Stock-Based Compensation and Employee Benefit Plan

2002 Stock Plan

Our 2002 Stock Plan (the "2002 Plan") was approved in April 2002 and amended in June 2011. In August 2012 and in connection with the adoption of the 2012 Equity Incentive Plan (the "2012 Plan"), shares authorized for issuance under the 2002 Plan were cancelled, except for those shares reserved for issuance upon exercise of outstanding stock options. As of March 31, 2019, options to purchase 2,232,865 shares of Class B common stock were outstanding and the weighted average exercise price of outstanding options was $21.16 per share.

2012 Equity Incentive Plan

Our 2012 Plan was approved in August 2012. In April 2018 and in connection with the adoption of the 2018 Equity Incentive Plan (the "2018 Plan"), any reserved shares not issued were carried over to the 2018 Equity Incentive Plan. As of March 31, 2019, options to purchase 10,873,302 shares of Class B common stock were outstanding under the 2012 Plan and the weighted average exercise price of outstanding options under the 2012 Plan was $27.12 per share. As of March 31, 2019, we had outstanding RSU awards that may be settled for 12,267,679 shares of Class B common stock under the 2012 Plan.

2018 Equity Incentive Plan

The 2018 Plan was approved in April 2018. The 2018 Plan became effective upon the IPO and will serve as the successor to the 2012 Plan.

The 2018 Plan authorizes the award of stock options, restricted stock awards, stock appreciation rights, RSUs, performance awards and stock bonuses. The 2018 Plan provides for the grant of awards to employees, directors, consultants, independent contractors and advisors provided the consultants, independent contractors, directors and advisors render services not in connection with the offer and sale of securities in a capital-raising transaction. The exercise price of stock options is at least equal to the fair market value of Class A common stock on the date of grant.

As of March 31, 2019, options to purchase 1,947,883 shares of Class A common stock were outstanding under the 2018 Plan and the weighted average exercise price of outstanding options was $20.74 per share. As of March 31, 2019, we had outstanding RSUs that may be settled for 3,980,837 shares of Class A common stock and 20,063,687 shares of Class A common stock were available for future grant.

2018 Employee Stock Purchase Plan

In April 2018, we adopted the 2018 Employee Stock Purchase Plan ("ESPP"). The ESPP is qualified under Section 423 of the Internal Revenue Code. As of March 31, 2019, there were 4,052,804 shares of Class A common stock were available for future grant.

Stock Option Activity

The following table summarizes the stock option activity under our stock plans during the reporting period:



	Outstanding Options
	Number of Shares		Weighted Average Exercise Price		Remaining Contractual Life (Years)	Aggregate Intrinsic Value

						(in thousands)
Balances at December 31, 2018	14,558,420		$	25.93	6.78	$	3,084
Granted	743,705		11.38
Exercised	(136,382	)	4.23
Cancelled	(111,693	)	25.44
Balances at March 31, 2019	15,054,050		25.41		6.62	4,686
Vested and expected to vest at March 31, 2019	14,690,193		25.56		6.56	4,645
Exercisable at March 31, 2019	8,555,962		28.18		4.97	3,586

RSUs Activity

A summary of our RSUs activity and related information is as follows:



	Number of Awards Outstanding		Weighted Average Grant Date Fair Value

Unvested Balance at December 31, 2018	16,784,800		$	18.74
Granted	2,525,755		12.43
Vested	(2,960,462	)	20.17
Forfeited	(101,577	)	16.44
Unvested Balance at March 31, 2019	16,248,516		17.52

Stock-Based Compensation Expense

We used the following weighted-average assumptions in applying the Black-Scholes valuation model:



	Three Months Ended March 31,
	2019	2018

Risk-free interest rate	2.60% - 2.64%	2.49%
Expected term (years)	6.3 - 6.6	6.2 - 6.5
Expected dividend yield	—	—
Expected volatility	50.20%	55.10%

Stock-based Compensation - No stock-based compensation costs were capitalized in the three months ended March 31, 2019 and 2018. The following table summarizes the components of stock-based compensation expense in the consolidated statements of operations (in thousands):



	Three Months Ended March 31,
	2019		2018

Cost of revenue	$	14,372	$	1,898
Research and development	14,230		1,638
Sales and marketing	11,512		952
General and administrative	23,768		3,468
Total stock-based compensation	$	63,882	$	7,956

During the three months ended March 31, 2019 and 2018, we recognized $63.9 million and $8.0 million of stock-based compensation expense, respectively. Our stock-based compensation expense is associated with stock options, restricted stock units, or RSUs, and our employee stock purchase plan, or ESPP.

As of March 31, 2019, there was unrecognized compensation expense related to unvested stock options of $65.8 million. This expense is expected to be recognized over the remaining weighted-average period of 2.74 years. We had no excess tax benefits in the three months ended March 31, 2019 and 2018.

As of March 31, 2019, there was $145.5 million of unrecognized stock-based compensation cost related to unvested RSUs. This expense is expected to be recognized over a weighted average period of 1.27 years.

As of March 31, 2019, there was $8.8 million of unrecognized stock-based compensation cost related to the stock purchase plan or ESPP. This expense is expected to be recognized over a weighted average period of 1.16 years.