BIOLASE, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Redeemable Preferred Stock and Stockholders' Equity (Tables)

Redeemable Preferred Stock and Stockholders' Equity (Tables)

3 Months Ended

Mar. 31, 2021

Summary of Income Statement Classification of Compensation Expense

The following table summarizes the income statement classification of compensation expense associated with share-based payments (in thousands):


	Three Months Ended
	March 31,
	2021		2020
Cost of revenue	$	79		$	51
Sales and marketing		121			210
General and administrative		615			425
Engineering and development		113			33
Total	$	928		$	719

Assumptions on Estimation of Stock Option Fair Values

The stock option fair values were estimated using the Black-Scholes option-pricing model with the following assumptions:


	Three Months Ended
	March 31,
	2021			2020
Expected term (years)		6.1			5.9
Volatility		110	%		82	%
Annual dividend per share	$	—		$	—
Risk-free interest rate		0.69	%		1.25	%

Summary of Option Activity

A summary of option activity for the three months ended March 31, 2021 is as follows (in thousands, except per share data):


					Weighted		Weighted Average Remaining
					Average		Contractual			Aggregate
	Shares				Exercise Price		Term (Years)			Intrinsic Value(1)
Options outstanding at December 31, 2020		2,398		$		2.96		7.2	$		53
Granted at fair market value		20		$		1.29
Exercised		—		$		—
Forfeited, cancelled, or expired		(9	)	$		1.88
Options outstanding at March 31, 2021		2,409		$		2.95		6.9	$		589
Options exercisable at March 31, 2021		1,083		$		6.01		4.3	$		2
Vested options expired during the period ended March 31, 2021		—		$		—

(1)

The intrinsic value calculation does not include negative values. This can occur when the fair market value on the reporting date is less than the exercise price of the grant.

Summary of Unvested Stock Option Activity

A summary of unvested stock option activity for the three months ended March 31, 2021 is as follows (in thousands, except per share data):


				Weighted
				Average Grant
	Shares			Date Fair Value
Unvested options at December 31, 2020		1,323			$	0.34
Granted		20			$	1.07
Vested		(18	)		$	1.18
Forfeited or cancelled		—			$	—
Unvested options at March 31, 2021		1,325			$	0.34

Cash Proceeds, Along With Fair Value Disclosures Related to Grants, Exercises and Vesting Options

Cash proceeds, along with fair value disclosures related to grants, exercises and vested options are as follows (in thousands, except per share amounts):


	Three Months Ended
	March 31,
	2021		2020
Proceeds from stock options exercised	$	—	$	—
Tax benefit related to stock options exercised (1)	N/A		N/A
Intrinsic value of stock options exercised (2)	$	—	$	—
Weighted-average fair value of options granted during period	$	1.07	$	0.54
Total fair value of shares vested during the period	$	21	$	67

(1)

Excess tax benefits received related to stock option exercises are presented as operating cash inflows. The Company currently does not receive a tax benefit related to the exercise of stock options due to the Company’s net operating losses.

(2)

The intrinsic value of stock options exercised is the amount by which the market price of the stock on the date of exercise exceeded the exercise price of the options.

Restricted Stock Units

Summary of Unvested Restricted Stock Units

A summary of unvested RSU activity for the three months ended March 31, 2021 is as follows (in thousands, except per share amounts):


				Weighted
				Average Grant
	Shares			Date Fair Value
Unvested RSUs at December 31, 2020		3,672			$	0.66
Granted		1,164			$	1.14
Vested		(1,694	)		$	0.88
Forfeited or cancelled		(465	)		$	1.50
Unvested RSUs at March 31, 2021		2,677			$	0.58

Summary of Warrant Activity

A summary of warrant activity for the three months ended March 31, 2021 is as follows (in thousands, except exercise price amounts):


				Weighted
				Average
	Shares			Exercise Price
Warrants outstanding, December 31, 2020		54,052			$	0.62
Granted or Issued		—			$	—
Exercised		(35,740	)		$	0.43
Forfeited, cancelled, or expired		—			$	—
Warrants outstanding at March 31, 2021		18,312			$	1.01
Warrants exercisable at March 31, 2021		18,312			$	1.01
Vested warrants expired during the period ended March 31, 2021		—			$	—