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Equity Incentive Plans and Stock-Based Compensation | 12 Months Ended
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Dec. 31, 2023
Share-Based Payment Arrangement [Abstract] |
Equity Incentive Plans and Stock-Based Compensation | Equity Incentive Plans and Stock-Based Compensation Equity Incentive Plans The Company has two equity incentive plans under which grants are currently outstanding: the 2015 Equity Incentive Plan (the “2015 Plan”) and the 2019 Inducement Equity Incentive Plan (the “2019 Inducement Plan”). The 2015 Plan and 2019 Inducement Plan were the Company’s only plans for providing stock-based incentive awards to eligible employees, executive officers, non-employee directors and consultants as of December 31, 2023. Grants under all plans typically have a requisite service period of 60 months or 48 months, have straight-line vesting schedules and expire not more than 10 years from date of grant. A summary of shares available for grant under the Company’s plans is as follows:
|  | Shares Available for Grant
Total shares available for grant as of December 31, 2020 |  | 12,412,320
Stock options forfeited |  | 54,327
Nonvested equity stock and stock units granted (1) (2) |  | (3,918,251)
Nonvested equity stock and stock units forfeited (1) |  | 1,943,782
Total shares available for grant as of December 31, 2021 |  | 10,492,178
Nonvested equity stock and stock units granted (1) (3) |  | (4,107,633)
Nonvested equity stock and stock units forfeited (1) |  | 1,271,224
Total shares available for grant as of December 31, 2022 |  | 7,655,769
Increase in shares approved for issuance (4) |  | 5,210,000
Nonvested equity stock and stock units granted (1) (5) |  | (2,082,334)
Nonvested equity stock and stock units forfeited (1) |  | 1,170,715
Total shares available for grant as of December 31, 2023 |  | 11,954,150
______________________________________ (1) For purposes of determining the number of shares available for grant under the 2015 Plan against the maximum number of shares authorized, each restricted stock unit granted prior to April 27, 2023 reduces the number of shares available for grant by 1.5 shares and each restricted stock unit forfeited increases shares available for grant by 1.5 shares. Each restricted stock unit granted on or after April 27, 2023 reduces the number of shares available for grant by 1.0 shares and each restricted stock unit forfeited increases shares available for grant by 1.0 shares. (2) Amount includes approximately 0.4 million shares that have been reserved for potential future issuance related to certain performance unit awards granted in 2021 and discussed under the section titled “Nonvested Equity Stock and Stock Units” below. (3) Amount includes approximately 0.6 million shares that have been reserved for potential future issuance related to certain performance unit awards granted in 2022 and discussed under the section titled “Nonvested Equity Stock and Stock Units” below. (4) On April 27, 2023, the Company’s stockholders approved these additional shares to be reserved for issuance under the 2015 Plan. (5) Amount includes approximately 0.2 million shares that have been reserved for potential future issuance related to certain performance unit awards granted in 2023 and discussed under the section titled “Nonvested Equity Stock and Stock Units” below. General Stock Option Information The following table summarizes stock option activity under the Company’s equity incentive plans for the years ended December 31, 2023, 2022 and 2021 and information regarding stock options outstanding, exercisable, and vested and expected to vest as of December 31, 2023:
|  | Options Outstanding |  | Weighted-Average Remaining Contractual Term (years) |  |
(In thousands, except per share amounts and years) |  | Number of Shares |  | Weighted-Average Exercise Price Per Share |  |  | Aggregate Intrinsic Value
Outstanding as of December 31, 2020 |  | 964,211 |  | $ | 11.08 |  |  |  |  |
Options exercised |  | (360,303) |  | $ | 11.06 |  |  |  |  |
Options forfeited |  | (54,327) |  | $ | 14.98 |  |  |  |  |
Outstanding as of December 31, 2021 |  | 549,581 |  | $ | 10.71 |  |  |  |  |
Options exercised |  | (117,138) |  | $ | 7.43 |  |  |  |  |
Outstanding as of December 31, 2022 |  | 432,443 |  | $ | 11.60 |  |  |  |  |
Options exercised |  | (307,711) |  | $ | 11.61 |  |  |  |  | $ | 17,430 |
Outstanding as of December 31, 2023 |  | 124,732 |  | $ | 11.60 |  |  | 3.35 |  | $ | 7,066 |
Vested or expected to vest at December 31, 2023 |  | 124,732 |  | $ | 11.60 |  |  | 3.35 |  | $ | 7,066 |
Options exercisable at December 31, 2023 |  | 124,732 |  | $ | 11.60 |  |  | 3.35 |  | $ | 7,066 |
Employee Stock Purchase Plan During the years ended December 31, 2023, 2022 and 2021, the Company had one employee stock purchase plan, the 2015 Employee Stock Purchase Plan (“2015 ESPP”). Employees generally will be eligible to participate in the plan if they are employed by the Company for more than 20 hours per week and more than five months in a fiscal year. The 2015 ESPP provides for six-month offering periods, with a new offering period commencing on the first trading day on or after May 1 and November 1 of each year. Under the plan, employees may purchase stock at the lower of 85% of the fair market value of the Company’s common stock at the beginning of the offering period (the enrollment date) or the end of each offering period (the purchase date). Employees generally may not purchase more than the number of shares having a value greater than $25,000 in any calendar year, as measured at the purchase date. The Company issued 172,711 shares at an average price of $31.10 p er share during the year ended December 31, 2023. The Company issued 255,614 shares at an average price of $20.60 per share during the year ended December 31, 2022. The Company issued 384,087 shares at an average price of $12.95 per share during the year ended December 31, 2021. As of December 31, 2023, 2.4 million shares under the ESPP remained available for issuance. Stock-Based Compensation Stock Options There were no stock options granted during the years ended December 31, 2023, 2022 and 2021, respectively. Stock-based compensation expense related to stock options was immaterial for the years ended December 31, 2023, 2022 and 2021. As of December 31, 2023, all compensation cost net of expected forfeitures, related to unvested stock-based compensation arrangements granted under the stock option plans has been fully recognized. The total fair value of options vested f or the years ended December 31, 2023, 2022 and 2021 was $0.5 million, $1.7 million and $2.0 million, respectively. Employee Stock Purchase Plan During the years ended December 31, 2023, 2022 and 2021, the Company recorded stock-based compensation related to the 2015 ESPP of $1.8 million, $1.7 million and $1.4 million, respectively. As of December 31, 2023, there was $0.8 million of total unrecognized compensation cost related to stock-based compensation arrangements granted under the 2015 ESPP. That cost is expected to be recognized over four months. Valuation Assumptions The Company estimates the fair value of stock awards using the BSM model. The BSM model determines the fair value of stock-based compensation and is affected by the Company’s stock price on the date of the grant, as well as assumptions regarding a number of highly complex and subjective variables. These variables include expected volatility, expected life of the award, expected dividend rate and expected risk-free rate of return. The assumptions for expected volatility and expected life are the two assumptions that significantly affect the grant-date fair value. If actual results differ significantly from these estimates, stock-based compensation expense and the Company’s results of operations could be materially impacted. The fair value of stock awards is estimated as of the grant date using the BSM option-pricing model assuming a dividend yield of 0% and the additional weighted-average assumptions as listed in the table below.
|  | Employee Stock Purchase Plan for Years Ended December 31,
|  | 2023 |  | 2022 |  | 2021
Employee Stock Purchase Plan |  |  |  |  |  |
Expected stock price volatility |  | 48%-53% |  | 40%-44% |  | 32%-33%
Risk free interest rate |  | 5.14%-5.51% |  | 1.49%-4.58% |  | 0.04%-0.05%
Expected term (in years) |  | 0.5 |  | 0.5 |  | 0.5
Weighted-average fair value of purchase rights granted under the purchase plan |  | $14.86 |  | $8.02 |  | $5.17
Expected Stock Price Volatility: Given the volume of market activity in its market traded options, the Company determined that it would use the implied volatility of its nearest-to-the-money traded options. The Company believes that the use of implied volatility is more reflective of market conditions and a better indicator of expected volatility than historical volatility. If there is not sufficient volume in its market traded options, the Company will use an equally weighted blend of historical and implied volatility. Risk-free Interest Rate: The Company bases the risk-free interest rate used in the BSM valuation method on implied yield currently available on the U.S. Treasury zero-coupon issues with an equivalent term. Where the expected terms of the Company’s stock-based awards do not correspond with the terms for which interest rates are quoted, the Company uses an approximation based on rates on the closest term currently available. Expected Term: The expected term of options granted represents the period of time that options granted are expected to be outstanding. The expected term was determined based on historical experience of similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules and expectations of future employee behavior. The expected term of ESPP grants is based upon the length of each respective purchase period. Nonvested Equity Stock and Stock Units The Company grants nonvested equity stock units to officers, employees and directors. For the years ended December 31, 2023, 2022 and 2021, the Company granted nonvested equity stock units totaling 1.3 million, 2.3 million and 2.4 million shares, respectively. These awards have a service condition, generally a service period of four years, except in the case of grants to directors, for which the service period is one year. For the years ended December 31, 2023, 2022 and 2021, the nonvested equity stock units were valued at the date of grant, giving them a fair value of approximately $60.7 million, $65.6 million and $50.1 million, respectively. During the years ended December 31, 2023, 2022 and 2021, the Company granted performance unit awards to certain Company executive officers with vesting subject to the achievement of certain performance and/or market conditions. The ultimate number of performance units that can be earned can range from 0% to 200% of target depending on performance relative to target over the applicable period. The shares earned will vest on the third anniversary of the date of grant. The Company’s shares available for grant have been reduced to reflect the shares that could be earned at the maximum target. For the years ended December 31, 2023, 2022 and 2021, the Company recorded stock-based compensation expense of approximately $43.1 million, $33.8 million and $25.7 million, respectively, related to all outstanding nonvested equity stock grants. Unrecognized compensation cost related to all nonvested equity stock grants, net of estimated forfeitures, was approximately $64.2 million at December 31, 2023. This amount is expected to be recognized over a weighted-average period of 1.9 years. The following table reflects the activity related to nonvested equity stock and stock units for the years ended December 31, 2023, 2022 and 2021:
Nonvested Equity Stock and Stock Units | Shares |  | Weighted-Average Grant-Date Fair Value
Nonvested at December 31, 2020 | 4,851,265 |  | $ | 12.82 |
Granted | 2,363,885 |  | $ | 21.18 |
Vested | (1,524,950) |  | $ | 12.41 |
Forfeited | (971,815) |  | $ | 15.30 |
Nonvested at December 31, 2021 | 4,718,385 |  | $ | 16.62 |
Granted | 2,338,255 |  | $ | 28.10 |
Vested | (1,853,260) |  | $ | 14.42 |
Forfeited | (485,320) |  | $ | 20.48 |
Nonvested at December 31, 2022 | 4,718,060 |  | $ | 22.78 |
Granted | 1,268,973 |  | $ | 46.93 |
Vested | (1,797,002) |  | $ | 18.07 |
Forfeited | (759,839) |  | $ | 28.60 |
Nonvested at December 31, 2023 | 3,430,192 |  | $ | 32.90 |

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