SHARE-BASED COMPENSATION - Note 7

3 Months Ended

Mar. 31, 2020

Disclosure Of Compensation Related Costs

Share-Based Compensation - Note 7

7. SHARE-BASED COMPENSATION

We issue share-based compensation to employees in the form of stock options, restricted stock units (RSUs), and performance stock units (PSUs). We account for the share-based awards by recognizing the fair value of share-based compensation expense on a straight-line basis over the service period of the award, net of estimated forfeitures. The fair value of stock options is estimated on the grant date using the Black-Scholes option pricing model. The fair value of RSUs is determined by the closing price of our common stock on the grant date. The PSUs are valued using a binomial option pricing model using the following inputs: stock price, volatility, and risk-free interest rates. Changes in estimated inputs or using other option valuation methods may result in materially different option values and share-based compensation expense.

The following table summarizes the amount of share-based compensation expense by line item on the statements of operations:

Share-based compensation expense		Three Months Ended
		March 31,
(in thousands)		2020		2019
Cost of product revenue	$	-	$	1
Research and development expense		39		123
Sales, marketing, general and administrative expense		150		227
	$	189	$	351

Options activity and positions

The following table summarizes shares, weighted-average exercise price, weighted-average remaining contractual term and aggregate intrinsic value of options outstanding and options exercisable as of March 31, 2020:

				Weighted-
			Weighted-	Average
			Average	Remaining		Aggregate
			Exercise	Contractual		Intrinsic
Options	Shares		Price	Term (years)		Value
Outstanding as of March 31, 2020	4,616,000	$	1.71	6.4	$	-
Exercisable as of March 31, 2020	2,497,000	$	2.39	4.3	$	-

As of March 31, 2020, our unrecognized share-based employee compensation related to stock options was $791,000 which we plan to amortize over the next 1.8 years, our unrecognized share-based compensation related to RSUs was $240,000 which we plan to amortize over the next 1.3 years, and our unrecognized share-based compensation related to the PSUs was $12,000, which we plan to amortize over the next 1.5 years.