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Employee Benefit Plans
 12 Months Ended
Dec. 31, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Employee Benefit Plans
Employee Benefit Plans

Equity Incentive Plans

The Company’s equity incentive plans include the 2015 Equity Incentive Plan (the “2015 Plan”), the 2006 Equity Incentive Plan (the “2006 Plan”), the Amended and Restated 1996 Stock Plan (the “1996 Plan”), various equity incentive plans assumed through acquisitions, and the ESPP. Under these plans, the Company has granted (or, in the case of acquired plans, assumed) stock options, restricted stock units (“RSUs”), restricted stock awards (“RSAs”), and performance share awards (“PSAs”).

The 2015 Plan was adopted and approved by the Company's stockholders in May 2015 and had an initial authorized share reserve of 38.0 million shares of common stock plus the addition of any shares subject to outstanding awards under the 2006 Plan and the 1996 Plan that were outstanding as of May 19, 2015, and that subsequently expire or otherwise terminate, up to a maximum of an additional 29.0 million shares. As of December 31, 2015, an aggregate of 20.5 million shares were subject to outstanding equity awards under the 2015 Plan, the 2006 Plan, and the 1996 Plan. As of December 31, 2015, 36.7 million shares were available for future issuance under the 2015 Plan and no shares were available for future issuance under the 2006 Plan or the 1996 Plan.

As of December 31, 2015, a total of approximately 66.5 million shares of common stock were reserved for future issuance upon exercise of stock options and vesting of RSUs, RSAs, and PSAs, and for the future grant of share-based compensation awards under the Company's equity incentive plans.

The ESPP was adopted and approved by the Company's stockholders in May 2008. To date, the Company's stockholders have approved a share reserve of 26.0 million shares of the Company's common stock for issuance under the ESPP, which includes an additional 7.0 million shares approved by the Company's stockholders in May 2015. The ESPP permits eligible employees to acquire shares of the Company’s common stock at a 15% discount to the offering price (as determined in the ESPP) through periodic payroll deductions of up to 10% of base compensation, subject to individual purchase limits of 6,000 shares in any twelve-month period or $25,000 worth of stock, determined at the fair market value of the shares at the time the stock purchase option is granted, in one calendar year. As of December 31, 2015, approximately 18.4 million shares have been issued and 7.6 million shares remain available for future issuance under the ESPP.

During 2014, the Company completed the acquisition of WANDL Inc. and assumed the WANDL Inc. 2013 Restricted Stock Unit Plan. In connection with this plan, the Company assumed RSUs, RSAs, and PSAs and exchanged the assumed awards for Juniper Networks' RSUs, RSAs, and PSAs, respectively. The Company assumed an aggregate of 1.5 million shares of RSUs, RSAs, and PSAs in connection with the acquisition of WANDL Inc. No additional awards can be granted under this plan. As of December 31, 2015, stock options, RSUs, RSAs, and PSAs representing approximately 1.7 million shares of common stock were outstanding under all awards assumed through the Company's acquisitions.

Stock Option Activities

Since 2006, the Company has granted stock option awards that have a maximum contractual life of seven years from the date of grant. Prior to 2006, stock option awards generally had a ten-year contractual life from the date of grant.

The following table summarizes the Company’s stock option activity and related information as of and for the three years ended December 31, 2015 (in millions, except for per share amounts and years):
 
Outstanding Options
 
Number of Shares
 
Weighted Average
Exercise Price
per Share
 
Weighted Average
Remaining
Contractual Term
(In Years)
 
Aggregate
Intrinsic
Value
Balance as of December 31, 2012
34.1

 
$
24.13

 
3.1
 
$
52.5

Canceled
(1.3
)
 
29.56

 
 
 
 
Exercised
(5.6
)
 
15.58

 
 
 
 
Expired
(4.1
)
 
28.35

 
 
 
 
Balance as of December 31, 2013
23.1

 
$
25.15

 
2.4
 
$
44.6

Canceled
(0.6
)
 
30.15

 
 
 
 
Exercised
(5.4
)
 
19.76

 
 
 
 
Expired
(7.2
)
 
29.11

 
 
 
 
Balance as of December 31, 2014
9.9

 
$
24.87

 
2.0
 
$
24.7

Canceled
(0.1
)
 
23.65

 
 
 
 
Exercised
(3.5
)
 
19.78

 
 
 
 
Expired
(2.7
)
 
27.99

 
 
 
 
Balance as of December 31, 2015
3.6

 
$
27.52

 
2.1
 
$
16.6

 
 
 
 
 
 
 
 
As of December 31, 2015:
 
 
 
 
 
 
 
Vested and expected-to-vest options
3.6

 
$
27.58

 
2.1
 
$
16.3

Exercisable options
3.4

 
$
28.82

 
1.8
 
$
12.1



The aggregate intrinsic value represents the difference between the Company’s closing stock price on the last trading day of the period, which was $27.60 per share as of December 31, 2015 and the exercise price of the applicable options multiplied by the number of related options. The pre-tax intrinsic value of options exercised, representing the difference between the fair market value of the Company’s common stock on the date of the exercise and the exercise price of each option, was $27.5 million, $33.4 million, and $29.4 million for 2015, 2014, and 2013, respectively. Total fair value of options vested during 2015, 2014, and 2013 was $7.0 million, $20.8 million, and $45.2 million, respectively.

The following table summarizes additional information regarding outstanding and exercisable options as of December 31, 2015:
 
 
Options Outstanding 
 
Options Exercisable 
Range of Exercise Price
(In dollars)
 
Number
Outstanding
(In millions)
 
Weighted Average
Remaining
Contractual Life
(In years)
 
Weighted Average
Exercise Price
(In dollars)
 
Number
Exercisable
(In millions)
 
Weighted Average
Exercise Price
(In dollars)
$0.03 - $14.68
 
0.4

 
5.3
 
$
3.38

 
0.3

 
$
4.94

$15.09 - $18.45
 
0.4

 
0.7
 
15.58

 
0.3

 
15.47

$18.49 - $26.10
 
0.4

 
2.3
 
24.11

 
0.3

 
24.19

$26.39 - $27.44
 
0.5

 
1.0
 
26.97

 
0.5

 
26.97

$27.62 - $29.33
 
0.1

 
2.0
 
28.88

 
0.1

 
28.88

$29.89 - $29.89
 
0.5

 
1.2
 
29.89

 
0.5

 
29.89

$30.01 - $36.49
 
0.4

 
1.9
 
32.76

 
0.4

 
32.76

$38.93 - $38.93
 
0.1

 
2.4
 
38.93

 
0.1

 
38.93

$40.26 - $40.26
 
0.5

 
2.2
 
40.26

 
0.6

 
40.26

$44.00 - $44.00
 
0.3

 
2.1
 
44.00

 
0.3

 
44.00

$0.03 - $44.00
 
3.6

 
2.1
 
$
27.52

 
3.4

 
$
28.82



Restricted Stock Unit, Restricted Stock Award, and Performance Share Award Activities

RSUs and RSAs generally vest over a period of three to four years from the date of grant and PSAs generally vest over a period of two to three years provided that certain annual performance targets and other vesting criteria are met. Until vested, RSUs and PSAs do not have the voting and dividend participation rights of common stock and the shares underlying the awards are not considered issued and outstanding.

The following table summarizes the Company’s RSU, RSA, and PSA activity and related information as of and for the three years ended December 31, 2015 (in millions, except per share amounts and years):
 
Outstanding RSUs, RSAs, and PSAs
 
Number of Shares
 
Weighted Average
Grant-Date Fair
Value per Share
 
Weighted Average
Remaining
Contractual Term
(In Years)
 
Aggregate
Intrinsic
Value
Balance as of December 31, 2012
26.8

 
$
27.76

 
1.7
 
$
565.0

RSUs granted
10.3

 
20.32

 
 
 
 
PSAs granted(1)
2.2

 
21.27

 
 
 
 
RSUs vested(2)
(6.1
)
 
26.15

 
 
 
 
PSAs vested(2)
(1.1
)
 
28.52

 
 
 
 
RSAs vested(2)
(1.6
)
 
19.59

 
 
 
 
RSUs canceled
(3.4
)
 
22.99

 
 
 
 
PSAs canceled
(1.7
)
 
29.10

 
 
 
 
Balance as of December 31, 2013
25.4

 
$
23.44

 
1.1
 
$
573.5

RSUs granted(3)(6)
10.0

 
22.52

 
 
 
 
RSUs assumed(4)
0.4

 
22.66

 
 
 
 
RSAs assumed(4)
0.9

 
22.66

 
 
 
 
PSAs granted(5)(6)
1.4

 
24.25

 
 
 
 
PSAs assumed(4)
0.2

 
22.66

 
 
 
 
RSUs vested(2)
(7.3
)
 
22.98

 
 
 
 
RSAs vested(2)
(1.4
)
 
19.59

 
 
 
 
PSAs vested(2)
(1.1
)
 
36.19

 
 
 
 
RSUs canceled
(4.0
)
 
21.63

 
 
 
 
PSAs canceled
(3.2
)
 
30.43

 
 
 
 
Balance as of December 31, 2014
21.3

 
$
22.05

 
1.1
 
$
475.0

RSUs granted(3)(6)
8.9

 
23.41

 
 
 
 
PSAs granted(6)(7)
1.0

 
23.76

 
 
 
 
RSUs vested(2)
(7.2
)
 
22.58

 
 
 
 
RSAs vested(2)
(1.8
)
 
20.13

 
 
 
 
PSAs vested(2)
(0.3
)
 
22.52

 
 
 
 
RSUs canceled
(2.3
)
 
22.18

 
 
 
 
PSAs canceled
(1.0
)
 
22.27

 
 
 
 
Balance at December 31, 2015
18.6

 
$
22.71

 
1.1
 
$
514.1

 
 
 
 
 
 
 
 
As of December 31, 2015
 
 
 
 
 
 
 
Vested and expected-to-vest RSUs, RSAs,
   and PSAs
15.3

 
$
22.59

 
1.0
 
$
421.3

________________________________
(1) 
The number of shares subject to PSAs granted represents the aggregate maximum number of shares that may be issued pursuant to the award over its full term. The aggregate number of shares subject to these PSAs that would be issued if performance goals determined by the Compensation Committee (or an authorized subcommittee) are achieved at target is 1.1 million shares. Depending on achievement of such performance goals, the range of shares that could be issued under these awards is 0 to 2.2 million shares.
(2) 
Total fair value of RSUs, RSAs, and PSAs vested during 2015, 2014, and 2013 was $202.7 million, $238.5 million, and $221.5 million, respectively.
(3) 
Includes service-based and market-based RSUs granted under the 2006 Plan and 2015 Plan according to their terms.
(4) 
RSUs, RSAs, and PSAs assumed in connection with the acquisition of WANDL Inc.
(5) 
The number of shares subject to PSAs granted represents the aggregate maximum number of shares that may be issued pursuant to the award over its full term. The aggregate number of shares subject to these PSAs that would be issued if performance goals determined by the Compensation Committee (or an authorized subcommittee) are achieved at target is 0.7 million shares. Depending on achievement of such performance goals, the range of shares that could be issued under these awards is 0 to 1.4 million shares.
(6) 
On February 20, 2014, the Company announced its intention to initiate a quarterly cash dividend of $0.10 per share of common stock in the third quarter of 2014. As a result of the Company's announcement, the grant date fair value of RSUs and PSAs granted after the announcement date were reduced by the present value of the dividends expected to be paid on the underlying shares of common stock during the requisite and derived service period as these awards are not entitled to receive dividends until vested.
(7) 
The number of shares subject to PSAs granted represents the aggregate maximum number of shares that may be issued pursuant to the award over its full term. The aggregate number of shares subject to these PSAs that would be issued if performance goals determined by the Compensation Committee (or an authorized subcommittee) are achieved at target is 0.7 million shares. Depending on achievement of such performance goals, the range of shares that could be issued under these awards is 0 to 1.0 million shares.

Shares Available for Grant

The following table presents the stock activity and the total number of shares available for grant under the 2015 Plan and the 2006 Plan, as applicable:
 
Number of Shares
Balance as of December 31, 2014
47.8

RSUs and PSAs granted (1)
(20.7
)
RSUs and PSAs canceled (1)(2)
7.0

Options canceled (2)
0.1

Options expired (2)
2.7

Shares discontinued (3) 
(38.2
)
Shares authorized under the 2015 Plan
38.0

Balance as of December 31, 2015
36.7

________________________________
(1) 
RSUs and PSAs with a per share or unit purchase price lower than 100% of the fair market value of the Company's common stock on the day of the grant under the 2015 Plan and the 2006 Plan are counted against shares authorized under the plan as two and one-tenth shares of common stock for each share subject to such award. The number of shares subject to PSAs granted represents the maximum number of shares that may be issued pursuant to the award over its full term.
(2) 
Canceled or expired options under the 2006 Plan and the 1996 Plan and canceled RSUs and PSAs under the 2006 Plan are no longer available for future grant under such plans; however, the number of shares available for grant under the 2015 Plan will be increased by the amount of such canceled or expired options, RSUs or PSAs, as applicable, up to a maximum of 29.0 million additional shares of common stock, pursuant to the terms of the 2015 Plan.
(3) 
Authorized shares not subject to outstanding awards under the 2006 Plan were canceled on May 19, 2015, following the approval by the Company’s stockholders of the 2015 Plan. Effective May 19, 2015, no additional awards are issuable under the 2006 Plan.

Employee Stock Purchase Plan

The Company's ESPP is implemented in a series of offering periods, each six months in duration, or a shorter period as determined by the Board. Employees purchased approximately 2.7 million, 2.9 million, and 3.3 million shares of common stock through the ESPP at an average exercise price of $19.25, $19.30, and $16.53 per share during 2015, 2014, and 2013, respectively.

Valuation Assumptions

The weighted-average assumptions used and the resulting estimates of fair value for stock options, ESPP, and market-based RSUs were as follows:
 
Years Ended December 31,
 
2015
 
2014
 
2013
ESPP(1):
 
 
 
 
 
Volatility
29%
 
30%
 
36%
Risk-free interest rate
0.1%
 
0.1%
 
0.1%
Expected life (years)
0.5
 
0.5
 
0.5
Dividend yield
1.7%
 
0% - 1.8%
 
—
Weighted-average fair value per share
$5.63
 
$5.72
 
$5.54
 
 
 
 
 
 
Market-based RSUs(2)
 
 
 
 
 
Volatility
34%
 
36%
 
—
Risk-free interest rate
1.4%
 
1.6%
 
—
Dividend yield
1.8%
 
0% - 2.0%
 
—
Weighted-average fair value per share
$14.97
 
$16.89
 
—
________________________________
(1) 
The Black-Scholes-Merton option-pricing model is utilized to estimate the fair value of ESPP.
(2) 
The fair value of market-based RSUs utilizes the Monte Carlo simulation option pricing model. The Company amortizes the fair value of these awards over the derived service period adjusted for estimated forfeitures for each separately vesting tranche of the award. Provided that the derived service is rendered, the total fair value of the market-based RSUs at the date of grant is recognized as compensation expense even if the market condition is not achieved. However, the number of shares that ultimately vest can vary significantly with the performance of the specified market criteria.

Share-Based Compensation Expense

Share-based compensation expense associated with stock options, RSUs, RSAs, PSAs, and ESPP was recorded in the following cost and expense categories in the Company's Consolidated Statements of Operations (in millions):
 
Years Ended December 31,
 
2015
 
2014
 
2013
Cost of revenues - Product
$
5.6

 
$
5.0

 
$
4.7

Cost of revenues - Service
13.8

 
14.2

 
15.4

Research and development
125.4

 
134.5

 
127.6

Sales and marketing
45.6

 
60.2

 
70.9

General and administrative
26.9

 
26.1

 
26.0

Total
$
217.3

 
$
240.0

 
$
244.6



The following table summarizes share-based compensation expense by award type (in millions):
 
Years Ended December 31,
 
2015
 
2014
 
2013
Stock options
$
6.6

 
$
14.9

 
$
31.5

RSUs, RSAs, and PSAs
197.3

 
209.7

 
196.8

ESPP
13.4

 
15.4

 
16.3

Total
$
217.3

 
$
240.0

 
$
244.6



The following table presents unrecognized compensation cost, adjusted for estimated forfeitures, recognized over a weighted-average period related to unvested stock options, RSUs, RSAs, and PSAs as of December 31, 2015 (in millions, except years):
 
Unrecognized
Compensation Cost
 
Weighted Average
Period
(In Years)
Stock options
$
2.1

 
0.6
RSUs, RSAs, and PSAs
$
211.2

 
1.7


401(k) Plan

The Company maintains a savings and retirement plan qualified under Section 401(k) of the Internal Revenue Code of 1986, as amended (the "IRC"). Employees meeting the eligibility requirements, as defined under the IRC, may contribute up to the statutory limits each year. The Company currently matches 30% of all eligible employee contributions which vest immediately. The Company’s matching contributions to the plan totaled $19.6 million, $20.2 million, and $20.7 million during the years ended December 31, 2015, 2014, and 2013, respectively.

Deferred Compensation Plan

The Company’s non-qualified deferred compensation (“NQDC”) plan is an unfunded and unsecured deferred compensation arrangement. Under the NQDC plan, officers and other senior employees may elect to defer a portion of their compensation and contribute such amounts to one or more investment funds. The NQDC plan assets are included within short-term investments and offsetting obligations are included within accrued compensation in the Consolidated Balance Sheets. The investments are considered trading securities and are reported at fair value. The realized and unrealized holding gains and losses related to these investments are recorded in other (expense) income, net, and the offsetting compensation expense is recorded as operating expenses in the Consolidated Statements of Operations. The deferred compensation liability under the NQDC plan was approximately $17.7 million and $16.3 million as of December 31, 2015 and December 31, 2014, respectively.