Stock-based Compensation
 12 Months Ended
Dec. 31, 2021
Share-based Payment Arrangement [Abstract]  
Stock-based Compensation Stock-based Compensation
Equity Incentive Plans

The following table summarizes stock-based compensation expense related to stock options, restricted stock awards (RSAs) and RSUs granted to employees, non-employee directors and consultants, and the 2019 ESPP (as defined below) included in the consolidated statements of operations as follows (in thousands):
Years Ended December 31,
20212020
Research and development$1,357 $1,922 
Selling and marketing1,870 2,388 
General and administrative5,671 8,387 
Total$8,898 $12,697 
The 2012 Equity Incentive Plan (the 2012 Plan) provides for the issuance of RSAs, RSUs, or non-qualified and incentive common stock options to its employees, non-employee directors and consultants, from its authorized shares. In general, the options expire ten years from the date of grant and generally vest either (i) over a four-year period, with 25% exercisable at the end of one year from the employee’s hire date and the balance vesting ratably thereafter or (ii) over a three-year period, with 25% exercisable at the grant date and the balance vesting ratably thereafter. No further awards may be issued under the 2012 Plan.

On September 15, 2014, the Company's board of directors adopted, and stockholders approved, the 2014 Equity Incentive Plan (the 2014 Plan), which was amended and restated on each of May 2018 and February 26, 2019 (the Amended and Restated 2014 Plan), which among other things, increased the number of authorized shares under the 2014 Plan from 749,305 to an aggregate of 7,800,000 shares. On February 25, 2020, the Company’s board of directors approved, subject to stockholder approval, and recommended its stockholders approve at the 2020 Annual Meeting, an additional 2,000,000 authorized shares reserved for issuance under the Amended and Restated 2014 Plan to an aggregate of 11,725,515 shares, including the Evergreen Shares, as defined and discussed below. Such stockholder approval was obtained on May 12, 2020. Per the terms of the Amended and Restated 2014 Plan, the shares reserved will automatically increase on each January 1 through 2024, by an amount equal to the smaller of (i) 4% of the number of shares of common stock issued and outstanding on the immediately preceding December 31; or (ii) an amount determined by our board of directors. This provision resulted in an additional 5,000,000 shares (Evergreen Shares) added to the total number of authorized shares on January 1, 2022.

On July 24, 2018, upon the recommendation by the Compensation Committee, the Company's board of directors adopted the Evofem Biosciences, Inc. 2018 Inducement Equity Incentive Plan (the Inducement Plan), pursuant to which the Company reserved 250,000 shares for the issuance of equity awards under the Inducement Plan. The Inducement Plan was amended effective February 25, 2020 (the Amended Inducement Plan), which increased the number of authorized shares to an aggregate of 1,250,000 shares. The only persons eligible to receive awards under the Inducement Plan are individuals who satisfy the standards for inducement grant recipients under Nasdaq Marketplace Rule 5635(c)(4), generally, a person not previously an employee or director of the Company, or following a bona fide period of non-employment, as an inducement material to the individual’s entering into employment with the Company. 

Stock Options

The following table summarizes share option activity for the year ended December 31, 2021:
OptionsWeighted Average Exercise PriceWeighted Average Remaining Contractual Term (in Years)Aggregate Intrinsic Value (in thousands)
Outstanding as of December 31, 20208,935,801 $6.08 7.76$338 
     Granted3,208,525 $2.77 
     Exercised— $— 
     Cancelled(1,519,264)$4.30 
Outstanding as of December 31, 202110,625,062 $5.34 6.80$— 
Options vested and expected to vest as of December 31, 202110,625,062 $5.34 6.80$— 
Options exercisable as of December 31, 20217,384,269 $6.26 5.93$— 

The following table summarizes certain information regarding stock options for the years ended December 31, 2021 and 2020 (in thousands, except per share data):
20212020
Weighted average grant date fair value per share of options granted during the period$2.18 $3.20 
Fair value per share of options vested during the period$3.15 $3.51 
Cash received from options exercised during the period$— $83 
Intrinsic value of options exercised during the period$— $47 

The Company recognized $6.1 million and $6.0 million in stock-based compensation expense related to stock options for the years ended December 31, 2021 and 2020, respectively. As of December 31, 2021, unrecognized stock-based compensation expense for employee stock options was approximately $7.3 million, which the Company expects to recognize over a weighted-average remaining period of 2.3 years, assuming all unvested options become fully vested.
Summary of Assumptions

The fair value of noncash stock-based compensation for stock options granted to employees and non-employees was estimated on the date of grant using the Black-Scholes option pricing model based on the following weighted-average assumptions for options granted for the periods indicated.
Years Ended December 31,
20212020
Expected volatility101.1 %82.7 %
Risk-free interest rate0.7 %0.6 %
Expected dividend yield— %— %
Expected term (years)5.96.0

Expected volatility. The expected volatility assumption is based on volatilities of a peer group of similar companies whose share prices are publicly available. The peer group was developed based on companies in the biotechnology industry.

Risk-free interest rate. The risk-free interest rate assumption is based on observed interest rates appropriate for the expected term of the stock option grants.

Expected dividend yield. The expected dividend yield assumption is based on the fact that the Company has never paid cash dividends and has no present intention to pay cash dividends.
Expected term. The expected term represents the period options are expected to be outstanding. Because the Company does not have historical exercise behavior, it determines the expected term assumption using the practical expedient as provided for under ASC 718, Compensation-Stock Compensation (ASC 718), which is the midpoint between the requisite service period and the contractual term of the option.
Restricted Stock Awards
The following table summarizes RSAs activity for the year ended December 31, 2021:
Shares (RSAs)Weighted Average Fair Value per Share
Unvested as of December 31, 202080,000 $4.78 
      Granted1,777,500 $3.25 
      Forfeited(1,073,833)$3.27 
      Released(783,667)$3.36 
Unvested as of December 31, 2021— $— 

There were 1,777,500 shares and 1,275,000 shares of RSAs granted under the Amended and Restated 2014 Plan and the Inducement Plan during the years ended December 31, 2021 and 2020, respectively, to its executive management team, certain non-executive employees and consultants. Of the total RSAs granted during the years ended December 31, 2021 and 2020, 707,000 and 1,245,000 shares vested in accordance with the Company’s achievement of the Performance-based RSAs milestones, respectively.

For the performance-based RSAs, (i) the fair value of the award is determined on the grant date; (ii) the Company assesses the probability of achieving each individual milestone associated with the award using reasonable assumptions based on the Company's operation performance towards each milestone; (iii) the fair value of the shares subject to the milestone is expensed over the implicit service period commencing once management believes the performance criteria is probable of being met; and (iv) the Company reassesses the probability of achieving each individual milestone at each reporting date, and any change in estimate is accounted for through a cumulative adjustment in the period when the change in estimate occurs. The non-performance based RSAs and RSUs are valued at the fair value on the grant date and the associated expenses will be recognized over the vesting period.

For the year ended December 31, 2021, the Company recognized $2.5 million in noncash stock-based compensation expense related to RSAs. For the year ended December 31, 2020, the Company recognized $6.5 million in noncash stock-based
compensation expense related to RSAs and RSUs. As of December 31, 2021, there was no unrecognized noncash stock-based compensation expense related to unvested RSAs.

Employee Stock Purchase Plan

On May 7, 2019, the board of directors approved a 2019 Employee Stock Purchase Plan (the 2019 ESPP), which was approved by stockholders at the 2019 annual meeting held on June 5, 2019. The 2019 ESPP initially authorized the issuance of 500,000 shares of common stock pursuant to purchase rights granted to employees. In addition, the number of shares available for issuance under the 2019 ESPP will increase on January 1 of each year until the first day of 2029, in an amount equal to the lesser of (i) 1,000,000 shares, (ii) 2% of the shares of common stock outstanding on December 31, or (iii) such lesser number of shares as is determined by the board of directors. This provision resulted in an additional 250,000 shares added to the total number of authorized shares on January 1, 2022. The 2019 ESPP is intended to qualify as an employee stock purchase plan within the meaning of Section 423 of the Internal Revenue Code of 1986, as amended.

The 2019 ESPP enables eligible full-time and part-time employees to purchase shares of the Company’s common stock through payroll deductions of between 1% and 15% of eligible compensation during an offering period. A new offering period begins around June 15 and December 15 of each year. At the last business day of each offering period, the accumulated contributions made during the offering period will be used to purchase shares. The purchase price is 85% of the lesser of the fair market value of the common stock on the first or the last business day of an offering period. The maximum number of shares of common stock that may be purchased by any participant during an offering period will be equal to $25,000 divided by the fair market value of the common stock on the first business day of an offering period. During the years ended December 31, 2021 and 2020, there were 460,636 and 128,701 shares of common stock purchased under the 2019 ESPP, respectively.

The Company recognized $0.3 million and $0.2 million in noncash stock-based compensation expense related to the 2019 ESPP for the years ended December 31, 2021 and 2020, respectively. As of December 31, 2021, unrecognized noncash stock-based compensation expense related to the 2019 ESPP was approximately $0.1 million, which the Company expects to recognize over a weighted-average remaining period of 0.5 years, assuming all unvested shares become fully vested.

The fair value of shares to be issued to employees under the 2019 ESPP is estimated using a Black-Scholes option-pricing model at the grant date, which requires the use of subjective and complex assumptions, including (i) the expected stock price volatility, (ii) the calculation of the expected term of the award, (iii) the risk-free interest rate and (iv) the expected dividend yield. The following weighted average assumptions were used in the calculation of fair value of shares under the 2019 ESPP at the grant dates for the period indicated.
Year Ended December 31, 2021Year Ended December 31, 2020
Expected volatility83.9 %94.8 %
Risk-free interest rate0.1 %0.1 %
Expected dividend yield— %— %
Expected term (years)0.50.5