Stockholders' Equity

9 Months Ended

Sep. 30, 2022

Share-based Payment Arrangement [Abstract]

Stockholders' Equity

Stockholders’ Equity

Common Stock

As of September 30, 2022, there were 200,000,000 shares of common stock authorized, 77,934,440 shares issued, and 75,188,197 shares outstanding. As of December 31, 2021, there were 200,000,000 shares of common stock authorized, 74,980,546 shares issued, and 72,234,303 shares outstanding. The par value for shares of common stock is $0.001 per share.

Preferred Stock

As of September 30, 2022 and December 31, 2021, there were 5,000,000 shares of preferred stock authorized, and no shares were issued or outstanding. The par value for shares of preferred stock is $0.001 per share.

Stock-Based Compensation

Stock Option Plans

The Company’s 2019 Stock Incentive Plan, as amended and restated (the “2019 Plan”), became effective on April 11, 2019. The 2019 Plan allows the Company to grant incentive stock options and restricted stock units to its employees and directors to participate in the Company’s future performance through stock-based awards at the discretion of the board of directors. On April 19, 2021, the Company’s board of directors amended the plan and authorized 5,000,000 new shares for issuance. The number of shares authorized for issuance is 40,067,744 shares in the aggregate. Options to acquire common stock granted thereunder have ten-year terms. As of September 30, 2022, approximately 2.0 million shares of common stock remained available for issuance (taking into account all option exercises and other equity award settlements through September 30, 2022).

Employee Stock Purchase Plan

There are 1,000,000 shares authorized and reserved for issuance under the 2019 Employee Stock Purchase Plan. As of September 30, 2022, approximately 0.5 million shares of common stock remained available for issuance under the 2019 Employee Stock Purchase Plan (taking into account all share purchases through September 30, 2022).

Inducement Plan

There are 6,159,009 shares of common stock authorized and reserved for issuance under the Inducement Plan. As of September 30, 2022, approximately 1.4 million shares of common stock remained available for issuance under the Inducement Plan (taking into account all option exercises and other equity award settlements through September 30, 2022).

Stock Option Activity

A summary of the Company’s stock option activity and weighted average exercise prices follows:

	Stock Option Activity			Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value
	Options	Weighted Average Exercise Price
	(In thousands)	(Per share)		(In years)	(In thousands)
Balances outstanding at December 31, 2021	4,782	$	27.52	6.77	$	62,300
Granted	802	22.75
Exercised	(200)	6.27
Cancelled or expired	(870)	38.52
Balances outstanding at September 30, 2022	4,514	25.28		6.58	1,471
Options vested and expected to vest	1,187	31.64		8.48	895
Options exercisable at September 30, 2022	2,680	$	20.67	5.21	$	476

The total fair value of stock options exercised during the nine months ended September 30, 2022 was approximately $7.4 million. As of September 30, 2022, there was approximately $24.8 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements. That cost is expected to be recognized over a weighted average period of approximately 2.6 years.

Restricted Stock Unit Activity

A summary of the Company’s RSU activity and weighted average exercise prices follows:

	Restricted Stock Unit Activity
	Number of Shares	Weighted Average Grant Date Fair Value		Aggregate Fair Value
	(In thousands)	(Per share)		(In thousands)
Balances outstanding at December 31, 2021	3,732	$	43.63	$	133,308
Awarded	4,205	19.76
Vested	(1,711)	30.07
Forfeited	(980)	42.43
Non-vested and outstanding at September 30, 2022	5,246	$	29.17	$	49,420
Expected to vest	3,233	$	29.43	$	30,459

RSUs granted to employees generally vest over a three to four-year period or upon achievement of certain performance conditions. As of September 30, 2022, total unrecognized compensation cost, adjusted for estimated forfeitures, related to nonvested RSUs was approximately $130.1 million and the weighted-average remaining vesting period was 2.8 years.

For the three months ended September 30, 2022 and 2021, the Company accrued approximately $0.0 million and $5.1 million in cash rewards, respectively, and for the nine months ended September 30, 2022 and 2021, the Company accrued approximately $11.9 million and $15.5 million in cash awards, respectively, to be settled in shares of the Company’s stock and recorded a corresponding expense, which is included as a component of stock-based compensation expense in the accompanying condensed consolidated statements of operations for the three and nine months ended September 30, 2022 and 2021, respectively.

Stock-based compensation expense recognized in the Company’s condensed consolidated statements of operations and cash flows was $31.9 million and $18.3 million for the three months ended September 30, 2022 and 2021, respectively, and $100.3 million and $48.0 million for the nine months ended September 30, 2022 and 2021, respectively.

The per share weighted average fair value of stock options granted was $7.35 and $29.13 during the three months ended September 30, 2022 and 2021, respectively. The per share weighted average fair value of stock options granted was $11.16 and $26.98 during the nine months ended September 30, 2022 and 2021, respectively. The fair value of each option grant is estimated on the date of grant, adjusted for estimated forfeitures, using the Black-Scholes option-pricing model with the following weighted average assumptions:

	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2022	2021	2022	2021
Dividend yield	0.00%	0.00%	0.00%	0.00%
Risk-free interest rate	2.82% - 3.05%	0.72% - 1.02%	1.62% - 3.38%	0.46% - 1.02%
Expected life (in years)	5	5	5	5
Historical volatility	59.74% - 61.22%	53.51% - 53.67%	53.87% - 61.22%	53.51% - 54.55%

A description of the methods used in the significant assumptions used to estimate the fair value of stock-based compensation awards follows:

•Dividend yield – The Company uses 0% as it has never issued dividends and does not anticipate issuing dividends in the near term.

•Risk-free interest rate – The Company uses the market yield on U.S. Treasury securities at five years with constant maturity, representing the current expected life of stock options in years.

•Expected life – The Company uses historical data to estimate the expected life of a stock option.

•Historical volatility – The Company uses a trailing five year from grant date to determine volatility.