Inogen, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Stockholders' Equity (Tables)

Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2019

The activity for stock options under the Company’s stock plans for the years ended December 31, 2019, 2018 and 2017 is as follows:

								Remaining
								weighted-
						Weighted-		average		Per share
						average		contractual		average
				Price per		exercise		terms		intrinsic
	Options			share		price		(in years)		value
Outstanding as of December 31, 2016		2,355,527		$0.60-$58.95		$	28.22		5.42	$	38.95
Granted		64,498			83.30		83.30
Exercised		(520,393	)	0.60-58.95			24.16
Forfeited		(63,173	)	24.52-58.95			43.74
Expired		(33	)		8.70		8.70
Outstanding as of December 31, 2017		1,836,426		0.60-83.30			30.77		4.58		88.31
Vested and exercisable as of December 31, 2017		1,176,504		0.60-83.30			24.33		4.39		94.75
Vested and expected to vest as of December 31, 2017		1,792,871		0.60-83.30			30.50		4.58		88.58
Outstanding as of December 31, 2017		1,836,426		0.60-83.30			30.77		4.58		88.31
Granted		—			—		—
Exercised		(708,319	)	0.60-58.95			24.22
Forfeited		(771	)	24.52-44.19			28.24
Expired		—			—		—
Outstanding as of December 31, 2018		1,127,336		0.75-83.30			34.89		3.84		89.28
Vested and exercisable as of December 31, 2018		851,039		0.75-83.30			32.12		3.75		92.05
Vested and expected to vest as of December 31, 2018		1,109,280		0.75-83.30			34.75		3.84		89.42
Outstanding as of December 31, 2018		1,127,336		0.75-83.30			34.89		3.84		89.28
Granted		—			—		—
Exercised		(109,291	)	0.75-58.95			28.45
Forfeited		(37,161	)	38.54-58.95			44.58
Expired		—			—		—
Outstanding as of December 31, 2019		980,884		0.75-83.30			35.24		2.84		34.07
Vested and exercisable as of December 31, 2019		929,825		0.75-83.30			34.73		2.81		34.64
Vested and expected to vest as of December 31, 2019		977,589		$0.75-$83.30		$	35.21		2.84	$	34.11

Summary of Restricted Stock Activity

Stock Awards activity for the years ended December 31, 2019 and December 31, 2018 are summarized below:

										Weighted-
										average
										grant
				Performance						date fair
				and						value
Restricted stock units	Time-based			time-based			Total			per share
Unvested restricted stock units as of December 31, 2016		—			—			—		$	—
Granted		42,028			13,109			55,137			90.05
Vested		—			—			—			—
Forfeited/canceled		—			—			—			—
Unvested restricted stock units as of December 31, 2017 ⁽¹⁾		42,028			13,109			55,137		$	90.05
Unvested and expected to vest restricted stock units outstanding as of December 31, 2017								48,589		$	89.95
Unvested restricted stock units as of December 31, 2017		42,028			13,109			55,137		$	90.05
Granted		31,877			—			31,877			143.50
Vested		(13,742	)		(4,370	)		(18,112	)		89.35
Forfeited/canceled		(1,574	)		—			(1,574	)		106.55
Unvested restricted stock units as of December 31, 2018 ⁽¹⁾		58,589			8,739			67,328		$	115.16
Unvested and expected to vest restricted stock units outstanding as of December 31, 2018								62,504		$	115.98
Unvested restricted stock units as of December 31, 2018		58,589			8,739			67,328		$	115.16
Granted		87,902			—			87,902			75.56
Vested		(24,680	)		(4,366	)		(29,046	)		123.53
Forfeited/canceled		(12,835	)		(1,239	)		(14,074	)		102.89
Unvested restricted stock units as of December 31, 2019 ⁽¹⁾		108,976			3,134			112,110		$	83.48
Unvested and expected to vest restricted stock units outstanding as of December 31, 2019								103,087		$	83.22

										Weighted-
										average
										grant
				Performance						date fair
				and						value
Restricted stock awards	Time-based			time-based			Total			per share
Unvested restricted stock awards outstanding as of December 31, 2016		—			—			—		$	—
Granted		20,789			20,785			41,574			91.52
Vested		—			—			—			—
Forfeited/canceled		—			—			—			—
Unvested restricted stock awards outstanding as of December 31, 2017 ⁽¹⁾		20,789			20,785			41,574		$	91.52
Unvested and expected to vest restricted stock awards outstanding as of December 31, 2017								34,051		$	91.52
Unvested restricted stock awards outstanding as of December 31, 2017		20,789			20,785			41,574		$	91.52
Granted		22,645			33,964			56,609			130.89
Vested		(6,497	)		(6,928	)		(13,425	)		91.52
Forfeited/canceled		—			—			—			—
Unvested restricted stock awards outstanding as of December 31, 2018 ⁽¹⁾		36,937			47,821			84,758		$	115.80
Unvested and expected to vest restricted stock awards outstanding as of December 31, 2018								65,773		$	115.85
Unvested restricted stock awards outstanding as of December 31, 2018		36,937			47,821			84,758		$	115.80
Granted		54,853			40,166			95,019			86.10
Vested		(13,627	)		(15,732	)		(29,359	)		115.37
Forfeited/canceled		(7,093	)		(9,627	)		(16,720	)		109.11
Unvested restricted stock awards outstanding as of December 31, 2019 ⁽¹⁾		71,070			62,628			133,698		$	95.74
Unvested and expected to vest restricted stock awards outstanding as of December 31, 2019								79,473		$	90.31

(1)	Outstanding restricted stock units and restricted stock awards are based on the maximum payout of the targeted number of shares.

Summary of Stock-based Compensation Expense

Stock-based compensation

Stock-based compensation expense recognized for the years ended December 31, 2019, 2018 and 2017, was as follows:

(amounts in thousands)	Years ended December 31,
Stock-based compensation expense by type of award:	2019		2018		2017
Stock option plan awards	$	2,977	$	6,015	$	7,652
Restricted stock units and restricted stock awards		5,413		5,890		1,447
Employee stock purchase plan		739		885		541
Total stock-based compensation expense	$	9,129	$	12,790	$	9,640

For the years ended December 31, 2019, 2018 and 2017, respectively, stock-based compensation expense recognized under ASC 718, included in cost of revenue, research and development expense, sales and marketing expense, and general and administrative expense was as follows:

	Years ended December 31,
(amounts in thousands)	2019		2018		2017
Cost of revenue	$	890	$	1,060	$	845
Research and development		1,100		1,314		1,015
Sales and marketing		1,755		2,355		1,558
General and administrative		5,384		8,061		6,222
Total stock-based compensation expense	$	9,129	$	12,790	$	9,640

Assumptions Applied to Estimate Fair Value of Stock Option Awards

The following table displays the assumptions that have been applied to estimate the fair value of stock option awards on the date of grant using the Black-Scholes option pricing model. During 2019 and 2018, the Company did not grant any stock option awards.

		2017
Expected term (years)		3.54-4.00
Risk free interest rate		1.65-1.73%
Expected dividend yield		None
Volatility		41.61-42.15%

Assumptions Applied to Estimate Fair Value of Shares Issued Under ESPP

The following table displays the assumptions that have been applied to estimate the fair value of the Company’s shares to be issued under the ESPP using the Black-Scholes option pricing model.

	2019		2018		2017
Expected term (years)		0.50		0.50		0.50
Risk free interest rate	1.75-2.53%		1.63-2.46%		1.15-1.63%
Expected dividend yield	None		None		None
Volatility	44.00-47.00%		37.34-44.00%		42.35-45.34%