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Stock-Based Compensation
 9 Months Ended
Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation Stock-Based Compensation
As of September 30, 2023, 7,835,715 shares of common stock had been authorized for issuance under our 2021 Equity and Incentive Compensation Plan (“2021 Plan”) and 6,287,687 shares of common stock were originally reserved for issuance under our 2018 Equity Incentive Plan (“2018 Plan”).
Stock Option Activity
A summary of the stock option activity under our equity incentive plans is as follows:
Number of OptionsWeighted- Average Exercise PriceWeighted- Average Remaining Contractual Term (years)Aggregate Intrinsic Value (in thousands)
Balance – December 31, 20222,599,264 $8.41 7.2$— 
Granted— — — — 
Exercised — — — — 
Forfeited and cancelled(209,903)$25.17 — $— 
Balance – September 30, 20232,389,361 $6.94 6.3$— 
Exercisable – September 30, 20232,238,745 $6.58 6.2$— 
Vested and expected to vest as of September 30,20232,389,361 $6.94 6.3$— 
There were no options granted during the three or nine months ended September 2023 and 2022.
Restricted Stock Units
A summary of restricted stock unit activity under our equity incentive plans is as follows:
Number of AwardsWeighted- Average Grant Date Fair Value per Share
Unvested and outstanding balance at December 31, 20222,058,534 $12.79 
Granted— — 
Vested(959,031)12.69 
Forfeited(176,695)20.12 
Unvested and outstanding balance at September 30, 2023922,808 $11.49 
The total fair value of restricted stock units that vested during the three months ended September 30, 2023 and 2022 was approximately $0.2 million and $0.1 million, respectively. The total fair value of restricted stock units that vested during the nine months ended September 30, 2023 and 2022 was approximately $1.8 million and $3.2 million, respectively. We had 67,479 outstanding and fully vested restricted stock units remained unsettled at September 30, 2023, all of which were settled in October and November 2023. As such, they are excluded from outstanding shares of common stock but are included in weighted-average shares outstanding for the calculation of net loss per share for the three and nine months ended September 30, 2023 and 2022.
Performance Stock Units
Our performance-based restricted stock units (“PSUs”) vest upon achieving each of certain Company stock price milestones during the contractual vesting period. The stock price milestones vary among grantees and are set forth in each grantee’s PSU grant agreement (for example, achievement of each of the following 30-day volume-weighted average prices for a share of Company common stock: $20, $30, $40 and $50). The vesting of PSUs is subject to each grantee’s continued service to the Company.
To determine the value of PSUs for stock-based compensation purposes, the Company uses the Monte Carlo simulation valuation model. The Monte Carlo simulation model utilizes multiple input variables, including a derived service period of 1.88 years for 2021 grants and a weighted-average derived service period of 3.8 years for 2022 grants, to estimate the probability that the market conditions will be achieved and is applied to the trading price of our common stock on the date of grant. For milestones that have not been achieved, such PSUs vest over the derived requisite service period and the fair value of such awards is estimated on the grant date using Monte Carlo simulations. The determination of the grant date fair value of PSUs issued is affected by a number of variables and subjective assumptions, including (i) the fair value of the Company’s common stock, (ii) the expected common stock price volatility over the expected life of the award, (iii) the expected term of the award, (iv) risk-free interest rates, (v) the exercise price, and (vi) the expected dividend yield. Forfeitures are recognized when they occur.
A summary of PSU activity under our 2021 Plan is as follows:

Number of
awards		Weighted-
average grant
date fair value
per share
Unvested and outstanding balance at December 31, 20221,089,045 $12.72 
Granted— — 
Vested— — 
Forfeited(280,854)15.32 
Unvested and outstanding balance at September 30, 2023808,191 $11.82 
Stock-Based Compensation Expense
Stock-based compensation expense under our equity incentive plans was as follows (in thousands):
Three Months Ended
September 30,		Nine Months Ended
September 30,
2023202220232022
Cost of sales (1)
$643 $513 $190 $2,156 
Selling and administrative expenses (2)
(103)4,030 8,720 13,673 
Total$540 $4,543 $8,910 $15,829 
(1)    Cost of sales for the nine months ended September 30, 2023 includes a net reversal of $1.0 million of stock-based compensation expense associated with equity awards granted to an independent contractor for services pursuant to the terms of a license services and collaboration agreement. Stock-based compensation expense associated with equity awards granted to an independent contractor for services pursuant to the terms of a license, services and collaboration agreement and recorded in cost of sales for the three months ended September 30, 2023 was immaterial. Stock-based compensation expense associated with equity awards granted to an independent contractor for services pursuant to the terms of a license, services and collaboration agreement and recorded in cost of sales for the three and nine months ended September 30, 2022 were $0.4 million and $1.1 million, respectively.
(2)    Selling and administrative expenses for the three months ended September 30, 2023 includes a reversal of $2.4 million of stock-based compensation expense due to forfeitures of certain equity grants. Selling and administrative expenses for the nine months ended September 30, 2023 includes $2.3 million of accelerated amortization of stock-based compensation expense for certain equity awards, offset by a $2.4 million reduction in stock-based compensation expense due to forfeitures of certain equity grants during the nine months ended September 30, 2023.
The expense presented in the table above is net of capitalized stock-based compensation relating to software development costs of $0.8 million and $2.0 million during the three and nine months ended September 30, 2023, respectively, and $0.8 million and $1.4 million during the three and nine months ended September 30, 2022, respectively.
At September 30, 2023, unrecognized compensation cost related to unvested stock options was $0.7 million and is expected to be recognized over the remaining weighted-average service period of 0.54 years. At September 30, 2023, total unrecognized compensation cost related to unvested performance-based stock units and restricted stock units was $9.4 million and is expected to be recognized over the remaining weighted-average service period of 1.95 years.