Equity

12 Months Ended

Dec. 31, 2023

Stockholders' Equity Note [Abstract]

Common Stock – On all matters submitted to our stockholders for vote, our common stockholders are entitled to one vote per share, voting together as a single class, and do not have cumulative voting rights. Accordingly, the holders of a majority of the shares of common stock entitled to vote in any election of directors can elect all of the directors standing for election, if they so choose. Subject to preferences that may apply to any shares of preferred stock outstanding, the holders of common stock are entitled to share equally in any dividends, when and if declared by our Board of Directors. Upon the occurrence of a liquidation, dissolution or winding-up, the holders of common stock are entitled to share equally in all assets remaining after the payment of any liabilities and the liquidation preferences on any outstanding preferred stock. Holders of common stock have no preemptive or conversion rights or other subscription rights and there are no redemption or sinking funds provisions applicable to the common stock.

Stock Repurchase Programs – We had no stock repurchase activity during the years ending December 31, 2023, 2022 or 2021. As of December 31, 2023 and 2022, we had a total of 12.8 million and 12.4 million shares, respectively, held in treasury. As of December 31, 2023 and 2022, we had 2.1 million and 1.7 million shares, respectively, in treasury that were previously surrendered by employees to satisfy tax withholding due in connection with the vesting of certain restricted stock units as well as 10.7 million shares previously repurchased under our past repurchase programs.

For accounting purposes, common stock repurchased under our stock repurchase programs is recorded based upon the settlement date of the applicable trade. Such repurchased shares are held in treasury and are presented using the cost method.

2020 Employee Share Purchase Plan – Our Board of Directors adopted in March 2020 and our stockholders approved in June 2020 the 2020 Employee Stock Purchase Plan (“ESPP”). A total of 0.5 million shares of our common stock are available for sale under the ESPP. Eligible employees can purchase shares of our common stock based on a percentage of their compensation subject to certain limits. The purchase price per share is equal to the lower of 85% of the fair market value of our common stock on the offering date or the purchase date.

Employees purchased 0.1 million, 0.2 million and 0.1 million shares of common stock under our ESPP during the years ended December 31, 2023, 2022 and 2021, respectively. There were 0.1 million shares remaining for purchase under our ESPP as of December 31, 2023. As of December 31, 2023, there was $0.2 million of unrecognized compensation cost related to our employee stock purchase program, expected to be recognized over a weighted average period of 0.4 years.

Equity Plans – On June 12, 2014, upon approval at the Annual Meeting of Stockholders, we adopted the 2014 Equity Incentive Plan (the “2014 Plan”) with 4.5 million shares authorized for issuance. The 2014 Plan does not include an evergreen provision to automatically increase the number of shares available under it, and any increase in the number of shares authorized for issuance under the 2014 Plan requires stockholder approval. Also, under the 2014 Plan the following shares are not recycled for future grant under the 2014 Plan: (i) shares used in connection with the exercise of an option and/or stock appreciation right to pay the exercise price or purchase price of such award or satisfy applicable tax withholding obligations; and (ii) the gross number of shares subject to stock appreciation rights that are exercised. Furthermore, the 2014 Plan included a provision that prohibits repricing of outstanding stock options or stock appreciation rights and formalized and updated procedures to qualify awards as “performance-based” compensation under Section 162(m) of the Internal Revenue Code in order to preserve full tax deductibility of such awards. Our stockholders approved an amendment to the 2014 Plan to increase the maximum number of shares that may be issued by 2.5 million shares in 2019 and by 3.0 million in 2022. The 2014 Plan was further amended on September 29, 2022 to remove certain provisions permitting the Company to provide a reload option (as amended and restated, the “A&R 2014 Plan”).

On September 22, 2021, the Company adopted an inducement plan (the “2021 Inducement Plan”), pursuant to which the Company reserved 0.4 million shares of its common stock (subject to customary adjustments in the event of a change in capital structure of the Company) to be used exclusively for grants of awards to individuals who were not previously employees or directors of the Company, other than following a bona fide period of non-employment, as an inducement material to the individual's entry into employment with the Company within the meaning of Rule 5635(c)(4) of the Nasdaq Listing Rules (“Nasdaq Rules”). In March 2022 and September 2022, the Company amended and restated its 2021 Inducement Plan to reserve an additional 0.5 million and 1.5 million shares of its common stock, respectively (as amended and restated, the “A&R 2021 Inducement Plan”). The 2021 Inducement Plan and its amendments were approved by our Board of Directors without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Rules, and the terms and conditions of the A&R 2021 Inducement Plan and awards to be granted thereunder are substantially similar to our stockholder-approved A&R 2014 Plan. As of December 31, 2023, 2.0 million shares were issued under the A&R 2021 Inducement Plan.

Shares Reserved – We generally issue previously unissued common stock upon the exercise of stock options, the vesting of restricted and performance-based stock units and upon granting of restricted common stock awards; however, we may reissue previously acquired treasury shares to satisfy these future issuances.

Shares of authorized but unissued common stock reserved for future issuance were as follows (in thousands):


	December 31, 2023	December 31, 2022
Stock options issued and outstanding	218	226
Restricted stock units issued and outstanding	3,105	2,238
Performance-based stock units issued and outstanding	400	242
Shares available for grant	2,810	5,165
Total shares reserved	6,533	7,871

The following table summarizes activity under our A&R 2014 Plan and A&R 2021 Inducement Plan for the year ended December 31, 2023 (in thousands):


Balance at December 31, 2022(1)			5,165

Restricted stock units granted			(2,413)
Performance-based stock units granted			(337)

Restricted stock units cancelled			283
Performance-based stock units cancelled			104
Options cancelled			8
Balance at December 31, 2023			2,810

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(1)Shares available for grant do not include treasury stock shares that could be granted if we determined to do so.

Stock-Based Compensation Expense – The following table summarizes stock-based compensation expense recognized for the years presented below (in thousands):


	Year Ended December 31,
	2023		2022		2021
Restricted stock units	$	19,151	$	17,837	$	23,645
Performance-based stock units	2,422		876		6,867
Common stock options	1,254		1,154		707
Employee stock purchase program	386		449		1,638
Total stock-based compensation expense	$	23,213	$	20,316	$	32,857
Related tax benefit recognized	$	5,488	$	4,747	$	7,746

The following table summarizes stock-based compensation expense by operating function for the years presented below (in thousands):


	Year Ended December 31,
	2023		2022		2021
Marketing and advertising	$	2,201	$	1,901	$	8,660
Customer care and enrollment	2,287		2,096		2,836
Technology and content	4,498		6,015		10,013
General and administrative	14,227		10,304		11,348

Total stock-based compensation expense	23,213		20,316		32,857
Amount capitalized for internal-use software	1,040		1,885		2,621
Total stock-based compensation	$	24,253	$	22,201	$	35,478

For the years ended December 31, 2023, 2022 or 2021, there was a total of $1.0 million, $1.9 million and $2.6 million, respectively, of stock-based compensation expense capitalized in the internal-use software and website development costs classified under Other assets, which represents a noncash investing activity.

Stock Options – The following table summarizes stock option activity (in thousands, except weighted-average exercise price and weighted-average remaining contractual life data):


	Number of Stock Options (1)	Weighted Average Exercise Price		Weighted-Average Remaining Contractual Life (years)	Aggregate Intrinsic Value (2)
Outstanding as of December 31, 2022	226	$	39.07	5.3	$	—
Granted	—	$	—
Exercised	—
Forfeited	(8)	$	23.34
Outstanding balance as of December 31, 2023	218	$	39.65	4.5	$	—
Vested and expected to vest as of December 31, 2023	194	$	39.48	4.5	$	—
Exercisable as of December 31, 2023	74	$	36.98	4.0	$	—

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(1)Includes certain stock options with service, performance-based or market-based vesting criteria.

(2)The aggregate intrinsic value is calculated as the product between eHealth’s closing stock price as of December 31, 2023 and 2022 and the exercise price of in-the-money options as of those dates.

The following table provides information pertaining to our stock options for the years presented below (in thousands, except weighted-average fair values):


	Year Ended December 31,
	2023		2022		2021
Weighted average fair value of options granted	n/a		n/a		$	41.03
Total fair value of options vested	$	534	$	835	$	797
Intrinsic value of options exercised	n/a		$	694	$	5,182

There were no options granted during the years ended December 31, 2023 and 2022. For the options granted during the year ended December 31, 2021, the fair value of stock options granted to employees was estimated using the Black-Scholes option-pricing model and with the following weighted average assumptions for the year presented below:


			Year Ended December 31,
			2021
Expected term (years)			7.0
Expected volatility			69.1%
Expected dividend yield			—%
Risk-free interest rate			1.3%

As of December 31, 2023, there was $1.2 million of total unamortized compensation cost, net of estimated forfeitures, related to stock options, expected to be recognized over a weighted average period of 1.1 years.

Restricted Stock Units – The following table summarizes restricted stock unit activity (in thousands, except weighted-average grant date fair value and weighted-average remaining service period data):


	Number of Restricted Stock Units	Weighted-Average Grant Date Fair Value		Weighted-Average Remaining Service Period (years)	Aggregate Intrinsic Value (1)
Outstanding as of December 31, 2022	2,238	$	19.13	1.4	$	10,832
Granted	2,413	$	8.33
Vested	(1,263)	$	16.88
Forfeited	(283)	$	22.80
Outstanding as of December 31, 2023	3,105	$	11.31	1.3	$	27,083

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(1)The aggregate intrinsic value is calculated as the difference of the grant date price and our closing stock price as of December 31, 2023 and 2022 multiplied by the number of restricted stock units outstanding as of December 31, 2023 and 2022, respectively.

As of December 31, 2023, there was $22.8 million of total unamortized compensation cost, net of estimated forfeitures, related to restricted stock units, expected to be recognized over a weighted average period of 2.6 years.

Performance-based Stock Units – The following table summarizes performance-based stock unit activity (in thousands, except weighted-average grant date fair value and weighted-average remaining service period data):


	Number of Performance-based Stock Units	Weighted-Average Grant Date Fair Value		Weighted-Average Remaining Service Period (years)	Aggregate Intrinsic Value (1)
Outstanding as of December 31, 2022	242	$	20.55	1.1	$	1,172
Granted	337	$	7.56
Vested	(75)	$	4.42
Forfeited	(104)	$	14.08
Outstanding as of December 31, 2023	400	$	14.32	0.6	$	3,486

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(1)The aggregate intrinsic value is calculated as the difference of the grant date price and our closing stock price as of December 31, 2023 and 2022 multiplied by the number of performance stock units outstanding as of December 31, 2023 and 2022, respectively.

The weighted-average fair value of the market-based restricted stock units was determined using the Monte Carlo simulation model using the following weighted average assumptions:


	Year Ended December 31,
	2023	2022	2021
Expected term (years)	1.1	2.1	2.0
Expected volatility	76.3%	68.7%	66.0%
Expected dividend yield	—%	—%	—%
Risk-free interest rate	4.0%	2.5%	0.9%
Weighted-average grant date fair value	$4.79	$9.66	$46.36

As of December 31, 2023, there was $0.9 million of total unamortized compensation cost, net of estimated forfeitures, related to performance-based stock units, expected to be recognized over a weighted average period of 0.6 years.