XML 34 R24.htm IDEA: XBRL DOCUMENT v3.22.1
Equity Awards and Instruments
 3 Months Ended
Mar. 31, 2022
Share-based Payment Arrangement [Abstract]  
Equity Awards and Instruments Equity Awards and Instruments
Stock-Based Compensation Expense
Total stock‑based compensation expense was as follows:
Three Months Ended
March 31,
20222021
Bonus Plan expense (see Note 11)$8,161 $6,124 
Restricted stock and restricted stock units (“RSUs”) expense (1)
5,365 1,497 
Stock option expense756 998 
ESPP expense (see Note 13)680 449 
DCP elective participant deferrals expense (2) (see Note 12)
137 — 
Total stock-based compensation expense (3)
$15,099 $9,068 
(1)Includes acquisition‑related shares for the three months ended March 31, 2022 (see Note 4).
(2)DCP elective participant deferrals expense excludes deferred incentive bonus payable pursuant to the Bonus Plan.
(3)As of March 31, 2022 and December 31, 2021, $8,658 and $6,749 remained in Accruals and other current liabilities in the consolidated balance sheets, respectively.
Total stock‑based compensation expense is included in the consolidated statements of operations as follows:
Three Months Ended
March 31,
20222021
Cost of subscriptions and licenses$385 $89 
Cost of services383 243 
Research and development5,395 3,955 
Selling and marketing1,454 788 
General and administrative7,482 3,993 
Total stock-based compensation expense$15,099 $9,068 
Stock‑based compensation expense is measured at the grant date fair value of the award and is recognized ratably over the requisite service period, which is generally the vesting period. Specifically for performance‑based RSUs, stock‑based compensation expense is measured at the grant date fair value of the award and is recognized ratably over the requisite service period based on the number of awards expected to vest at each reporting date. The Company accounts for forfeitures of equity awards as those forfeitures occur.
Stock Options
The following is a summary of stock option activity and related information under the Company’s applicable equity incentive plans:
Weighted
WeightedAverage
AverageRemainingAggregate
StockExercise PriceContractualIntrinsic
OptionsPer ShareLife (in years)Value
Outstanding, December 31, 20216,917,925 $5.26 
Exercised(1,715,908)4.42 
Forfeited(25,125)5.56 
Outstanding, March 31, 20225,176,892 $5.54 1.6$200,026 
Exercisable, March 31, 20223,144,392 $5.55 1.6$121,455 
For the three months ended March 31, 2022 and 2021, the Company received cash proceeds of $2,768 and $1,751, respectively, related to the exercise of stock options. The total intrinsic value of stock options exercised for the three months ended March 31, 2022 and 2021 was $62,025 and $61,267, respectively.
As of March 31, 2022, there was $1,873 of unrecognized compensation expense related to unvested stock options, which is expected to be recognized over a weighted average period of approximately 0.9 years.
Acquisition Options — In addition to stock options granted under the Company’s equity incentive plans, in connection with an acquisition completed in March 2018, the Company issued to certain selling shareholder entities options to acquire an aggregate of up to 900,000 shares of Class B Common Stock. The options have a five‑year term, were exercisable on March 27, 2022, and have an initial exercise price of $6.805 per share. The exercise price of the options is subject to a cap and collar adjustment mechanism that automatically reduces (but not to less than $0.01) or increases the exercise price based on the difference between the exercise price and the fair market value of the Company’s Class B Common Stock on the exercise date. During the three months ended March 31, 2022, 735,000 shares were exercised. As of March 31, 2022, 165,000 shares remain outstanding and have an aggregate intrinsic value of $1,465.
Restricted Stock and RSUs
Under the equity incentive plans, the Company may grant both time‑based and performance‑based shares of restricted Class B Common Stock and RSUs to eligible colleagues. Time‑based awards generally vest ratably on each of the first four anniversaries of the grant date. Performance‑based awards vesting is determined by the achievement of certain business profitability and growth targets, which include growth in annualized recurring revenues, as well as actual bookings for perpetual licenses and non‑recurring services, and certain non‑financial performance targets. Performance targets are generally set for annual performance periods.
The following is a summary of unvested restricted stock and RSU activity and related information under the Company’s applicable equity incentive plans:
Time-Performance-
BasedBased
Time-Performance-WeightedWeighted
TotalBasedBasedAverageAverage
RestrictedRestrictedRestrictedGrant DateGrant Date
StockStockStockFair ValueFair Value
and RSUsand RSUsand RSUsPer SharePer Share
Unvested, December 31, 20211,708,545 1,611,862 96,683 
(4)
$32.81 $49.93 
Granted1,377,889 
(1)
1,072,104 
(3)
305,785 
(5)
39.2639.26
Vested(95,877)(4,707)(91,170)
(4)
44.20 49.93 
Forfeited(20,044)(14,531)(5,513)39.27 49.93 
Unvested, March 31, 20222,970,513 
(2)
2,664,728 305,785 $35.35 $39.26 
(1)For the three months ended March 31, 2022, the Company only granted RSUs.
(2)Includes 67,957 RSUs which are expected to be settled in cash.
(3)Includes 199,076 time‑based RSUs granted during the three months ended March 31, 2022 to certain officers and key employees, which cliff vest on January 31, 2025.
(4)Relates to the 2021 annual performance period. Total stock‑based compensation expense associated with these awards was fully recognized as of December 31, 2021.
(5)Relates to the 2022 annual performance period, except for 185,186 performance‑based RSUs granted during the three months ended March 31, 2022 with extraordinary terms, which are described below.
During the three months ended March 31, 2022, the Company granted 185,186 performance‑based RSUs to certain officers and key employees, which vest subject to the achievement of certain performance goals over a three‑year performance period (the “Performance Period”). For each year of the Performance Period, one‑third of the performance‑based RSUs will be subject to a cliff, whereby no vesting of that portion will occur unless the Company’s Adjusted EBITDA margin also equals or exceeds the relevant target level for such year. Provided Adjusted EBITDA margin targets are met, the total number of performance‑based RSUs that will vest is determined by the achievement of certain business profitability and growth targets, which include growth in annualized recurring revenues, as well as actual bookings for perpetual licenses and non‑recurring services. Final actual vesting will be determined on January 31, 2025.
During the three months ended March 31, 2022, the Company granted 120,599 performance‑based RSUs to certain officers and key employees, which vest subject to the achievement of certain performance goals related to the 2022 annual performance period. Provided Adjusted EBITDA margin targets are met, the total number of performance‑based RSUs that will vest is determined by the achievement of certain business profitability and growth targets, which include growth in annualized recurring revenues, as well as actual bookings for perpetual licenses and non‑recurring services. To the extent performance exceeds the applicable targets for 2022, these grantees could realize a maximum of 1.25x the number of annual performance‑based RSUs granted or 150,749 performance‑based RSUs.
In 2016, the Company granted RSUs subject to performance‑based vesting as determined by the achievement of certain business growth targets. Certain colleagues elected to defer delivery of such shares upon vesting. During the three months ended March 31, 2022 and 2021, 10,888 and 10,864 shares, respectively, were delivered to colleagues, and 7 and 14 additional shares, respectively, were earned as a result of dividends. As of March 31, 2022 and December 31, 2021, 9,340 and 20,221 shares, respectively, of these vested and deferred RSUs remained outstanding.
The weighted average grant date fair values of RSUs granted were $39.26 and $45.32, for the three months ended March 31, 2022 and 2021, respectively.
For the three months ended March 31, 2022 and 2021, restricted stock and RSUs were issued net of 38,955 and 14,869 shares, respectively, which were sold back to the Company to settle applicable income tax withholdings of $1,555 and $708, respectively.
As of March 31, 2022, there was $83,341 of unrecognized compensation expense related to unvested time‑based restricted stock and RSUs, which is expected to be recognized over a weighted average period of approximately 2.2 years. There was no remaining unrecognized compensation expense related to unvested performance‑based restricted stock. As of March 31, 2022, there was $11,676 of unrecognized compensation expense related to unvested performance‑based RSUs, which is expected to be recognized over a weighted average period of approximately 2.0 years.