Note 10.

Stockholders’ Equity

Common Stock

As of October 31, 2015, we had 80,616,320 shares of Class A common stock and 52,170,094 shares of Class B common stock outstanding, of which 95,083 shares of Class B common stock were unvested, resulting from employees exercising stock options prior to vesting.

As of January 31, 2015, we had 64,729,479 shares of Class A common stock and 66,338,146 shares of Class B common stock outstanding, of which 195,833 shares of Class B common stock were unvested, resulting from employees exercising stock options prior to vesting.

Early Exercise of Employee Options

We historically have allowed for the early exercise of options granted under the 2007 Stock Plan (2007 Plan) prior to vesting. Historically, all such early exercises have been through cash payment. The unvested shares are subject to our repurchase right at the original purchase price. The proceeds initially are recorded as an accrued liability from the early exercise of stock options, and reclassified to common stock as our repurchase right lapses. At October 31, 2015, the amount of unvested shares and the aggregate price for those shares that were subject to repurchase were immaterial. At January 31, 2015 there were 195,833 unvested shares which were subject to repurchase at an aggregate price of approximately $0.1 million.

Stock Option Activity

A summary of stock option activity for the nine months ended October 31, 2015 is as follows:

						Weighted
				Weighted		average
				average		remaining		Aggregate
	Number			exercise		contractual		intrinsic
	of shares			price		term (in years)		value
Options outstanding at January 31, 2015		20,233,620		$	4.18		7.7	$	498,862,568
Options granted		619,800			26.91
Options exercised		(1,429,644	)		2.90
Options forfeited/cancelled		(193,986	)		9.92
Options outstanding at October 31, 2015		19,229,790		$	4.95		7.1	$	396,596,492
Options vested and exercisable at October 31, 2015		5,090,023		$	3.33		6.3	$	113,151,592
Options vested and exercisable at October 31, 2015 and expected to vest thereafter		18,355,846		$	4.93		7.1	$	378,969,871

There were no stock options granted during the three months ended October 31, 2015 and 619,800 stock options were granted during the nine months ended October 31, 2015. The weighted average grant-date fair value of options granted during the nine months ended October 31, 2015 was $12.36 per share.

As of October 31, 2015, there was $34.2 million in unrecognized compensation cost, net of estimated forfeitures, related to unvested stock options granted under the 2007 Plan, 2012 Equity Incentive Plan and 2013 Equity Incentive Plan (2013 EIP). This cost is expected to be recognized over a weighted average period of 4.0 years.

As of October 31, 2015, we had authorized and unissued shares of common stock sufficient to satisfy exercises of stock options.

The total intrinsic value of options exercised was approximately $7.8 million and $34.6 million for the three and nine months ended October 31, 2015.

Restricted Stock Units

A summary of restricted stock unit (RSU) activity for the nine months ended October 31, 2015 is as follows:

				Weighted
	Unreleased			average
	Restricted			grant date
	Stock Units			fair value
Balance at January 31, 2015		965,972		$	27.48
RSUs granted		1,578,288			26.59
RSUs vested		(292,681	)		27.35
RSUs forfeited/cancelled		(183,024	)		26.24
Balance at October 31, 2015		2,068,555		$	26.93

During the three and nine months ended October 31, 2015, we issued RSUs under the 2013 EIP with a weighted-average grant date fair value of $25.68 and $26.59, respectively.

During the nine months ended October 31, 2015, in connection with the acquisition of Qforma CrowdLink, we issued 17,000 performance-based RSUs to certain employees. These performance-based RSUs will vest based on a service and performance-based vesting condition. The RSUs had an estimated value of $0.5 million on the date of grant. We currently estimate that the performance-based conditions will be achieved and as a result, the full grant date fair value of these RSUs are being accounted for as compensation expense over the vesting periods.

As of October 31, 2015, there was a total of $54.5 million in unrecognized compensation cost, net of estimated forfeitures, related to unvested RSUs. This cost is expected to be recognized over a weighted-average period of approximately 3.3 years.

Stock-Based Compensation

Compensation expense related to share-based transactions, including employee, consultant, and non-employee director stock option awards, is measured and recognized in the condensed consolidated financial statements based on fair value. The fair value of each option award is estimated on the grant date using the Black-Scholes option-pricing model. The stock-based compensation expense, net of forfeitures, is recognized using a straight-line basis over the requisite service periods of the awards, which is generally four to nine years. For restricted stock awards, fair value is based on the closing price of our common stock on the grant date.

Our option-pricing model requires the input of subjective assumptions, including the fair value of the underlying common stock, the expected term of the option, the expected volatility of the price of our common stock, risk-free interest rates, and the expected dividend yield of our common stock. The assumptions used in our option-pricing model represent management’s best estimates. These estimates involve inherent uncertainties and the application of management’s judgment. If factors change and different assumptions are used, our stock-based compensation expense could be materially different in the future.

There were no stock options granted during the three months ended October 31, 2015. The following table presents the weighted-average assumptions used to estimate the grant date fair value of options granted during the periods presented:

	Three Months Ended October 31,			Nine Months Ended October 31,
	2015	2014		2015	2014
Volatility	—		49%	45% – 46%	48% – 50%
Expected term (in years)	—	6.00		5.50 – 6.32	6.00 – 6.32
Risk-free interest rate	—	1.90%		1.69% – 1.84%	1.85% – 1.94%
Dividend yield	—	—%		—%	—%

There was no stock-based compensation capitalized for internal-use software during the three months ended October 31, 2015. The amounts of stock-based compensation capitalized for internal-use software during the nine months ended October 31, 2015 and for the three and nine months ended October 31, 2014 were immaterial.