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Employee Benefit Plans and Stockholders' Equity | 12 Months Ended
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Dec. 31, 2019
Share-based Payment Arrangement [Abstract] |
Employee Benefit Plans and Stockholders' Equity |
9. Employee Benefit Plans and Stockholders’ Equity
401(k) Plan We have a defined contribution 401(k) retirement plan (the 401(k) Plan) covering substantially all employees in the United States that meet certain age requirements. Employees who participate in the 401(k) Plan may contribute up to 75% of their compensation each year, subject to Internal Revenue Service limitations and the terms and conditions of the plan. Under the terms of the 401(k) Plan, we may elect to match a discretionary percentage of contributions. In April 2018, we began matching 50% of contributions up to 4% of annual compensation. Total matching contributions were $4.8 million and $2.6 million for the twelve months ended December 31, 2019, and 2018, respectively. Employee Stock Purchase Plan, or ESPP Under the 2015 Employee Stock Purchase Plan (the 2015 ESPP) eligible employees can purchase shares of our common stock at semi-annual intervals through periodic payroll deductions during defined Offering Periods. A total of up to 1.5 million shares may be issued under the 2015 ESPP and it expires upon the earliest to occur of (a) termination of the 2015 ESPP by our board of directors, (b) issuance of all of the shares of common stock reserved for issuance under the plan, or (c) May 28, 2025. Payroll deductions may not exceed 10% of the participant’s cash compensation subject to certain limitations, and the purchase price will not be less than 85% of the lower of the fair market value of the common stock at either the beginning of the applicable Offering Period or the Purchase Date. We issued 150,408 and 189,904 and 122,857 shares of common stock under the 2015 ESPP during the twelve months ended December 31, 2019, 2018 and 2017, respectively. Equity Incentive Plans In May 2015, we adopted the Amended and Restated 2015 Equity Incentive Plan (the 2015 Plan), which replaced our 2005 Equity Incentive Plan and provides for the grant of incentive and nonstatutory stock options, restricted stock, stock bonuses, stock appreciation rights, and restricted stock units to employees, directors or consultants of the Company. On May 30, 2019 our stockholders approved an increase to the maximum number of shares that may be issued under the 2015 Plan. We are permitted to issue up to 9.8 million shares under the 2015 Plan. Treasury Stock Repurchased shares of our common stock are held as treasury shares until they are reissued or retired. When we reissue treasury stock, if the proceeds from the sale are more than the average price we paid to acquire the shares we record an increase in additional paid-in capital. Conversely, if the proceeds from the sale are less than the average price we paid to acquire the shares, we record a decrease in additional paid-in capital to the extent of increases previously recorded for similar transactions and a decrease in retained earnings for any remaining amount. We issue new shares of common stock to satisfy option exercises and RSU vesting under our employee equity incentive plans. We have not yet determined the ultimate disposition of the 0.8 million shares that we repurchased in 2018, and consequently we continue to hold them as treasury shares rather than retiring them. No shares of our common stock were repurchased during 2019. Stock Options We have not granted any stock options since 2010. As of December 31, 2019 we have 28,385 options outstanding, all of which are in-the-money. The options have a weighted- average remaining contractual term of 0.27 years, a weighted- average exercise price of $10.11 per share, and an aggregate intrinsic value of $5.9 million. The aggregate intrinsic value of options outstanding and exercisable is calculated as the difference between the exercise price of the underlying options and the $218.74 per share market price of our common stock at December 31, 2019. The total intrinsic value of stock options exercised as of the date of exercise was as follows:
| Twelve Months Ended December 31,
(In millions) | 2019 |  | 2018 |  | 2017
Intrinsic value of options exercised | $ | 7.4 |  |  | $ | 30.0 |  |  | $ | 21.6 |
Restricted Stock Units (RSUs) RSU awards typically vest annually over three or four years and vesting is subject to continued services. A summary of our RSU activity for the twelve months ended December 31, 2019, 2018 and 2017 is as follows:
(In millions except weighted average grant date fair value) | Shares |  | Weighted Average Grant Date Fair Value |  | Aggregate Intrinsic Value
Nonvested at December 31, 2016 | 3.7 |  |  | $ | 62.51 |  |  |
Granted | 1.3 |  |  | 75.78 |  |  |
Vested | (1.9 | ) |  | 58.92 |  |  |
Forfeited | (0.4 | ) |  | 67.97 |  |  |
Nonvested at December 31, 2017 | 2.7 |  |  | 70.68 |  |  | $ | 154.5 |
Granted | 1.7 |  |  | 66.07 |  |  |
Vested | (1.4 | ) |  | 68.44 |  |  |
Forfeited | (0.3 | ) |  | 68.56 |  |  |
Nonvested at December 31, 2018 | 2.7 |  |  | 69.19 |  |  | 319.0 |
Granted | 0.7 |  |  | 144.37 |  |  |
Vested | (1.4 | ) |  | 69.45 |  |  |
Forfeited | (0.2 | ) |  | 83.45 |  |  |
Nonvested at December 31, 2019 | 1.8 |  |  | $ | 96.63 |  |  | $ | 392.0 |
The total vest-date fair value of RSUs vested was $207.2 million, $120.9 million and $144.5 million for the twelve months ended December 31, 2019, 2018 and 2017, respectively. Common Stock Reserved for Future Issuance Shares of common stock reserved for future issuance were as follows as of the dated indicated:
| December 31,
(In millions) | 2019 |  | 2018
Stock options and awards under our plans: |  |  |
Stock options granted and outstanding | — |  |  | 0.1 |
Unvested restricted stock units | 1.8 |  |  | 2.7 |
Reserved for future grant | 4.9 |  |  | 3.2 |
Employee Stock Purchase Plan | 0.9 |  |  | 1.1 |
Total | 7.6 |  |  | 7.1 |
Share-based Compensation The following table summarizes share-based compensation expense related to restricted stock units and employee stock purchases under the ESPP for the twelve months ended December 31, 2019, 2018 and 2017:
| Twelve Months Ended December 31,
(In millions) | 2019 |  | 2018 |  | 2017
Cost of sales | $ | 9.0 |  |  | $ | 9.2 |  |  | $ | 9.6 |
Research and development | 33.5 |  |  | 33.0 |  |  | 37.5 |
Selling, general and administrative | 60.2 |  |  | 59.7 |  |  | 59.1 |
Total share-based compensation expense included in net loss | $ | 102.7 |  |  | $ | 101.9 |  |  | $ | 106.2 |
We estimate the fair value of ESPP purchase rights on the date of grant using the Black-Scholes option pricing model and the assumptions below for the specified reporting periods.
| Twelve Months Ended December 31,
| 2019 |  | 2018 |  | 2017
Risk free interest rate | 1.72 - 2.55 |  |  | 1.55 – 2.25 |  |  | 0.75 – 1.12 |
Dividend yield | — | % |  | — | % |  | — | %
Expected volatility of DexCom common stock | 0.40 - 0.51 |  |  | 0.50 – 0.67 |  |  | 0.33 – 0.56 |
Expected life (in years) | 1 |  |  | 1 |  |  | 1 |
At December 31, 2019, unrecognized estimated compensation costs related to unvested restricted stock units and ESPP shares totaled $119.3 million and are expected to be recognized through 2022.

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- Definition The entire disclosure for an entity's employee compensation and benefit plans, including, but not limited to, postemployment and postretirement benefit plans, defined benefit pension plans, defined contribution plans, non-qualified and supplemental benefit plans, deferred compensation, share-based compensation, life insurance, severance, health care, unemployment and other benefit plans. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 712 -URI http://asc.fasb.org/topic&trid=2197446 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 710 -URI http://asc.fasb.org/topic&trid=2127225 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 715 -URI http://asc.fasb.org/topic&trid=2235017 + Details
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