NOTE 11. STOCK PLANS

Stock-Based Compensation

During the three months ended March 31, 2024 and 2023, the Company granted options to purchase an aggregate of 0 and 226,966 shares of its common stock that are subject to time-based vesting conditions, respectively.

The Company valued these stock options using the Black-Scholes Merton option pricing model. The assumptions used to compute the grant date fair values of the stock options granted during the three months ended March 31, 2024 and 2023 are set forth in the table below:

Stock-based compensation capitalized for internal-use software was $118 and $134 for the three months ended March 31, 2024 and 2023, respectively.

Equity Award Activity Under Stock Plans

Performance Stock Units

In connection with the Steel Holdings Consulting Agreement (as defined and further described in Note 12), on January 11, 2023, the Compensation Committee of the Board (the “Compensation Committee”) approved a grant of 118,460 performance stock units (the “Steel Holdings Consulting PSUs”) that were to vest upon the achievement of certain performance milestones. During the year ended December 31, 2023, certain performance milestones were achieved resulting in the vesting of 19,743 shares of the Steel Holdings Consulting PSUs on April 22, 2023 and 39,486 shares on November 15, 2023.

In January 2024, the Company entered into an amended and restated independent contractor services agreement with Steel Holdings, LLC (the “Amended Consulting Agreement”), which supersedes and replaces the Steel Holdings Consulting Agreement. Under the Amended Consulting Agreement, all equity grants that were made, other than vested Steel Holdings PSUs but including unvested Steel Holdings PSUs, or contemplated under the Steel Holdings Consulting Agreement were terminated as of the effective date of the Amended Consulting Agreement and no further performance stock units will be issued under the Amended Consulting Agreement.

On March 16, 2023, the Compensation Committee approved a grant of 170,402 target performance stock units to be granted to the Company’s named executive officers (the “Senior Executive PSUs”). The awards had a grant date of March 31, 2023 and were to vest based on the achievement of revenue and non-GAAP net income targets (each equally weighted) for 2023, which achievement shall then be modified (up to a 20% increase or decrease) based on the Company’s relative total stockholder return over a three-year performance period (the “TSR Modifier”), as compared with the S&P Software and Services Select Industry Index. Based on the Company’s performance, the Company’s named executive officers were to earn from 0% to 200% of the target number of shares of the Senior Executive PSUs. The Senior Executive PSUs, to the extent earned, were to vest on the date the Board certifies the TSR Modifier for the three-year performance period ending December 31, 2025 and the number of Senior Executive PSUs that were to vest as of such certification, all of which was to occur within 90 days of the end of the performance period ending December 31, 2025. Compensation costs recognized on the Senior Executive PSUs were to be adjusted, as applicable, for performance above or below the target specified in the award. On April 8, 2024, the Compensation Committee determined that, as of December 31, 2023, the revenue and non-GAAP net income targets were not achieved and the Senior Executive PSUs were forfeited.

Restricted Stock Units

As of March 31, 2024, total unrecognized compensation cost related to restricted stock units was $5,729, which is expected to be recognized over a weighted average period of 2.1 years.

Performance-Based Stock Options

The aggregate intrinsic value of the options exercised during the three months ended March 31, 2024 and 2023 was $0 and $5, respectively. No performance-based stock options were granted during the three months ended March 31, 2024 and 2023 and no performance-based stock options vested during the three months ended March 31, 2024.

Stock Options

No stock options were granted during three months ended March 31, 2024. The weighted average grant date fair value of stock options granted during the three months ended March 31, 2023 was $4.21 per share. The aggregate intrinsic value of the stock options exercised during the three months ended March 31, 2024 and 2023 was $30 and $10, respectively. The total grant date fair value of stock options vested during the three months ended March 31, 2024 and 2023 was $1,080 and $1,584, respectively. At March 31, 2024, total unrecognized compensation expense related to stock options was $4,194 and is expected to be recognized over a weighted average period of 2.1 years.

The aggregate intrinsic values in the tables above represent the difference between the fair market value of the Company’s common stock and the average option exercise price of in-the-money options, multiplied by the number of such stock options.

Employee Stock Purchase Plan

As of March 31, 2024 and December 31, 2023, employee payroll deductions accrued under the ESPP totaled $160 and $357, respectively. During the three months ended March 31, 2024, a total of 119,954 shares of common stock were purchased under the ESPP.