Stock-Based Compensation and Employee Benefit Plans

Equity incentives are currently issued to employees and directors in the form of stock options and RSUs under our 2014 Equity Incentive Plan. Our 2007 Stock Option Plan was terminated in connection with our Initial Public Offering (IPO). Accordingly, no additional equity incentives are issuable under this plan although it continues to govern outstanding awards granted thereunder. Additionally, we offer an Employee Stock Purchase Plan through the 2014 Employee Stock Purchase Plan and a 401(k) plan to employees.

Options

The following table summarizes the assumptions used for estimating the fair value of stock options granted under our option plans for the years ended December 31:



	2016	2015	2014
Risk-free interest rate	1.40% - 2.54%	1.65 - 2.13%	1.02 - 2.08%
Expected term (years)	5.0 - 6.0	5.5 - 6.0	3.2 - 6.1
Expected volatility	46% - 54%	41 - 47%	35 - 59%
Dividend yield	—%	—%	—%
Weighted-average grant date fair value per share	$2.65	$5.70	$5.57

The following is a summary of option activity for the year ended December 31, 2016:



	Number of Options		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Outstanding at January 1, 2016	10,711,321		$	6.16	—	—
Granted	2,240,951		$	5.81	—	—
Exercised	(559,034	)	$	0.57	—	—
Forfeited	(816,688	)	$	8.66	—	—
Expired	(150,254	)	$	11.75	—	—
Outstanding at December 31, 2016	11,426,296		$	6.10	7.3	$	18,928
Exercisable at December 31, 2016	6,891,188		$	4.74	6.6	$	17,103
Vested or expected to vest as of December 31, 2016	11,215,431		$	6.07	7.3	$	18,912

Total compensation cost related to nonvested option awards not yet recognized as of December 31, 2016 was $15.6 million and will be recognized over a weighted-average period of approximately 2.3. The aggregate intrinsic value of employee options exercised during the years ended December 31, 2016, 2015 and 2014 was $3.0 million, $10.8 million and $12.1 million, respectively.

Restricted Stock Units

The following table summarizes our activities of RSUs and PRSUs during the year ended December 31, 2016:



	Number of RSUs		Weighted-Average Grant Date Fair Value
Unvested at January 1, 2016	1,853,452		$	12.85
RSUs and PRSUs granted	3,105,312		$	6.48
RSUs vested	(434,978	)	13.11
RSUs forfeited/expired	(635,018	)	$	9.60
Unvested at December 31, 2016	3,888,768		$	8.46
Expected to vest after December 31, 2016	3,656,537		$	8.95

During the year ended December 31, 2016, in addition to granting RSUs, we also granted 194,207 PRSUs with a grant date fair value of $5.95. For each of the three annual performance periods, one-third (1/3) of the total PRSUs may vest depending upon achievement of performance-based targets. Participants have the ability to earn up to 150% of the baseline award based on certain levels of achievement in excess of the relevant target performance level or could earn less than the baseline award, or nothing at all, based on certain levels of achievement below the relevant target performance level. Measurement of performance is based on a 12-month period ending June 30 of each year. Performance goals have yet to be established for the twelve-month performance periods ending June 30, 2018 and June 30, 2019.

As of December 31, 2016, there was $23.4 million of unrecognized compensation cost related to unvested RSUs, which is expected to be recognized over the next 3.0 years.

Employee Stock Purchase Plan

As of December 31, 2016, there was $0.3 million of unrecognized compensation expense related to the ESPP.

The assumptions used to calculate our Black-Scholes-Merton Option Pricing Model for each stock purchase right granted under the ESPP were as follows or the year ended December 31:



	2016		2015		2014
Risk-free interest rate	0.39	%	0.27	%	0.17	%
Expected term (years)	0.50		0.50		0.75
Expected volatility	52	%	42	%	42	%
Dividend yield	—	%	—	%	—	%

Stock-based compensation expense related to stock options, RSUs, PRSUs and ESPP are included in the following line items in our accompanying consolidated statements of operations for the year ended December 31 (in thousands):



	2016		2015		2014
Sales and marketing	$	4,002	$	3,081	$	686
Technology and analytics	3,199		2,351		539
Processing and servicing	1,092		775		219
General and administrative	7,622		5,375		1,398
Total	$	15,915	$	11,582	$	2,842

401(k) Plan

We maintain a 401(k) defined contribution plan that covers substantially all of our employees. Participants may elect to contribute their annual compensation up to the maximum limit imposed by federal tax law. During the years ended December 31, 2016, 2015 and 2014 we had $1.4 million, $1.0 million, and $0.3 million in employer related match expense, respectively.