(9) Stock-based Compensation

The Company may grant stock options to purchase shares of its common stock, restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”) or common stock awards to its employees and non-employee directors. Stock‑based compensation expense included in the Company’s consolidated statements of operations during the periods presented is as follows (in thousands):


	Three months ended September 30,				Nine months ended September 30,
	2015		2014		2015		2014
	(unaudited)
Stock-based compensation expense:
Marketing	$	322	$	252	$	977	$	751
Technology and development		1,170		929		3,350		2,335
Customer service and operations		335		215		937		617
General and administrative		1,719		1,223		4,767		3,173
Total stock-based compensation	$	3,546	$	2,619	$	10,031	$	6,876

(a) Stock Options

The fair value of options granted was estimated at the date of the grant using a Black-Scholes option-pricing model. The following table presents the weighted-average assumptions used in estimating the fair value of options granted during the periods presented:


	Three months ended September 30,		Nine Months Ended September 30,
	2015	2014	2015	2014
	(unaudited)
Expected term (in years)	—	—	6.0	6.2
Risk-free interest rate	—	—	1.65%	2.03%
Dividend yield	—	—	None	None
Volatility rate	—	—	35%	43%

The Company’s common stock has been publicly traded for over two years, which has provided a history of the Company’s share price and volatility. As part of its continuous review of the key assumptions in the Black-Scholes option-pricing model, the Company phased in its own historical volatility to estimate its expected volatility based on the Company’s historical share prices. For the options with expected terms of less than the Company’s tenure as a publicly-traded company, a weighting equal to the division of the length of the Company’s public tenure over the expected term of stock options was assigned to the Company’s historical volatility. The remaining weightings were assigned based on the average of comparable public companies’ historical volatilities.

The following table presents the stock option activity and related information for the nine months ended September 30, 2015:


		Weighted-		Weighted-	Aggregate
		Average		Average	Intrinsic
	Options	Exercise		Contractual Term	Value
	Outstanding	Price		(In Years)	(in Millions)
	(unaudited)
Outstanding as of December 31, 2014	6,132,641	$	11.62	6.17	$	50.4
Granted	685,690		16.27
Exercised (1)	(808,700)		6.16
Forfeited or cancelled	(325,729)		16.35
Outstanding as of September 30, 2015	5,683,902	$	12.69	6.00	$	72.2
Exercisable as of September 30, 2015	3,672,116	$	9.86	4.91	$	56.5
Vested and expected to vest as of September 30, 2015	5,656,899	$	12.65	5.99	$	72.1

(1) Exercised options in the table above included both settled and unsettled exercises during the nine months ended September 30, 2015.

The following table presents the total intrinsic value of stock options exercised and the weighted-average grant date fair value of stock options granted for the periods presented:


		Three months ended September 30,				Nine months ended September 30,
(In millions except per share data)		2015	2014			2015	2014
		(unaudited)				(unaudited)
Total intrinsic value of stock options exercised	$	2.9	$	4.5	$	10.2	$	15.9
Weighted-average per share grant date fair value of stock options granted	$	—	$	—	$	6.02	$	11.71

As of September 30, 2015, there was $14.2 million of total unrecognized compensation expense related to option grants, which is expected to be recognized over a weighted-average remaining period of 2.3 years.

(b) Restricted Stock Units and Performance-based Restricted Stock Units

The fair value of RSUs is equal to the closing market price of the Company’s common stock on the date of grant. Stock-based compensation expense is amortized on a straight-line basis over the requisite service period, which is generally four years.

In February 2015, the Company granted PSUs to certain employees, which contain both service and performance requirements. The number of PSUs that will ultimately vest will range from 0% to 170% of the target amount depending on the actual level of achievement within the specified performance bands for the year ended December 31, 2015. The performance condition will be evaluated quarterly to determine the probable level of achievement within specified performance bands as defined in the PSU agreement. Stock-based compensation expense related to PSUs is amortized over a graded vesting period of three years. Changes in the quarterly estimate of probable achievement impact the total amount of stock-based compensation expense on a cumulative basis. Pursuant to the PSU agreements and to the Merger Agreement, after the Merger closes, an employee who was granted PSUs will be credited with RSUs at 100% of the target amount.

The following table shows a summary of RSU and PSU activity for the nine months ended September 30, 2015:


	RSUs			PSUs
		Weighted-				Weighted-
		Average				Average
		Grant Date				Grant Date
(unaudited)	Shares	Fair Value		Shares		Fair Value
Unvested as of December 31, 2014	497,020	$	19.40	—		$	—
Granted	606,582		18.47	397,800	(1)		15.71
Vested	(145,215)		17.84	—			—
Forfeited	(108,404)		18.84	—			—
Unvested as of September 30, 2015	849,983	$	19.07	397,800		$	15.71

(1) Represents the maximum number of performance units which could be earned.

The following table presents the total fair value and the aggregate intrinsic value of RSUs vested and the weighted-average grant date fair value of RSUs granted for the periods presented:


		RSUs
		Three months ended September 30,				Nine months ended September 30,
(In millions, except per share data)		2015	2014			2015	2014
		(unaudited)				(unaudited)
Total fair value of shares vested	$	1.0	$	—	$	2.8	$	—
Total aggregate intrinsic value of shares vested	$	1.1	$	—	$	2.8	$	—
Weighted-average per share grant date fair value of shares granted	$	24.79	$	24.21	$	18.47	$	20.73

The weighted-average per share grant-date fair value of PSUs granted was $15.71 during the nine months ended September 30, 2015. There were no PSUs granted during the three months ended September 30, 2015. No PSUs vested during any of the periods presented.

As of September 30, 2015, there was $13.0 million of total unrecognized compensation expense related to RSUs, which is expected to be recognized over a weighted-average remaining period of 3.1 years. Based on estimated level of achievement as of September 30, 2015, there was $0.7 million of total unrecognized compensation expense related to PSUs, which is expected to be recognized over a weighted-average remaining period of 1.6 years.