Stockholders' Equity

Common Stock

At December 31, 2018, there were 100,000,000 shares of common stock authorized, and 63,676,229 shares issued and outstanding. As of December 31, 2017, there were 100,000,000 shares of common stock authorized, and 59,663,969 shares issued and outstanding. The par value for common shares is $0.001.

Preferred Stock

As of December 31, 2018 and 2017, there were 5,000,000 shares of preferred stock authorized, and zero shares issued and outstanding. The par value for preferred shares is $0.001.

Stock Repurchase Program

From 2012 through 2018, the Company had a stock repurchase program in place pursuant to which the Company was authorized to repurchase shares of its common stock, in the open market or privately negotiated transactions, at times and prices considered appropriate by the Board of Directors depending upon prevailing market conditions and other corporate considerations. The timing and actual number of shares repurchased depend on a variety of factors including the timing of open trading windows, price, corporate and regulatory requirements and other market conditions. The program was discontinued at the end of 2018. The Company may or may not enter into a new stock repurchase program in the future.

Stock-Based Compensation

The Company follows FASB ASC 718-10, “Stock Compensation,” which addresses the accounting for transactions in which an entity exchanges its equity instruments for goods or services, with a primary focus on transactions in which an entity obtains employee services in share-based payment transactions. ASC 718-10 requires measurement of the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. Incremental compensation costs arising from subsequent modifications of awards after the grant date must be recognized.

The per share weighted average fair value of stock options granted during the years ended December 31, 2018, 2017 and 2016 was $6.60, $4.25, and $3.10, respectively. The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions for the years ended December 31, 2018, 2017 and 2016:



	December 31,
	2018	2017	2016
Dividend yield	—%	—%	—%
Risk-free interest rate	2.5% – 3.1%	1.7% – 2.1%	1.0% – 1.8%
Expected life (in years)	5.0	5.0	5.0
Historical volatility	43.5% – 48.4%	46.6% – 48.1%	46.8% – 48.2%

A description of the methods used in the significant assumptions used to estimate the fair value of stock-based-based compensation awards follows:

Dividend yield – The Company uses 0% as it has never issued dividends and does not anticipate issuing dividends in the near term.

Risk-free interest rate – The Company uses the market yield on U.S. Treasury securities at five years with constant maturity, representing the current expected life of stock options in years.

Expected life – The Company uses historical data to estimate the expected life of a stock option.

Historical volatility – The Company uses a trailing five year from grant date to determine volatility.

Stock Option Plans

During 1998, the Company established the Stock Option and Restricted Stock Purchase Plan (the “1998 Plan”). Under the 1998 Plan, the Board of Directors could issue incentive stock options or nonqualified stock options to purchase up to 5,850,000 shares of common stock. The 2000 Stock Incentive Plan (the “2000 Plan”) succeeded the 1998 Plan. Under the 2000 Plan, the options which had been outstanding under the 1998 Plan were incorporated in the 2000 Plan increasing the number of shares available for issuance under the plan by approximately 4,150,000, thereby reserving for issuance 10,000,000 shares of common stock in the aggregate.

The Company established the 2009 Stock Incentive Plan (as amended and restated, the “2009 Plan”) as a successor to the 2000 Plan. Under the 2009 Plan, the options which had been outstanding under the 2000 Plan were incorporated into the 2009 Plan and the Company increased the number of shares available for issuance under the plan by 6,000,000. The Company amended the 2009 Stock Incentive Plan (the “Amended 2009 Plan”) effective June 7, 2012. The Amended 2009 Plan increased the number of shares authorized for issuance under the plan by an additional 4,250,000.

On June 2, 2017, the Company's Board of Directors amended and restated the Amended 2009 Plan effective April 30, 2017. The amended and restated plan increased the number of shares authorized for issuance under the plan by an additional 4,000,000, thereby reserving for issuance 23,817,744 shares of common stock in the aggregate. Options to acquire common stock granted thereunder have 10-year terms. As of December 31, 2018, approximately 2.7 million shares of common stock were remaining authorized for issuance under the 2009 Plan (taking into account all option exercises through December 31, 2018).

Employee Stock Purchase Plan

In June 2010, the Company's stockholders approved the 2010 Employee Stock Purchase Plan with 1,000,000 shares of common stock initially reserved for issuance. Subject to stockholder approval, which was obtained on June 2, 2017, the Company's Board of Directors amended and restated the 2010 Employee Stock Purchase Plan effective April 30, 2017. The amended and restated plan increased the number of shares authorized for issuance under the plan by an additional 1,000,000, thereby reserving for issuance 2,000,000 shares of common stock in the aggregate. As of December 31, 2018, approximately 0.9 million shares of common stock were reserved for issuance under the Employee Stock Purchase Plan (taking into account all share purchases through December 31, 2018).

Inducement Plan

During January 2018, the Company established the Inducement Plan (the “2018 Plan”). Under the 2018 Plan, the Board of Directors can issue incentive stock options or nonqualified stock options or other equity-based awards in respect of up to 1,500,000 shares of common stock. On April 25, 2018, the Company's Board of Directors amended and restated the 2018 Plan (the "Amended 2018 Plan"). The Amended 2018 Plan increased the number of shares authorized for issuance under the plan by an additional 500,000 shares, thereby reserving for issuance 2,000,000 shares of common stock in the aggregate. As of December 31, 2018, approximately 0.1 million shares of common stock were reserved for issuance under the Amended 2018 Plan (taking into account all option grants and other equity award settlements through December 31, 2018).

Stock Option Activity

A summary of the Company’s stock option activity and weighted average exercise prices follows:



	Stock Option Activity				Weighted Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
	Options (in thousands)		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Balance outstanding at December 31, 2015	9,144		$	11.05
Granted	635		7.32
Exercised	(325	)	5.66
Cancelled or expired	(1,685	)	11.49
Balance outstanding at December 31, 2016	7,769		$	10.88	6.05	$	2,641
Options vested and expected to vest	7,348		$	11.00	5.90	$	2,529
Options exercisable at December 31, 2016	5,580		$	11.31	5.27	$	2,347

Balance outstanding at December 31, 2016	7,769		$	10.88
Granted	2,042		9.87
Exercised	(854	)	8.80
Cancelled or expired	(998	)	11.98
Balance outstanding at December 31, 2017	7,959		$	10.71	5.85	$	14,881
Options vested and expected to vest	7,163		$	10.75	5.49	$	13,197
Options exercisable at December 31, 2017	5,163		$	11.17	4.50	$	8,648

Balance outstanding at December 31, 2017	7,959		$	10.71
Granted	2,033		15.00
Exercised	(3,120	)	10.70
Cancelled or expired	(606	)	10.03
Balance outstanding at December 31, 2018	6,266		$	12.13	6.55	$	43,348
Options vested and expected to vest	5,550		$	11.89	6.28	$	39,521
Options exercisable at December 31, 2018	3,278		$	11.12	4.64	$	25,367

The total fair value of stock options exercised during the years ended December 31, 2018 and 2017 was approximately $16.1 million and $3.7 million, respectively. As of December 31, 2018, there was approximately $14.4 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements. That cost is expected to be recognized over a weighted average period of approximately 2.7 years.

The following table summarizes information about outstanding and vested stock options as of December 31, 2018:



	Options Outstanding				Options Exercisable
Range of Exercise Prices	Number of Shares Outstanding (in thousands)	Weighted-Average Remaining Contractual Life (Years)	Weighted-Average Exercise Price		Number of Shares (in thousands)	Weighted-Average Exercise Price
$1.79 - $7.60	1,081	6.37	$	7.03	570	$	6.70
$7.95 - $9.55	635	5.90	9.20		488	9.18
$9.90 - $10.13	640	5.33	10.09		636	10.09
$10.31 - $11.96	660	6.77	11.26		388	11.00
$12.09 - $12.32	39	2.31	12.29		39	12.29
$12.45 - $12.45	930	9.13	12.45		—	—
$12.46 - $13.59	684	3.42	13.31		684	13.31
$14.30 - $15.96	678	7.22	14.73		146	14.97
$16.05 - $21.75	770	6.85	18.30		327	17.45
$22.04 - $23.50	149	9.56	22.91		—	—

	6,266	6.55	$	12.13	3,278	$	11.12

Restricted Stock Unit Activity

A summary of the Company’s restricted stock units (“RSUs”) activity and weighted average exercise prices follows:



	Restricted Stock Unit Activity
	Number of Shares (in thousands)		Weighted Average Grant Date Fair Value (Per Share)		Aggregate Fair Value (in thousands)
Balance outstanding at December 31, 2015	1,202		$	10.31	$	6,220
Awarded	571		6.32		—
Released	(394	)	10.31		—
Forfeited	(191	)	10.01		—
Non-vested and outstanding at December 31, 2016	1,188		$	8.44	$	8,968

Balance outstanding at December 31, 2016	1,188		$	8.44	$	8,968
Awarded	332		8.16		—
Released	(363	)	8.48		—
Forfeited	(284	)	8.46		—
Non-vested and outstanding at December 31, 2017	873		$	8.29	$	10,053

Balance outstanding at December 31, 2017	873		$	8.29	$	10,053
Awarded	2,568		17.02		—
Released	(361	)	9.49		—
Forfeited	(390	)	9.49		—
Non-vested and outstanding at December 31, 2018	2,690		$	15.81	$	50,756
Expected to vest	1,875		$	14.83	$	35,357

RSUs granted to employees generally vest over a three to four-year period, or upon achievement of certain performance conditions. As of December 31, 2018, total unrecognized compensation cost, adjusted for estimated forfeitures, related to nonvested RSUs was approximately $37.9 million and the weighted-average remaining vesting period was 2.8 years.