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Equity-Based Compensation
3 Months Ended
Mar. 31, 2023
Share-Based Payment Arrangement [Abstract]  
Equity-Based Compensation


 

 

11. Equity-Based Compensation

Equity Compensation Plans

A summary of the option activity under the Companys equity compensation plans is as follows:

 

 

Options Outstanding

 

 

Number of Options

 

 

Weighted-Average Exercise Price
(per option)

 

 

Weighted-Average Remaining Contractual Term
(in years)

 

 

Aggregate Intrinsic Value
(in thousands)

 

Outstanding at December 31, 2022

 

48,414,625

 

 

$

2.65

 

 

 

6.35

 

 

$

 

Granted

 

3,463,488

 

 

 

0.63

 

 

 

 

 

 

 

Forfeited

 

(3,272,682

)

 

 

2.80

 

 

 

 

 

 

 

Expired

 

(496,499

)

 

 

2.54

 

 

 

 

 

 

 

Outstanding at March 31, 2023

 

48,108,932

 

 

$

2.49

 

 

 

5.91

 

 

$

 

Exercisable at March 31, 2023

 

23,015,721

 

 

$

2.48

 

 

 

2.86

 

 

$

 

A summary of RSU activity is as follows:

 

 

 

RSUs Outstanding

 

 

Number of RSUs

 

 

Weighted-Average Fair Value
(per RSU)

 

 

Outstanding at December 31, 2022

 

 

3,159,185

 

 

$

 

1.45

 

 

Granted

 

 

22,676,189

 

 

 

 

0.58

 

 

Vested

 

 

(9,736,133

)

 

 

 

0.60

 

 

Forfeited

 

 

(619,173

)

 

 

 

0.96

 

 

Outstanding at March 31, 2023

 

 

15,480,068

 

 

$

 

0.73

 

 

 

The fair value of RSUs vested during the three months ended March 31, 2023 was $5.9 million. No RSUs vested during the three months ended March 31, 2022.

 

On January 1, 2023, the number of shares available for issuance under the 2021 Incentive Award Plan (the “2021 Plan”) increased by 15,608,106 pursuant to the terms of the 2021 Plan. As of March 31, 2023, 11,663,071 shares of Class A Common Stock were available for issuance under the 2021 Plan.

 

Vested RSUs included shares of common stock that the Company withheld on behalf of certain employees to satisfy the minimum statutory tax withholding requirements, as defined by the Company. The Company withheld shares of common stock with an aggregate fair value and remitted taxes of $2.1 million during the three months ended March 31, 2023, which were classified as financing cash outflows in the unaudited condensed consolidated statements of cash flows. The Company canceled and returned these shares to the 2021 Plan, which are available under the plan terms for future issuance.

Equity-Based Compensation Expense

The fair value of each award as of the date of grant is estimated using a Black-Scholes option-pricing model. The following table summarizes the weighted-average assumptions used to determine the fair value of option grants:

 

 

 

Three months ended March 31,

 

 

 

2023

 

 

2022

 

Risk-free rate

 

 

3.6

%

 

 

1.7

%

Dividend yield rate

 

 

 

 

 

 

Volatility

 

 

56.4

%

 

 

52.3

%

Expected term (in years)

 

 

5.16

 

 

 

6.20

 

Weighted-average grant date fair value

 

$

0.32

 

 

$

0.95

 

 

 

Equity-based compensation expense for the three months ended March 31, 2023 and 2022 was as follows (in thousands):

 

 

 

Three months ended March 31,

 

 

 

2023

 

 

2022

 

 

 

 

 

 

 

 

Cost of revenue

 

$

1,429

 

 

$

335

 

Selling and marketing

 

 

3,386

 

 

 

1,639

 

Enterprise technology and development

 

 

563

 

 

 

927

 

General and administrative

 

 

4,177

 

 

 

1,663

 

Total equity-based compensation

 

$

9,555

 

 

$

4,564

 

 

In connection with the restructuring activity that took place during the three months ended March 31, 2023, the Company modified certain stock awards of terminated employees (approximately 102 employees). The modifications included; accelerating the vesting of any options that would have vested within three months of the employees termination date; and all vested options will be available for exercise for a total of six months after the employees’ termination date (that is, three months in addition to the standard three months per original agreement). As a result of these modifications, the Company recognized a $0.6 million reduction to equity-based compensation expense within general and administrative expense in the unaudited condensed consolidated statements of operations.

 

As of March 31, 2023, the total unrecognized equity-based compensation expense was $38.8 million, which will be recognized over a weighted-average remaining period of 2.88 years.