Note 13 - Stock-based Compensation

12 Months Ended

Dec. 31, 2022

Notes to Financial Statements

Share-Based Payment Arrangement [Text Block]

13. Stock-Based Compensation

Overview

On July 22, 2021, at the 2021 Annual Meeting of Stockholders, stockholders voted to approve the Company’s Amended and Restated Incentive Compensation Plan (the “Plan”) to increase the number of shares reserved for issuance under the Plan by 22,000,000 shares. As of December 31, 2022, there were 32,072,308 shares authorized for issuance, and 11,038,824 shares available for future issuance under the Plan. To date all equity awards under the Plan have consisted of nonqualified stock options, incentive stock options, and restricted stock units.

Under the Plan, which is administered by the Compensation Committee, the Company may grant stock options, stock appreciation rights, restricted stock and/or deferred stock to employees, officers, directors, consultants, and vendors. The exercise price of stock options or stock appreciation rights may not be less than the fair market value of the Company’s shares at the date of grant. Additionally, no stock options or stock appreciation rights granted under the Plan may have a term exceeding ten years.

Stock Options

The following table summarizes the Company’s stock option activity, including grants to non-employees, for the year ended December 31, 2022:

	Number of Shares			Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term (Years)
Balance at December 31, 2021		4,640,660		$	6.64		5.66
Granted		3,153,881			0.70
Forfeited		(129,134	)		1.60
Cancelled		(36,987	)		21.11
Exercised		(43,453	)		0.41
Balance at December 31, 2022		7,584,967		$	4.22		5.31

The aggregate intrinsic value of stock options exercised under the Company’s stock plans was not material during the year ended December 31, 2022.

The following table summarizes information about stock options outstanding at December 31, 2022:

	Number of Shares		Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value (Millions)
Exercisable at December 31, 2022		3,524,473	$	7.40		4.75	$	-
Vested or expected to vest at December 31, 2022		7,350,141	$	4.32		5.28	$	-

The fair value of options granted were estimated using the Black-Scholes-Merton option pricing model based on the assumptions in the table below:

	Years Ended December 31,
	2022			2021
Expected dividend yield	0%			0%
Expected volatility	126%	-	133%	118%	-	139%
Risk-free interest rate	1.25%	-	4.40%	0.33%	-	1.11%
Expected life (in years)	3.8	-	4.5	3.8	-	4.5

Restricted Stock Units

The following is a summary of the restricted stock units activity, including performance restricted stock units, for the year ended December 31, 2022:

	Number of Restricted Stock Units Outstanding			Weighted- Average Grant Date Fair Value
Unvested December 31, 2021		3,839,030		$	2.36
Granted		6,996,822			0.71
Vested		(2,076,663	)		2.34
Forfeited		(275,698	)		1.19
Unvested December 31, 2022		8,483,491		$	1.04

Performance Restricted Stock Units

In 2022 and 2021, the Company granted performance-based restricted stock units with vesting terms based on our attainment of certain operational targets by October 1, 2023 and October 1, 2022, respectively. The number of shares earnable under the 2022 and 2021 awards are based on achieving designated corporate goals. These operational targets were achieved for 2022 and 2021, therefore the performance-based restricted stock units are fully earned and remain subject to three-year time-based vesting requirements.

Stock-based Compensation Expense

The following table summarizes non-cash stock-based compensation expense by award type for the years ended December 31, 2022, and 2021:

	Years Ended December 31,
	2022		2021
	(in thousands)
Stock options	$	3,654	$	4,535
Restricted stock units		3,319		3,954
Performance restricted stock units		1,443		940
	$	8,416	$	9,429

As of December 31, 2022, the Company had future employee stock-based compensation expense of approximately $2.1 million related to unvested stock options, which is expected to be recognized over an estimated weighted-average period of 1.5 years. As of December 31, 2022, the unrecognized stock-based compensation expense related to unvested restricted stock units and performance restricted stock units was approximately $4.2 million, which is expected to be recognized over a weighted average period of approximately 1.4 years.