We incur stock compensation expense for stock options, restricted stock units ("RSU"), performance restricted stock units ("PRSU") and in years prior to 2018 stock purchased under our employee stock purchase plan ("ESPP"), which was suspended in 2017. We receive a tax benefit on stock compensation expense and direct tax benefits from the exercise of stock options. We also have indirect tax benefits upon exercise of stock options related to research and development tax credits which are recorded as a reduction of income tax expense.

Our 2011 Stock Incentive Plan ("2011 Plan") replaced our 2003 Stock Option Plan (“2003 Plan”). Our 2011 Plan initially had 650,000 shares available for issuance, plus the remaining available shares for grant from the 2003 Plan and any shares that were forfeited, terminated or expired that would have otherwise returned to the 2003 Plan. In 2012, 2014 and 2017, our stockholders approved amendments to the 2011 plan that increased the shares available for issuance by 3,275,000, bringing the initial shares available for issuance to 3,925,000, plus the remaining 248,700 shares that remained available for grant from the 2003 Plan. As of December 31, 2019, the 2011 Plan has 4,188,300 shares of common stock reserved for issuance to employees, which includes 263,300 shares that transferred from the 2003 Plan. Shares issued as options or stock appreciation rights ("SARs") are charged against the 2011 Plan's share reserve as one share for one share issued. Shares subject to awards other than options and SARs are charged against the 2011 Plan's share reserve as 2.09 shares for 1 share issued. Options may be granted with exercise prices at no less than fair market value at date of grant. Options granted under the 2011 Plan may be

In 2014, our Compensation Committee of the Board of Directors awarded our then new Chief Executive Officer an employment inducement option to purchase 182,366 shares of our common stock and an employment inducement grant of restricted stock units with respect to 68,039 shares of our common stock. The inducement grants were made out of our 2014 Inducement Incentive Plan ("2014 Plan").

Our 2001 Directors’ Stock Option Plan (the “Directors’ Plan”), initially had 750,000 shares reserved for issuance to members of our Board of Directors, expired in November 2011. Although no new grants may be made under the Director's Plan, grants made under the Director's Plan prior to its expiration continue to remain outstanding. Options not vested terminate if the directorship is terminated.

To date, all options granted under the 2014 Plan, 2011 Plan, 2003 Plan and Directors' Plan have been non-statutory stock options. The majority of the time-based outstanding employee option grants vest 25% after one year from the grant date and the balance vests ratably on a monthly basis over 36 months. The majority of the outstanding options granted to non-employee directors vest one year from the grant date. The options generally expire 10 years from the grant date.

The fair value of time-based option grants is calculated using the Black-Scholes option valuation model. The expected term for the option grants was based on historical experience and expected future employee behavior. We estimate the volatility of our common stock at the date of grant based on the historical volatility of our common stock, based on the average expected exercise term. The table below summarizes the total time-based stock options granted, total valuation and the weighted average assumptions (dollars in thousands, except per option amounts):



	Year ended December 31,
	2019			2018			2017
Number of time-based options granted	6,265			5,815			8,825
Grant date fair value of options granted (in thousands)	$	424		$	425		$	375
Weighted average assumptions for stock option valuation:
Expected term (years)	5.5			5.5			5.5
Expected stock price volatility	28.0		%	24.0		%	27.0		%
Risk-free interest rate	2.2		%	2.3		%	1.1		%
Expected dividend yield	—		%	—		%	—		%
Weighted average grant price per option	$	225.27		$	269.80		$	158.20
Weighted average grant date fair value per option	$	67.73		$	73.14		$	42.51

A summary of our stock option activity as of and for the year ended December 31, 2019 is as follows:



	Shares		Weighted Average Exercise Price Per Share		Weighted Average Contractual Life (Years)	Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2018	1,186,928		$	63.66
Granted	6,265		$	225.27
Exercised	(145,339	)	$	53.18
Forfeited or expired	—		$	—
Outstanding at December 31, 2019	1,047,854		$	66.08	4.1	$	127,556
Exercisable at December 31, 2019	1,041,589		$	65.12	4.0	$	127,556
Vested and expected to vest, December 31, 2019	1,047,854		$	66.08	4.1	$	127,556

The following table presents information regarding stock option activity:



	Year ended December 31,
(In thousands)	2019		2018		2017
Intrinsic value of options exercised	$	22,976	$	51,105	$	71,283
Cash received from exercise of stock options	$	7,732	$	14,275	$	32,003
Tax benefit from stock option exercises	$	9,653	$	12,617	$	20,004

In 2019, we granted performance restricted stock units ("PRSU") to our executive officers. For the executive officers other than the Chief Executive Officer ("CEO") and the Chief Operations Officer ("COO"), the PRSUs will vest subject to a three-year time vesting and further subject to a determination by the Compensation Committee that the officers have met their individual performance goals for the applicable years. For the CEO and the COO, the performance shares will cliff-vest ending on March 6, 2022 and further subject to the achievement of a minimum Cumulative Adjusted EBITDA. If for the three year period ending on December 31, 2021 the Cumulative Adjusted EBITDA has a growth of at least 6% to 8%, 50% of the awarded units will vest. If on the vesting date the Cumulative Adjusted EBITDA has a growth of between 8% to 10%, 100% of the awarded units will vest. If on the vesting date the Cumulative Adjusted EBITDA has a growth of over 10%, 200% of the awarded units will vest. In 2019, we also granted PRSUs to one of our non-executive employees. These PRSUs will vest at the end of a three-year period ending on March 31, 2022, if certain minimum performance goals are met.

In 2018, we granted PRSUs to our executive officers. For the executive officers other than the CEO and the COO, the PRSUs will vest subject to a three-year time vesting and further subject to a determination by the Compensation Committee that the officers have met their individual performance goals for the applicable year. For the CEO and the COO, the performance shares will cliff-vest ending on February 15, 2021 and further subject to the achievement of a minimum Cumulative Adjusted EBITDA. If for the three year period ending on December 31, 2020 the Cumulative Adjusted EBITDA has a growth of at least 6% to 8%, 50% of the awarded units will vest. If on the vesting date the Cumulative Adjusted EBITDA has a growth of between 8% to 10%, 100% of the awarded units will vest. If on the vesting date the Cumulative Adjusted EBITDA has a growth of over 10%, 200% of the awarded units will vest.

In 2017, we granted PRSUs to our executive officers. The PRSUs were scheduled to vest, if at all, upon the achievement of a minimum Cumulative Adjusted EBITDA, subject to a three-year cliff vesting ending on December 31, 2019. If at that date, our Cumulative Adjusted EBITDA is at least $600 million but less than $650 million, 100% of the awarded units will vest. If our Cumulative Adjusted EBITDA is at least $650 million but less than $700 million, 200% of the awarded units will vest. If our Cumulative Adjusted EBITDA is at least $700 million, 300% of the awarded units will vest. On January 17, 2020, the Compensation Committee made the determination that the 2017 PRSU shares were earned by our executive officers at the 300% achievement level.

In 2016, we granted PRSUs to our executive officers, which vested on December 31, 2018. During the first quarter of 2019, the Compensation Committee determined the award granted vested at 300%, as a minimum specified compound annual growth rate ("CAGR") in adjusted EBITDA per share of greater than 12% was reached for the 3-year performance period January 1, 2016 through December 31, 2018. The total number of shares of 2016 PRSUs that were earned by our executive officers was 109,110 shares.



	Year ended December 31,
(In thousands except shares and per share amounts)	2019		2018		2017
PRSU
Shares granted	37,657		30,348		20,686
Shares earned	114,032		—		—
Grant date fair value per share	$	231.63	$	248.65	$	154.75
Grant date fair value	$	8,723	$	7,546	$	3,201
Intrinsic value vested	$	26,445	$	—	$	—

RSU
Shares granted	61,856		63,094		107,678
Grant date fair value per share	$	227.42	$	252.42	$	156.49
Grant date fair value	$	14,067	$	15,926	$	16,851
Intrinsic value vested	$	16,753	$	17,086	$	9,813



	Number of Units		Grant Date Fair Value Per Share		Weighted Average Contractual Life (Years)	Aggregate Intrinsic Value
Non-vested at December 31, 2018	340,704		$	155.27
Change in units due to performance expectations^(a)	(14,444	)	$	238.03
Granted	99,513		$	229.01
Vested	(185,662	)	$	122.55
Forfeited	(7,584	)	$	216.29
Non-vested and expected to vest at December 31, 2019	232,527		$	205.82	0.7	$	43,510

We have an ESPP under which U.S. employees may purchase up to $25,000 annually of common stock at 85% of its fair market value at the beginning or the end of a six-month offering period, whichever is lower. There are 750,000 shares of common stock reserved for issuance under the ESPP, which is subject to an annual increase of the least of 300,000 shares, two percent of the shares outstanding or such a number as determined by the Board. To date, there have been no increases. As of December 31, 2019, there were 133,487 shares available for future issuance. The ESPP is intended to constitute an “employee stock purchase plan” within the meaning of Section 423 of the Internal Revenue Code. We suspended our ESPP in 2017.

The fair value of rights to purchase shares under the ESPP is calculated using the Black-Scholes option valuation model. The table below summarizes the number and intrinsic value of ESPP share purchases and the weighted average valuation assumptions for the 2017 purchase period.




	2017
ESPP shares purchased by employees	23,426
Intrinsic value of ESPP purchases (in thousands)	$	986
Weighted average assumptions for ESPP valuation:
Expected term (in years)	0.5
Expected stock price volatility	28.1		%
Risk-free interest rate	0.6		%
Expected dividend yield	—		%