We have two stock option plans which authorize granting of stock options, restricted stock awards and stock purchase rights to our employees, officers, directors and consultants. In 1997, the board of directors adopted the 1997 Stock Incentive Plan (the "1997 Plan"), which was later amended in December 2018 to be renamed the "Stock Incentive Plan." In May 2012, stockholders approved an amendment allowing for an increase of 250,000 shares and an annual increase through 2016 based on the number of non-employee directors serving as of our Annual Meeting of Stockholders, subject to a maximum of 45,000 shares per year. The plan was further amended in May 2016, May 2018, and April 2020 to increase the number of shares authorized for issuance by 500,000, 250,000, and 300,000 shares, respectively. In May 2003, the stockholders approved a new plan, the 2003 Equity Incentive Plan (the "2003 Plan"), which allows for the granting of stock options/restricted stock for up to 239,050 shares of the Company's common stock. The number of shares reserved for issuance under both plans as of December 31, 2020 was 151,605.

The stock options granted by the Board of Directors may be either incentive stock options ("ISOs") or non-qualified stock options ("NQs") and may include time-based vesting terms and/or be tied to Company and market-related performance metrics. The exercise price for options under all of the plans may be no less than

100% of the fair value of the underlying common stock. Options granted will expire no later than the tenth anniversary subsequent to the date of grant or three months following termination of employment, except in cases of death or disability, in which case the options will remain exercisable for up to twelve months. Under the terms of the Stock Incentive Plan, in the event we are sold or merged, outstanding options will either be assumed by the surviving corporation or vest immediately.

We use the Black-Scholes option-pricing model to estimate the fair value of time-vested and performance stock options granted, which includes four key inputs: expected term, expected volatility, risk-free interest rate and expected dividends. Our expected term is estimated based on historical exercise patterns. Our expected volatility input was estimated based on our historical stock price volatility. Our risk-free interest rate input was determined based on the U.S. Treasury yield curve at the time of option issuance. Our expected dividends inputs were zero in all periods as we did not anticipate paying dividends in the foreseeable future. For options tied to market performance, the fair value used in our expense recognition method is measured based on the number of shares granted, and a Monte Carlo simulation model, which incorporates the probability of the achievement of the market-related performance goals as part of the grant date fair value. We recognize forfeitures as they occur.


	Year Ended December 31,
	2020
	Options	Weighted Average Exercise Price
Outstanding at beginning of period	536,315	$	54.86
Granted at market	83,250	$	69.27
Forfeited	(42,307)	$	76.24
Expired	(28,691)	$	69.25
Exercised	(84,335)	$	40.64
Outstanding at end of period	464,232	$	57.18
Exercisable at end of period	291,334	$	46.53

The total estimated fair value of time vesting stock options granted was computed to be approximately $2.4 million, $2.6 million and $4.4 million during the years ended December 31, 2020, 2019 and 2018, respectively. The amounts are amortized ratably over the vesting periods of the options. The weighted average estimated fair value of options granted was computed to be approximately $28.66, $29.89 and $28.81 during the years ended December 31, 2020, 2019 and 2018, respectively. The total intrinsic value of options

exercised was $5.0 million, $12.8 million and $10.5 million during the years ended December 31, 2020, 2019 and 2018, respectively. The cash proceeds from options exercised were $3.4 million, $1.0 million and $3.2 million during the years ended December 31, 2020, 2019 and 2018, respectively.


	Options Outstanding				Options Exercisable
Exercise Prices	Number of Options Outstanding at December 31, 2020	Weighted Average Remaining Contractual Life in Years	Weighted Average Outstanding Price		Number of Options Exercisable at December 31, 2020	Weighted Average Remaining Contractual Life in Years	Weighted Average Exercise Price
$6.23 - $12.78	86,166	2.20	$	7.59	86,166	2.20	$	7.59
$12.79 - $39.76	63,197	4.57	$	30.11	63,197	4.57	$	30.11
$39.77 - $60.94	65,000	9.29	$	60.94	—	0	$	—
$60.95 - $71.84	120,666	7.59	$	70.21	71,334	7.47	$	70.03
$71.85 - $108.25	129,203	7.82	$	89.45	70,637	6.89	$	84.98
$6.23 - $108.25	464,232	6.48	$	57.18	291,334	5.14	$	46.53

As of December 31, 2020, there was approximately $3.6 million of total unrecognized compensation cost related to outstanding stock options. That cost is expected to be recognized over a weighted-average period of 1.63 years with all cost to be recognized by the end of August 2023, assuming all options vest according to the vesting schedules in place at December 31, 2020. As of December 31, 2020, the aggregate intrinsic value of outstanding options was approximately $41.1 million and the aggregate intrinsic value of exercisable options was approximately $28.9 million.

On April 16, 2020, the Company granted a total of 240,000 performance-based stock options all with an exercise price of $60.94. Of the options granted,10,000 are tied to market-related vesting conditions and 230,000 are tied to Company performance metrics, including future product launches, future sales targets, operating performance, and EBITDA. Performance and market conditions must be achieved by December 31, 2023 otherwise the stock options are forfeited. All vested but unexercised options will expire April 15, 2030.

During the year ended December 31, 2020, 20,000 of the performance-based stock options were forfeited, leaving a total of 220,000 options outstanding as of December 31, 2020. The outstanding options had a weighted-average exercise price of $60.94, a weighted-average remaining contractual term of 9.29 years, and an aggregate intrinsic value of approximately $18.6 million. No options were exercisable as of December 31, 2020. For the year ended December 31, 2020, the weighted-average estimated fair value of the options granted was computed to be approximately $25.04 and the total estimated fair value was approximately $6.0 million. As of December 31, 2020, there was approximately $2.4 million of total unrecognized compensation cost that is expected to be recognized over a weighted average period of 1.80 years.

As of December 31, 2020, we reviewed each of the underlying corporate performance targets and determined that approximately 80,000 shares were related to corporate performance targets in which we did not deem achievement probable. No compensation expense had been recorded at any period prior to December 31, 2020. The unrecognized compensation cost associated with the performance options not deemed probable, based on grant date fair value, is approximately $2.0 million. Any change in the probability determination could accelerate the recognition of this expense.

We have granted unvested restricted stock awards (“restricted stock”) to management and directors pursuant to the Stock Incentive Plan. The restricted stock awards have varying vesting periods, but generally become fully vested between one and four years after the grant date, depending on the specific award, performance targets met for performance based awards granted to management, and vesting period for time based awards. Management performance based awards are granted at the target amount of shares that may be earned and are tied to future sales targets, operating performance, and/or EBITDA. We valued the restricted stock awards related to service and/or company performance targets based on grant date fair value and expense over the period when achievement of those conditions is deemed probable. For restricted stock awards related to market conditions, we utilize a Monte Carlo simulation model to estimate grant date fair value and expense over the requisite period. We recognize forfeitures as they occur.


	Restricted Stock	Weighted-Average Grant Date Fair Value Per Award
Non-vested as of December 31, 2019	335,667	$	74.29
Granted	69,823	$	87.29
Vested	(46,140)	$	68.80
Forfeited	(67,830)	$	73.27
Non-vested as of December 31, 2020	291,520	$	78.44

The weighted average grant date fair value of awards granted during the year was $87.29, $74.93, and $71.77 for the years ended December 31, 2020, 2019 and 2018, respectively. Fair value of restricted stock vested was $5.0 million, $0.3 million, and $4.4 million for the years ended December 31, 2020, 2019 and 2018, respectively.

As of December 31, 2020, there was approximately $5.5 million of total unrecognized compensation cost related to restricted stock awards with probable Company performance targets, as well as market and time vesting conditions. The Company expects to recognize this expense over a weighted average period of 1.4 years. As of December 31, 2020, we reviewed each of the underlying corporate performance targets and determined that approximately 129,000 shares of common stock were related to corporate performance targets in which we did not deem achievement probable. No compensation expense had been recorded at any period prior to December 31, 2020. The unrecognized compensation cost associated with the restricted stock awards not deemed probable, based on grant date fair value, is approximately $10.6 million. Any change in the probability determination could accelerate the recognition of this expense.

Under the 2020 Employee Stock Purchase Plan (the "ESPP"), we are authorized to issue up to 200,000 shares of common stock to our employees, of which 3,859 had been issued as of December 31, 2020. The ESPP provides for the issuance of shares of our common stock to participating employees. At the end of each designated offering period, which occurs every six months on June 30 and December 31, employees can elect to purchase shares of our common stock with contributions of up to 10% of their base pay, accumulated via payroll deductions, at an amount equal to 85% of the lower of our stock price on (i) the first trading day of the offering period, or (ii) the last trading day of the offering period.

We issued 10,069, 10,698 and 10,078 shares under the ESPP for the years ended December 31, 2020, 2019 and 2018, respectively. The weighted-average fair value of the purchase rights granted was $16.19, $18.10 and $18.14 per share for the years ended December 31, 2020, 2019 and 2018, respectively.

On March 30, 2020, the Company completed a private placement offering in which the Company issued and sold an aggregate of 122,000 shares of its Series X Convertible Preferred Stock, par value $0.01 per share (the "Preferred Stock"). The shares of Preferred Stock issued and sold were priced at $1,000 per share (the “Stated Value”), resulting in gross proceeds of $122.0 million, less issuance costs of $0.2 million. The Company used approximately $111.0 million of the proceeds from the offering to fund the April 1, 2020 acquisition of scil and plans to use the remaining proceeds for working capital and general corporate purposes.

The offering was made pursuant to the Securities Purchase Agreement (the “Securities Purchase Agreement”), dated as of January 12, 2020, by and among the Company and certain investors, and subsequent amendment (the “Securities Purchase Agreement Amendment”) to the Securities Purchase Agreement, entered into by the Company and each investor on March 30, 2020 (the Securities Purchase Agreement as amended by the Securities Purchase Agreement Amendment, the “Amended Securities Purchase Agreement”).

The shares of Preferred Stock were convertible into shares of the Company’s Common Stock at an initial ratio of approximately 12.4 shares of Common Stock for each share of Preferred Stock (equivalent to a conversion price of approximately $80.85 per share of common stock), at the option of the holders of the Preferred Stock or the Company, subject to the Company possessing sufficient unissued and otherwise unreserved shares of Common Stock under the Company’s Restated Certificate of Incorporation, as amended (the “Certificate of Incorporation”). On April 14, 2020, the Company gave notice of its exercise of its right to convert the 122,000 shares of Preferred Stock into 1,508,964 shares of Public Common Stock (the "Conversion Shares") and the conversion was effective on April 21, 2020. The conversion resulted in dilution of less than 20% of total shares of the Company’s Public Common Stock currently issued and outstanding. A registration statement on Form S-3 (File No. 333-238005) registering the Conversion Shares for resale was filed by us with the SEC on May 5, 2020.