Share-Based Payments

6 Months Ended

Jun. 30, 2020

Share-based Payment Arrangement [Abstract]

The Company measures the fair value of stock options and restricted stock units ("RSUs") issued to employees and nonemployees as of the grant date for recognition of stock-based compensation expense. Stock-based compensation expense for employees and nonemployees is recognized over the requisite service period, which is typically the vesting period. Stock-based compensation costs included in the condensed consolidated statements of operations are presented below:


	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		2020		2019
Cost of products	$	2	$	4	$	6	$	12
Cost of services	35		52		64		117
Research and development	364		1,360		953		2,701
Selling, general and administrative	4,496		(1,900)		9,592		4,934
Discontinued operations	—		545		(1,346)		1,351
Total	$	4,897	$	61	$	9,269	$	9,115

Precigen Stock Option Plans

In April 2008, Precigen adopted the 2008 Equity Incentive Plan (the "2008 Plan") for employees and nonemployees pursuant to which Precigen's board of directors granted share-based awards, including stock options, to officers, key employees and nonemployees. Upon the effectiveness of the 2013 Omnibus Incentive Plan (the "2013 Plan"), no new awards may be granted under the 2008 Plan. As of June 30, 2020, there were 223,451 stock options outstanding under the 2008 Plan.

Precigen adopted the 2013 Plan for employees and nonemployees pursuant to which Precigen's board of directors may grant share-based awards, including stock options and shares of common stock, to employees, officers, consultants, advisors, and nonemployee directors. The 2013 Plan became effective in August 2013, and as of June 30, 2020, there were 27,000,000 shares authorized for issuance under the 2013 Plan, of which 10,388,996 stock options and 1,399,669 RSUs were outstanding and 6,848,044 shares were available for grant.

In April 2019, Precigen adopted the 2019 Incentive Plan for Non-Employee Service Providers (the "2019 Plan"), which became effective upon shareholder approval in June 2019. The 2019 Plan permits the grant of share-based awards, including stock options, restricted stock awards, and RSUs, to non-employee service providers, including board members. As of June 30, 2020, there were 5,000,000 shares authorized for issuance under the 2019 Plan, of which 770,592 stock options and 497,512 RSUs were outstanding and 2,582,279 shares were available for grant.

Stock option activity was as follows:


	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)
Balances at December 31, 2019	9,022,282	$	21.94	6.10
Granted	5,287,092	10.43

Exercised	(20,780)	(3.17)
Forfeited	(834,286)	(16.27)
Expired	(2,071,269)	(27.30)
Balances at June 30, 2020	11,383,039	16.07		7.55
Exercisable at June 30, 2020	5,604,412	20.02		5.86

RSU activity was as follows:


	Number of Restricted Stock Units	Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Term (Years)
Balances at December 31, 2019	1,781,982	$	8.71	1.24
Granted	3,103,819	3.08
Vested	(2,625,093)	(3.97)
Forfeited	(363,527)	(8.57)
Balances at June 30, 2020	1,897,181	6.09		0.87

Precigen currently uses authorized and unissued shares to satisfy share award exercises.

The Company's Executive Chairman ("Executive Chairman"), who previously served as the Company's Chief Executive Officer ("CEO") until January 1, 2020, received a base salary of $200 per month through March 31, 2020, payable in fully-vested shares of Precigen common stock with such shares subject to a three-year lock-up on resale. The monthly number of shares of common stock was calculated based on the closing price on the last trading day of each month through March 2019 and based on the volume weighted average of the price of Precigen common stock over the 30 day period ending on the last calendar day of each month thereafter, and the shares were issued pursuant to the terms of a Restricted Stock Unit Agreement ("RSU Agreement") between Precigen and the Executive Chairman pursuant to the terms of the 2013 Plan. The RSU Agreement expired March 31, 2020. The fair value of the shares issued as compensation for services is included in selling, general, and administrative expenses in the Company's condensed consolidated statements of operations and totaled $495 for the three months ended June 30, 2019, and $454 and $981 for the six months ended June 30, 2020 and 2019, respectively.