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Equity-Based Compensation

9 Months Ended

Sep. 30, 2024

Equity-Based Compensation

Equity-Based Compensation

(12) Equity-Based Compensation

During the three and nine months ended September 30, 2024, the Company recognized $11.7 million and $17.2 million, respectively, of equity-based compensation. During the three and nine months ended September 30, 2023, the Company recognized $6.7 million and $11.1 million, respectively, of equity-based compensation. The following table details where equity-based compensation is recognized on the Company’s Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (in thousands):


		Three Months Ended September 30,							Nine Months Ended September 30,
		2024			2023				2024			2023
Cost of revenue		$	36		$	22			$	68		$	56
General and administrative			6,865			4,850				10,870			7,830
Sales and marketing			87			769				657			1,187
Operations			191			722				767			1,360
Technology and development			100			323				467			641
Restructuring charges (Note 18)			4,395			—				4,395			—
Total equity-based compensation		$	11,674		$	6,686			$	17,224		$	11,074

The Company also recognized income tax benefits from stock compensation of $1.1 million and $2.0 million for the three and nine months ended September 30, 2024, respectively, and $0.8 million and $1.3 million for the three and nine months ended September 30, 2023, respectively.

2021 Plan

Under the 2021 Equity Incentive Plan (the “2021 Plan”), the Company may grant options, stock appreciation rights, restricted stock, restricted stock units (“RSU”) and performance awards to employees, directors and consultants. The number of awards that may be issued pursuant to the 2021 Plan is calculated yearly based on provisions of the 2021 Plan. Once granted, the RSUs typically vest ratably over a period of one to four years with a cliff vesting on the first anniversary and continue to vest quarterly thereafter.

Inducement Plan

On August 13, 2024, the 2024 Inducement Award Plan (the “Inducement Plan”) became effective. Pursuant to the Inducement Plan, the Company may grant up to 2.0 million shares in the form of options, stock appreciation rights, restricted stock, RSUs and performance awards to new employees, directors and consultants, plus any additional shares that become available for issuance under the Inducement Plan. On August 13, 2024, the Company granted an award of 500,000 RSUs of Class A Common Stock, which shall vest 25% on the first anniversary of the date of grant, with the remaining 75% vesting in equal quarterly installments over the subsequent three years. On August 13, 2024, the Company also granted a performance-based equity award of 500,000 performance-based units (“PBUs”) of Class A Common Stock (the “Performance-Based Equity Grant”). The Performance-Based Equity Grant awards will vest in full on the trading day after the Company’s Class A Common Stock achieves the market condition of a closing price of $15.00 per share or more over a period of at least 30 consecutive trading days from August 14, 2024 through August 13, 2025 (the “Performance Period”). If the performance stock price goal is not met during the Performance Period, the Performance Based Equity Grant will be forfeited on August 14, 2025.

RSUs

The following table represents RSU activity for the nine months ended September 30, 2024 and 2023 (in thousands, except per share amounts):


										Number of units		Weighted average grant date fair value
Outstanding as of December 31, 2022										275		$	124.60
Granted										793		$	1.36
Vested										(159)		$	4.74
Forfeited										(147)		$	2.42
Outstanding as of September 30, 2023										762		$	44.93

Outstanding as of December 31, 2023										727		$	41.42
Granted										975		$	3.62
Vested										(833)		$	29.50
Forfeited										(41)		$	33.20
Outstanding as of September 30, 2024										828		$	9.31

As of September 30, 2024, there was $6.0 million of unrecognized compensation cost related to the RSUs, which is expected to be recognized over a weighted average period of 2.2 years. Additionally, during the three and nine months ended September 30, 2024, the Company accelerated vesting of RSUs, which resulted in $10.2 million and $11.0 million, respectively, of incremental compensation cost recognized in the periods.

PBUs

The Company had 500,000 PBUs outstanding as of September 30, 2024 and there was $0.5 million of unrecognized compensation cost related to PBUs. The Company recognized less than $0.1 million in equity-based compensation expense related to PBUs during both the three and nine months ended September 30, 2024. The Company valued the issued PBUs using a Monte Carlo simulation.

Unit Option Plan

The Company had 132,000 and 204,000 stock options outstanding and exercisable as of September 30, 2024 and December 31, 2023, respectively. No stock options have been granted since January of 2021. There were no stock option exercises during the three and nine months ended September 30, 2024. There were 56,000 and 174,000 stock option exercises during the three and nine months ended September 30, 2023, respectively, at a weighted average exercise price of $15.60 in each period.