NOTE 14. Equity

Equity Plans

We provide long-term incentives to eligible officers, directors, and employees in the form of equity-based awards. We maintain four equity incentive compensation plans, collectively described below as our “Equity Plans”:

the 2000 Stock Option Plan,

the 2010 Equity Incentive Plan (“2010 Plan”),

the 2012 Equity Incentive Plan (“2012 Plan”), and

the 2019 Equity Incentive Plan (“2019 Plan”).

We issue new shares of common stock to satisfy awards issued under our Equity Plans.

Stock-based compensation

The effect of recording stock-based compensation expense was as follows:


	For the three months				For the six months
Stock-based Compensation Expense - by award type	ended March 31,				ended March 31,
(in thousands)	2020		2019		2020		2019
Employee stock options	$	4	$	7	$	9	$	14
Restricted stock units and awards		552		396		928		782
Performance stock units and awards		363		229		655		169
Employee stock purchase plan		46		42		93		82
Outside director equity awards and fees in common stock		80		47		161		99
Total stock-based compensation expense	$	1,045	$	721	$	1,846	$	1,146


	For the three months				For the six months
Stock-based Compensation Expense - by expense type	ended March 31,				ended March 31,
(in thousands)	2020		2019		2020		2019
Cost of revenue	$	202	$	109	$	338	$	220
Selling, general, and administrative		591		473		1,076		632
Research and development		252		139		432		294
Total stock-based compensation expense	$	1,045	$	721	$	1,846	$	1,146

401(k) Plan

We have a savings plan that qualifies as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code. Under this savings plan, participating employees may defer a portion of their pretax earnings, up to the Internal Revenue Service annual contribution limit. Since June 2015, all employer contributions are made in cash. Our matching contribution in cash for the three months ended March 31, 2020 and 2019 was approximately $0.3 million and $0.1 million, respectively. Our matching contribution in cash for the six months ended March 31, 2020 and 2019 was approximately $0.5 million and $0.3 million, respectively.

Loss Per Share

The following table sets forth the computation of basic and diluted net loss per share:


	For the three months				For the six months
Basic and Diluted Net Loss Per Share	ended March 31,				ended March 31,
(in thousands, except per share)	2020		2019		2020		2019
Numerator:
Loss from continuing operations	$	(5,081)	$	(4,994)	$	(6,416)	$	(10,532)
Undistributed earnings allocated to common shareholders for basic and diluted net income per share		(5,081)		(4,994)		(6,416)		(10,532)
Denominator:
Denominator for basic and fully diluted net loss per share - weighted average shares outstanding		29,033		27,652		28,931		27,592

Net loss per basic and fully diluted share	$	(0.18)	$	(0.18)	$	(0.22)	$	(0.38)

Weighted average antidilutive options, unvested restricted stock units and awards, unvested performance stock units and ESPP shares excluded from the computation		2,161		849		1,704		535

For diluted loss per share, the denominator includes all outstanding common shares. The anti-dilutive stock options and unvested stock were excluded from the computation of diluted net loss per share for the three and six months ended March 31, 2020 and 2019 due to the Company incurring a net loss for the periods.

Employee Stock Purchase Plan

We maintain an Employee Stock Purchase Plan (“ESPP”) that provides employees an opportunity to purchase common stock through payroll deductions. The ESPP is a 6‑month duration plan with new participation periods beginning on approximately February 25 and August 26 of each year. The purchase price is set at 85% of the average high and low market price of our common stock on either the first or last trading day of the participation period, whichever is lower, and annual contributions are limited to the lower of 10% of an employee’s compensation or $25,000.

Future Issuances

As of March 31, 2020, we had common stock reserved for the following future issuances:


		Number of Common
		Stock Shares Available for
Future Issuances		Future Issuances
Exercise of outstanding stock options		46,342
Unvested restricted stock units and awards		1,799,427
Unvested performance stock units and awards (at 200% maximum payout)		1,812,000
Purchases under the employee stock purchase plan		428,349
Issuance of stock-based awards under the Equity Plans		822,155
Purchases under the officer and director share purchase plan		88,741
Total reserved		4,997,014