Stockholders' Equity

6 Months Ended

Jun. 30, 2021

NOTE 9. STOCKHOLDERS’ EQUITY

Equity Plans

At March 31, 2020, we had three active equity compensation plans: the 2010 Equity Incentive Plan (“2010 Plan”), the 2010 Outside Director Equity Incentive Plan (“2010 Director Plan”) and the 2010 Employee Stock Purchase Plan (“ESPP”). Our 2010 Plan and 2010 Director Plan expired on July 29, 2020.

On August 4, 2020, stockholders approved our new 2020 Equity Incentive Plan (the “2020 Plan”) and reserved 11,000,000 shares of the Company’s common stock for issuance pursuant to equity awards granted under the 2020 Plan.

On December 2, 2020, the Board of Directors (the “Board”) adopted the 2020 Inducement Equity Incentive Plan (the “Inducement Plan”) and reserved 2,500,000 shares of the Company’s common stock for issuance pursuant to equity awards granted under the Inducement Plan. On April 18, 2021, the Board amended the Inducement Plan to reserve an additional 750,000 shares of the Company’s common stock for issuance pursuant to equity awards granted under the Inducement Plan.

Stock Options

The following table summarizes stock option activity for all our stock option plans for the six months ended June 30, 2021 (in thousands, except per share amounts):



	Stock Options Outstanding
				Weighted
	Number			average
	of shares	Exercise price		exercise price
Outstanding at December 31, 2020	14,638	$	1.16 – 20.90	$	5.53
Granted	2,229		23.39 – 46.37		34.68
Exercised	(4,058)		1.16 – 15.98		5.49
Canceled	(474)		2.54 – 46.37		4.68
Outstanding at June 30, 2021	12,335	$	1.16 – 46.37	$	10.84

For the three and six months ended June 30, 2021, we recognized stock-based compensation expense of $3.4 million and $5.9 million, respectively, related to options.

Restricted Stock Units (“RSUs”)

Time-based RSUs

The following table summarizes the time-based RSUs activity for the six months ended June 30, 2021 (in thousands, except per share amounts):


		Weighted average
	Number	grant date
	of shares	fair value
Outstanding at December 31, 2020	5,919	$	5.25
Granted	2,579		39.62
Released	(1,489)		4.39
Forfeited	(189)		12.47
Outstanding at June 30, 2021	6,820	$	18.23

For the three and six months ended June 30, 2021, we recognized stock-based compensation expense of $6.8 million and $11.9 million, respectively, for time-based RSUs.

Performance-based RSUs

The following table summarizes the performance-based RSUs (“PSUs”) activity for the six months ended June 30, 2021 (in thousands, except per share amounts):


		Weighted average
	Number	grant date
	of shares	fair value
Outstanding at December 31, 2020	94	$	2.63
Granted	—		—
Released	—		—
Forfeited	(94)		2.63
Outstanding at June 30, 2021	—	$	—

For the three and six months ended June 30, 2021, we recognized stock-based compensation expense of $0 for the performance-based RSUs.

As of June 30, 2021, we had a total of 5.8 million shares of common stock available for future issuance under the 2020 Plan and the Inducement Plan.

Employee Stock Purchase Plan (“ESPP”)

Shares issued under our ESPP were 983,180 and none during the six months ended June 30, 2021 and 2020, respectively. In January 2021, an additional 3.8 million shares were reserved under the ESPP. As of June 30, 2021, 8,741,461 shares of our common stock remain available for issuance under our ESPP.

For the three and six months ended June 30, 2021, we recognized stock-based compensation expense of $5.5 million and $8.0 million, respectively, for the ESPP.

Stock-Based Compensation

The following table summarizes stock-based compensation expense (in thousands):



	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Cost of revenue	$	1,906	$	452	$	2,898	$	979
Research and development		4,310		1,433		7,357		3,192
Sales, general and administrative		9,589		1,349		15,715		3,095
Total stock-based compensation expense	$	15,805	$	3,234	$	25,970	$	7,266

We estimate the fair value of employee stock options on the grant date using the Black-Scholes option pricing model. The estimated fair value of employee stock options is amortized on a straight-line basis over the requisite service period of the awards.

The assumptions used for the specified periods and the resulting estimates of weighted-average fair value per share for shares to be issued upon exercise of our stock options were as follows:



	Three Months Ended June 30,		Six Months Ended June 30,
Stock Option	2021	2020	2021	2020
Expected term in years	4.6	—	4.6	5.1
Expected volatility	70%	—	68% - 70%	57%
Risk-free interest rate	0.74%	—	0.50% - 0.74%	1.20%
Dividend yield	—	—	—	—
Weighted average grant date fair value per share	$14.54	—	$18.86	$1.22

We estimate the value of employee stock purchase rights on the grant date using the Black-Scholes option pricing model. The assumptions used for the specified reporting periods and the resulting estimates of weighted-average fair value per share for stock to be issued under the ESPP were as follows:



	Six Months Ended June 30,
ESPP	2021	2020
Expected term in years	0.5 - 2.0	0.5 - 2.0
Expected volatility	68%	57%
Risk-free interest rate	0.07% - 0.13%	0.8% - 1.0%
Dividend yield	—	—
Weighted average fair value per share	$29.26	$1.62