9 — Stock‑Based Compensation

In April 2014, our Board of Directors adopted and our shareholders approved the 2014 Equity Incentive Plan (“2014 Plan”). Upon adoption and approval of the 2014 Plan, the previous equity incentive plan was terminated and the remaining shares available for future awards were canceled. The 2014 Plan reserved 1,000,000 shares of our common stock for awards of incentive stock options, non-qualified stock option, stock appreciation rights, restricted stock, restricted stock units, performance awards and other stock-based and cash awards. As of December 31, 2019, there were 198,966 shares available for future awards under the 2014 Plan.

Stock‑based compensation was recognized as follows in the Statements of Operations:


	For the Years Ended December 31,
	2019		2018		2017
Cost of revenue	$	256,924	$	279,221	$	214,325
General and administrative		1,167,161		1,000,002		1,670,015
Sales and marketing		348,603		329,644		441,931
Research and development		82,277		155,452		128,092
Total stock-based compensation expense	$	1,854,965	$	1,764,319	$	2,454,363

Stock Options

The following table presents a summary of our stock option activity as of and for the year ended December 31, 2019:


				Weighted-Average
		Weighted-Average		Remaining	Aggregate
		Exercise Price		Contractual	Intrinsic
	Options	Per Share		Life (Yrs.)	Value
Outstanding beginning of period	1,129,463	$	2.29	4.2	$	25,052,908

Options granted	50,000		21.13
Options exercised	(539,853)		1.60
Options cancelled	(750)		26.33
Options expired	—		—
Outstanding end of period	638,860	$	4.31	4.3	$	12,192,995
Exercisable	586,985	$	2.84	3.9	$	12,067,647

As of December 31, 2019, we had $538,991 of unrecognized compensation expense related to unvested stock options, which is expected to be recognized over a weighted average period of 3.6 years. The total grant date fair value of stock options that vested during the year ended December 31, 2019 was $101,387. The total intrinsic value of options exercised during the year ended December 31, 2019, 2018 and 2017 was $11,870,492, $6,071,319 and $268,053, respectively.

The weighted-average grant-date fair value of options granted during the year ended December 31, 2019 was $11.84. No options were granted during the year ended December 31, 2018. The weighted-average grant-date fair value of options granted during the years ended December 31, 2017 was $11.10. For the years ended December 31, 2019, 2018 and 2017, we estimated the fair value of options granted using a Black-Scholes option pricing model with the following weighted average assumptions:


	For the Years Ended December 31,
	2019		2018		2017
Volatility	59.1	%	—	%	92.0	%
Expected term (years)	6.3		—		6.3
Risk-free interest rate	1.5	%	—	%	1.4	%
Dividend yield	0.0	%	—	%	0.0	%

Restricted Stock Units

The following table presents a summary of our restricted stock unit activity as of and for the year ended December 31, 2019:


	Restricted	Weighted-Average
	Stock	Grant Date
	Units	Fair Value
Unvested at December 31, 2018	226,501	$	15.89
Granted	178,657	$	21.88
Vested	(93,989)	$	16.41
Cancelled	(14,121)	$	15.11
Unvested at December 31, 2019	297,048	$	19.36

As of December 31, 2019, we had $5,261,330 of unrecognized compensation cost related to the unvested restricted stock units, which is expected to be recognized over a weighted-average period of 3.1 years.

Warrants

Associated with our IPO completed on July 21, 2014, we issued Underwriters Warrants (the “Warrants”) to purchase up to a total of 201,600 shares of our common stock. The grant date aggregate fair value of the Warrants was $611,000. The Warrants were exercisable, in whole or in part, commencing July 21, 2015 through July 21, 2017. The Warrants were exercisable at $8.125 per share, or 130 percent of the public offering price per share of our common stock in the IPO. On the grant date, we classified the Warrants as equity and incremental direct costs associated with our IPO. Accordingly, the issuance of the Warrants had no impact on our financial statements.

On July 17, 2017, our Board of Directors approved a modification to the Warrants. This modification extended the expiration date of the Warrants from July 17, 2017 to July 17, 2019 and revised the strike price from $8.125 to $10.05. The fair value of the amended Warrants was $2.42 per share as measured using the Black-Scholes options pricing model. Related to this modification, we recognized a $380,452 charge to earnings during the year ended December 31, 2017. This charge is included in general and administrative expense in our Statements of Operations. During the year ended December 31, 2019, 162,031 warrants were exercised. As of December 31, 2019, no Warrants remained outstanding.