Enom 2012 Annual Report Download - page 110

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F-27
vest quarterly over a 3 or 4-year period. Certain stock options and restricted stock awards have accelerated vesting provisions
in the event of a change in control or termination without cause.
Valuation of Awards
The per share fair value of stock options granted with service and/or performance conditions was determined on the
date of grant using the Black-Scholes option pricing model with the following assumptions:
Year ended
December 31,
2010
Year ended
December 31,
2011
Year ended
December 31,
2012 (1)
Expected life (in years) 6.27 5.50 NA
Risk-free interest rate 1.31-2.83 1.46-2.30 NA
Expected volatility range 54-56% 56% NA
Weighted average expected volatility 56% 56% NA
Expected dividend yield —% —% NA
(1) The Company did not grant any stock options to employees during the year ended December 31, 2012.
The expected term of stock options granted represents the weighted average period that the stock options are expected
to remain outstanding. The Company determines the expected term assumption based on the Company's historical exercise
behavior combined with estimates of the post-vesting holding period. Expected volatility is based on historical volatility of
peer companies in the Company's industry that have similar vesting and contractual terms. The risk free interest rate is based on
the implied yield currently available on U.S. Treasury issues with terms approximately equal to the expected life of the option.
The Company currently has no history or expectation of paying cash dividends on its common stock.
The expected term for performance-based and non-employee awards is based on the period of time for which each
award is expected to be outstanding, which is typically the remaining contractual term.
Award Activity
Stock Options
Stock option activity for the year ended December 31, 2012 is as follows:
Number of
options
outstanding
Weighted
average
exercise
price
Weighted
average
remaining
contractual
term
(in years)
Aggregate
intrinsic
value
Outstanding at December 31, 2011 16,654 $ 13.21 7.53 $ 17,480
Options granted — —
Options exercised (3,747) 3.41
Options forfeited or canceled (1,061) 12.87
Outstanding at December 31, 2012 11,846 $ 16.34 6.93 $ 10,208
Exercisable at December 31, 2012 5,854 $ 8.92 6.31 $ 9,156
Vested and expected to vest at December 31, 2012 10,512 $ 15.38 6.85 $ 9,990
The pre-tax aggregate intrinsic value of outstanding and exercisable stock options is based on the difference between
the estimated fair value of the Company's common stock at December 31, 2011 and 2012 and their exercise prices, respectively
for all awards where the fair value of the Company's common stock exceeds the exercise price. Options expected to vest reflect
an estimated forfeiture rate.