Share-Based Compensation

Equity Incentive Plan

In June 2009, our board of directors adopted and approved our 2009 Plan, which provides for the issuance of stock options, restricted stock and RSUs to qualified employees, directors and consultants. Stock options granted under our 2009 Stock Plan have a maximum life of 10 years and an exercise price not less than 100% of the fair market value of our common stock on the date of grant. RSUs granted under our 2009 Plan have a maximum life of seven years. 22,641,049 shares of our common stock were reserved for future issuance under our 2009 Plan as of March 31, 2019. In connection with the closing of our IPO, all remaining shares available for future issuance under our 2009 Plan ceased to be available for issuance under our 2009 Plan, and an equal number of shares of our Class A common stock became available for issuance under our 2019 Omnibus Incentive Plan (the “2019 Plan”), as described below.

Our 2019 Plan became effective upon closing of our IPO and succeeds our 2009 Plan. Our 2019 Plan provides for the issuance of stock options, restricted stock, RSUs and other equity- or cash-based awards to qualified employees, directors and consultants. We initially reserved 48,200,000 shares of our Class A common stock for issuance under the 2019 Plan. There are 86,807,385 shares of our Class B common stock reserved for future issuance under our 2019 Plan following the closing of our IPO, which includes the 48,200,000 shares of Class A common stock originally reserved, the 22,641,049 shares of our Class B common stock reserved for future issuance under our 2009 Plan as of March 31, 2019 and 15,966,336 shares of our Class B common stock we withheld to satisfy our tax withholding and remittance obligations related to RSUs for which the performance condition was deemed satisfied upon pricing of our shares of Class A common stock sold in connection with our IPO. The withheld shares were automatically retired and cancelled, and an equal number of shares of our Class A common stock became available for issuance under our 2019 Plan.

The number of shares of our Class A common stock available for issuance under the 2019 Plan will be further increased by the number of shares of our Class B common stock subject to awards outstanding under our 2009 Plan as of the closing of our IPO that would, but for the terms of the 2019 Plan, have returned to the share reserves of the 2009 Plan pursuant to the terms of such awards, including as the result of forfeiture, repurchase, expiration or retention by us in order to satisfy an award’s exercise price or tax withholding obligations. In addition, the number of shares of our Class A common stock reserved for issuance under our 2019 Plan will automatically increase on the first day of each fiscal year, commencing on January 1, 2020 and ending on (and including) January 1, 2029, in an amount equal to 5% of the total number of shares of our Class A common stock and our Class B common stock outstanding on the last day of the calendar month before the date of each automatic increase, or a lesser number of shares determined by our board of directors.

Stock Option Activity

Stock option activity during the three months ended March 31, 2019, was as follows (in thousands, except per share amounts):



	Stock Options Outstanding
	Shares	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value ⁽¹⁾
				(in years)
Outstanding as of December 31, 2018	76,635	$	2.22	4.5	$	1,285,338
Exercised	(73)	2.58
Forfeited	(6)	3.84
Outstanding as of March 31, 2019	76,556	$	2.22	4.3	$	1,339,176
Exercisable as of March 31, 2019	76,351	$	2.21	4.3	$	1,335,964


(1)	We calculate intrinsic value based on the difference between the exercise price of in-the-money-stock options and the fair value of our common stock as of the respective balance sheet date.

The total grant-date fair value of stock options vested during the three months ended March 31, 2019 and 2018, was $0.6 million and $18.6 million, respectively. The aggregate intrinsic value of stock options exercised during the three months ended March 31, 2019 and 2018, was $1.2 million and $5.9 million, respectively.

Restricted Stock Unit Activity

RSU activity during the three months ended March 31, 2019, was as follows (in thousands, except per share amounts):



	Restricted Stock Units Outstanding
	Shares	Weighted Average Grant Date Fair Value
Outstanding as of December 31, 2018	77,882	$	17.79
Granted	28,531	19.60
Forfeited	(2,486)	18.43
Outstanding as of March 31, 2019	103,927	$	18.27

Share-Based Compensation

Share-based compensation expense during the three months ended March 31, 2019 and 2018, was as follows (in thousands):



	Three Months Ended March 31,
	2019		2018
Cost of revenue	$	15	$	32
Research and development	626		4,054
Sales and marketing	29		241
General and administrative	24		507
Total share-based compensation	$	694	$	4,834

We began granting RSUs in March 2015. RSUs granted under our 2009 Plan are subject to both a service condition, which is typically satisfied over four years, and a performance condition, which was deemed satisfied in connection with our IPO. Because the performance condition had not been satisfied as of March 31, 2019, we had not recorded any share-based compensation expense for our RSUs at that date. Had our IPO occurred on March 31, 2019, we would have recorded cumulative share-based compensation expense of $974.9 million using the accelerated attribution method, and we would have expected to recognize the remaining $924.5 million of unrecognized share-based compensation expense over a weighted-average period of 3.7 years.

Unrecognized share-based compensation expense relating to stock options was not material as of March 31, 2019.