Equity Incentive Plans

We maintain two equity incentive plans: the 2009 Equity Incentive Plan (our 2009 Plan) and the 2015 Equity Incentive Plan (our 2015 Plan). In August 2015, our board of directors adopted, and in September 2015 our stockholders approved, the 2015 Plan, which became effective in connection with our IPO and serves as the successor to our 2009 Plan. Our 2015 Plan provides for grants of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, performance stock awards, performance cash awards, and other forms of stock awards to our employees, directors and consultants. We ceased grants of new awards under our 2009 Plan after the effective date of our 2015 Plan, and no new grants will be made from our 2009 Plan. Outstanding awards granted under our 2009 Plan will remain subject to the terms of our 2009 Plan and applicable award agreements, until such outstanding awards that are stock options are exercised, terminated or expired by their terms.

We initially reserved 27,000,000 shares of our Class A common stock for issuance under our 2015 Plan. The number of shares reserved for issuance under our 2015 Plan increases automatically on the first day of February of each year through 2025, in an amount equal to 5% of the total number of shares of our capital stock outstanding as of the immediately preceding January 31.

The exercise price of stock options will generally not be less than 100% of the fair market value of our common stock on the date of grant, as determined by our board of directors. Our equity awards generally vest over a two to four year period and expire no later than ten years from the date of grant.

2015 Employee Stock Purchase Plan

In August 2015, our board of directors adopted and our stockholders approved, the 2015 Employee Stock Purchase Plan (2015 ESPP), which became effective in connection with our IPO. A total of 3,500,000 shares of Class A common stock was initially reserved for issuance under the 2015 ESPP. The number of shares reserved for issuance under our 2015 ESPP increases automatically on the first day of February of each year through 2025, in an amount equal to the lesser of (i) 1% of the total number of shares of our capital stock outstanding as of the immediately preceding January 31, and (ii) 3,500,000 shares of Class A common stock.

The 2015 ESPP allows eligible employees to purchase shares of our Class A common stock at a discount through payroll deductions (or other payroll contributions) of up to 30% of their eligible compensation, subject to a cap of 3,000 shares on any purchase date or $25,000 in any calendar year (as determined under applicable tax rules). The 2015 ESPP provides for 24 month offering periods beginning March 16th and September 16th of each year, and each offering period consists of four six-month purchase periods, subject to a reset provision. If the closing stock price on the offering date of a new offering falls below the closing stock price on the offering date of an ongoing offering, the ongoing offering would terminate immediately following the purchase of ESPP shares on the purchase date immediately preceding the new offering and participants in the terminated ongoing offering would automatically be enrolled in the new offering (ESPP reset). On each purchase date, eligible employees will purchase our Class A common stock at a price per share equal to 85% of the lesser of the fair market value of our Class A common stock (1) on the first trading day of the applicable offering period or (2) the purchase date. Our closing stock price on the new offering date of March 16, 2017 was lower than the closing stock prices for both the offerings that started on March 16, 2016 and September 16, 2016, which triggered an ESPP reset for those offerings. The ESPP reset resulted in a modification charge of approximately $9.0 million, which is being recognized over the new 24-month offering period ending on March 15, 2019. In addition, the original remaining unamortized stock-based compensation expense for each of the offerings is being recognized over the same 24-month offering period ending on March 15, 2019.

We recognized stock-based compensation related to our 2015 ESPP of $4.2 million and $4.1 million during the three months ended April 30, 2016 and 2017. As of April 30, 2017, there was $27.9 million of unrecognized stock-based compensation expense related to our 2015 ESPP which is expected to be recognized over a weighted-average period of approximately 1.9 years.

Stock Options

A summary of stock option activity under our equity incentive plans and related information is as follows:



	Options Outstanding
	Number of Shares		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (In Years)	Aggregate Intrinsic Value (in thousands)
Balance as of January 31, 2017	56,840,189		$	7.15	7.0	$	315,502
Options granted	—		—
Options exercised	(1,340,121	)	1.84
Options forfeited/cancelled	(605,324	)	12.74
Balance as of April 30, 2017	54,894,744		$	7.22	6.7	$	273,338
Vested and exercisable as of April 30, 2017	30,739,000		$	4.45	6.0	$	208,957

The aggregate intrinsic value of options vested and exercisable as of April 30, 2017 is calculated based on the difference between the exercise price and the closing price of $10.61 of our Class A common stock on April 28, 2017.

As of April 30, 2017, total unrecognized employee compensation cost related to outstanding options was $115.6 million, which is expected to be recognized over a weighted-average period of approximately 2.7 years.

Restricted Stock Units

A summary of the restricted stock unit activity under our 2015 Plan and related information is as follows:



	Number of Restricted Stock Units Outstanding		Weighted- Average Grant Date Fair Value		Aggregate Intrinsic Value (in thousands)
Unvested Balance as of January 31, 2017	8,783,024		$	13.06	$	99,863
Granted	8,014,950		10.19		—
Vested	(794,543	)	10.38		—
Forfeited	(376,522	)	12.18		—
Unvested Balance as of April 30, 2017	15,626,909		$	11.74	$	165,802

As of April 30, 2017, total unrecognized employee compensation cost related to unvested restricted stock units was $165.3 million, which is expected to be recognized over a weighted-average period of approximately 2.6 years.

During the three months ended April 30, 2017, we granted 827,000 (target number of units) performance stock units with both performance condition and service vesting conditions payable in common shares from 0% to 150% of the target number granted, contingent upon the degree to which the performance condition is met. Management determined it is probable that the performance condition will be satisfied and accordingly, we began recognizing stock-based compensation expense during the three months ended April 30, 2017. Stock-based compensation expense was $468,000 for the three months ended April 30, 2017.

Stock-Based Compensation Expense

The following table summarizes the components of stock-based compensation expense recognized in the condensed consolidated statements of operations (in thousands):



	Three Months Ended April 30,
	2016		2017
Cost of revenue—product	$	106	$	397
Cost of revenue—support	1,092		1,774
Research and development	11,658		15,588
Sales and marketing	7,519		10,626
General and administrative	2,623		3,834
Total stock-based compensation expense	$	22,998	$	32,219