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STOCK PLANS AND SHARE BASED COMPENSATION | 12 Months Ended
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Dec. 31, 2019
Share-based Payment Arrangement [Abstract] |
STOCK PLANS AND SHARE BASED COMPENSATION [Text Block] | STOCK PLANS AND SHARE BASED COMPENSATION: Stock Plans As of December 31, 2019, the Company had three stock-based compensation plans (the “Plans”) which are described below. 2007 Equity Incentive Plan The 2007 Equity Incentive Plan (2007 Plan) was adopted by the board of directors on September 10, 2007, and approved by the stockholders on November 7, 2007, as an amendment and restatement of the 1997 Stock Option Plan (1997 Plan). The 2007 Plan provides for the grant of incentive stock options, non-statutory stock options, restricted stock awards, restricted stock unit (RSU) awards, stock appreciation rights, performance-based (PSU) awards, long-term performance based (PRSU) awards and other stock awards to employees, directors and consultants. Pursuant to the 2007 Plan, the exercise price for incentive stock options and non-statutory stock options is generally at least 100% of the fair market value of the underlying shares on the date of grant. Options generally vest over 48 months measured from the date of grant. Options generally expire no later than ten years after the date of grant, subject to earlier termination upon an optionee’s cessation of employment or service. The 2007 Plan expired in September 2017 with no further grants to be made under this plan; however previous grants under this plan shall remain outstanding until they are exercised, vest, forfeited or expire. Beginning January 27, 2009, grants pursuant to the Directors Equity Compensation Program (which was adopted by the board of directors on January 27, 2009) to non-employee directors have been made primarily under the 2007 Plan. The Directors Equity Compensation Program provides for grants to outside directors as follows: effective annually, upon the first trading day of July, each outside director would receive a grant of an equity award with an aggregate value of $120,000. At each outside director’s election, such award would consist entirely of RSUs or entirely of stock options. The quantity of options would be calculated by dividing $120,000 by the Black-Scholes value on the date of grant. The quantity of RSUs issued would be calculated by dividing $120,000 by the grant-date fair value. Further, on the date of election of a new outside director, such new director would receive such grant as continuing outside directors receive on the first trading day of July; provided, however, that such grant is prorated for the portion of the year that such new outside director will serve until the next first trading day of July. The Directors Equity Compensation Program will remain in effect at the discretion of the board of directors or the compensation committee. 2016 Incentive Award Plan The 2016 Incentive Award Plan (2016 Plan) was adopted by the board of directors on March 17, 2016 and approved by the stockholders on May 13, 2016. The Plan provides for the grant of RSU awards, PSU awards and PRSU awards. No other forms of equity-based awards, including stock options and stock appreciation rights, may be granted under the 2016 Plan. As of December 31, 2019, 0.8 million awards have been issued and approximately 1.7 million shares of common stock remain available for future grant under the 2016 Plan. 1997 Employee Stock Purchase Plan Under the 1997 Employee Stock Purchase Plan (Purchase Plan), eligible employees may apply accumulated payroll deductions, which may not exceed 15% of an employee’s compensation, to the purchase of shares of the Company’s common stock at periodic intervals. The purchase price of stock under the Purchase Plan is equal to 85% of the lower of (i) the fair market value of the Company’s common stock on the first day of each offering period, or (ii) the fair market value of the Company’s common stock on the purchase date (as defined in the Purchase Plan). Each offering period consists of one purchase period of approximately six months duration. An aggregate of 3.5 million shares of common stock were reserved for issuance to employees under the Purchase Plan. As of December 31, 2019, of the shares reserved for issuance, 3.2 million shares had been purchased and 0.3 million shares were reserved for future issuance under the Purchase Plan. Shares Reserved As of December 31, 2019, the Company had approximately 2.1 million shares of common stock reserved for future grant under all stock plans. Stock-Based Compensation The Company applies the provisions of ASC 718-10, Stock Compensation. Under the provisions of ASC 718-10, the Company recognizes the fair value of stock-based compensation in its financial statements over the requisite service period of the individual grants, which generally equals a four-year vesting period. The Company uses estimates of volatility, expected term, risk-free interest rate, dividend yield and forfeitures in determining the fair value of these awards and the amount of compensation expense to recognize. The Company uses the straight-line method to amortize all stock awards granted over the requisite service period of the award. The following table summarizes the stock-based compensation expense recognized in accordance with ASC 718-10 for the years ended December 31, 2019, 2018 and 2017:
| Year Ended December 31,
(in thousands) | 2019 |  | 2018 |  | 2017
Cost of revenues | $ | 1,237 |  |  | $ | 1,097 |  |  | $ | 1,321 |
Research and development | 8,423 |  |  | 7,688 |  |  | 8,496 |
Sales and marketing | 5,015 |  |  | 4,729 |  |  | 5,197 |
General and administrative | 8,672 |  |  | 8,066 |  |  | 9,663 |
Total stock-based compensation expense | $ | 23,347 |  |  | $ | 21,580 |  |  | $ | 24,677 |
The following table summarizes total compensation expense related to unvested awards not yet recognized, net of expected forfeitures, and the weighted average period over which it is expected to be recognized as of December 31, 2019:
| Unrecognized Compensation Expense for Unvested Awards (in thousands) |  | Weighted Average Remaining Recognition Period (in years)
Long-term performance-based awards | $ | 1,693 |  |  | 2.00
Restricted stock units | 35,276 |  |  | 2.94
Purchase plan | 142 |  |  | 0.08
Total unrecognized compensation expense | $ | 37,111 |  |  |
Stock-based compensation expense in the year ended December 31, 2019, was approximately $23.3 million (comprising approximately $17.5 million related to restricted stock units, $4.1 million related to performance-based awards and $1.7 million related to the Company’s Purchase Plan). Stock-based compensation expense in the year ended December 31, 2018, was approximately $21.6 million (comprising approximately $16.6 million related to restricted stock units, $3.4 million related to performance-based awards and $1.6 million related to the Company’s Purchase Plan). Stock-based compensation expense in the year ended December 31, 2017, was approximately $24.7 million (comprising approximately $15.2 million related to restricted stock units, $8.2 million related to performance-based awards and $1.3 million related to the Company’s Purchase Plan). The Company did not grant stock options in the years ended December 31, 2019, 2018 and 2017, and therefore no fair-value assumptions are reported. The fair value of employees’ stock purchase rights under the Purchase Plan was estimated using the Black-Scholes model with the following weighted-average assumptions used during the three years ended December 31, 2019, 2018 and 2017:
| Year Ended December 31,
| 2019 |  | 2018 |  | 2017
Risk-free interest rates | 2.28% |  | 1.94% |  | 0.91%
Expected volatility rates | 37% |  | 31% |  | 30%
Expected dividend yield | 0.91% |  | 0.89% |  | 0.80%
Expected term of purchase rights (in years) | 0.50 |  | 0.50 |  | 0.50
Weighted-average estimated fair value of purchase rights | $19.39 |  | $17.33 |  | $16.74
A summary of stock options outstanding as of December 31, 2019, and activity during three years then ended, is presented below:
(shares and intrinsic value in thousands) | Shares |  | Weighted Average Exercise Price |  | Weighted Average Remaining Contractual Term (in years) |  | Aggregate Intrinsic Value
Outstanding at January 1, 2017 | 697 |  |  | $ | 28.62 |  |  |  |  |
Granted | — |  |  | — |  |  |  |  |
Exercised | (186 | ) |  | $ | 27.48 |  |  |  |  |
Forfeited or expired | — |  |  | — |  |  |  |  |
Outstanding at December 31, 2017 | 511 |  |  | $ | 29.03 |  |  |  |  |
Granted | — |  |  | — |  |  |  |  |
Exercised | (176 | ) |  | $ | 22.60 |  |  |  |  |
Forfeited or expired | — |  |  | — |  |  |  |  |
Outstanding at December 31, 2018 | 335 |  |  | $ | 32.41 |  |  |  |  |
Granted | — |  |  | — |  |  |  |  |
Exercised | (168 | ) |  | $ | 25.96 |  |  |  |  |
Forfeited or expired | — |  |  | — |  |  |  |  |
Outstanding at December 31, 2019 | 167 |  |  | $ | 38.88 |  |  | 1.30 |  | $ | 10,051 |
Vested and Exercisable at December 31, 2019 | 167 |  |  |  |  | 1.30 |  | $ | 10,051 |
The total intrinsic value of options exercised during the year ended December 31, 2019, 2018 and 2017, was $8.3 million, $7.5 million and $8.9 million, respectively. The following table summarizes the stock options outstanding at December 31, 2019:
|  | Options Outstanding |  | Options Exercisable
(shares in thousands) Range of Exercise Prices |  | Options Outstanding |  | Weighted Average Remaining Contractual Term (in years) |  | Weighted Average Exercise Price |  | Options Exercisable |  | Weighted Average Exercise Price
$32.26 - $38.07 |  | 92 |  |  | 0.74 |  | $ | 36.80 |  |  | 92 |  |  | $ | 36.80 |
$39.49 - $42.88 |  | 75 |  |  | 1.99 |  | $ | 41.43 |  |  | 75 |  |  | $ | 41.43 |
|  | 167 |  |  | 1.30 |  | $ | 38.88 |  |  | 167 |  |  | $ | 38.88 |
PSU Awards Under the performance-based awards program, the Company grants awards in the performance year in an amount equal to twice the target number of shares to be issued if the maximum performance metrics are met. The number of shares that are released at the end of the performance year can range from zero to 200% of the target number depending on the Company’s performance. The performance metrics of this program are annual targets consisting of a combination of net revenue, non-GAAP operating earnings and strategic goals. As the net revenue, non-GAAP operating income and strategic goals are considered performance conditions, expense associated with these awards, net of estimated forfeitures, is recognized over the service period based on an assessment of the achievement of the performance targets. The fair value of these PSUs is determined using the fair value of the Company’s common stock on the date of the grant, reduced by the discounted present value of dividends expected to be declared before the awards vest. If the performance conditions are not achieved, no compensation cost is recognized and any previously recognized compensation is reversed. A summary of PSU awards outstanding as of December 31, 2019, and activity during the three years then ended, is presented below:
(shares and intrinsic value in thousands) | Shares |  | Weighted Average Grant-Date Fair Value Per Share |  | Weighted Average Remaining Contractual Term (in years) |  | Aggregate Intrinsic Value
Outstanding at January 1, 2017 | 99 |  |  | $ | 46.25 |  |  |  |  |
Granted | 88 |  |  | $ | 63.99 |  |  |  |  |
Vested | (99 | ) |  | $ | 46.25 |  |  |  |  |
Forfeited or canceled | (9 | ) |  | $ | 63.99 |  |  |  |  |
Outstanding at December 31, 2017 | 79 |  |  | $ | 63.99 |  |  |  |  |
Granted | 89 |  |  | $ | 62.87 |  |  |  |  |
Vested | (79 | ) |  | $ | 63.99 |  |  |  |  |
Forfeited or canceled | (63 | ) |  | $ | 62.87 |  |  |  |  |
Outstanding at December 31, 2018 | 26 |  |  | $ | 62.87 |  |  |  |  |
Granted | 93 |  |  | $ | 70.11 |  |  |  |  |
Vested | (26 | ) |  | $ | 62.87 |  |  |  |  |
Forfeited or canceled | (32 | ) |  | $ | 70.11 |  |  |  |  |
Outstanding at December 31, 2019 | 61 |  |  | $ | 70.11 |  |  | — |  |  | $ | 5,999 |
Outstanding and expected to vest at December 31, 2019 | 61 |  |  |  |  | — |  |  | $ | 5,999 |
The grant-date fair value of PSU awards released, which were fully vested, in the years ended December 31, 2019, 2018 and 2017 were approximately $1.6 million, $5.1 million and $4.6 million, respectively. PRSU Awards (Long-term Performance Based) The Company's PRSU program provides for the issuance of PRSUs which will vest based on the Company's performance measured against the PRSU Plan's established revenue targets. The PRSUs were granted in an amount equal to twice the target number of shares to be issued if the maximum performance metrics are met. The actual number of shares the recipient receives is determined at the end of a three-year performance period based on results achieved versus the Company’s performance goals, and may range from zero to 200% of the target number. The performance goals for PRSUs granted in fiscal 2019, 2018 and 2017 were based on the Company’s annual revenue growth over the respective three-year performance period. Recipients of a PRSU award generally must remain employed by the Company on a continuous basis through the end of the applicable three-year performance period in order to receive shares subject to that award. Expenses associated with these awards, net of estimated forfeitures, are recorded throughout the year depending on the number of shares expected to vest based on progress toward the performance target. The fair value of PRSU awards is determined using the fair value of the Company’s common stock on the grant date, reduced by the discounted present value of dividends expected to be declared before the awards vest. If the performance conditions are not achieved, no compensation cost is recognized and any previously recognized compensation is reversed. A summary of PRSU awards outstanding as of December 31, 2019, and activity during the three years then ended, is presented below:
(shares and intrinsic value in thousands) | Shares |  | Weighted Average Grant-Date Fair Value Per Share |  | Weighted Average Remaining Contractual Term (in years) |  | Aggregate Intrinsic Value
Outstanding at January 1, 2017 | 150 |  |  | $ | 47.65 |  |  |  |  |
Granted | 71 |  |  | $ | 63.00 |  |  |  |  |
Vested | — |  |  | — |  |  |  |  |
Forfeited or canceled | (37 | ) |  | $ | 51.59 |  |  |  |  |
Outstanding at December 31, 2017 | 184 |  |  | $ | 52.80 |  |  |  |  |
Granted | 72 |  |  | $ | 59.90 |  |  |  |  |
Vested | (38 | ) |  | $ | 52.45 |  |  |  |  |
Forfeited or canceled | (5 | ) |  | $ | 43.26 |  |  |  |  |
Outstanding at December 31, 2018 | 213 |  |  | $ | 55.48 |  |  |  |  |
Granted | 72 |  |  | $ | 68.17 |  |  |  |  |
Vested | (70 | ) |  | $ | 43.26 |  |  |  |  |
Forfeited or canceled | (71 | ) |  | $ | 63.00 |  |  |  |  |
Outstanding at December 31, 2019 | 144 |  |  | $ | 64.05 |  |  | 1.50 |  | $ | 14,203 |
Outstanding and expected to vest at December 31, 2019 | 58 |  |  |  |  | 2.00 |  | $ | 5,768 |
The grant-date fair value of PRSU awards released, which were fully vested, in the year ended December 31, 2019 and 2018 were approximately $3.0 million and $2.0 million, respectively. RSU Awards RSUs granted to employees typically vest ratably over a four-year period, and are converted into shares of the Company’s common stock upon vesting on a one-for-one basis subject to the employee’s continued service to the Company over that period. The fair value of RSUs is determined using the fair value of the Company’s common stock on the date of the grant, reduced by the discounted present value of dividends expected to be declared before the awards vest. Compensation expense is recognized on a straight-line basis over the requisite service period of each grant adjusted for estimated forfeitures. A summary of RSU awards outstanding as of December 31, 2019, and activity during the three years then ended, is presented below:
(shares and intrinsic value in thousands) | Shares |  | Weighted Average Grant-Date Fair Value Per Share |  | Weighted Average Remaining Contractual Term (in years) |  | Aggregate Intrinsic Value
Outstanding at January 1, 2017 | 718 |  |  | $ | 47.54 |  |  |  |  |
Granted | 558 |  |  | $ | 60.82 |  |  |  |  |
Vested | (284 | ) |  | $ | 46.52 |  |  |  |  |
Forfeited | (44 | ) |  | $ | 50.89 |  |  |  |  |
Outstanding at December 31, 2017 | 948 |  |  | $ | 55.51 |  |  |  |  |
Granted | 275 |  |  | $ | 62.85 |  |  |  |  |
Vested | (296 | ) |  | $ | 53.78 |  |  |  |  |
Forfeited | (32 | ) |  | $ | 59.43 |  |  |  |  |
Outstanding at December 31, 2018 | 895 |  |  | $ | 58.19 |  |  |  |  |
Granted | 291 |  |  | $ | 69.79 |  |  |  |  |
Vested | (301 | ) |  | $ | 56.19 |  |  |  |  |
Forfeited | (25 | ) |  | $ | 63.43 |  |  |  |  |
Outstanding at December 31, 2019 | 860 |  |  | $ | 62.66 |  |  | 1.58 |  | $ | 85,037 |
Outstanding and expected to vest at December 31, 2019 | 801 |  |  |  |  | 1.50 |  | $ | 79,192 |
The grant-date fair value of RSUs vested in the years ended December 31, 2019, 2018 and 2017, was approximately $16.9 million, $15.9 million and $13.2 million, respectively.

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