Employee Benefits and Share-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-Based Compensation Expense Recognized in Consolidate Statements of Income

The following table sets forth the total share-based compensation expense recognized in our Condensed Consolidated Statements of Operations:

	Three months ended				Nine months ended
	September 30, 2015		September 30, 2014		September 30, 2015		September 30, 2014
	(In thousands)
Cost of product and service revenues	$	581	$	441	$	1,630	$	973
Research and development	587		407		1,472		1,156
Selling, general and administrative	2,798		2,313		8,165		6,481
Total share-based compensation expense	$	3,966	$	3,161	$	11,267	$	8,610

Estimate of Fair Value of Share-Based Awards, Employee Stock Purchase Plan

The following weighted average assumptions are used to value share options and Employee Stock Purchase Plan ("ESPP") shares issued pursuant to our equity incentive plans for the three and nine months ended September 30, 2015 and September 30, 2014:

	Three months ended				Nine months ended
	September 30, 2015		September 30, 2014		September 30, 2015		September 30, 2014
	(In thousands, except percentages)
Stock Option Plans
Expected life, years	5.04		4.81		5.04		4.80
Expected volatility, %	29.3	%	34.1	%	31.1	%	35.1	%
Risk free interest rate, %	1.73	%	1.70	%	1.63	%	1.56	%
Estimated forfeiture rate %	2.5	%	2.5	%	2.5	%	2.5	%
Dividend yield, %	—	%	—	%	—	%	—	%

	Three months ended				Nine months ended
	September 30, 2015		September 30, 2014		September 30, 2015		September 30, 2014
	(In thousands, except percentages)
Employee Stock Purchase Plan
Expected life, years	0.5-2.0		0.5-2.0		0.5-2.0		0.5-2.0
Expected volatility, %	25.79-34.36%		29.56-39.69%		25.79-37.53%		29.56-42.16%
Risk free interest rate, %	0.12-0.79%		0.03-0.53%		0.03-0.79%		0.03-0.53%
Estimated forfeiture rate %	—	%	—	%	—	%	—	%
Dividend yield, %	—	%	—	%	—	%	—	%

Estimate of Fair Value of Share-Based Awards, Share Options

The following weighted average assumptions are used to value share options and Employee Stock Purchase Plan ("ESPP") shares issued pursuant to our equity incentive plans for the three and nine months ended September 30, 2015 and September 30, 2014:

	Three months ended				Nine months ended
	September 30, 2015		September 30, 2014		September 30, 2015		September 30, 2014
	(In thousands, except percentages)
Stock Option Plans
Expected life, years	5.04		4.81		5.04		4.80
Expected volatility, %	29.3	%	34.1	%	31.1	%	35.1	%
Risk free interest rate, %	1.73	%	1.70	%	1.63	%	1.56	%
Estimated forfeiture rate %	2.5	%	2.5	%	2.5	%	2.5	%
Dividend yield, %	—	%	—	%	—	%	—	%

	Three months ended				Nine months ended
	September 30, 2015		September 30, 2014		September 30, 2015		September 30, 2014
	(In thousands, except percentages)
Employee Stock Purchase Plan
Expected life, years	0.5-2.0		0.5-2.0		0.5-2.0		0.5-2.0
Expected volatility, %	25.79-34.36%		29.56-39.69%		25.79-37.53%		29.56-42.16%
Risk free interest rate, %	0.12-0.79%		0.03-0.53%		0.03-0.79%		0.03-0.53%
Estimated forfeiture rate %	—	%	—	%	—	%	—	%
Dividend yield, %	—	%	—	%	—	%	—	%

Stock Option Activity under the Equity Incentive Plans

The following table summarizes the stock option activity under the Company’s equity incentive plans during the nine months ended September 30, 2015:

	Number of Shares		Weighted-Average Exercise Price		Weighted-Average Remaining Years	Aggregate Intrinsic Value(1)
	(In thousands, except per share data)
Stock Options
Outstanding at December 31, 2014	2,672		$	19.02	6.5
Granted	322		34.90
Exercised	(494	)	15.90
Expired	(2	)	15.72
Forfeited	(81	)	23.82
Outstanding at September 30, 2015	2,417		$	21.61	6.5	$	24,341
Exercisable at September 30, 2015	1,368		$	16.73	4.8	$	19,660
Vested and expected to vest at September 30, 2015 and thereafter	2,390		$	21.50	6.4	$	24,293

_________________________________________________

⁽¹⁾  Intrinsic value is calculated as the difference between the market value or closing price of our common stock as of the last trading day of the period as reported by the NASDAQ Global Select Market, and the exercise price of the option.

Restricted Stock Units Activity under the Stock Option Activity under the Equity Incentive Plans

Restricted stock activity under the Company’s equity incentive plans in the nine months ended September 30, 2015 is as follows:

	Number of Shares		Weighted-Average Grant Date Fair Value		Weighted-Average Remaining Years	Aggregate Intrinsic Value
	(In thousands, except per share data)
Restricted Stock Units (RSUs)
Outstanding at December 31, 2014	399		$	24.00	1.5
Granted	131		34.72
Vested	(99	)	21.51
Forfeited	(29	)	23.79
Outstanding and unvested at September 30, 2015	402		$	28.10	1.3	$	12,503
Expected to vest after September 30, 2015	392				1.2	$	12,181

Restricted Stock Units Award under the Stock Option Activity under the Equity Incentive Plans

	Number of Shares		Weighted-Average Grant Date Fair Value
	(In thousands, except per share data)
Restricted Stock Awards (RSAs)
Outstanding at December 31, 2014	36		$	26.47
Granted	37		36.05
Vested	(41	)	26.47
Forfeited	(1	)	27.65
Outstanding and unvested at September 30, 2015	31		$	35.95

Performance Shares Restricted Stock Activity under the Stock Option Activity under the Equity Incentive Plans

Performance-based restricted stock activity under our equity incentive plans in the nine months ended September 30, 2015 is as follows:

	Number of Shares		Weighted-Average Grant Date Fair Value Per Unit
	(In thousands, except per share data)
Performance-based Restricted Stock Units (PSUs)
Outstanding at December 31, 2014	233		$	17.96
Granted	60		29.56
Vested	(70	)	18.91
Forfeited	(27	)	14.69
Outstanding and unvested at September 30, 2015	196		$	21.63

Shares Reserved for Future Issuance under the Stock Option Activity under the Equity Incentive Plans

We had the following ordinary shares reserved for future issuance under our equity incentive plans as of June 30, 2015:

	Number of Shares
	(In thousands)
Share options outstanding	2,417
Restricted share awards outstanding	629
Shares authorized for future issuance	4,402
ESPP shares available for future issuance	3,251
Total shares reserved for future issuance as of September 30, 2015	10,699