Stock-Based Compensation

3 Months Ended

Mar. 31, 2015

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

Stock-Based Compensation

(10) Stock-Based Compensation

Stock-based compensation expense for the three months ended March 31, 2015 and 2014 was $0.5 million and $0.2 million, respectively.

Total stock-based compensation expense was recorded to cost of revenues and operating expenses based upon the functional responsibilities of the individuals holding the respective options as follows (in thousands):

	Three Months Ended March 31,
	2015		2014
Cost of revenues	$	19	$	—
Sales and marketing		8		3
Research and development		375		—
General and administrative		130		161
Total	$	532	$	164

There were no option exercises in the three months ended March 31, 2015. Cash received from option exercises was $12,000 for the three months ended March 31, 2014.

Juniper granted 232,000 and 222,000 stock options to employees during the three months ended March 31, 2015 and 2014, respectively.

The Company records stock-based compensation expense for stock options granted to non-employees based on the fair value of the stock options which is re-measured over the graded vesting term resulting in periodic adjustments to stock-based compensation expense. During the three months ended March 31, 2015, 240,000 stock options were granted by the Company to non-employees. One-third of the options vested immediately and as such, the Company has recorded stock-based compensation expense of $0.4 million, which is recorded in the research and development line of the statement of operations. The remaining options will vest over a two year period from the date of grant.

The Company uses the Black-Scholes option pricing model to determine the estimated grant date fair values for stock-based awards. The weighted-average grant date fair values of the options granted during the three months ended March 31, 2015 and 2014 were $3.35 and $4.51, respectively for employees and $4.44 and $0 for non-employees, using the following assumptions:

	Three Months Ended March 31,
	2015	2014
Risk free interest rate	0.90% - 1.47%		1.64	%
Expected term	4.56 - 7 years		4.75 years
Dividend yield	—		—
Expected volatility	76.76% - 82.88%		81.36	%

Option-pricing models require the input of various subjective assumptions, including the option’s expected life and the price volatility of the underlying stock. Juniper’s estimated expected stock price volatility is based on its own historical volatility. Juniper’s expected term of options granted during the three months ended March 31, 2015 and 2014 was derived using the simplified method for employees and the contractual term of the option for non-employees. The risk-free rate for the expected term of the option is based on the U.S. Treasury yield curve in effect at the time of grant.

As of March 31, 2015, the total unrecognized compensation cost related to outstanding stock options and restricted stock awards expected to vest was $2.4 million, which the Company expects to recognize over a weighted-average period of 3.02 years.