COMMON STOCK AND STOCK-BASED COMPENSATION PLANS (Tables)

9 Months Ended

Sep. 30, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

A summary of the Company’s stock option and SARs activities and related information for the nine months ended September 30, 2016, are as follows:


	Number of options and SAR units (1)			Weighted average exercise price		Weighted average remaining contractual term		Aggregate intrinsic-value
Outstanding as of December 31, 2015		2,406,455		$	18.15
Granted		66,000			27.17
Exercised		(940,526	)		16.76
Forfeited or expired		(37,633	)		17.89

Outstanding as of September 30, 2016 (2)		1,494,296		$	19.42		4.8	$	23,378,563

Exercisable as of September 30, 2016 (3)		981,117		$	19.97		4.0	$	14,809,518

(1)	The SAR units are convertible for a maximum number of shares of the Company’s common stock equal to 75% of the SAR units subject to the grant.

(2)	Due to the ceiling imposed on the SAR grants, the outstanding amount equals a maximum of 1,331,360 shares of the Company’s common stock issuable upon exercise.

(3)	Due to the ceiling imposed on the SAR grants, the exercisable amount equals a maximum of 895,288 shares of the Company’s common stock issuable upon exercise.

Summary of Restricted Stock Units Activity

A summary of the Company’s RSU activities and related information for the nine months ended September 30, 2016, are as follows:


	Number of RSUs			Weighted Average Grant-Date Fair Value
Unvested as of December 31, 2015		234,000		$	19.89
Granted		372,617			21.51
Vested		(97,640	)		19.61
Forfeited or expired		(15,969	)		20.12

Unvested as of September 30, 2016		493,008		$	21.16

Expected to vest after September 30, 2016		452,937		$	21.16

Equity-Based Compensation Expense Included in Interim Condensed Consolidated Statements of Income

The following table shows the total equity-based compensation expense included in the interim condensed consolidated statements of income:


	Nine months ended September 30,				Three months ended September 30,
	2016		2015		2016		2015
	(unaudited)		(unaudited)		(unaudited)		(unaudited)
Cost of revenue	$	179	$	111	$	65	$	34
Research and development, net		2,162		1,323		741		438
Sales and marketing		681		395		179		151
General and administrative		1,626		966		580		496

Total equity-based compensation expense	$	4,648	$	2,795	$	1,565	$	1,119

Assumptions Used to Estimate Fair Value of Stock Options Granted

The fair value for the Company’s stock options and SARs (other than share issuances in connection with the employee stock purchase plan, as detailed below) granted to employees and non-employees directors was estimated using the following assumptions:


	Nine months ended September 30,				Three months ended September 30,
	2016		2015		2016		2015
	(unaudited)		(unaudited)		(unaudited)		(unaudited)

Expected dividend yield		0%		0%		0%		0%
Expected volatility		40%-49%		33%-49%		40%-49%		35%-49%
Risk-free interest rate		0.5%-1.5%		0.2%-2.4%		0.5%-1.5%		0.3%-2.4%
Expected forfeiture (employees)		—		10%		—		10%
Expected forfeiture (executives)		5%		5%		5%		5%
Contractual term of up to		10 Years		10 Years		10 Years		10 Years
Suboptimal exercise multiple (employees)		—		2.1		—		2.1
Suboptimal exercise multiple (executives)		2.4		2.4		2.4		2.4

Assumptions Used to Estimate Fair Value of Employee Stock Purchase Plan

The fair value for rights to purchase shares of common stock under the Company’s employee stock purchase plan was estimated on the date of grant using the following assumptions:


	Nine months ended September 30,				Three months ended September 30,
	2016		2015		2016		2015
	(unaudited)		(unaudited)		(unaudited)		(unaudited)

Expected dividend yield		0%		0%		0%		0%
Expected volatility		29%-57%		35%-36%		29%-48%		35%-36%
Risk-free interest rate		0.3%-0.5%		0.1%-0.3%		0.4%-0.5%		0.2%-0.3%
Expected forfeiture		0%		0%		0%		0%
Contractual term of up to		24 months		24 months		24 months		24 months