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Stock Based Compensation | 3 Months Ended
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Mar. 31, 2023
Stock Based Compensation |
Stock Based Compensation | Note 11. Stock Based Compensation The following table presents a summary of activity related to stock options during the three months ended March 31, 2023:
| Number of Options (in thousands) |  |  | Weighted Average Exercise Price |  |  | Weighted Average Remaining Contractual Term (Years) |
Outstanding, January 1, 2023 | $ | 440 |  |  | $ | 55.65 |  |  |  | 7.5 |
Granted |  | 3 |  |  |  |  |  |  |  |  |
Exercised |  | — |  |  |  |  |  |  |  |  |
Cancelled |  | (6 | ) |  |  |  |  |  |  |  |
Outstanding, March 31, 2023 | $ | 437 |  |  | $ | 55.74 |  |  |  | 7.2 |
Exercisable, March 31, 2023 | $ | 284 |  |  | $ | 75.84 |  |  |  | 6.7 |
The intrinsic value is calculated as the difference between the fair market value at March 31, 2023 and the exercise price per share of the stock options. As of March 31, 2023, all options outstanding had no material intrinsic value. The options granted to employees generally vest over a three or four-year period. The following table presents a summary of activity related to restricted and deferred stock units (“Stock Units”) granted during the three months ended March 31, 2023:
|  | Number of Shares (in thousands) |  |  | Weighted Average Grant Date Fair Value |
Nonvested, January 1, 2023 |  |  | 127 |  |  | $ | 11.85 |
Granted |  |  | — |  |  |  |  |
Vested |  |  | (4 | ) |  |  |  |
Cancelled |  |  | — |  |  |  |  |
Nonvested, March 31, 2023 |  |  | 123 |  |  | $ | 11.81 |
In general, Stock Units granted to employees vest over two to four-year periods. Immediately following the Company’s annual meeting of stockholders, the Company generally grants each non-employee director an equity award that vests over a 12-month period. Upon a non-employee director’s initial appointment or election to the board of directors, the Company grants such non-employee director an equity award subject to vesting as determined by the board of directors. The Company recognized stock compensation expense for its equity awards as follows:
|  |  | Three months ended March 31, |
(in thousands) |  | 2023 |  |  | 2022 |
Selling, general and administrative |  | $ | 510 |  |  | $ | 705 |
Research and development |  |  | 57 |  |  |  | 66 |
Cost of goods sold |  |  | 5 |  |  |  | 6 |
Total expense |  | $ | 572 |  |  | $ | 777 |
Total unrecognized compensation cost related to unvested awards as of March 31, 2023 was $23.2 million and is expected to be recognized over the next one and one-half years. Valuation Information for Stock-Based Compensation The fair value of each stock option award during the three months ended March 31, 2023 and 2022 was estimated on the date of grant using the Black-Scholes model. Expected volatility was based on historical common stock volatility of the Company’s peers. Beginning in December 2022, the Company began incorporating its historical common stock volatility at a weighting of 50% of the total composite volatility rate. During the remainder of 2023, the Company will continue to evaluate the volatility rate used to value stock options. The risk-free interest rate was based on the average U.S. Treasury rate that most closely resembled the expected life of the related award. The expected term of the award was calculated using the simplified method. No dividend was assumed as the Company does not pay regular dividends on its common stock and does not anticipate paying any dividends in the foreseeable future. The weighted average assumptions used in the Black-Scholes option pricing model in valuing stock options granted in the three months ended March 31, 2023 and 2022 are summarized in the table below.
| Three months ended March 31, |
| 2023 |  |  |  | 2022 |
Fair value at grant date | $ | 3.46 |  |  | $ | 8.10 |
Expected volatility | 114.0 | % |  |  | 84.0 | %
Risk-free interest rate | 3.9 | % |  |  | 1.6 | %
Expected holding period, in years | 6.0 |  |  |  | 6.0 |
Dividend yield |  | — | % |  |  | — | %

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