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Stockholders' Equity
 9 Months Ended
Sep. 30, 2023
Stockholders' Equity Note [Abstract]  
Stockholders' Equity

9. Stockholders’ Equity

Undesignated Preferred Stock

The Company’s Amended and Restated Certificate of Incorporation authorizes the issuance of 100,000,000 shares of undesignated preferred stock, par value of $0.01 per share, with rights and preferences, including voting rights, designated from time to time by the board of directors. No shares of preferred stock were issued or outstanding as of September 30, 2023 and December 31, 2022.

Common Stock

In the three and nine months ended September 30, 2023, no shares of Class B common stock were converted to Class A common stock. As of September 30, 2023, the par value of the Class A, Class B and Class C shares was $2,533, $275, and $56, respectively.

 

 

 

Shares
Authorized

 

 

Shares
Issued

 

 

Shares
Outstanding

 

Class A

 

 

1,000,000,000

 

 

 

254,038,177

 

 

 

254,038,177

 

Class B

 

 

100,000,000

 

 

 

27,390,397

 

 

 

27,390,397

 

Class C

 

 

200,000,000

 

 

 

5,555,555

 

 

 

5,555,555

 

 

 

 

1,300,000,000

 

 

 

286,984,129

 

 

 

286,984,129

 

 

As of September 30, 2023 and December 31, 2022, the Company had reserved 76,010,467 and 68,617,245 shares of common stock for the exercise of outstanding stock options, the vesting of restricted stock units, the vesting of performance-based market condition share awards, and the number of shares remaining available for future grant, respectively.

Stock Plans and Stock Options

The Company maintains the 2006 Employee, Director and Consultant Stock Plan as amended and restated (the “2006 Plan”) and 2020 Equity Incentive Plan (the “2020 Plan” together, the “Plans”) under which it has granted incentive stock options, non-qualified stock options, and restricted stock units to employees, officers, and directors of the Company. In connection with the adoption of the 2020 Plan, the then-remaining shares of common stock reserved for grant or issuance under the 2006 Plan became available for issuance under the 2020 Plan, and no further grants will be made under the 2006 Plan.

Options issued under the Plans are exercisable for periods not to exceed ten years, and vest and contain such other terms and conditions as specified in the applicable award document. Options to buy common stock are issued under the Plans, with exercise prices equal to the closing price of shares of the Company’s common stock on the New York Stock Exchange on the date of award.

Activity under the Plans is as follows:

 

 

 

Number of
Shares

 

 

Weighted
Average
Exercise Price

 

 

Weighted Average
Remaining
Contractual
Term (Years)

 

 

Aggregate
Intrinsic Value

 

Outstanding as of January 1, 2023

 

 

11,039,551

 

 

$

5.23

 

 

 

5.5

 

 

$

996

 

Granted

 

 

—

 

 

$

—

 

 

 

 

 

 

 

Forfeited

 

 

(581,830

)

 

$

5.46

 

 

 

 

 

 

 

Expired

 

 

(6,160

)

 

$

1.77

 

 

 

 

 

 

 

Exercised

 

 

(286,599

)

 

$

1.99

 

 

 

 

 

 

 

Outstanding as of September 30, 2023

 

 

10,164,962

 

 

$

5.25

 

 

 

4.9

 

 

$

—

 

Vested and expected to vest as of December 31, 2022

 

 

10,951,967

 

 

$

5.02

 

 

 

5.5

 

 

$

996

 

Vested and expected to vest as of September 30, 2023

 

 

10,145,752

 

 

$

5.09

 

 

 

4.9

 

 

$

—

 

Options exercisable as of December 31, 2022

 

 

10,417,259

 

 

$

4.97

 

 

 

5.4

 

 

$

996

 

Options exercisable as of September 30, 2023

 

 

9,988,146

 

 

$

5.07

 

 

 

4.9

 

 

$

—

 

 

No options were granted in the nine months ended September 30, 2023 and 2022.

Restricted Stock Units

Activity for the restricted stock units is as follows:

 

 

 

Shares

 

 

Weighted Average
Grant Date
Fair Value

 

Unvested as of January 1, 2023

 

 

19,316,459

 

 

$

10.78

 

Granted

 

 

14,811,194

 

 

 

2.55

 

Vested

 

 

(7,452,216

)

 

 

7.35

 

Forfeited

 

 

(3,054,608

)

 

 

4.15

 

Unvested as of September 30, 2023

 

 

23,620,829

 

 

$

7.56

 

 

The total grant date fair value of RSU’s granted for the nine months ended September 30, 2023 was $37,765. Restricted stock units vest over the service period of one to four years. The aggregate intrinsic value of restricted stock units vested for the nine months ended September 30, 2023 and 2022 was $17,018 and $18,304, respectively.

Restricted Stock Units with a Market Condition

In the nine months ended September 30, 2023, the Company granted performance-based market condition share awards to certain members of the Company’s management team (excluding the co-CEOs), which entitle these employees with the right to receive shares of common stock upon achievement of certain stock price milestones measured over a rolling thirty day trading-period, subject to the satisfaction of the applicable service vesting conditions. These performance-based market condition share awards consist of three tranches with three separate specified award values that become payable upon the achievement of certain stock price milestones, which can result in a vesting range of up to 2,654,598 shares. These performance-based market condition share awards have a performance period of three years.

As of September 30, 2023, 1,146,310 of the performance-based market condition share awards granted in the prior year have satisfied both the applicable market capitalization milestones and the service vesting conditions. None of the performance-based market condition share awards granted in 2023 have vested.

 

 

 

Shares

 

 

Weighted Average
Grant Date
Fair Value

 

Unvested as of January 1, 2023

 

 

25,602,405

 

 

$

2.30

 

Granted

 

 

2,654,598

 

 

 

2.19

 

Vested

 

 

(1,146,310

)

 

 

2.12

 

Cancelled/Forfeited

 

 

(108,035

)

 

 

2.19

 

Unvested as of September 30, 2023

 

 

27,002,658

 

 

$

2.29

 

The total grant-date fair value of performance-based market condition share awards granted during the nine months ended September 30, 2023 and 2022 was $5,805 and $63,157, respectively. There were no performance-based market condition share awards granted during the three months ended September 30, 2023.

The weighted average estimated fair value of the performance-based market condition share awards granted during the nine months ended September 30, 2023 was determined using a Monte-Carlo valuation simulation, with the following most significant weighted-average assumptions:

 

 

 

Nine Months Ended September 30,

 

 

 

2023

 

 

2022

 

Risk-free rate

 

 

4.61

%

 

 

2.34

%

Term to end of performance period (yrs)

 

3 years

 

 

3 years

 

Valuation date stock price

 

$

2.76

 

 

$

3.50

 

Expected volatility

 

 

70

%

 

 

75

%

Expected dividend yield

 

 

0

%

 

 

0

%

 

2020 Employee Stock Purchase Plan

During the nine months ended September 30, 2022, the Company issued 703,148 shares under the ESPP. During the nine months ended September 30, 2023, the Company issued 1,224,312 shares under the ESPP. As of September 30, 2023, 6,923,669 shares remained available for issuance.

Stock-Based Compensation

Stock-based compensation expense was classified in the condensed consolidated statements of operations and comprehensive loss as follows:

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Cost of revenues

 

$

423

 

 

$

427

 

 

$

1,256

 

 

$

1,188

 

Research and development

 

 

2,407

 

 

 

2,750

 

 

 

8,080

 

 

 

7,631

 

Selling and marketing

 

 

2,406

 

 

 

2,045

 

 

 

6,729

 

 

 

5,144

 

General and administrative

 

 

11,663

 

 

 

16,090

 

 

 

43,344

 

 

 

34,341

 

Total

 

$

16,899

 

 

$

21,312

 

 

$

59,409

 

 

$

48,304

 

 

As of September 30, 2023, the unrecognized stock-based compensation expense related to unvested common stock-based awards was $77,452, which is expected to be recognized over a weighted-average period of 2.3 years.