as of a vesting date and the PSUs become Earned PSUs prior to the next vesting date the Earned PSUs that would have vested on any earlier vesting date shall become immediately vested and deliverable. The PSUs are valued using a binomial option pricing model using the following inputs: stock price, volatility, and risk-free interest rates. On May 19, 2020 and May 22, 2019, we issued 120,000 and 180,000 RSUs, respectively, to members of the board, vesting ownership in the RSUs on the earlier of the day prior to the date of the Company’s annual meeting of shareholders following the date of grant, or one year from the grant date, provided the member of the board continues to serve as a director on the vesting date. On November 11, 2019 we issued 163,734 RSUs to the members of the board in lieu of the annual cash fee. The members of the board vest ownership in the RSUs immediately. As of December 31, 2021, our unrecognized share-based compensation related to RSUs was $25.3 million which we plan to expense over the next 2.4 years and our unrecognized share-based compensation related to the non-executive PSUs was $716,000, which we plan to expense over the next 0.8 years.

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