STOCK-BASED COMPENSATION

6 Months Ended

Jun. 30, 2021

Share-based Payment Arrangement [Abstract]

Under the Company’s 2009 Equity Incentive Plan (the “2009 Plan”), incentive stock options (ISOs), nonqualified stock options (NSOs), stock bonuses, and rights to acquire restricted stock are available for grant to employees, directors and consultants. At June 30, 2021, 9,647,780 stock options outstanding under the 2009 Plan and zero shares were available for future grant. In May 2021, the Company issued stock options under the Stem Inc 2021 Equity Incentive Plan (the “2021 Plan”), with 23,722,254 shares reserved thereunder.

Under both the 2009 Plan and the 2021 Plan (collectively, the “Plans”), the exercise price of an option cannot be less than 100% of the fair value of one share of common stock for incentive or non-qualified stock options, and not less than 110% of the fair value for stockholders owning greater than 10% of all classes of stock, as determined by the Company’s Board of Directors (the “Board”). Options under the Plans generally expire after 10 years. Under the Plans, the Compensation Committee of the Board determines when the options granted will become exercisable. Options granted under the Plans generally vest 1/4 one year from the grant date and then 1/48 each month over the following three years and are exercisable for 10 years from the date of the grant. The Plans allow for exercise of unvested options with repurchase rights over the restricted common stock issued at the original exercise price. The repurchase rights lapse at the same rate as the options vest.

A summary of activity under the Plans is as follows:


	Number of Options Outstanding	Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Life (years)	Aggregate Intrinsic Value (in thousands)
Balances as of December 31, 2020	51,379,939	$	0.56	7.2	$	46,516
Retroactive application of recapitalization	(40,314,281)	2.05		—	—
Adjusted Balance as of December 31, 2020	11,065,658	2.61		7.2	46,516
Options granted	709,448	25.53
Options exercised	(1,402,538)	1.97
Options forfeited	(15,435)	2.25

Balances as of June 30, 2021	10,357,133	$	4.27	7.0	$	328,644
Options vested and exercisable — June 30, 2021	7,273,421	$	2.15	6.2	$	247,154

The weighted-average grant date fair value of stock options granted to employees was $16.84 during the six months ended June 30, 2021. There were 2,354,515 stock options granted during the six months ended June 30, 2020. The intrinsic value of options exercised was $47.6 million and less than $0.1 million during the six months ended June 30, 2021 and 2020, respectively.

Stock-Based Compensation

The following table summarizes stock-based compensation expense recorded in each component of operating expenses in the Company’s consolidated statements of operations and comprehensive loss (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Sales and marketing	$	168	$	150	$	252	$	220
Research and development	264		301		419		486
General and administrative	592		25		1,113		226
Total stock-based compensation expense	$	1,024	$	476	$	1,784	$	932

As of June 30, 2021, the Company had approximately $17.9 million of remaining unrecognized stock-based compensation expense, which is expected to be recognized over a weighted average period of 3.6 years.