9. Stock-Based Compensation

The Company provides equity-based compensation awards to employees, independent contractors and directors as an effective means for attracting, retaining and motivating such individuals. The Company maintains two share-based compensation plans: the 2014 Equity Incentive Plan (the "2014 Plan") and the 2008 Stock Incentive Plan (the "2008 Plan"). Upon the effective date of the 2014 Plan in January 2014, the Company ceased using the 2008 Plan to grant new equity awards, and began using the 2014 Plan for grants of new equity awards.

2014 Plan

In February 2014, the Company's stockholders approved the 2014 Plan. The 2014 Plan provides for the grant of incentive stock options to the Company's employees and its parent and subsidiary corporations' employees, and for the grant of nonstatutory stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights, performance stock awards and other forms of stock compensation to the Company's employees, consultants and directors. The 2014 Plan also provides for the grant of performance-based cash awards to the Company's employees, consultants and directors.

Authorized Shares. A total of 2,800,000 shares of the Company's common stock were initially reserved for issuance pursuant to the 2014 Plan. In addition, the shares reserved for issuance under the 2014 Plan include (a) those shares reserved but unissued under the 2008 Plan, and (b) shares returned to the 2008 Plan as the result of expiration or termination of awards (provided that the maximum number of shares that may be added to the 2014 Plan pursuant to (a) and (b) is 5,943,348 shares). The number of shares of the Company's common stock that may be issued under the 2014 Plan will automatically increase on January 1st of each year, for a period of ten years, from January 1, 2015 continuing through January 1, 2024, by 5% of the total number of shares of the Company's common stock outstanding on December 31st of the preceding calendar year, or a lesser number of shares as may be determined by the Company's board of directors. The shares available for issuance increased by 2,288,820 and 2,036,503 on January 1, 2016 and 2015, respectively, pursuant to the automatic share reserve increase provision under the 2014 Plan.

In addition, shares subject to outstanding stock awards granted under the 2008 Plan and 2014 Plan that (i) expire or terminate for any reason prior to exercise or settlement; (ii) are forfeited because of the failure to meet a contingency or condition required to vest such shares or otherwise return to the Company; or (iii) are reacquired, withheld (or not issued) to satisfy a tax withholding obligation in connection with an award or to satisfy the purchase price or exercise price of a stock award, return to the 2014 Plan's share reserve and become available for future grant under the 2014 Plan, up to the maximum number of shares of 5,943,348.

As of December 31, 2015, the Company had 1,904,743 shares reserved for issuance under the 2014 Plan. Further, as of December 31, 2015, under the 2014 Plan, options to purchase 1,698,475 shares of the Company's common stock were outstanding at a weighted-average exercise price of $17.03 per share and 1,220,008 restricted stock units were outstanding.

The compensation committee of the Company's board of directors, acting under authority delegated from the board of directors, granted to employees in the first quarter of 2016, 12,708 shares of common stock, option awards to purchase an aggregate of 3,617 shares of common stock at an exercise price of $27.98 and restricted stock unit awards for an aggregate of 8,177 shares of common stock, in each case under the 2014 Equity Incentive Plan.

2008 Plan

In October 2008, the Company's stockholders approved the Company's 2008 Plan. The 2008 Plan was most recently amended on May 8, 2013. The 2008 Plan provided for the grant of incentive stock options to the Company's employees and the employees of the Company's subsidiaries, and for the grant of nonstatutory stock options, restricted stock awards and deferred stock awards to the Company's employees, directors and consultants. Upon the effective date of the 2014 Plan, the Company ceased using the 2008 Plan to grant new equity awards, and began using the 2014 Plan for grants of new equity awards. Accordingly, as of January 30, 2014, no shares were available for future grant under the 2008 Plan. However, the 2008 Plan will continue to govern the terms and conditions of outstanding awards granted thereunder.

As of December 31, 2015, options to purchase 3,600,035 shares of the Company's common stock were outstanding under the 2008 Plan at a weighted-average exercise price of $3.84 per share.

Stock-Based Compensation Expense

Stock-based compensation expense related to stock-based awards is included in the following line items in the accompanying consolidated statements of operations:

	Year Ended December 31,
	2015		2014		2013
	(in thousands)
Servicing and support	$	2,270	$	1,468	$	364
Technology and content development		1,548		794		159
Program marketing and sales		1,057		676		178
General and administrative		7,624		4,589		1,725

Total stock-based compensation expense	$	12,499	$	7,527	$	2,426

Stock Options

The terms of stock option grants, including the exercise price per share and vesting periods, are determined by the Company's board of directors or the compensation committee thereof. Stock options are granted at exercise prices of not less than the estimated fair market value of the Company's common stock at the date of grant. Stock options are generally subject to service-based vesting conditions and vest at various times from the date of the grant, with most options vesting in tranches, generally over a period of four years. Stock options granted under the 2014 Plan and the 2008 Plan are subject to service-based vesting conditions, and generally expire ten years from the grant date.

The Company values stock options using the Black-Scholes-Merton option pricing model, which requires the input of subjective assumptions, including the risk-free interest rate, expected life of the option, expected stock price volatility and dividend yield. Additionally, the recognition of expense requires estimation of the number of options that will ultimately vest and those that will be forfeited. The Company estimates the expected forfeitures of share-based awards at the grant date and recognizes the compensation cost only for those awards expected to vest.

The risk-free interest rate assumption is based upon observed interest rates for constant maturity U.S. Treasury securities consistent with the expected term of the Company's employee stock options. The expected life represents the period of time the stock options are expected to be outstanding and is based on the "simplified method." Under the "simplified method," the expected life of an option is presumed to be the mid-point between the vesting date and the end of the contractual term. The Company used the "simplified method" due to the lack of sufficient historical exercise data to provide a reasonable basis upon which to otherwise estimate the expected life of the stock options. Expected volatility is based on historical volatilities for publicly traded stock of comparable companies over the estimated expected life of the stock options. The Company assumed no dividend yield because dividends are not expected to be paid in the near future, which is consistent with the Company's history of not paying dividends.

The following table summarizes the assumptions used for estimating the fair value of the stock options granted:

	Year Ended December 31,
	2015	2014	2013
Risk-free interest rate	1.5% - 1.9%	1.7% - 2.1%	0.9% - 2.0%
Expected term (years)	5.56 - 6.08	5.11 - 6.25	5.54 - 6.31
Expected volatility	50%	50% - 55%	55% - 58%
Dividend yield	0%	0%	0%
Weighted average grant date fair value	$12.54	$5.71	$4.58

The following is a summary of the stock option activity for the year ended December 31, 2015:

	Number of Options			Weighted-Average Exercise Price per Share		Weighted-Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value (in thousands)
Outstanding balance at December 31, 2014		5,850,211		$	5.39		7.33	$	83,487
Granted		692,814			25.73		9.04
Exercised		(1,141,731	)		4.67		5.76
Forfeited		(96,441	)		12.34
Expired		(6,343	)		12.13

Outstanding balance at December 31, 2015		5,298,510			8.07		6.66		105,595


Exercisable at December 31, 2015		3,426,496			4.30		5.77		81,131


Vested and expected to vest at December 31, 2015		5,161,978			7.82		6.61		104,132

The total compensation cost related to the nonvested options not yet recognized as of December 31, 2015 was $11.6 million and will be recognized over a weighted-average period of approximately 2.1 years.

The aggregate intrinsic value of the options exercised during the years ended December 31, 2015, 2014 and 2013 was $25.8 million, $16.2 million and $1.8 million, respectively.

The following table summarizes by grant date the number of shares of common stock subject to stock options granted from January 1, 2015 to December 31, 2015, as well as the associated exercise price per share and the estimated fair value per share of the Company's common stock on the grant date.

Grant Date	Number of Shares Underlying Options Granted		Exercise Price per Share		Estimated Grant Date Fair Value per Share
January 1, 2015		3,518	$	19.66	$	19.66
January 2, 2015		14,888		19.48		19.48
April 1, 2015		608,746		25.52		25.52
June 1, 2015		28,770		28.23		28.23
June 3, 2015		10,629		28.58		28.58
July 1, 2015		19,743		30.83		30.83
October 1, 2015		6,520		32.20		32.20

Prior to the IPO, the Company determined for financial reporting purposes the estimated per share fair value of its common stock at various grant dates using contemporaneous valuations performed in accordance with the guidance outlined in the American Institute of Certified Public Accountants Practice Aid, "Valuation of Privately-Held Company Equity Securities Issued as Compensation," also known as the Practice Aid. In conducting the contemporaneous valuations, the Company used relevant information available and considered all objective and subjective factors that it believed to be relevant for each valuation conducted, including management's best estimate of the Company's business condition, prospects and operating performance at each valuation date.

Restricted Stock Units

Throughout 2015 and 2014, the Company granted restricted stock units under the 2014 Plan to the Company's directors and certain of the Company's employees. The terms of the restricted stock unit grants under the 2014 Plan, including the vesting periods, are determined by the Company's board of directors or the compensation committee thereof. Restricted stock units are generally subject to service-based vesting conditions and vest at various times from the date of the grant, with most restricted stock units vesting in equal annual tranches, generally over a period of four years.

The following is a summary of restricted stock unit activity:

	Number of Restricted Stock Units			Weighted-Average Grant Date Fair Value
Outstanding balance at December 31, 2014		992,665		$	11.39
Granted		585,765			25.74
Vested		(272,128	)		11.54
Forfeited		(86,294	)		15.20

Outstanding balance at December 31, 2015		1,220,008			17.97

The total compensation cost related to the nonvested restricted stock units not yet recognized as of December 31, 2015 was $14.8 million and will be recognized over a weighted-average period of approximately 2.6 years.

Other Stock Awards

During 2015, the Company granted 26,567 shares of common stock to a new key employee, with a fair value of $0.8 million.