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Common Stock and Stock-Based Compensation
 6 Months Ended
Jun. 30, 2021
Share-based Payment Arrangement [Abstract]  
Common Stock and Stock-Based Compensation Common Stock and Stock-Based Compensation
Increase in Authorized Shares of Common Stock
In May 2021, our stockholders approved an amendment to our Fifth Amended and Restated Certificate of Incorporation to increase the total number of authorized shares of our common stock from 100,000,000 to 200,000,000 shares. The increase in the authorized common shares was effected pursuant to a Certificate of Amendment of our Fifth Amended and Restated Certificate of Incorporation filed with the State of Delaware on May 28, 2021 and was effective as of such date.
2010 Equity Incentive Award Plan
Under our 2010 Equity Incentive Award Plan, as amended and restated effective May 22, 2019 (the Prior 2010 Plan), the aggregate number of shares with respect to which awards may be granted was 11,500,000 shares. The various types of awards that may be granted include stock options, stock appreciation rights, restricted stock units, restricted stock and other stock-based awards, any of which may be performance-based.
In May 2021, our board of directors adopted, and our stockholders approved, an amendment and restatement of the Prior 2010 Plan. The 2010 Equity Incentive Award Plan, as amended and restated effective May 27, 2021 (the 2010 Plan), increased the aggregate number of shares authorized for issuance under the plan from 11,500,000 to 16,000,000 shares, and an extension of the expiration date of the Prior 2010 Plan from March 2029 to May 2031. At June 30, 2021, approximately 6.9 million shares were available for future issuance under our 2010 Plan.
2021 Employment Inducement Equity Incentive Award Plan
In May 2021, our board of directors approved the adoption of the Zogenix, Inc. 2021 Employment Inducement Equity Incentive Award Plan (2021 Inducement Plan), pursuant to which we reserved 1,000,000 shares of our
common stock (subject to customary adjustments in the event of a change in capital structure). The 2021 Inducement Plan provides for the grant of non-statutory stock options, restricted stock units and other incentive awards and was adopted without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules.
The terms and conditions of the 2021 Inducement Plan are substantially similar to our 2010 Plan, but with such other terms and conditions intended to comply with the Nasdaq inducement award rules. In accordance with Rule 5635(c)(4) of the Nasdaq Listing Rules, the only persons eligible to receive grants of equity awards under the 2021 Inducement Plan are individuals who were not previously a Zogenix employee or director, or following a bona fide period of non-employment, as an inducement material to such persons entering into employment with us.
At June 30, 2021, no grants have been made from the 2021 Inducement Plan and 1,000,000 shares were available for future issuance.
Stock Options
The following is a summary of stock option activity for the six months ended June 30, 2021 (in thousands, except per share data):
Shares
Weighted-
Average
Exercise
Price per Share
Outstanding at December 31, 20205,311 $29.12 
Granted
1,345 18.77 
Exercised
(22)8.80 
Canceled
(216)27.91 
Outstanding at June 30, 20216,418 $27.06 

Restricted Stock Units
Time-based restricted stock units (RSUs) and performance-based restricted stock units (PSUs) will be settled with our common stock on a one-to-one basis upon vesting. The following is a summary of our stock award activity for the six months ended June 30, 2021 (in thousands, except per share data):
RSUs
PSUs
Total
Outstanding at December 31, 2020393 — 393 
Granted(1)
451 492 943 
Vested
(120)— (120)
Canceled
(35)(26)(61)
Outstanding at June 30, 2021689 466 1,155 
(1) Weighted-average grant date fair value
$19.55 $18.76 $19.17 
For the six months ended June 30, 2021, we granted approximately 492,000 PSUs to employees and executive officers. The PSUs are subject to vesting based on various performance conditions including achievement of certain regulatory milestones, net product revenue targets and the number of patients on reimbursed therapy, subject to continued service by the employee. Compensation expense related to equity-based awards with performance conditions and terms that provide for a graded vesting schedule is recognized over the requisite service period on a straight-line basis for each separately vesting tranche of the award, and is based on the expected satisfaction of the performance conditions at each reporting date. For performance conditions associated with regulatory milestones, we determined the outcome is not probable of being achieved unless and until the occurrence of the event. As a result, compensation expense will only be recognized, at a point in time, when regulatory approval occurs. We expect stock-based compensation will fluctuate from period to period based on the timing of achievement of regulatory milestones and such fluctuations may be material. For performance conditions associated with the net product revenue and the number of patients receiving reimbursed therapy, we determined the outcome is probable of being achieved and stock-based compensation expense is recognized commencing at the grant date over the implicit service period.
The following table summarizes the components of total stock-based compensation expense included in our condensed consolidated statements of operations:
Three Months Ended June 30,Six Months Ended June 30,
(In thousands)2021202020212020
Research and development$4,525 $3,488 $7,824 $6,217 
Selling, general and administrative5,001 4,815 9,800 8,480 
Total$9,526 $8,303 $17,624 $14,697 
The following table summarizes stock-based compensation expense by award type included in our condensed consolidated statements of operations:
Three Months Ended June 30,Six Months Ended June 30,
(In thousands)2021202020212020
Time-based stock options and restricted stock units$8,734 $6,733 16,209 12,975 
Performance-based stock units627 1,441 1,054 1,441 
Employee stock purchase plan (ESPP)165 129 361 281 
Total$9,526 $8,303 $17,624 $14,697 
Shares reserved and available for future issuance under all employee equity plans as of June 30, 2021 and December 31, 2020 were approximately 7.4 million shares and 3.9 million shares, respectively.