The Company’s stock-based compensation expenses recognized during the three and nine months ended September 30, 2020 and 2019, were attributable to selling, general and administrative expenses, which are included in the accompanying unaudited condensed interim consolidated statements of operations.

The Company recognized total stock-based compensation expense during the three and nine months ended September 30, 2020 and 2019, granted under the Equity Plan, from the following categories (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Restricted stock awards under the Plan	$	467	$	81	$	2,848	$	373
Stock option awards under the Plan		-		-		-		58
Total stock-based compensation	$	467	$	81	$	2,848	$	431

Riot Blockchain, Inc. and Subsidiaries

Notes to Condensed Interim Consolidated Financial Statements

(Unaudited)

Restricted common stock awards:

A summary of the Company’s unvested restricted common stock awards activity in the nine months ended September 30, 2020 is presented here:

	Number of Shares		Weighted Average Grant-Date Fair Value
Unvested at January 1, 2020		1,524,499	$	1.37
Vested		(1,850,965)	$	1.36
Granted		1,544,359	$	1.27
Unvested at September 30, 2020		1,217,893	$	1.27

On February 7, 2020, the Company issued 122,377 shares of common stock under a February 2019 employment agreement as disclosed above, and 5,000 vested restricted stock units to the Company’s Chief Executive Officer pursuant to the Equity Plan.

On February 7, 2020, in relation to its amended and restated employment agreement with its Chief Executive Officer and Chief Financial Officer, the Company awarded 209,790 restricted common stock units, which vest in four equal quarterly installments, with each quarterly installment vesting as of the end of each quarter pursuant to the Equity Plan.

On February 27, 2020, for 2020 services the Company awarded 1,212,192 restricted common stock units vesting over a one-year period to directors and certain employees of the Company issued pursuant to the Equity Plan.

The total fair value of restricted stock rights granted during the nine months ended September 30, 2020 was approximately $2.0 million. The fair value of each restricted stock right was based upon the closing stock price on the grant date.

The fair value of restricted stock rights is measured based on their fair value on the date of grant and amortized over the vesting period of twelve to twenty-four months. As of September 30, 2020, there was approximately $0.8 million of unrecognized compensation cost related to unvested restricted common stock awards, which is expected to be recognized over a remaining weighted-average vesting period of approximately 2.6 months.

Stock incentive plan options:

As of September 30, 2020, 12,000 stock options were outstanding under the Equity Plan, with a weighted average exercise price of $4.09, and a weighted average remaining contractual term of approximately 3.0 years. The stock options are 100% vested with zero intrinsic value.

Other common stock purchase warrants:

Following is a summary of outstanding warrants that were issued outside of the Equity Plan for the nine months ended September 30, 2020:

	Shares Underlying Options/Warrants			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding at January 1, 2020		3,574,257		$	19.48		2.9	$	-
Exercised		(200,000	)	$	1.94		-
Forfeited		(20,000)		$	3.50		-
Outstanding at September 30, 2020		3,554,257		$	20.62		2.1	$	1,298,189

Exercisable at September 30, 2020		3,554,257		$	20.62		2.1	$	1,298,189

The aggregate intrinsic value in the table above represents the total intrinsic value (the difference between the Company’s closing stock price on September 30, 2020 and the exercise price, multiplied by the number of in-the-money warrants) that would have been received by the warrant holders, had all warrant holders exercised their warrants on September 30, 2020.