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Equity Incentive Plans, Stock-Based Compensation and Stock Repurchase Program | 12 Months Ended
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Dec. 31, 2024
Share-Based Payment Arrangement [Abstract] |
Equity Incentive Plans, Stock-Based Compensation and Stock Repurchase Program | Equity Incentive Plans, Stock-Based Compensation and Stock Repurchase Program Equity Incentive Plans 2014 Equity Incentive Plan and 2023 Stock Incentive Plan The 2014 Equity Incentive Plan (the “2014 Plan”) was in effect until it was replaced by the 2023 Stock Incentive Plan (the “2023 Plan”) on April 1, 2023. Both the 2014 Plan and 2023 Plan provide for the granting of stock options, restricted stock awards, restricted stock units (“RSUs”), market performance-based RSUs (“PSUs”), stock appreciation rights, performance units and performance shares to our employees, consultants and members of our Board of Directors. As of December 31, 2024, we had 3,553,759 shares available for future grant under the 2023 Plan. Like the 2014 Plan, the shares authorized for the 2023 Plan increase annually on January 1 by the least of (i) 8,000,000 shares, (ii) 5% of the outstanding shares of common stock on the last day of our immediately preceding fiscal year, or (iii) such other amount as determined by our Board of Directors. Our Board of Directors determined the current shares authorized under the 2023 Plan were sufficient for the time being and decided not to increase the number of shares authorized on January 1, 2024. To date, the Company has granted stock options, RSUs and PSUs. Stock options expire no more than 10 years from the grant date and generally vest over four years. In the case of an incentive stock option granted to an employee, who at the time of grant, owns stock representing more than 10% of the total combined voting power of all classes of stock, the per share exercise price will be no less than 110% of the fair market value per share on the date of grant, and the incentive stock option will expire no later than five years from the date of grant. For incentive stock options granted to any other employees and nonstatutory stock options granted to employees, consultants, or members of our Board of Directors, the per share exercise price will be no less than 100% of the fair market value per share on the date of grant. RSUs and PSUs generally vest from one to four years. 2014 Employee Stock Purchase Plan In October 2018, the Board of Directors approved amending the 2014 Employee Stock Purchase Plan (the “Amended 2014 Purchase Plan”) in order to, among other things, reduce the maximum contribution participants can make under the plan from 15% to 10% of eligible compensation. The Amended 2014 Purchased Plan also reflects revised offering periods, which were changed from 24 months to six months in duration and that begin on or about December 1 and June 1 each year, starting in December 2018. The Amended 2014 Purchase Plan permits eligible employees to purchase shares of our common stock through payroll deductions with up to 10% of their pre-tax eligible earnings subject to certain Internal Revenue Code (“IRC”) limitations. The purchase price of the shares is 85% of the lower of the fair market value of our common stock on the first day of a six-month offering period or the relevant purchase date. In addition, no participant may purchase more than 1,500 shares of common stock in each purchase period. Employees purchased 281,107 shares at an average price of $11.69 per share and with an aggregate intrinsic value of $1.2 million during the year ended December 31, 2024. Employees purchased 274,937 shares at an average price of $12.88 per share and with an aggregate intrinsic value of $1.2 million during the year ended December 31, 2023. Employees purchased 434,547 shares at an average price of $7.46 per share and with an aggregate intrinsic value of $2.1 million during the year ended December 31, 2022. The intrinsic value is calculated as the difference between the market value on the date of purchase and the purchase price of the shares. As of December 31, 2024, we had 531,170 shares available for future issuance under the Amended 2014 Purchase Plan. Stock-Based Compensation A summary of our stock-based compensation expense is as follows (in thousands):
|  |  | Years Ended December 31,
|  |  |  |  | 2024 |  | 2023 |  | 2022
Stock-based compensation by type of award: |  |  |  |  |  |  |  |  |
Stock options |  |  |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Stock awards |  |  |  |  | 15,958 |  |  | 12,999 |  |  | 11,995 |
Employee stock purchase rights |  |  |  |  | 1,090 |  |  | 1,082 |  |  | 1,336 |
Total |  |  |  |  | $ | 17,048 |  |  | $ | 14,081 |  |  | $ | 13,331 |
Stock-based compensation by category of expense: |  |  |  |  |  |  |  |  |
Cost of revenue |  |  |  |  | $ | 2,022 |  |  | $ | 1,702 |  |  | $ | 1,556 |
Sales and marketing |  |  |  |  | 3,946 |  |  | 3,722 |  |  | 4,556 |
Research and development |  |  |  |  | 4,199 |  |  | 3,232 |  |  | 3,346 |
General and administrative |  |  |  |  | 6,881 |  |  | 5,425 |  |  | 3,873 |
Total |  |  |  |  | $ | 17,048 |  |  | $ | 14,081 |  |  | $ | 13,331 |
As of December 31, 2024, the Company had $32.7 million of unrecognized stock-based compensation expense related to unvested stock-based awards, including ESPP under our Amended 2014 Purchase Plan, which will be recognized over a weighted-average period of 2.5 years. Fair Value Determination The fair values of employee stock purchase rights were estimated as of the grant date using the Black-Scholes option-pricing model with the following assumptions:
|  |  | Years Ended December 31,
|  |  | 2024 |  | 2023 |  | 2022
Expected term (in years) |  |  | 0.5 |  | 0.5 |  | 0.5
Risk-free interest rate |  |  | 5.0% |  | 5.3% |  | 0.9%
Expected volatility |  |  | 32% |  | 42% |  | 58%
Dividend rate |  |  | 1.50% |  | 1.80% |  | 1.25%
•Expected Term. We estimate the expected life of options based on an analysis of our historical experience of employee exercise and post-vesting termination behavior considered in relation to the contractual life of the option. The expected term for the employee stock purchase rights is based on the term of the purchase period. •Risk-Free Interest Rate. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for zero coupon U.S. Treasury notes with maturities approximately equal to the expected terms of stock options and the employee stock purchase rights. •Expected Volatility. For stock options, due to the limited trading history of our own common stock, we determined the share price volatility factor based on a combination of the historical volatility of our own common stock and the historical volatility of our peer group for the stock options. For employee stock purchase rights, we used the historical volatility of our own common stock. •Dividend Rate. In December 2021, the Company paid its first quarterly cash dividend in the amount of $0.05 per share of common stock outstanding and increased the amount to $0.06 per share in the three months ended December 31, 2022. For the years ended December 31, 2024, 2023 and 2022, the expected dividend rate assumes cash dividends will total $0.24, $0.24 and $0.24 per common share outstanding annually, respectively. Stock-based compensation expense related to shares not purchased due to terminations, or forfeitures, is reversed on the date of forfeiture. Stock Options The following tables summarize our stock option activities and related information:
| Number of Shares (thousands) |  | Weighted-Average Exercise Price Per Share |  | Weighted-Average Remaining Contractual Term (years) |  | Aggregate Intrinsic Value (1) (thousands)
Outstanding as of December 31, 2023 | 80 |  |  | $ | 4.63 |  |  |  |  |
Granted | — |  |  | — |  |  |  |  |
Exercised | (77) |  |  | 4.39 |  |  |  |  |
Canceled | (3) |  |  | 12.19 |  |  |  |  |
Outstanding as of December 31, 2024 | — |  |  | $ | — |  |  | 0 |  | $ | — |
Vested and exercisable as of December 31, 2024 | — |  |  | $ | — |  |  | 0 |  | $ | — |
(1)The aggregate intrinsic value represents the excess of the closing price of our common stock of $18.40 as of December 31, 2024 over the exercise price of the outstanding in-the-money options. No stock options were granted in years ended December 31, 2024, 2023 and 2022. The intrinsic value of options exercised is as follows (in thousands):
| Years Ended December 31,
| 2024 |  | 2023 |  | 2022
Intrinsic value of options exercised (1) | $ | 822 |  |  | $ | 1,440 |  |  | $ | 5,744 |
(1)Intrinsic value of options exercised is the difference between the closing price of our common stock at the time of exercise and the exercise price paid. Stock Awards The Company has granted Restricted Stock Units (“RSUs”) to its employees, consultants and members of its Board of Directors, and Performance Stock Units (“PSUs”) to certain executives and employees. RSUs have service-based vesting conditions and PSUs have market performance-based vesting conditions as well as service-based vesting conditions. As of December 31, 2024, there were 2,496,267 RSUs outstanding that were unvested and 746,422 PSUs outstanding that had not yet achieved their market-performance vesting conditions. Our RSUs typically vest over a three or four year service term. We granted 1,424,261, 1,315,210 and 1,230,180 RSUs in 2024, 2023 and 2022, respectively. The fair value of RSUs is determined to be the fair value of our common stock on the grant date as quoted on the New York Stock Exchange. Our PSUs typically have a four year term. Market performance-based conditions are satisfied upon the achievement of specified 100-day volume weighted average stock price targets for the Company’s common stock. We granted 363,445, 326,630 and 314,538 PSUs in 2024, 2023 and 2022, respectively. The fair value of our PSUs is determined using a Monte Carlo valuation model which incorporates various assumptions including expected stock price volatility, expected term, expected dividend yield and risk-free interest rates. We estimate the volatility of common stock on the date of grant based on historical volatility of our common stock price. We estimate the expected term based on various exercise scenarios. We estimate the expected dividend yield based on the current annual dividend payment per share divided by our grant date common stock price The risk-free interest rate is based on U.S. Treasury yields in effect at the time of grant. The following table summarizes our restricted stock unit activities and related information:
Service-Based Restricted Stock Units (RSUs) |  | Number of Shares (thousands) |  | Weighted-Average Grant Date Fair Value Per Share |  | Weighted-Average Remaining Vesting Term (years) |
Nonvested as of December 31, 2023 |  | 2,360 |  |  | $ | 13.94 |  |  |  |
Granted |  | 1,424 |  |  | 14.10 |  |  |  |
Released |  | (916) |  |  | 13.25 |  |  |  |
Canceled |  | (372) |  |  | 14.11 |  |  |  |
Nonvested as of December 31, 2024 |  | 2,496 |  |  | $ | 14.26 |  |  | 1.42 |
The following table summarizes our market performance-based restricted stock unit activities and related information:
Market Performance-Based Restricted Stock Units (PSUs) |  | Number of Shares (thousands) |  | Weighted-Average Grant Date Fair Value Per Share |  | Weighted-Average Remaining Vesting Term (years)
Nonvested as of December 31, 2023 |  | 657 |  |  | $ | 10.32 |  |  |
Granted |  | 363 |  |  | 11.51 |  |  |
Released |  | (243) |  |  | 7.88 |  |  |
Canceled |  | (31) |  |  | 11.99 |  |  |
Nonvested as of December 31, 2024 |  | 746 |  |  | $ | 11.63 |  |  | 2.63
The fair values of market performance-based restricted stock units were estimated as of the grant date using a Monte Carlo valuation model with the following assumptions:
|  |  | Years Ended December 31,
|  |  | 2024 |  | 2023 |  | 2022
Expected term (in years) |  |  | 4.0 |  | 4.0 |  | 4.0
Risk-free interest rate |  |  | 4.0% |  | 4.3% |  | 1.4%
Expected volatility |  |  | 52.01% |  | 50.20% |  | 47.98%
Dividend rate |  |  | 1.77% |  | 1.63% |  | 1.39%
Following is additional information pertaining to our stock award activities for both RSUs and PSUs (in thousands, except per share data):
| Years Ended December 31,
| 2024 |  | 2023 |  | 2022
Weighted-average grant date fair value of stock awards granted (per share) | $ | 13.57 |  |  | $ | 14.04 |  |  | $ | 13.76 |
Total fair value of stock awards released (vested) during the period | $ | 14,044 |  |  | $ | 13,535 |  |  | $ | 12,226 |
Repurchase Agreements In September 2022, the Company entered into a Common Stock Repurchase Agreement with entities affiliated with Summit Partners whereby the Company purchased 3.5 million shares of common stock for $12.75 per share, or an aggregate purchase price of $44.6 million. In November 2024, the Company entered into a Common Stock Repurchase Agreement with entities affiliated with Summit Partners whereby the Company purchased 330 thousand shares of common stock for $15.73 per share, or an aggregate purchase price of $5.2 million. The Company’s common shares repurchased are held in treasury and accounted for under the cost method. Stock Repurchase Programs On November 1, 2022, the Company announced its Board of Directors authorized a stock repurchase program of up to $50 million of its common stock over a period of twelve months. On November 7, 2023, the Company announced its Board of Directors had authorized a stock repurchase program under which the Company may repurchase up to $50 million of its outstanding common stock over a period of twelve months. On November 7, 2024, the Company announced its Board of Directors had authorized a new, non-expiring stock repurchase program under which the Company may repurchase up to $50 million of its outstanding common stock. As of December 31, 2024, the Company had $44.2 million available to repurchase shares under this program. Under all of the Company’s stock repurchase programs, repurchased shares are held in treasury at cost. The Company’s stock repurchase programs do not obligate it to acquire any specific number of shares. Shares may be repurchased in privately negotiated and/or open market transactions and by withholding shares in connection with vesting equity awards held by certain employees, including under plans complying with Rule 10b5-1 under the Exchange Act. To date, all repurchases under the Company’s stock repurchase programs have occurred in the open market, in negotiated transactions and from withholding shares in connection with vesting equity awards held by certain employees. During the year ended December 31, 2024, the Company repurchased 2.2 million shares for a total cost of $30.1 million. During the year ended December 31, 2023, the Company repurchased 1.3 million shares for a total cost of $16.0 million. During the year ended December 31, 2022, the Company repurchased 6.1 million shares for a total cost of $79.3 million.

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