Noncash Share-based Compensation (Note)

9 Months Ended

Sep. 30, 2023

Noncash Share-based Compensation [Abstract]

The Company's 2017 Equity Incentive Plan (as amended and restated, the "2017 Stock Plan") has an aggregate authorized limit of 7,650,000 shares for issuance. In May 2023, the Company's stockholders approved an amendment to the 2017 Stock Plan increasing the aggregate amount of shares available for issuance to 10,550,000. As of September 30, 2023, 4,281,409 shares remain available for issuance under the 2017 Stock Plan.

The following table presents the number of shares or units outstanding for each award type as of September 30, 2023 and December 31, 2022, respectively, (in thousands):


Award type	September 30, 2023	December 31, 2022

Restricted stock units (time-based)	2,986	2,235



Market stock units	358	216
EveryMundo equity consideration	137	137

During the three months ended September 30, 2023, the Company granted 18,847 RSUs (time-based) with a weighted average grant-date fair value of $37.14 per share.

During the nine months ended September 30, 2023, the Company granted 1,633,253 RSUs (time-based) with a weighted average grant-date fair value of $25.71 per share. The Company also granted 142,386 MSUs with a weighted average grant-date fair value of $30.42 to certain executive employees during the nine months ended September 30, 2023. These MSUs vest on January 31, 2026 and the actual number of MSUs that will be eligible to vest is based on the total stockholder return of the Company relative to the total stockholder return of the Index over the performance period, as defined by each award's plan documents or individual award agreements. The maximum number of shares issuable upon vesting is 200% of the MSUs initially granted.

The assumptions used to value the MSUs granted during the nine months ended September 30, 2023 were as follows:


	Nine Months Ended September 30, 2023
Volatility	63.26	%
Risk-free interest rate	3.76	%
Expected award life in years	2.97
Dividend yield	—	%

Share-based compensation expense is allocated to expense categories on the unaudited condensed consolidated statements of comprehensive loss. The following table summarizes share-based compensation expense included in the Company's unaudited condensed consolidated statements of comprehensive loss for the three and nine months ended September 30, 2023 and 2022:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Share-based compensation:
Cost of revenue	$	1,033	$	1,050	$	2,850	$	2,881
Operating expenses:
Selling and marketing	2,992		2,897		9,023		9,413
Research and development	2,817		2,995		7,840		9,607
General and administrative	4,091		3,684		11,876		10,716
Total included in operating expenses	9,900		9,576		28,739		29,736
Total share-based compensation expense	$	10,933	$	10,626	$	31,589	$	32,617

At September 30, 2023, the Company had an estimated $79.5 million of total unrecognized compensation costs related to share-based compensation arrangements. These costs will be recognized over a weighted average period of 2.6 years.

The Company's Employee Stock Purchase Plan (as amended, the "ESPP") permits eligible employees to purchase Company shares on an after-tax basis in an amount between 1% and 10% of their annual pay: (i) on June 30 of each year at a

15% discount of the fair market value of the Company's common stock on January 1 or June 30, whichever is lower, and (ii) on December 31 of each year at a 15% discount of the fair market value of the Company's common stock on July 1 or December 31, whichever is lower. An employee may not purchase more than $5,000 in either of the six-month measurement periods described above or more than $10,000 annually. In May 2021, the Company's stockholders approved an amendment to the ESPP Plan increasing the aggregate amount of shares available for issuance under the ESPP to 1,000,000. During the three and nine months ended September 30, 2023, the Company issued 48,859 and 104,008 shares under the ESPP, respectively. As of September 30, 2023, 283,117 shares remain authorized and available for issuance under the ESPP. As of September 30, 2023, the Company held approximately $0.6 million on behalf of employees for future purchases under the ESPP, and this amount was recorded in accrued payroll and other employee benefits in the Company's unaudited condensed consolidated balance sheet.