Our three classes of common stock are Class A, Class B and Class C common stock. On May 2, 2018, our founder, Mark Pincus, elected to convert certain outstanding shares of Class B common stock and all outstanding shares of Class C common stock controlled by Mr. Pincus and an affiliated investment entity into an equivalent number of shares of Class A common stock. As a result of Mr. Pincus’ conversion, the remaining shares of Class B common stock represented less than 10% of the total voting power of all Zynga stockholders and, accordingly, each remaining outstanding share of Class B common stock automatically converted into one share of Class A common stock. Each Zynga stockholder now has one vote per share on all matters subject to stockholder vote. Following the conversion, no shares of Class B or Class C common stock are outstanding.

Dividends. The holders of outstanding shares of our common stock are entitled to receive dividends out of funds legally available at the times and in the amounts which our Board of Directors may determine.

Voting Rights. Holders of our Class A common stock are entitled to one vote per share.

Liquidation. Upon our liquidation, dissolution or winding-up, the assets legally available for distribution to our stockholders would be distributable ratably among the holders of our Class A common stock.

Preemptive or Similar Rights. None of our common stock is entitled to preemptive rights or subject to redemption.

Conversion. Our Class A common stock is not convertible into any other shares of our capital stock. The Class B and Class C common stock converted into Class A common stock may not be reissued.

In April 2018, a share repurchase program was authorized for up to $200.0 million of our outstanding Class A common stock (“2018 Share Repurchase Program”). The timing and amount of any stock repurchase will be determined based on market conditions, share price and other factors. The program does not require us to repurchase any specific number of shares of our Class A common stock and may be modified, suspended or terminated at any time without notice. The 2018 Share Repurchase Program will be funded from existing cash on hand or other sources of funding as the Company may determine to be appropriate. Share repurchases under these authorizations may be made through a variety of methods, which may include open market purchases, privately negotiated transactions, block trades, accelerated share repurchase transactions, purchases through 10b5-1 plans or by any combination of such methods.

During the year ended December 31, 2018, we repurchased 7.1 million shares for our Class A common stock under the 2018 Share Repurchase Program at a weighted average price of $3.71 per share for a total of $26.2 million. During the year ended December 31, 2019, no share repurchases were made. As of December 31, 2019, we had $173.8 million remaining under the 2018 Share Repurchase Program. The 2018 Share Repurchase Program will expire in April 2022.

All of our stock repurchases were made through open market purchases under Rule 10b5-1 plans and subsequently retired.

In 2007, we adopted the 2007 Equity Incentive Plan (the “2007 Plan”) for the purpose of granting stock options and ZSUs to employees, directors and non-employees. Concurrent with the effectiveness of our initial public offering on December 15, 2011, we adopted the 2011 Equity Incentive Plan (the “2011 Plan”), and all remaining common shares reserved for future grant or issuance under the 2007 Plan were added to the 2011 Plan. The 2011 Plan was adopted for purposes of granting stock options and ZSUs to employees, directors and non-employees. The number of shares of our Class A common stock reserved for future issuance under our 2011 Plan will automatically increase on January 1 of each year, beginning on January 1, 2012, and continuing through and including January 1, 2021, by 4% of the total number of shares of our capital stock outstanding as of December 31 of the preceding calendar year or such lesser number of shares that may be determined by the Company’s Board of Directors.

We recorded stock-based compensation expense related to grants of employee stock options, ZSUs and performance-based awards in our consolidated statements of operations as follows (in thousands):

	Year Ended December 31,
	2019		2018		2017
Cost of revenue	$	1,471	$	1,584	$	1,838
Research and development		47,049		42,151		42,176
Sales and marketing		11,277		8,495		7,281
General and administrative		21,685		16,009		13,220
Total stock-based compensation expense	$	81,482	$	68,239	$	64,515

All stock options granted under the 2011 Plan generally vest over four to five years, with 25% to 20% vesting after one year and the remainder vesting monthly thereafter over 36 to 48 months, respectively. The stock options have a contract term of 10 years and the related expense is determined using the Black-Scholes option pricing model on the date of grant.

The following table shows stock option activity for the year ended December 31, 2019 (in thousands, except weighted-average exercise price and weighted-average contractual term):

	Outstanding Options
	Stock Options			Weighted- Average Exercise Price		Aggregate Intrinsic Value of Stock Options Outstanding		Weighted- Average Contractual Term (in years)
Balance as of December 31, 2018		36,185		$	2.35	$	57,510		6.23
Granted		4,647			5.37
Forfeited, expired and cancelled		(42	)		2.85
Exercised		(9,586	)		0.90
Balance as of December 31, 2019		31,204		$	3.24	$	89,786		7.19
As of December 31, 2019
Exercisable options		15,666		$	2.78	$	52,363		6.59
Vested and expected to vest		31,204		$	3.24	$	89,786		7.19

The following table presents the weighted-average grant date fair value and related assumptions used to estimate the fair value of our stock options:

	Year Ended December 31,
	2019			2018			2017
Expected term, in years		6			6			6
Risk-free interest rates		2.53	%		2.14	%		2.12	%
Expected volatility		43	%		47	%		46	%
Dividend yield		—			—			—
Weighted-average estimated fair value of stock options granted during the year	$	2.41		$	1.61		$	1.75

The aggregate intrinsic value of stock options exercised during 2019, 2018 and 2017 was $44.9 million, $6.3 million and $4.9 million, respectively. The total grant date fair value of options that vested during December 31, 2019, 2018 and 2017 was $9.5 million, $6.0 million and $8.0 million, respectively.

As of December 31, 2019, total unrecognized stock-based compensation expense of $23.5 million related to unvested stock options is expected to be recognized over a weighted-average recognition period of approximately 2.1 years.

ZSUs are granted to eligible employees under the 2011 Plan. In general, ZSU awards vest in annual or quarterly installments over a period of four years, are subject to the employee’s continuing service to us and do not have an expiration date. The cost of ZSUs is determined using the fair value of our common stock on the date of grant.

The following table shows a summary of ZSU activity for the year ended December 31, 2019 (in thousands, except weighted-average grant date fair value):

	Outstanding ZSUs
				Weighted-
				Average Grant Date		Aggregate Intrinsic
				Fair Value		Value of
	Shares			(per share)		Unvested ZSUs
Unvested as of December 31, 2018		52,482		$	3.49	$	206,254
Granted		14,086			5.61
Vested		(21,650	)		3.43
Forfeited		(4,730	)		3.81
Unvested as of December 31, 2019		40,188		$	4.23	$	245,951

As of December 31, 2019, total unamortized stock-based compensation expense relating to ZSUs amounted to $152.7 million over a weighted-average recognition period of approximately 2.4 years.

Certain employees are eligible to receive performance-based ZSUs, which are subject to performance and time-based vesting requirements. The target number of shares of the performance-based awards are adjusted based on our business performance measured against the performance goals approved by the Compensation Committee at the date of employment with the Company. Generally, if the performance criteria are satisfied, 25% of the award will vest immediately or soon after with the remaining vesting ratably for each quarter or six month periods thereafter. Stock-based compensation expense for performance-based ZSUs granted to these employees is recorded based on the probability of achievement of the performance milestones. During the years ended December 31, 2019, 2018 and 2017, we recorded $1.2 million, $1.8 million and $2.4 million, respectively, of stock-based compensation expense related to these performance-based ZSUs.

Our 2011 Employee Stock Purchase Plan (“2011 ESPP”), was approved by our Board of Directors in September 2011 and by our stockholders in November 2011 and amended in August 2012. The number of shares of our Class A common stock reserved for future issuance under our 2011 ESPP will automatically increase on January 1 of each year, beginning on January 1, 2012, and continuing through and including January 1, 2021, by the lesser of 2% of the total number of shares of our capital stock outstanding as of December 31 of the preceding calendar year, 25,000,000 shares or the number of shares that may be determined by the Company’s Board of Directors.

Our 2011 ESPP permits participants to purchase shares of our Class A common stock through payroll deductions up to 15% of their earnings, subject to a maximum of 5,000 shares available for purchase on any purchase date. Unless otherwise determined by the administrator, the purchase price of the shares will be 85% of the lower of the fair market value of our Class A common stock on the first day of an offering or on the date of purchase. The ESPP offers two purchase dates within each annual period, resulting in a six-month and twelve-month look-back. Additionally, the ESPP contains an automatic reset feature after the first six months of each annual period, such that if the fair market value of our Class A common stock has decreased from the original offering date, the offering will automatically terminate and all participants will be re-enrolled in the new, lower-priced offering for the remaining six months. Participants may end their participation at any time during an offering and will be refunded their accrued contributions that have not yet been used to purchase shares. Participation ends automatically upon termination of employment.

As of December 31, 2019, there were $3.4 million of employee contributions withheld by the Company. During the year ended December 31, 2019, the Company recognized $3.4 million of stock-based compensation expense related to the 2011 ESPP.

We have a defined contribution plan, which is qualified under Section 401(k) of the Internal Revenue Code. Participating employees may contribute up to 90% of their eligible compensation, or the statutory limit, whichever is lower. In 2019, 2018 and 2017, we contributed one dollar for each dollar a participant contributed, with a maximum contribution of 3% of each employee’s eligible compensation, subject to a maximum total contribution mandated by the IRS. The total expense for this savings plan was $5.8 million, $4.7 million and $4.5 million in 2019, 2018 and 2017, respectively.

As of December 31, 2019, we had reserved shares of common stock for future issuance as follows (in thousands):