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Capital Stock (Tables)
 12 Months Ended
Dec. 31, 2015
Reserved Shares of Common Stock

The Company had reserved shares of common stock, on an as if converted basis, for issuance as follows:

 

 

 

As of December 31,

 

 

 

2015

 

 

2014

 

Issuance in connection with outstanding stock options

 

 

1,949,089

 

 

 

2,244,363

 

Issuance in connection with restricted stock units outstanding

 

 

1,898,025

 

 

 

2,279,081

 

Reserved for future stock option and restricted stock unit grants

 

 

650,527

 

 

 

1,166,742

 

Reserved for future issuance under the employee stock

   purchase plan

 

 

1,049,524

 

 

 

895,268

 

 

 

 

5,547,165

 

 

 

6,585,454

 

 
Summary of Option Activity under Plans and Related Information

The following table summarizes option activity under the Plans and related information:

 

 

 

Options Outstanding

 

 

Weighted-

Average

Remaining

 

 

 

 

 

 

 

Number of

Shares

 

 

Weighted

Average

Exercise Price

 

 

Contractual

Term

(in years)

 

 

Aggregate

Intrinsic Value

(in thousands) (1)

 

Outstanding - December 31, 2012

 

 

1,989,237

 

 

$

14.08

 

 

 

8.09

 

 

$

35,513

 

Granted

 

 

631,775

 

 

$

36.55

 

 

 

 

 

 

 

 

 

Exercised or released

 

 

(687,719

)

 

$

6.94

 

 

 

 

 

 

 

 

 

Cancelled or forfeited

 

 

(257,787

)

 

$

25.11

 

 

 

 

 

 

 

 

 

Outstanding - December 31, 2013

 

 

1,675,506

 

 

$

23.78

 

 

 

8.01

 

 

$

40,813

 

Granted

 

 

1,256,559

 

 

$

41.39

 

 

 

 

 

 

 

 

 

Options assumed in acquisitions

 

 

72,607

 

 

$

13.30

 

 

 

 

 

 

 

 

 

Exercised or released

 

 

(496,297

)

 

$

14.85

 

 

 

 

 

 

 

 

 

Cancelled or forfeited

 

 

(264,012

)

 

$

35.85

 

 

 

 

 

 

 

 

 

Balances - December 31, 2014

 

 

2,244,363

 

 

$

33.83

 

 

 

8.27

 

 

$

38,457

 

Granted

 

 

696,971

 

 

$

49.20

 

 

 

 

 

 

 

 

 

Exercised or released

 

 

(636,424

)

 

$

29.44

 

 

 

 

 

 

 

 

 

Cancelled or forfeited

 

 

(355,821

)

 

$

42.00

 

 

 

 

 

 

 

 

 

Balances - December 31, 2015

 

 

1,949,089

 

 

$

39.27

 

 

 

8.09

 

 

$

47,480

 

Vested and expected to vest - December 31, 2015

 

 

1,700,981

 

 

$

38.26

 

 

 

8.01

 

 

$

43,108

 

Exercisable - December 31, 2015

 

 

609,137

 

 

$

29.57

 

 

 

6.91

 

 

$

20,557

 

 

(1)

The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the closing stock price of $63.31 of the Company’s common stock on December 31, 2015
Additional Information Regarding Company's Stock Options Outstanding and Exercisable

Additional information regarding the Company’s stock options outstanding and exercisable as of December 31, 2015 is summarized below:

 

 

 

Options Outstanding

 

 

Options Exercisable

 

Exercise Prices

 

Number of

Stock Options

Outstanding

 

 

Weighted

Average

Remaining

Contractual

Life (Years)

 

 

Weighted

Average

Exercise Price

per Share

 

 

Shares Subject

to Stock Options

 

 

Weighted

Average

Exercise Price

per Share

 

$0.02 to $10.70

 

 

157,918

 

 

 

4.86

 

 

$

6.66

 

 

 

148,074

 

 

$

7.07

 

$10.71 to $29.10

 

 

242,340

 

 

 

7.66

 

 

$

25.34

 

 

 

118,092

 

 

$

24.95

 

$29.11 to $32.54

 

 

269,777

 

 

 

8.51

 

 

$

29.43

 

 

 

72,161

 

 

$

29.66

 

$32.55 to $34.55

 

 

206,863

 

 

 

7.26

 

 

$

33.72

 

 

 

99,746

 

 

$

33.62

 

$34.56 to $54.48

 

 

581,938

 

 

 

8.79

 

 

$

43.19

 

 

 

74,298

 

 

$

41.88

 

$54.49 to $61.55

 

 

275,131

 

 

 

8.14

 

 

$

54.98

 

 

 

82,179

 

 

$

54.76

 

$61.56 to $69.55

 

 

184,232

 

 

 

9.21

 

 

$

64.87

 

 

 

14,587

 

 

$

62.81

 

$69.56 to $77.00

 

 

30,890

 

 

 

9.79

 

 

$

71.72

 

 

 

-

 

 

$

-

 

 

 

 

1,949,089

 

 

 

8.09

 

 

$

39.27

 

 

 

609,137

 

 

$

29.57

 

 
Summary of RSU Activity Outstanding and Weighted Average Grant Date Fair Value

A summary of RSU activity for the year ended December 31, 2015, is as follows:

 

 

 

Number of

Restricted

Stock Units

Outstanding

 

 

Weighted-

Average Grant

Date Fair Value

 

Unvested - December 31, 2013

 

 

1,044,651

 

 

$

31.64

 

Granted

 

 

1,368,761

 

 

$

41.66

 

Granted, performance RSUs

 

 

131,143

 

 

$

31.42

 

PRSUs assumed in acquisitions

 

 

198,825

 

 

$

61.14

 

Released

 

 

(238,446

)

 

$

34.84

 

Cancelled or expired

 

 

(225,853

)

 

$

39.83

 

Unvested - December 31, 2014

 

 

2,279,081

 

 

$

39.07

 

Granted

 

 

911,734

 

 

$

53.02

 

Granted, performance RSUs

 

 

249,220

 

 

$

42.58

 

Released

 

 

(898,205

)

 

$

34.97

 

Cancelled or expired

 

 

(643,805

)

 

$

35.09

 

Unvested - December 31, 2015

 

 

1,898,025

 

 

$

49.53

 

 
Stock-Based Compensation Expense

The Company recognized stock-based compensation expense under the 2011 Stock Option and Incentive Plan, 2003 Stock Plan, Inducement Plans, 2011 Employee Stock Purchase Plan, and the Incapsula 2010 Share Incentive Plan in the consolidated statements of operations as follows (in thousands):

 

 

 

Years Ended December 31,

 

 

 

2015

 

 

2014

 

 

2013

 

Cost of revenue

 

$

3,862

 

 

$

2,058

 

 

$

1,440

 

Research and development

 

 

13,831

 

 

 

8,799

 

 

 

3,660

 

Sales and marketing

 

 

16,717

 

 

 

13,558

 

 

 

8,537

 

General and administrative

 

 

16,554

 

 

 

12,858

 

 

 

8,857

 

Total stock-based compensation expense

 

$

50,964

 

 

$

37,273

 

 

$

22,494

 

 
Weighted Average Assumptions for Fair Value of Stock Options Grants and ESPP Grants

A summary of the weighted-average assumptions is as follows:

 

 

 

Years Ended December 31

 

 

 

2015

 

 

2014

 

 

2013

 

Stock option grants:

 

 

 

 

 

 

 

 

 

 

 

 

Dividend rate

 

 

0

%

 

 

0

%

 

 

0

%

Risk-free interest rate

 

 

1.8

%

 

 

1.8

%

 

 

1.2

%

Expected term (in years)

 

 

6.1

 

 

 

6.1

 

 

 

6.1

 

Expected volatility

 

 

49

%

 

 

46

%

 

 

46

%

ESPP grants:

 

 

 

 

 

 

 

 

 

 

 

 

Dividend rate

 

 

0

%

 

 

0

%

 

 

0

%

Risk-free interest rate

 

 

0.4

%

 

 

0.1

%

 

 

0.1

%

Expected term (in years)

 

 

0.5

 

 

 

0.5

 

 

 

0.5

 

Expected volatility

 

 

65

%

 

 

45

%

 

 

27

%

 
Incapsula Plan [Member]  
Summary of Option Activity under Plans and Related Information

The following table summarizes option activity under the Incapsula Plan and related:

 

 

 

Shares

Available

for Grant

 

 

Number of

Performance-

based Restricted

Stock Units

Outstanding

 

 

Number of

Stock Options

Outstanding

 

 

Weighted

Average Exercise

Price of Stock

Options

Outstanding

 

Outstanding - December 31, 2012

 

 

2,753,708

 

 

 

—

 

 

 

1,836,500

 

 

$

0.10

 

Additional shares authorized

 

 

5,529,878

 

 

 

 

 

 

 

 

 

 

$

—

 

Granted, performance RSUs

 

 

(7,095,461

)

 

 

7,095,461

 

 

 

—

 

 

$

—

 

Granted, stock options

 

 

(1,240,000

)

 

 

—

 

 

 

1,240,000

 

 

$

0.58

 

Exercised/Released

 

 

—

 

 

 

—

 

 

 

(1,128,438

)

 

$

0.02

 

Forfeited

 

 

141,562

 

 

 

—

 

 

 

(141,562

)

 

$

0.22

 

Outstanding - December 31, 2013

 

 

89,687

 

 

 

7,095,461

 

 

 

1,806,500

 

 

$

0.47

 

Granted

 

 

(95,000

)

 

 

—

 

 

 

95,000

 

 

$

1.25

 

Forfeited

 

 

15,213

 

 

 

(12,713

)

 

 

(2,500

)

 

$

1.25

 

Transferred to Imperva 2011 stock option plan

 

 

(9,900

)

 

 

(7,082,748

)

 

 

(1,899,000

)

 

$

0.16

 

Outstanding - December 31, 2014

 

 

—

 

 

 

—

 

 

 

—

 

 

$

—