XML 36 R22.htm IDEA: XBRL DOCUMENT v3.22.0.1
Employee Benefits and Share-Based Compensation
 12 Months Ended
Dec. 31, 2021
Share-based Payment Arrangement [Abstract]  
Employee Benefits and Share-Based Compensation Employee Benefits and Share-Based Compensation
Stock Purchase Plan
1997 Employee Stock Purchase Plan
The Company has an Employee Stock Purchase Plan (“ESPP”), under which employees can purchase shares of its common stock based on a percentage of their compensation, but not greater than 15% of their earnings; provided, however, an eligible employee’s right to purchase shares of the Company’s common stock may not accrue at a rate which exceeds $25,000 of the fair market value of such shares for each calendar year in which such rights are outstanding. The purchase price per share must be equal to the lower of 85% of the fair value of the common stock at the beginning of a 24-month offering period or the end of each six-month purchasing period.
There was a total of 0.9 million shares reserved for future issuance under the ESPP as of December 31, 2021.
Stock Award Plans
2009 Equity Incentive Plan
The 2009 Equity Incentive Plan (“2009 Plan”), as amended, provides for the issuance of incentive stock options, RSAs, RSUs, PSUs, and other stock awards to the Company’s employees, directors, and consultants. There were 5.5 million shares of common stock reserved for future issuance under the 2009 Plan as of December 31, 2021.
Options granted under the 2009 Plan generally become exercisable over periods of up to four years, with one-fourth of the shares vesting one year from the vesting commencement date with respect to initial grants, and the remaining shares vesting in 36 equal monthly installments thereafter. The exercise prices of the options is the fair market value of common stock on the date of grant. RSUs generally vest over periods of up to four years, with one-fourth of the shares vesting one year from the vesting commencement date with respect to initial grants, and the remaining shares vesting in 12 equal quarterly installments thereafter. Awards of restricted stock to non-employee directors are granted on the date of the annual meeting of stockholders and vest in full on the date of the next annual meeting of stockholders, provided such non-employee director remains a director on such date. The fair value of the awards on the date of issuance is amortized to expense from the date of grant to the date of vesting and are expensed ratably on a straight-line basis over the vesting period. PSUs granted to the Company’s executives might include performance and market conditions. PSUs become eligible for vesting when certain market or performance conditions are met.
Share-Based Compensation Expense
The following table sets forth the total share-based compensation expense recognized in the Company’s Consolidated Statements of Operations:
Year Ended December 31,
202120202019
(In thousands)
Cost of product and service revenues$7,994 $7,469 $5,648 
Research and development7,663 6,497 6,604 
Selling, general, and administrative37,503 30,731 21,797 
Total share-based compensation expense$53,160 $44,697 $34,049 
The Company did not capitalize any material share-based compensation amounts to inventory, capitalized software, or internal-use software for the years ended December 31, 2021 and 2020. Income tax benefits realized from share-based compensation were $26.6 million, $10.3 million, and $11.0 million, for the years ended December 31, 2021, 2020, and 2019, respectively.
ESPP
The following assumptions were used to value shares granted under the ESPP for the years ended December 31, 2021, 2020, and 2019:
Year Ended December 31,
202120202019
Expected life, years
0.5 - 2.0
0.5 - 2.0
0.5 - 2.0
Expected volatility, %
27.4% - 53.5%
30.4% - 53.5%
28.2% - 39.9%
Risk-free interest rate, %
0.1% - 2.6%
0.1% - 2.7%
1.3% - 2.7%
Dividend yield, %— %— %— %
For the years ended December 31, 2021 and 2020, employees purchased approximately 287,000 and 333,000 shares of common stock, respectively, under the ESPP at a weighted-average price of $62.14 and $48.77, respectively. As of December 31, 2021, the unrecognized compensation cost related to the shares to be purchased under the ESPP was approximately $1.9 million and is expected to be recognized over a weighted-average period of 1.3 years.
Stock Options
The following assumptions were used to value stock options granted pursuant to the 2009 Plan for the years ended December 31, 2021, 2020, and 2019:
Year Ended December 31,
202120202019
Expected life, years4.94.74.4
Expected volatility, %31.5 %39.4 %33.7 %
Risk-free interest rate, %0.9 %0.7 %2.0 %
Estimated forfeiture rate, %7.9 %5.7 %7.2 %
Dividend yield, %— %— %— %
The following table summarizes the stock option activity under the 2009 Plan during the year ended December 31, 2021:
Number of
Shares
Weighted-Average
Exercise Price
Weighted-Average
Remaining Years
Aggregate
Intrinsic Value
(In thousands, except per share data)
Outstanding at December 31, 20203,932 $62.50 7.8$226,160 
Granted160 129.21 
Exercised(901)54.99 
Expired(14)62.58 
Forfeited(223)76.57 
Outstanding at December 31, 20212,954 $67.35 6.9$334,119 
Exercisable at December 31, 20211,636 $55.13 6.0$204,949 
Vested and expected to vest at December 31, 2021 and thereafter2,845 $66.67 6.9$323,666 
The weighted-average fair value per share of options granted during the years ended December 31, 2021, 2020, and 2019 was $35.17, $26.48, and $23.54, respectively. The intrinsic value of options exercised during the years ended December 31, 2021, 2020, and 2019 was $88.0 million, $39.8 million, and $32.8 million, respectively. The tax benefit realized from stock options exercised was $18.3 million, $7.1 million, and $6.3 million, for the years ended December 31, 2021, 2020, and 2019, respectively.
As of December 31, 2021, total unrecognized compensation cost related to unvested stock options was $33.8 million, which is expected to be recognized over a weighted-average vesting period of 2.2 years.
Restricted Stock Units (“RSU”)
The following table summarizes the RSU activity under the 2009 Plan during the year ended December 31, 2021:
Number of
Shares
Weighted-Average
Grant Date Fair Value
Weighted-Average
Remaining Years
Aggregate
Intrinsic Value
(In thousands, except per share data)
Outstanding at December 31, 2020580 $72.87 1.6$69,670 
Granted (Awarded)481 149.65 
Vested (Released)(224)74.50 
Forfeited(74)81.79 
Outstanding and unvested at December 31, 2021763 $119.93 1.6$137,696 
The weighted-average grant date fair value per share of RSUs granted during the years ended December 31, 2021, 2020, and 2019 was $149.65, $74.52, and $78.49, respectively. The total fair value of RSUs that vested in the years ended December 31, 2021, 2020, and 2019 was $16.7 million, $11.2 million, and $10.6 million, respectively.
As of December 31, 2021, total unrecognized compensation cost related to RSUs was $76.8 million, which is expected to be recognized over the remaining weighted-average vesting period of 3.1 years.
Restricted Stock Awards (“RSAs”)
The following table summarizes the RSA activity under the 2009 Plan during the year ended December 31, 2021:
Number of
Shares
Weighted-Average
Grant Date Fair Value
(In thousands, except per share data)
Outstanding at December 31, 202021 $68.11 
Granted (Awarded)11 137.36 
Vested (Released)(21)68.11 
Outstanding and unvested at December 31, 202111 $137.36 
The weighted-average grant date fair value per share of RSAs granted during the years ended December 31, 2021, 2020, and 2019 was $137.36, $68.11, and $81.86, respectively. The total fair value of RSAs that vested in the years ended December 31, 2021, 2020, and 2019 was $1.4 million, $1.4 million, and $1.0 million, respectively.
As of December 31, 2021, total unrecognized compensation cost related to RSAs was $0.6 million, which is expected to be recognized over the remaining weighted-average vesting period of 0.4 years.
Performance-Based Stock Unit Awards (“PSUs”)
During the year ended December 31, 2020, the Company granted 62,759 PSUs to its executive officers, all of which became eligible for vesting upon the achievement of a certain level of shareholder return. During the year ended December 31, 2021, the Company granted 51,110 PSUs to its executive officers, of which 0% to 200% may become eligible for vesting depending on the level of shareholder return for the period from March 1, 2021 through March 1, 2022.
The number of shares that vest at the end of the performance period depends on the percentile ranking of the total shareholder return for Omnicell stock over the performance period relative to the total shareholder return of each of the other companies in the NASDAQ Healthcare Index (the “Index”). Stock price appreciation is calculated based on the trailing 20-day average stock price just prior to the first trading day of March in the grant year, compared to the trailing 20-day average stock price just prior to the first trading day of March in the year subsequent to the grant year. The fair value of PSU awards to executive officers is determined using a Monte Carlo simulation model.
PSUs generally vest over periods of up to four years, with one-fourth of the shares vesting approximately one year from the vesting commencement date with respect to initial grants and upon confirmation by the Compensation Committee that the performance target has been met, and the remaining shares vesting in six equal semi-annual installments thereafter. Vesting is contingent upon continued service.
In addition to executive officers’ PSU awards, from time to time, the Company may grant PSUs with specific performance and service conditions to certain employees on an ad hoc basis. Historically such grants have not been material.
The following table summarizes the PSU activity under the 2009 Plan during the year ended December 31, 2021:
Number of
Shares
Weighted-Average
Grant Date Fair Value Per Unit
(In thousands, except per share data)
Outstanding at December 31, 2020155 $74.26 
Granted68 162.16 
Vested(66)67.66 
Forfeited(13)72.89 
Outstanding and unvested at December 31, 2021144 $118.71 
The weighted-average grant date fair value per share of PSUs granted during the years ended December 31, 2021, 2020, and 2019 was $162.16, $82.17, and $73.38, respectively. The total fair value of PSUs that vested in the years ended December 31, 2021, 2020, and 2019 was $4.4 million, $3.7 million, and $3.5 million, respectively.
As of December 31, 2021, total unrecognized compensation cost related to PSUs was approximately $7.5 million, which is expected to be recognized over the remaining weighted-average vesting period of 1.2 years.
Summary of Shares Reserved for Future Issuance under Equity Incentive Plans
The Company had the following ordinary shares reserved for future issuance under its equity incentive plans as of December 31, 2021:
Number of Shares
(In thousands)
Share options outstanding2,954 
Non-vested restricted stock awards918 
Shares authorized for future issuance1,637 
ESPP shares available for future issuance919 
Total shares reserved for future issuance6,428 
401(k) Plan
The Company has established a pre-tax savings plan under Section 401(k) of the Internal Revenue Code of 1986, as amended. The 401(k) Plan allows eligible employees in the United States to voluntarily contribute a portion of their pre-tax salary, subject to a maximum limit specified in the Internal Revenue Code. The Company matches 50% of employee contributions up to $3,000, annually. The Company’s contributions under this plan were $6.8 million, $5.7 million, and $5.1 million in the years ended December 31, 2021, 2020, and 2019, respectively.