SHARE OPTION PLANS AND ESPP

3 Months Ended

Mar. 31, 2022

Share-based Payment Arrangement, Expensed and Capitalized, Amount [Abstract]

In September 2015, the Company adopted the 2015 Omnibus Incentive Plan (the “2015 Plan”). Under the 2015 Plan, the Company can issue various types of equity compensation awards such as share options, restricted shares, performance shares, restricted share units (“RSUs”), performance-based share units (“PSUs”), long-term cash awards and other share-based awards.

Options granted under the 2015 Plan generally have a two-year or four-year vesting period and expire ten years after the date of grant. Options granted under the 2015 Plan that are canceled or forfeited before expiration become

available for future grants. RSUs granted under the 2015 Plan generally vest over a three year period. PSUs granted under the 2015 Plan generally vest between a three- and six-year period as performance targets are attained. RSUs and PSUs granted under the 2015 Plan that are canceled before expiration become available for future grants. As of March 31, 2022, 17,070,368 ordinary shares were available for grant under the 2015 Plan.

A summary of the status of the Company’s option plans as of March 31, 2022 and changes during the period then ended is presented below:


	Three months ended March 31, 2022
	Unaudited
	Number of options	Weighted average exercise price
Outstanding at beginning of year	8,549,322	$	33.09
Granted	575,246	80.59
Exercised	(175,650)	18.14
Forfeited and canceled	(13,467)	77.31
Outstanding as of March 31, 2022	8,935,451	$	36.38

Exercisable options	5,787,733	$	24.15

For the three months ended March 31, 2022, options to purchase 175,650 ordinary shares were exercised, resulting in the issuance of 175,650 ordinary shares.

A summary of the status of the Company’s RSUs and PSUs as of March 31, 2022 and changes during the period then ended is presented below.


	Three months ended March 31, 2022
	Unaudited
	Number of RSU/PSUs	Weighted average grant date fair value
Unvested at beginning of year	4,459,107	$	65.56
Granted	964,555	80.59
Vested	(412,175)	84.05
Forfeited and cancelled	(15,928)	99.97
Unvested as of March 31, 2022 (1)	4,995,559	66.83

(1) Includes PSUs that have a mix of service, market and other milestone performance vesting conditions which are vested upon achievements of performance milestones which are not probable, as of March 31, 2022, in accordance with ASC 718 as follows:


March 31, 2022
Number of PSUs	Fair value at grant date per PSU		Total fair value at grant date
2,703,852	$	48.16	$	130,218
108,113	69.37		7,500
124,701	80.59		10,050
17,712	84.68		1,500
10,532	94.94		1,000
189,626	$	114.26	21,667
3,154,536			$	171,935

These PSUs will be expensed over the performance period when the vesting conditions become probable in accordance with ASC 718.

In September 2015, the Company adopted an employee share purchase plan (“ESPP”) to encourage and enable eligible employees to acquire ownership of the Company’s ordinary shares purchased through accumulated payroll deductions on an after-tax basis. In the United States, the ESPP is intended to be an “employee stock purchase plan” within the meaning of Section 423 of the Internal Revenue Code and the provisions of the ESPP are construed in a manner consistent with the requirements of such section. As of March 31, 2022, 4,954,997 ordinary shares were available to be purchased by eligible employees under the ESPP.

The fair value of share-based awards was estimated using the Black-Scholes model for all equity grants. For market condition awards, the Company also applied the Monte-Carlo simulation model. We assessed fair value using the following underlying assumptions:


	Three months ended March 31,				Year ended December 31, 2021
	2022		2021
	Unaudited				Audited
Stock Option Plans
Expected term (years)	5.33-5.83		5.86-6.00		5.50-6
Expected volatility	60%-62%		60%-60%		60%-63%
Risk-free interest rate	1.58%-1.61%		0.85%-0.88%		0.78%-1.27%



Dividend yield	0.00	%	0.00	%	0.00	%
ESPP
Expected term (years)	0.50		0.50		0.50
Expected volatility	51	%	54	%	54%-81%
Risk-free interest rate	0.19	%	0.09	%	0.05%-0.09%


Dividend yield	0.00	%	0.00	%	0.00	%

The total non-cash share-based compensation expense related to all of the Company’s equity-based awards recognized for the three months ended March 31, 2022 and 2021 and the year ended December 31, 2021 was:


	Three months ended March 31,			Year ended December 31, 2021
		2022				2021
	Unaudited			Audited
Cost of revenues		$	952	$	733		$	3,471
Research, development and clinical studies		6,801		5,124			27,597
Sales and marketing		6,655		4,471			22,673
General and administrative		10,637		8,535			41,159
Total share-based compensation expense		$	25,045	$	18,863		$	94,900