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2000
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18666000
18666000
18668000
18668000
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194901000
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24000
136596000
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189298000
201000
80269000
14445000
8412000
22483000
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2242000
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3735000
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16383000
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41525000
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10500
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2200000
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10500
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3250000
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34563000
25947000
3599000
5017000
10052000
750000
3497000
1799000
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405700000
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In June 2013, the commercial agreement was amended to automatically renew for an additional year on an annual basis, unless otherwise terminated by either party 60 days prior to the end of the then-current renewal period. In December 2015, the commercial agreement was further amended to extend the current term until December 30, 2018, and thereafter, the commercial agreement will automatically renew for an additional year on an annual basis, unless otherwise terminated by either party 60 days prior to the end of the then-current renewal period.
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<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The following table summarizes the investments in
<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">available-for-sale</font></font> securities
(in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="64%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="14" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2017</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Amortized<br />
Costs</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Unrealized<br />
Gains</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Unrealized<br />
Losses</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Estimated<br />
Fair<br />
Value</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
U.S. Treasury bills</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">8,612</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">        4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">        —</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">8,616</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Certificates of deposit</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">750</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">750</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Commercial paper</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,498</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,806</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,805</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">Total investments in 
available-for-sale securities</font></font></p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,666</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,668</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="62%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="14" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Amortized<br />
Costs</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Unrealized<br />
Gains</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Unrealized<br />
Losses</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Estimated<br />
Fair<br />
Value</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
U.S. government securities</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,072</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">        —</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,072</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Certificates of deposit</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">960</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">        —</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">960</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Commercial paper</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">30,347</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(32</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">30,319</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">Total investments in 
available-for-sale securities</font></font></p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,876</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(32</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,848</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
172000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt">
<b><i>Basis of Presentation and Consolidation</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The consolidated financial statements have been
prepared in accordance with generally accepted accounting
principles (“GAAP”) in the United States
(“U.S.”) and include the accounts of the Company and
its wholly owned subsidiaries. All intercompany transactions and
balances have been eliminated in consolidation.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b>4. BUSINESS COMBINATIONS</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt">
<b><i>Transactions completed in 2017 and 2016</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company did not complete any acquisitions
during the years ended December 31, 2017 and 2016.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Transactions completed in 2015</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify"><b><i>Onyara, Inc.</i></b> On August 31, 2015,
the Company acquired Onyara, Inc. (“Onyara”), the
creator of and key contributor to Apache NiFi. The acquisition
enables customers to automate and secure data flows and to collect,
conduct and curate real-time business insights and actions derived
from data in motion. As a result of the acquisition, the
Company introduced HDF powered by Apache NiFi, which simplifies and
accelerates the flow of data in motion into HDP for full fidelity
analytics.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The acquisition date fair value of the purchase
consideration was $26.5 million, which included the following
(in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="89%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock (921,643 shares at fair value of $23.76 per share)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">21,898</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Holdback of 194,259 shares of common stock for a period of 12
months for general representations and warranties</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,616</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">26,514</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The total purchase consideration of
$26.5 million exceeded the estimated fair value of the net
tangible and identifiable intangible assets and liabilities
acquired. Prior to the acquisition, Apache NiFi was open sourced in
November 2014 as part of the National Security Agency Technology
Transfer Program. As a result, no technology was acquired and the
Company recorded goodwill of $26.4 million in connection with
this transaction. The goodwill is attributable to the synergies
expected from combining Onyara’s operations with the
Company’s operations. The goodwill is not deductible for tax
purposes.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Under the terms of the agreement, all outstanding
shares of Onyara’s capital stock, options to purchase Onyara
capital stock and any other securities convertible into,
exercisable for or exchangeable for shares of Onyara capital were
canceled in exchange for an aggregate of approximately
1.6 million shares of the Company’s common stock with a
fair value of approximately $38.5 million. Of these shares,
1.1 million shares with a fair value of approximately
$26.5 million were allocated to purchase consideration. The
remaining 0.5 million shares with a fair value of
approximately $12.0 million were considered post-combination
remuneration which will be recorded as stock-based compensation
expense over the vesting period of up to three years. The vesting
of these RSUs is contingent upon continued employment. The related
acquisition costs, consisting primarily of legal expenses in the
amount of $0.4 million during the year ended December 31,
2015, were expensed as incurred.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The following table summarizes the allocation of
the consideration paid of approximately $26.5 million to the
fair values of the assets acquired and liabilities assumed at the
acquisition date (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="68%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="84%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Goodwill</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">26,429</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">180</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Tangible liabilities acquired</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(95</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">26,514</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">In connection with the acquisition, the Company
also issued RSUs covering 0.2 million shares of the
Company’s common stock with a fair value of approximately
$5.2 million, which is being recognized as stock-based
compensation expense as the RSUs vest over three years. The vesting
of these RSUs is contingent upon continued employment. As such, the
Company will account for such payments as post-combination
remuneration, to be recognized in operating expenses in the
consolidated statements of operations as the services are
performed.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The results of operations of Onyara have been
included in the Company’s consolidated statements of
operations from the acquisition date.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><b><i>SequenceIQ.</i></b> On April 23, 2015,
the Company acquired 100 percent of the voting shares of
SequenceIQ Hungary Kft. (“SequenceIQ”), an open source
provider of rapid deployment tools for Hadoop, to deliver a
consistent and automated solution for launching <font style="WHITE-SPACE: nowrap">on-demand</font> Hadoop clusters in the cloud
or to any environment that supports Docker containers. This
acquisition complements the Company’s strategy of providing
enterprise customers the broadest choice of consumption options for
HDP, from <font style="WHITE-SPACE: nowrap">on-premises</font>
deployments to cloud architectures.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The acquisition of SequenceIQ was accounted for as
the purchase of a business. The related acquisition costs,
consisting primarily of consulting and legal expenses, were not
material during the year ended December 31, 2015 and were
expensed as incurred.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The acquisition date fair value of the purchase
consideration was $10.0 million, which included the following
(in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="90%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,721</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash holdback for a period of 15 months for general representations
and warranties</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,875</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash payable upon <font style="WHITE-SPACE: nowrap">18-month</font>
anniversary of closing date</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,651</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Contingent consideration</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,625</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Vested RSUs (49,102 shares at fair value of $21.97 per share)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,079</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,951</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company estimated the acquisition date fair
value of the contingent consideration payable of $1.6 million
based on various estimates including a discount rate based on the
estimated timing of achievement of product milestones, the
probability of achievement and other factors, all of which the
Company believes are appropriate and representative of market
participant assumptions. Upon the achievement of product milestones
in January 2016, the Company paid the fair value of the contingent
consideration liability of $1.7 million.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company also issued to the selling shareholders
RSUs covering 114,583 shares of the Company’s common stock
that vest over a period of up to three years. The vesting of the
additional RSUs is contingent upon the continued employment of the
selling shareholders that were retained as employees. As such, the
Company accounted for such payments as post-combination
remuneration, to be recognized in operating expenses in the
consolidated statements of operations as the services are
performed.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The acquisition of SequenceIQ provided the Company
with developed technology. The Company determined that the fair
value of the developed technology was approximately
$4.4 million using the cost approach. The cost approach
reflects the amount that would be required at the acquisition date
to replace the service capacity of an asset. The assumptions
underlying the fair value calculation include: the labor required
using a burdened overhead rate, the development period, a
developer’s profit based on the operating profitability of
market participants and the opportunity cost based on the estimated
required return on investment over the development period using
venture capital rates of return and private capital rates of return
for enterprises at a similar stage of development as SequenceIQ. A
deferred tax liability related to the fair value of the developed
technology obtained in the acquisition was also recognized. The
Company recognized goodwill of $5.8 million equal to the
excess of the purchase consideration over the fair value of the
assets acquired and the liabilities assumed inclusive of
approximately $0.4 million related to a deferred tax liability
recognized in the acquisition. The goodwill is attributable to the
synergies expected from combining SequenceIQ’s operations
with the Company’s operations. The goodwill is not deductible
for tax purposes.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following table summarizes the allocation of
the consideration paid of approximately $10.0 million to the
fair values of the assets acquired and liabilities assumed at the
acquisition date (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="68%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="86%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Tangible assets acquired, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">191</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Developed technology</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,395</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Goodwill</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,785</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Deferred tax liabilities, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(420</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,951</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The results of operations of SequenceIQ have been
included in the Company’s consolidated statements of
operations from the acquisition date.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company’s business combinations completed
during the year ended December 31, 2015 did not have a
material impact on the Company’s consolidated financial
statements and therefore, actual and pro forma disclosures have not
been presented.</p>
</div>
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b>13. 401(K) PLAN</b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">The Company has a qualified defined contribution
plan under Section 401(k) of the Internal Revenue Code
covering eligible employees. To date, the Company has not made any
matching contributions to this plan.</p>
</div>
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b><i>Concentration of Risk</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">
<b><i>Credit Risk</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman" align="justify">Financial instruments, which potentially subject
the Company to concentration of credit risk, consist primarily of
cash and cash equivalents and investments. The Company places its
cash and cash equivalents with major financial institutions, which
management assesses to be of high-credit quality.</p>
<p style="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman" align="justify">The Company’s investment policies limit
investments to those that are investment grade, liquid securities
and restricts placement of these investments to issuers evaluated
as creditworthy.</p>
<p style="font-size:18pt;margin-top:0pt;margin-bottom:0pt">
 </p>
<p style="margin-top:0pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">
<b><i>Concentration of Revenue and Accounts Receivable</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman" align="justify">The Company generally does not require collateral
or other security in support of accounts receivable. Allowances are
provided for individual accounts receivable when the Company
becomes aware of a customer’s inability to meet its
financial obligations, such as in the case of bankruptcy,
deterioration in the customer’s operating results or change
in financial position. If circumstances related to customers
change, estimates of the recoverability of receivables would be
further adjusted. The Company also considers broad factors in
evaluating the sufficiency of its allowances for doubtful accounts,
including the length of time receivables are past due, significant
<font style="white-space:nowrap">one-time</font> events,
creditworthiness of customers and historical experience.</p>
<p style="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman" align="justify">Significant customers are those which represent
10 percent or more of the Company’s total revenue or
gross accounts receivable balance for each respective consolidated
statement of operations and consolidated balance sheet period. For
the years ended December 31, 2017, 2016 and 2015, there were
no customers that represented 10 percent or more of the
Company’s total revenue.</p>
<p style="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman" align="justify">As of both December 31, 2017 and 2016, there
were no customers that represented 10 percent or more of the
Company’s gross accounts receivable balance.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Cash and Cash Equivalents</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Cash and cash equivalents consist of cash, money
market funds, U.S. Treasury bills, commercial paper, and corporate
notes and bonds with original maturities of three months or less at
the time of purchase.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Operating cash deposits held with banks may exceed
the amount of insurance provided on such deposits. Generally, these
deposits may be redeemed upon demand and are maintained with
financial institutions with reputable credit and therefore bear
minimal credit risk. The Company seeks to mitigate its credit risk
by spreading such risk across multiple counterparties and
monitoring the risk profiles of these counterparties.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Restricted Cash</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Restricted cash includes collateral used to secure
a credit card, and may not be used or transferred until the
restriction is released by the issuing bank. Restricted cash also
includes amounts to secure letters of credit issued in lieu of
deposits on office space.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b>7. COMMITMENTS AND CONTINGENCIES</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Operating Leases</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company has many operating lease agreements
primarily involving office space facilities. These leases
are <font style="WHITE-SPACE: nowrap">non-cancelable</font> with
original lease periods up to 15 years, which expire between 2018
and 2031. Some of these operating lease agreements have free or
adjustable rent provisions. Lease expense is recognized on a
straight-line basis over the lease term. The Company subleases some
excess capacity to subtenants under <font style="WHITE-SPACE: nowrap">non-cancelable</font> operating
leases.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">As of December 31, 2017, future minimum lease
commitments under <font style="WHITE-SPACE: nowrap">non-cancelable</font> leases
are as follows (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="68%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="84%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom" nowrap="nowrap">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 8pt; FONT-FAMILY: "Times New Roman"; WIDTH: 95.55pt; BORDER-BOTTOM: rgb(0,0,0) 1pt solid; MARGIN-TOP: 0pt; DISPLAY: inline">
<b>Years Ending December 31,</b></p>
</td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>Leases</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
2018</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">5,942</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
2019</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2,741</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
2020</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,702</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
2021</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,097</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
2022</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">429</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Thereafter</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">3,735</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Gross lease payments</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">15,646</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Less: <font style="WHITE-SPACE: nowrap">Non-cancelable</font> subtenant
receipts</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(604</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Net lease payments</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">15,042</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Rent expense incurred under operating leases for
the years ended December 31, 2017, 2016 and 2015 was
$9.0 million, $9.9 million and $8.0 million,
respectively.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Legal Proceedings</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">From time to time, the Company is party to various
litigation and administrative proceedings relating to claims
arising from its operations in the normal course of business. Based
on the information presently available, including discussion with
legal counsel, management believes that resolution of these matters
will not have a material effect on the Company’s business,
results of operations, financial condition or cash flows.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">On February 29, 2016, a putative class action
lawsuit alleging violations of federal securities laws was filed in
the U.S. District Court for the Northern District of California,
captioned<i> Monachelli v. Hortonworks, Inc</i>.,
Case <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">No. 3:16-cv-00980-SI. The</font></font></font> lawsuit
names as defendants the Company, Robert G. Bearden, and Scott J.
Davidson. Plaintiffs allege that the defendants violated
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by
allegedly making materially false and misleading statements
regarding the Company’s business and operations. On
June 1, 2016, the court entered an order appointing a lead
plaintiff and lead counsel. On July 28, 2016, the lead
plaintiff and another named plaintiff filed an amended complaint
seeking to represent a class of persons who purchased or otherwise
acquired Hortonworks’ securities between August 5, 2015
and January 15, 2016, inclusive, and seeking class
certification, an award of unspecified compensatory damages, an
award of reasonable costs and expenses, including attorneys’
fees, and other further relief as the court may deem just and
proper. On December 5, 2016, the court granted
defendants’ motion to dismiss the amended complaint, with
leave to amend. The parties thereafter engaged in settlement
negotiations and have agreed to a class-wide settlement that would
not have a material effect on the Company’s financial
statements. On October 10, 2017, the Court issued an order and
final judgment granting approval of the proposed settlement and
dismissing the matter with prejudice.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">On April 13, 2017, a derivative action was
filed in the Court of Chancery of the State of Delaware,
captioned <i>Steinberg v. Bearden, et al.</i>,
Case No. <font style="WHITE-SPACE: nowrap">2017-0286-AGB,</font> purportedly
filed by a Hortonworks shareholder on behalf of the Company against
certain of the Company’s directors and executive officers.
The derivative complaint alleges that the defendants breached their
fiduciary duties to the Company and allegedly made false or
misleading statements regarding the Company’s business and
operations. The derivative action includes claims for, among other
things, unspecified damages in favor of the Company, corporate
actions to purportedly improve the Company’s corporate
governance, and an award of costs and expenses to the derivative
plaintiffs, including attorneys’ fees. On July 3, 2017,
defendants filed a motion to dismiss the complaint. The motion is
now fully briefed, and a hearing on that motion is currently
scheduled for March 27, 2018. Because the action is in the
early stages of the litigation process, the Company is unable to
assess whether any loss or adverse effect on its financial
condition is probable or remote or to estimate the range of
potential loss, if any.</p>
</div>
Each share of common stock is entitled to one vote for matters to be voted on by the stockholders of the Company.
9407000
-203663000
0
2793000
2816000
81095000
23000
30741000
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b><i>Cost of Revenue</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">Cost of support subscription revenue consists
primarily of personnel costs (including cash compensation, benefits
and stock-based compensation expense) for employees, including
support engineers, associated with the Company’s support
subscription offerings mainly related to technology support and
allocated shared costs. Cost of professional services revenue
consists primarily of personnel costs (including cash compensation,
benefits and stock-based compensation expense) for employees and
fees to subcontractors associated with the Company’s
professional service contracts, travel costs and allocated shared
costs.</p>
<p style="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">The Company allocates shared costs such as rent,
information technology and employee benefits to all departments
based on headcount. As such, allocated shared costs are reflected
in cost of revenue and each operating expense category. Cost of
revenue for support subscription and professional services is
expensed as incurred.</p>
</div>
--12-31
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b>8. DEBT</b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b><i>Amended and Restated Revolving Credit Agreement</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">On November 2, 2016, the Company entered into
a $30.0 million senior secured revolving credit facility (the
“Original Credit Agreement”) with Silicon Valley Bank
(the “Bank”), and on November 1, 2017, the Company
amended its Original Credit Agreement to increase its borrowing
capacity to $50.0 million, documented as an amendment and
restatement of its <font style="white-space:nowrap">two-year</font>
senior secured revolving credit facility (as amended and restated,
the “Amended and Restated Credit Agreement”). Amounts
outstanding under the Amended and Restated Credit Agreement are
payable on or before November 1, 2020 and will accrue interest
per annum at a rate equal to the London Interbank Offered Rate plus
3.50 percent. Pursuant to the terms of the Amended and
Restated Credit Agreement, the Company agreed to pay an annual
facility fee equal to 0.50 percent of the aggregate amount of
the revolving credit facility commitments and an unused line fee of
0.45 percent per annum on the unused commitments. In addition,
the Company is required to maintain a balance of at least
$15.0 million on account with the Bank. The Amended and
Restated Credit Facility currently has no subsidiary
guarantors.</p>
<p style="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">The Amended and Restated Credit Agreement contains
customary negative covenants and certain financial covenants that
require the Company to maintain a minimum trailing <font style="white-space:nowrap">12-month</font> <font style="white-space:nowrap">non-GAAP</font> operating profit and a minimum
adjusted quick ratio.</p>
<p style="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">As of December 31, 2017, the Company had no
borrowings outstanding under the Amended and Restated Credit
Agreement and was in compliance with all financial covenants.</p>
</div>
The Company has a number of operating lease agreements primarily involving office space and data center facilities. These leases are non-cancelable with original lease periods up to 15 years, which expire between 2017 and 2031. Some of these operating lease agreements have free or adjustable rent provisions. Lease expense is recognized on a straight-line basis over the lease term. The Company subleases some excess capacity to subtenants under non-cancelable operating leases.
-330000
8786000
-3.08
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b>10. NET LOSS PER SHARE OF COMMON STOCK</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Basic net loss per share of common stock is
calculated by dividing net loss by the weighted-average number of
shares of common stock outstanding during the period, less
restricted common stock and common stock issued that is subject to
repurchase, and excludes any dilutive effects of share-based
awards. Diluted net loss per share of common stock is computed
giving effect to all potential dilutive shares of common stock. As
the Company had net losses for the years ended December 31,
2017, 2016 and 2015, all potential shares of common stock were
determined to be anti-dilutive.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following table sets forth the computation of
basic and diluted net loss per share (in thousands, except share
and per share amounts):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="64%"></td>
<td valign="bottom" width="2%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="2%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="2%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Net loss</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(204,507</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(251,688</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(179,117</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Weighted-average shares used in computing net loss per share of
common stock</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">66,356,474</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">57,203,067</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">43,318,044</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Net loss per share, basic and diluted</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(3.08</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(4.40</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(4.13</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following outstanding shares of common stock
equivalents were excluded from the computation of diluted net loss
per share of common stock for the periods presented because
including them would have been anti-dilutive:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="61%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>As of
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock warrants</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,250,000</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,250,000</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,250,000</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Exercise and conversion of common stock warrants</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock subject to repurchase</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,500</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">30,708</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">55,603</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Outstanding stock options</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,490,445</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">7,430,094</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">11,552,487</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested restricted stock</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">137,919</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">275,835</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">789,982</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested RSUs</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,579,841</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,836,508</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,169,301</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested PSUs</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">839,857</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">424,503</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">683,318</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Estimated ESPP shares to be issued</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">292,978</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">442,992</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">151,468</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">19,077,908</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23,167,008</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">22,128,527</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
-0.0123
FY
2017
10-K
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b><i>Net Loss Per Share of Common Stock</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">Basic net loss per share of common stock is
calculated by dividing the net loss by the weighted-average number
of common shares outstanding during the period, less restricted
common stock and common stock issued that is subject to repurchase,
and excludes any dilutive effects of share-based awards. Diluted
net loss per share of common stock is the same as basic net loss
per share of common stock, because the effects of potentially
dilutive securities are anti-dilutive.</p>
</div>
0.3400
0.0141
-0.0139
-0.0016
1648000
2017-12-31
0.0228
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The following table sets forth the fair value of
the Company’s financial assets measured on a recurring basis
by level within the fair value hierarchy (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="76%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2017</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Level 1</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Level 2</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Total</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash equivalents:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Money market funds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">25,947</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">25,947</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
U.S. Treasury bills</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,599</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,599</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Commercial paper</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,799</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,799</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Short-term investments:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
U.S. Treasury bills</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,017</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,017</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Certificates of deposit</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">750</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">750</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,006</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,006</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total financial assets</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">34,563</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,052</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">44,615</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="76%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Level 1</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Level 2</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Total</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash equivalents:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Money market funds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">24,533</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">24,533</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Short-term investments:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
U.S. government securities</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,072</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,072</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Certificates of deposit</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">960</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">960</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Commercial paper</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">26,235</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">26,235</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Long-term investments:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,084</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,084</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total financial assets</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">24,533</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,848</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">60,381</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
Hortonworks, Inc.
No
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b>3. FAIR VALUE MEASUREMENTS</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The following table summarizes the investments in
<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">available-for-sale</font></font> securities
(in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="64%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="14" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2017</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Amortized<br />
Costs</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Unrealized<br />
Gains</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Unrealized<br />
Losses</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Estimated<br />
Fair<br />
Value</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
U.S. Treasury bills</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">8,612</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">        4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">        —</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">8,616</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Certificates of deposit</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">750</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">750</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Commercial paper</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,498</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,806</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,805</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">Total investments in 
available-for-sale securities</font></font></p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,666</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,668</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="62%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="14" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Amortized<br />
Costs</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Unrealized<br />
Gains</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Unrealized<br />
Losses</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Estimated<br />
Fair<br />
Value</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
U.S. government securities</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,072</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">        —</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,072</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Certificates of deposit</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">960</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">        —</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">960</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Commercial paper</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">30,347</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(32</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">30,319</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">Total investments in 
available-for-sale securities</font></font></p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,876</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(32</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,848</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The contractual maturities of investments in
<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">available-for-sale</font></font> securities
were as follows (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="64%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="14" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Amortized<br />
Cost</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Fair Value</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Amortized<br />
Cost</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Fair Value</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Due within one year</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,666</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,668</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">31,792</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">31,764</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Due after one year through five years</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,084</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,084</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total investments in <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">available-for-sale</font></font>
securities</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,666</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,668</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,876</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,848</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The following table sets forth the fair value of
the Company’s financial assets measured on a recurring basis
by level within the fair value hierarchy (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="76%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2017</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Level 1</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Level 2</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Total</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash equivalents:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Money market funds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">25,947</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">25,947</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
U.S. Treasury bills</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,599</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,599</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Commercial paper</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,799</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,799</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Short-term investments:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
U.S. Treasury bills</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,017</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,017</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Certificates of deposit</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">750</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">750</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,006</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,006</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total financial assets</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">34,563</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,052</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">44,615</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="76%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Level 1</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Level 2</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Total</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash equivalents:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Money market funds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">24,533</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">24,533</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Short-term investments:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
U.S. government securities</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,072</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,072</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Certificates of deposit</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">960</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">960</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Commercial paper</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,497</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">26,235</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">26,235</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Long-term investments:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Corporate notes and bonds</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,084</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,084</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total financial assets</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">24,533</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,848</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">60,381</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Where applicable, the Company uses quoted market
prices in active markets for identical assets to determine fair
value. This pricing methodology applies to Level 1
investments, which are composed of money market funds and U.S.
Treasury bills. If quoted prices in active markets for identical
assets are not available, then the Company uses quoted prices for
similar assets or inputs other than quoted prices that are
observable, either directly or indirectly. These investments are
included in Level 2 and consist of U.S. government securities,
certificates of deposit, commercial paper and corporate notes and
bonds. Commercial paper is valued using market prices, if
available, adjusting for accretion of the purchase price to face
value at maturity. The carrying amounts of accounts receivable,
prepaid expenses and other current assets, accounts payable,
accrued compensation and benefits and accrued expenses and other
current liabilities approximate fair value. In certain cases, where
there is limited activity or less transparency around inputs to
valuation, securities are classified as Level 3 within the
valuation hierarchy.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company entered into a three-year,
$2.5 million promissory note receivable with a third-party
service provider in February 2015, which bears interest at four
percent per annum. The promissory note receivable was valued on a
<font style="WHITE-SPACE: nowrap">non-recurring</font> basis and
was classified as <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">held-to-maturity</font></font> within
long-term investments. During the year ended
December 31, 2016, the Company recognized an
impairment charge of $2.7 million in operating expenses
related to the promissory note and related interest receivable as
the Company determined it was probable the promissory note and
related interest receivable were unrecoverable due to the
third-party service provider’s illiquidity and unfavorable
rate of cash use.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">A financial instrument’s categorization
within the valuation hierarchy is based upon the lowest level of
input that is significant to the fair value measurement. The
Company’s assessment of the significance of a particular
input to the fair value measurement in its entirety requires
management to make judgments and consider factors specific to the
asset or liability. During the years ended December 31, 2017
and 2016, the Company did not make any transfers between
Level 1 and Level 2 investments. As of December 31,
2017 and 2016, the Company did not have any Level 3 financial
assets or liabilities.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Gross unrealized gains and losses were not material
as of December 31, 2017 and 2016. Realized gains and losses
were not material for the years ended December 31, 2017, 2016
and 2015. As of December 31, 2017 and 2016, there were no
securities that were in an unrealized loss position for more than
12 months.</p>
</div>
0001610532
No
-0.4086
-0.0868
0.0224
Yes
Accelerated Filer
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Fair Value Measurement</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Fair value is defined as the price that would be
received to sell an asset or paid to transfer a liability in the
principal market (or most advantageous market, in the absence of a
principal market) for the asset or liability in an orderly
transaction between market participants at the measurement date.
Further, entities are required to maximize the use of observable
inputs and minimize the use of unobservable inputs in measuring
fair value, and to utilize a three-level fair value hierarchy that
prioritizes the inputs used to measure fair value. The three levels
of inputs used to measure fair value are as follows:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify"><i>Level</i><i> 1</i>—Quoted prices in
active markets for identical assets or liabilities.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><i>Level</i><i> 2</i>—Observable inputs
other than quoted prices included within Level 1, including
quoted prices for similar assets or liabilities in active markets;
quoted prices for identical or similar assets or liabilities in
markets that are not active; and inputs other than quoted prices
that are observable or are derived principally from, or
corroborated by, observable market data by correlation or other
means.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><i>Level</i><i> 3</i>—Unobservable
inputs that are supported by little or no market activity, are
significant to the fair value of the assets or liabilities, and
reflect the Company’s own assumptions about the assumptions
market participants would use in pricing the asset or liability
developed based on the best information available in the
circumstances.</p>
</div>
-1802000
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b><i>Foreign Currency</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">The remeasurement of foreign currencies creates
remeasurement adjustments that are included in the consolidated
statements of operations. For the year ended December 31,
2017, the net loss from remeasurement adjustments was
$3.1 million. For the years ended December 31, 2016 and
2015, the net gains from remeasurement adjustments were
immaterial.</p>
<p style="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">For subsidiaries with <font style="white-space:nowrap">non-U.S.</font> dollar functional currencies,
the impact of changes in foreign currency exchange rates resulting
from the translation of foreign currency financial statements into
U.S. dollars for financial reporting purposes is included in other
comprehensive gain (loss). Assets and liabilities are translated
into U.S. dollars at exchange rates in effect at the balance sheet
date. Income and expense items are translated at average rates for
the period. Foreign transaction gains and losses are recorded as
they are realized and were immaterial in 2017, 2016, and 2015.</p>
</div>
180715000
-349000
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b><i>Goodwill and Long-Lived Assets</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">Goodwill is tested for impairment on an annual
basis and between annual tests if events or circumstances indicate
that an impairment loss may have occurred. The test is based on a
comparison of the reporting unit’s book value to its
estimated fair market value. The annual impairment test is
performed by the Company during the fourth quarter of each fiscal
year using the opening consolidated balance sheet as of the first
day of the fourth quarter, with any resulting impairment recorded
in the fourth quarter of the fiscal year. During the year ended
December 31, 2017, the Company determined that the fair value
of its sole reporting unit exceeded its carrying value, and as a
result, no goodwill impairment was recorded in fiscal 2017. Since
the Company’s inception, goodwill has not been impaired.</p>
<p style="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">Long-lived assets (including property and
equipment) are reviewed for impairment whenever events or changes
in circumstances indicate that the carrying amount of such assets
may not be recoverable. In such instances, the recoverability of
assets to be held and used is measured first by a comparison of the
carrying amounts of the assets or asset groups to future
undiscounted net cash flows expected to be generated by the assets
or asset groups. If such assets or asset groups are considered to
be impaired, an impairment loss would be recognized if the carrying
amount of the assets or asset groups exceeds the fair value of the
assets or asset groups. During the year ended
December 31, 2016, the Company recognized an
impairment charge of $2.7 million in operating expenses due to
a promissory note and related interest receivable. During the year
ended December 31, 2016, the Company determined that it is
probable that the promissory note and related interest receivable
are unrecoverable due to our estimate of the third-party service
provider’s illiquidity and unfavorable rate of cash use.</p>
</div>
0
78282000
-157688000
-202021000
-44333000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b>11. INCOME TAXES</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The components of income tax expense for the years
ended December 31, 2017, 2016 and 2015 are as follows (in
thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="72%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="4%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Current:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Federal</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
State and local</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">23</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">67</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">58</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Foreign</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2,793</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,130</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">514</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total current tax expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2,816</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,197</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">572</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total deferred tax (benefit) expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(330</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">27</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(140</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Income tax expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2,486</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,224</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">432</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The components of loss before income taxes by
United States and foreign jurisdictions are as follows (in
thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="61%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top"><font style="FONT-FAMILY: "Times New Roman"">United States</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">$157,688</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">$209,882</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">$137,713</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top"><font style="FONT-FAMILY: "Times New Roman"">Foreign</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">44,333</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">40,582</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">40,972</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Loss before income tax</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">202,021</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">250,464</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">178,685</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Deferred income taxes reflect the net tax effects
of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used
for income tax purposes. Significant components of the
Company’s deferred tax assets are as follows (in
thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="69%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Deferred tax assets:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Net operating loss carryforwards</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">136,596</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">132,744</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Research and development credits</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">14,445</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">8,997</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Warrant expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">12,528</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">19,312</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Depreciation and amortization</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,191</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,105</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Accruals and reserves</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,206</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">3,005</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top"><font style="FONT-FAMILY: "Times New Roman"">Deferred revenue</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">14,000</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">9,093</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top"><font style="FONT-FAMILY: "Times New Roman"">Stock-based compensation
expense</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">8,412</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">15,865</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Other</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,145</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2,037</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Gross deferred tax assets</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">189,523</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">192,158</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Valuation allowance</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(189,298</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(192,152</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Intangibles</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(201</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(312</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Net deferred tax assets (liabilities)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">24</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(306</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The following is a reconciliation of the statutory
federal income tax rate to the Company’s effective tax
rate:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="75%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="4%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="4%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Tax at federal statutory rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">34.00</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">34.00</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">34.00</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
State and local taxes, net of federal benefit</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2.28</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2.54</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2.93</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Permanent differences and other items not individually
material</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(0.16</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(0.08</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(0.26</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Stock-based compensation expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1.39</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(8.24</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(2.29</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Credits</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2.24</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2.01</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">0.62</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Foreign tax differential</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(8.68</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(5.97</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(8.01</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Change in valuation allowance</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1.41</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(24.75</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(27.23</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Change in federal tax rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(40.86</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Adoption of ASU <font style="WHITE-SPACE: nowrap">2016-09</font></p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">7.15</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Income tax expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(1.23</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">)% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(0.49</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">)% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(0.24</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">)% </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company’s effective tax rate for the
period ended December 31, 2017 was lower than the statutory
tax rate primarily because of the valuation allowance on its U.S.
and foreign deferred tax assets and the losses of foreign
subsidiaries taxed at lower rates, partially offset by state taxes
and tax credits. The losses of the foreign subsidiaries were
generated primarily by the Company’s cost sharing agreement
with its Netherlands operations. The income tax expense for the
years ended December 31, 2017, 2016 and 2015 primarily relate
to state minimum income tax, <font style="WHITE-SPACE: nowrap">non-recoverable</font> withholding
tax and income tax on the Company’s earnings in foreign
jurisdictions.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">On December 22, 2017, the Tax Cuts and Jobs
Act (the “Act”) was signed into law. The new
legislation decreases the U.S. corporate federal income tax rate
from 35 percent to 21 percent effective January 1,
2018. The Company revalued its deferred tax assets and liabilities
accordingly. There was no net impact on recorded deferred tax
balances, as the remeasurement of net deferred tax assets was
offset by a change in valuation allowance. The Act imposes
a <font style="WHITE-SPACE: nowrap">one-time</font> deemed
repatriation tax on undistributed foreign earnings. The Company did
not have a deemed repatriation due to its foreign earnings
deficits. The Act also includes a number of other provisions
including the elimination of loss carrybacks and limitations on the
use of future losses, repeal of the alternative minimum tax regime
and the introduction of a base erosion and anti-abuse tax. These
provisions are not expected to have an immediate effect on the
Company.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Securities and Exchange Commission issued Staff
Accounting Bulletin No. 118 (“SAB 118”) on
December 23, 2017 regarding application of the Act. It
provides a “measurement period,” lasting through
December 22, 2018, to allow registrants time to obtain,
prepare and analyze information to complete the accounting required
under ASC 740, <i>Income Taxes</i>. While the
Company was able to make reasonable estimates under SAB 118 for the
impact of the reduction in the corporate tax rate and the deemed
repatriation transition tax as noted above, the Company has not
completed its analysis of other changes to the Act. The final
impacts of the Act may differ from the above estimates, possibly
materially, due to, among other things, changes in interpretations
of the Act, any legislative action to address questions that arise
because of the Act, any changes in accounting standards for income
taxes or related interpretations in response to the Act or any
updates or changes to estimates the Company has utilized under SAB
118. The Company will continue to analyze the impact of the Act as
additional information and guidance is provided and complete our
analysis within the measurement period in accordance with SAB
118.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">A valuation allowance is provided when it is more
likely than not that the deferred tax assets will not be realized.
The Company has established a valuation allowance to offset net
deferred tax assets at December 31, 2017 due to the
uncertainty of realizing future tax benefits from its NOL
carryforwards and other deferred tax assets. The net valuation
allowance decreased by approximately $2.9 million during the
year ended December 31, 2017. As of December 31, 2017,
the Company had NOL carryforwards for federal and state and local
tax purposes of approximately $525.3 million and
$405.7 million, respectively. The NOL carryforwards will
expire at various dates beginning in 2031 (federal) and 2018 (state
and local), unless previously utilized. The Company also has
federal and state research and development tax credit carryforwards
of approximately $11.8 million and $9.5 million,
respectively. The federal tax credits will expire at various dates
beginning in 2031, unless previously utilized. The state tax
credits do not expire and will carry forward indefinitely until
utilized.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Current laws impose substantial restrictions on the
utilization of NOLs and credit carryforwards in the event of an
“ownership change” within a three-year period as
defined by the Internal Revenue Code Section 382. If there
should be an ownership change, the Company’s ability to
utilize its carryforwards could be limited.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company previously considered the earnings in
its <font style="WHITE-SPACE: nowrap">non-U.S.</font> subsidiaries to be
indefinitely reinvested and, accordingly, recorded no deferred
income taxes. As noted above, the Company did not have a deemed
repatriation due to its foreign earnings deficits. The Company
has accumulated deficits for U.S. tax purposes in all of
its <font style="WHITE-SPACE: nowrap">non-U.S.</font>subsidiaries as of
December 31, 2017, and therefore, it does not have any foreign
earnings to distribute under U.S. tax law. However, the actual
repatriation of foreign undistributed earnings determined under
foreign local tax law could still be subject to additional foreign
withholding taxes.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company is currently analyzing its global
working capital and cash requirements and the potential tax
liabilities attributable to a repatriation, but it has
not yet determined whether its analysis will result in
repatriation of any earnings from
its <font style="WHITE-SPACE: nowrap">non-U.S.</font> subsidiaries.
Accordingly, the Company has not recorded any deferred taxes
attributable to its investments in its foreign
subsidiaries. The Company will record the tax effects of any change
in its prior assertion in the period that it completes its analysis
and is able to make a reasonable estimate, and disclose
any unrecognized deferred tax liability for temporary differences
related to its foreign investments, if practicable.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company adopted <font style="WHITE-SPACE: nowrap">ASU No. 2016-09,</font><i> Compensation-Stock
Compensation (Topic 718): Improvements to Employee Share-Based
Payment Accounting</i> as of January 1,
2017. See Note 2—“Summary of Significant Accounting
Policies—Recently Adopted Accounting Pronouncements”
for more information.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company recorded unrecognized tax benefits for
uncertain tax positions of approximately $5.3 million and
$3.5 million as of December 31, 2017 and 2016,
respectively, of which none would impact the effective tax rate, if
recognized, since the benefit would be offset by an increase in the
valuation allowance.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company’s policy is to recognize interest
and penalties accrued on any unrecognized tax benefits as a
component of income tax expense. During the year ended
December 31, 2017, the Company recognized no interest and
penalties associated with unrecognized tax benefits. There are no
tax positions for which it is reasonably possible that the total
amounts of unrecognized tax benefits will significantly increase or
decrease within 12 months of the reporting date.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company files income tax returns in the U.S.
federal jurisdiction, various state jurisdictions and foreign
jurisdictions. The Company’s tax years for fiscal year end
2011 and forward are subject to examination by the U.S. tax
authorities and various state tax authorities, and the
Company’s tax years for fiscal year end 2013 and forward are
subject to examination by various foreign tax authorities. During
2017, the IRS concluded its examination of the Company’s U.S.
federal income tax returns for the tax year ended April 30,
2014 and the eight months ended December 31, 2014 with no
changes made to the returns.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">A reconciliation of the Company’s
unrecognized tax benefits is as follows (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="68%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="86%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Balance as of December 31, 2015</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,585</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Increases related to prior years’ tax positions</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">875</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Increases related to current year’s tax positions</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,076</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Balance as of December 31, 2016</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">3,536</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Increases related to prior years’ tax positions</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">333</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Increases related to current year’s tax positions</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,444</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Balance as of December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">5,313</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
</div>
1378000
84564000
3978000
-992000
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b><i>Income Taxes</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">The Company accounts for income taxes using an
asset and liability approach. Deferred income tax assets and
liabilities are computed for differences between the financial
statement and income tax basis of assets and liabilities that will
result in taxable or deductible amounts in the future. Such
deferred income tax asset and liability computations are based on
enacted tax laws and rates applicable to periods in which the
differences are expected to affect taxable income. A valuation
allowance is established, when necessary, for any portion of
deferred income tax assets where it is considered more likely than
not that it will not be realized.</p>
<p style="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">The tax effects of the Company’s income tax
positions are recognized only if determined “more likely than
not” to be sustained based solely on the technical merits as
of the reporting date. The Company considers many factors when
evaluating and estimating its tax positions and tax benefits, which
may require periodic adjustments and which may not accurately
anticipate actual outcomes.</p>
<p style="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">The Company accounts for excess tax benefits and
tax deficiencies as income tax expense or benefit, treated as
discrete items in the reporting period in which they occur, and
recognizes previously unrecognized deferred tax assets that arose
directly from (or the use of which was postponed by) tax deductions
related to equity compensation in excess of compensation recognized
for financial reporting.</p>
</div>
26885000
1035000
2486000
-767000
-437000
308000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b>6. INTANGIBLE ASSETS, NET</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The following table summarizes the Company’s
intangible assets, net (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="61%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2017</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross Carrying<br />
Amount</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Accumulated<br />
Amortization</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Net</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Developed technology</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,395</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2,153</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,242</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Intangible assets, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,395</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2,153</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,242</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="61%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross Carrying<br />
Amount</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Accumulated<br />
Amortization</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Net</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Developed technology</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,395</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(1,274</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,121</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Intangible assets, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,395</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(1,274</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,121</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company’s intangible assets as of
December 31, 2017 and 2016 were comprised entirely of
developed technology from the Company’s acquisition of
SequenceIQ. The amortizable intangible assets have a useful life of
five years. For the years ended December 31, 2017, 2016 and
2015, the Company recognized amortization expense for intangible
assets of $0.9 million, $0.9 million and
$0.4 million, respectively, in research and development
expenses. Based on the current amount of intangibles subject to
amortization, the estimated amortization expense for each of the
succeeding <font style="WHITE-SPACE: nowrap">12-month</font>
periods ending December 31, 2018, 2019 and 2020 is
$0.9 million, $0.9 million and $0.5 million,
respectively.</p>
</div>
377000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Internal Use Software</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company’s capitalized internal use
software costs were not material for the years ended
December 31, 2017 and 2016.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The contractual maturities of investments in
<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">available-for-sale</font></font> securities
were as follows (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="64%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="14" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Amortized<br />
Cost</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Fair Value</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross<br />
Amortized<br />
Cost</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Fair Value</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Due within one year</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,666</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,668</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">31,792</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">31,764</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Due after one year through five years</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,084</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,084</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total investments in <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">available-for-sale</font></font>
securities</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,666</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">18,668</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,876</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,848</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Investments</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company classifies its debt securities as
“trading,” <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">“available-for-sale”</font></font>
or <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">“held-to-maturity,”</font></font>
depending on management’s intent at the time of purchase.
Unrealized losses on <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">available-for-sale</font></font> securities
are charged against net earnings when a decline in fair value is
determined to be other-than-temporary. The Company’s
management reviews several factors to determine whether a loss is
other-than-temporary, such as the length and extent of the fair
value decline and the financial condition and near-term prospects
of the issuer. For debt securities, management also evaluates
whether the Company has the intent to sell or will likely be
required to sell before its anticipated recovery. Realized gains
and losses are accounted for on the specific identification
method.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">Available-for-sale</font></font> debt
instruments with original maturities at the date of purchase
greater than approximately three months and remaining maturities of
less than one year are classified as short-term investments.
<font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">Available-for-sale</font></font> debt
instruments with remaining maturities beyond one year are
classified as long-term investments</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following table summarizes the Company’s
tangible long-lived assets by country (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="74%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
United States</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,671</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">15,838</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Ireland</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,120</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,033</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
India</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,578</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">471</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Rest of world</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,014</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,039</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total property and equipment, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">16,383</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">19,381</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
21010000
-29750000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">A summary of information related to restricted
stock for the year ended December 31, 2017 is presented
below:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="76%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Number of<br />
Shares Issued<br />
Outside the Stock<br />
Plans</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Weighted-<br />
Average<br />
Grant<br />
Date Fair<br />
Value<br />
Per Share<sup style="FONT-SIZE: 85%; VERTICAL-ALIGN: top">(*)</sup></b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2016</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">275,835</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23.76</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Granted</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Vested</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(137,916</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23.76</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Canceled/forfeited</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">137,919</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23.76</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 6pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr style="PAGE-BREAK-INSIDE: avoid">
<td valign="top" width="4%" align="left">(*)</td>
<td valign="top" align="left">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The weighted-average grant date fair value per
share relates to 1,424,946 shares of restricted stock paid as part
of the acquisition of Onyara, of which 137,919 shares are unvested
as of December 31, 2017. See Note 4—“Business
Combinations” for additional information regarding this
transaction.</p>
</td>
</tr>
</table>
</div>
1
379564000
16499000
-204507000
-198849000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Recently Issued Accounting Pronouncements</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In May 2017, the Financial Accounting Standards
Board (“FASB”) issued Accounting Standards Update
(“ASU”) <font style="WHITE-SPACE: nowrap">No. 2017-09,</font> <i>Compensation-Stock
Compensation (Topic 718): Scope of Modification
Accounting,</i> which provides guidance about
which changes to the terms or conditions of a share-based payment
award require an entity to apply modification accounting under
Topic 718. The ASU is effective for all entities for fiscal years
beginning after December 15, 2017, including interim periods
within those fiscal years. The Company anticipates
that <font style="WHITE-SPACE: nowrap">ASU 2017-09 will</font> not
have a material impact on its consolidated financial
statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In January 2017, FASB
issued <font style="WHITE-SPACE: nowrap">ASU No. 2017-04,</font><i> Intangibles-Goodwill
and Other (Topic 350): Simplifying the Test for Goodwill
Impairment</i>, which eliminates Step 2 from the goodwill
impairment test. The standard requires an entity to perform its
annual, or interim, goodwill impairment test by comparing the fair
value of a reporting unit with its carrying amount. An entity
should recognize an impairment charge for the amount by which the
carrying amount exceeds the reporting unit’s fair value. In
addition, the ASU eliminates the requirements for any
reporting unit with a zero or negative carrying amount to perform a
qualitative assessment. The ASU is effective for public
companies for fiscal years beginning after December 15, 2019.
Early adoption is permitted. The Company anticipates
that <font style="WHITE-SPACE: nowrap">ASU 2017-04 will</font> not
have a material impact on its consolidated financial
statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In January 2017, FASB
issued <font style="WHITE-SPACE: nowrap">ASU No. 2017-01,</font><i> Business
Combinations (Topic 805): Clarifying the Definition of a
Business,</i> which clarifies the definition of a business
with the objective of adding guidance to assist entities with
evaluating whether transactions should be accounted for as
acquisitions (or disposals) of assets or businesses. The ASU is
effective for public companies for fiscal years beginning after
December 15, 2017, including interim periods within those
fiscal years. The Company anticipates
that <font style="WHITE-SPACE: nowrap">ASU 2017-01 will</font> not
have a material impact on its consolidated financial
statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In November 2016, FASB issued
ASU <font style="WHITE-SPACE: nowrap">No. 2016-18,</font> <i>Statement
of Cash Flows (Topic 230): Restricted Cash</i>, which provides
guidance to decrease the diversity in practice in the
classification and presentation of changes in restricted cash on
the statements of cash flows. The ASU is effective for public
companies for fiscal years beginning after December 15, 2017,
including interim periods within those fiscal years. Early adoption
is permitted. The Company anticipates that
ASU <font style="WHITE-SPACE: nowrap">2016-18</font> will not
have a material impact on its consolidated financial
statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In August 2016, FASB issued
ASU <font style="WHITE-SPACE: nowrap">No. 2016-15,</font> <i>Statement
of Cash Flows (Topic 230): Classification of Certain Cash Receipts
and Cash Payments</i>, which provides guidance to decrease the
diversity in practice in how certain cash receipts and cash
payments are presented and classified in the statements of cash
flows. The ASU is effective for public companies for fiscal years
beginning after December 15, 2017, including interim periods
within those fiscal years. Early adoption is permitted. The Company
anticipates that ASU <font style="WHITE-SPACE: nowrap">2016-15</font> will not
have a material impact on its consolidated financial
statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In February 2016, FASB issued
ASU <font style="WHITE-SPACE: nowrap">No. 2016-02,</font> <i>Leases
(Topic 842),</i> which, for operating leases,
requires a lessee to recognize a <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">right-of-use</font></font> asset
and a lease liability, initially measured at the present value of
the lease payments, in its balance sheet. The standard also
requires a lessee to recognize a single lease cost, calculated so
that the cost of the lease is allocated over the lease term, on a
generally straight-line basis. The ASU is effective for public
companies for fiscal years beginning after December 15, 2018,
including interim periods within those fiscal years. Early adoption
is permitted. The Company is currently evaluating the effect that
adoption of ASU <font style="WHITE-SPACE: nowrap">2016-02</font> will have on
its consolidated financial statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In May 2014, FASB
issued <font style="WHITE-SPACE: nowrap">ASU No. 2014-09,</font><i> Revenue
from Contracts with Customers (Topic
606) </i>(the “new standard”), which
will replace most existing revenue recognition guidance in U.S.
GAAP when it becomes effective. The new standard requires an entity
to recognize the amount of revenue to which it expects to be
entitled upon transfer of promised goods or services to customers.
The new standard defines a five-step process in order to
achieve this core principle, which may require the use of judgment
and estimates, and also requires expanded qualitative and
quantitative disclosures relating to the nature, amount, timing and
uncertainty of revenue and cash flows arising from contracts with
customers, including significant judgments and estimates used.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In August 2015, FASB
issued <font style="WHITE-SPACE: nowrap">ASU No. 2015-14,</font><i> Revenue
from Contracts with Customers (Topic 606): Deferral of Effective
Date</i>, which defers the effective date of the new
standard by one year allowing early adoption as of the
original effective date of January 1, 2017. The deferral
results in the new revenue standard being effective for the Company
as of January 1, 2018. Additional ASUs have been issued to
amend or clarify the new standard as follows:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 6pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr style="break-inside: avoid">
<td width="5%"> </td>
<td valign="top" width="2%" align="left">•</td>
<td valign="top" width="1%"> </td>
<td valign="top" align="left">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-TOP: 0pt" align="justify"><font style="WHITE-SPACE: nowrap">ASU No. 2016-12,</font><i> Revenue
from Contracts with Customers (Topic 606)</i>:<i> Narrow-Scope
Improvements and Practical Expedients</i> was issued in May
2016. <font style="WHITE-SPACE: nowrap">ASU 2016-12 amends</font> the
new revenue recognition standard to clarify the guidance on
assessing collectability, <font style="WHITE-SPACE: nowrap">measuring non-cash consideration,</font> presenting
sales taxes and certain transition matters.</p>
</td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 6pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr style="break-inside: avoid">
<td width="5%"> </td>
<td valign="top" width="2%" align="left">•</td>
<td valign="top" width="1%"> </td>
<td valign="top" align="left">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-TOP: 0pt" align="justify"><font style="WHITE-SPACE: nowrap">ASU No. 2016-10,</font><i> Revenue
from Contracts with Customers (Topic 606): Identifying Performance
Obligations and Licensing</i> was issued in April
2016. <font style="WHITE-SPACE: nowrap">ASU 2016-10 addresses</font> implementation
issues identified by the FASB-International Accounting Standards
Board Joint Transition Resource Group (“TRG”) for
Revenue Recognition concerning identifying performance obligations
and accounting for licenses of intellectual property.</p>
</td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 6pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr style="break-inside: avoid">
<td width="5%"> </td>
<td valign="top" width="2%" align="left">•</td>
<td valign="top" width="1%"> </td>
<td valign="top" align="left">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-TOP: 0pt" align="justify"><font style="WHITE-SPACE: nowrap">ASU No. 2016-08,</font><i> Revenue
from Contracts with Customers (Topic 606): Principal versus Agent
Considerations (Reporting Revenue Gross versus Net)</i> was
issued in March 2016. <font style="WHITE-SPACE: nowrap">ASU 2016-08 requires</font> an
entity to determine whether the nature of its promise to provide
goods or services to a customer is performed in a principal or
agent capacity and to recognize revenue in a gross or net manner
based on its principal or agent designation.</p>
</td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The new standard permits adoption either by using
(i) a full retrospective approach for all periods presented or
(ii) a modified retrospective approach with the cumulative
effect of initially applying the new standard recognized at the
date of initial application and providing certain additional
disclosures. The Company adopted the new standard as of
January 1, 2018 using the modified retrospective approach. The
Company’s decision was based on a number of factors such as
the significance of the impact of the new standard on the
Company’s financial results, system readiness, including that
of software procured from third-party providers, and the
Company’s ability to accumulate and analyze the information
necessary to assess the cumulative effect of the new standard
through January 1, 2018.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company has substantially completed its
evaluation of the impact of the new standard on its accounting
policies, processes and system requirements. The Company has
assigned internal resources in addition to the engagement of
third-party service providers to assist in the evaluation and to
provide periodic updates to management and the Audit Committee. In
evaluating the risks associated with the adoption of the new
accounting standard, the Company has identified and scoped the
different revenue streams and reviewed contracts in each revenue
stream for terms and conditions that could result in different
accounting treatment. Furthermore, the Company has made and will
continue to make investments in systems to enable timely and
accurate reporting under the new standard. While the Company
continues to assess all potential impacts under the new standard,
significant impacts are expected to the timing and amount of
support subscription and professional services revenue recognized,
as well as the capitalization and amortization of contract
acquisition costs. In addition, the Company
will update certain disclosures, as
applicable, included in its filings pursuant to the Securities
Exchange Act of 1934, as amended, to meet the requirements of the
new standard.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Under current industry-specific software revenue
recognition guidance, the Company has concluded it has not
established VSOE for support subscriptions and professional
services offerings in multiple-element arrangements where support
subscriptions are sold with professional services. The Company
recognizes revenue on a ratable basis over the period beginning
when both the support subscription and professional services have
substantially commenced, and ending at the conclusion of the
support subscription or professional services period, whichever is
longer. The new standard, which does not retain the concept of
VSOE, requires an evaluation of whether support subscriptions and
professional services are distinct performance obligations, and
therefore should be separately recognized as the respective
performance obligations are satisfied based on the standalone
selling price for each performance obligation, which may not be on
a ratable basis. Based on the Company’s evaluation under the
new standard, the timing of revenue recognition will change
significantly for professional services bundled in multiple-element
arrangements and currently recognized ratably due to lack of VSOE
for support subscriptions. In particular, professional services
revenue will be recognized in an earlier period and over a shorter
timeframe under the new standard as the services are delivered
compared to the Company’s current accounting policy under the
existing standards and guidance. Also, the timing of recognition
will change to begin in an earlier period for some support
subscriptions bundled in multiple-element arrangements compared to
the Company’s current accounting policy for multiple-element
arrangements whereby recognition generally begins when both the
support subscription and professional services have substantially
commenced.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">As part of its evaluation, the Company has also
considered the impact of the guidance in Accounting Standards
Codification <font style="WHITE-SPACE: nowrap">(“ASC”) 340-40</font><i>,</i><i> Other
Assets and Deferred Costs; Contracts with Customers</i>, and the
interpretations of the FASB TRG for Revenue Recognition from their
November 7, 2016 meeting with respect to the capitalization
and amortization of incremental costs of obtaining a contract
(<i>e.g.</i>, sales commissions). For contracts with an expected
duration greater than one year, the new standard requires the
capitalization of incremental costs that the Company incurs to
obtain a contract with a customer that it would not have incurred
if the contract had not been obtained, provided the Company expects
to recover the costs. Such capitalized costs are then to be
amortized on a systematic basis that is consistent with the
transfer to the customer of the services to which such costs
relate, and the amortization period may extend beyond the initial
contract term if renewal commissions on expected renewals are not
commensurate with the commission on the initial contract. Under the
Company’s current accounting policy, incremental costs
incurred to obtain a contract are expensed when incurred. Thus, the
application of the new standard will result in a significant change
to the Company’s current accounting policy for contract
acquisition costs, which will result in the Company recognizing the
expense for contract acquisition costs in a different period, and
over a longer period, compared to the Company’s current
practice under the existing standards and guidance.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company adopted the new standard effective
January 1, 2018, by recognizing the cumulative effect of
initially applying the new standard. As a result of adopting
ASU <font style="WHITE-SPACE: nowrap">2014-09</font> <i>(Topic
606)</i> and its corresponding ASUs, accumulated
deficit will decrease by approximately $23.0 million to
$28.0 million and as a result of adopting
ASC <font style="WHITE-SPACE: nowrap">340-40,</font>accumulated deficit will
decrease by approximately $47.0 million to
$52.0 million.</p>
</div>
-3172000
0
844000
<div>
<p style="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b>1. ORGANIZATION AND DESCRIPTION OF BUSINESS</b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">Hortonworks, Inc. (the “Company”)
delivers 100 percent open-source global data management
solutions so that customers can deploy modern data architectures
and realize the full value of their data. The Company’s
enterprise-ready solutions enable organizations to govern, secure
and manage data of any kind, wherever it is located, and turn it
into actionable intelligence that will help them transform their
businesses.</p>
<p style="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">The Company’s platforms allow enterprises to
manage their data on a global scale, whether it is <font style="white-space:nowrap"><font style="white-space:nowrap">data-in-motion</font></font> or <font style="white-space:nowrap"><font style="white-space:nowrap">data-at-rest.</font></font> The Company has
the expertise, experience and proven solutions to power modern data
applications, including streaming analytics, data science,
artificial intelligence and more.</p>
<p style="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">In December 2014, the Company completed its initial
public offering and concurrent private placement (collectively, the
“IPO”). In February 2016, the Company completed a
<font style="white-space:nowrap">follow-on</font> public offering
of an aggregate of 9,688,750 shares of its common stock, including
1,263,750 additional shares sold pursuant to the full exercise of
the option to purchase additional shares by the underwriters, at a
public offering price of $9.50 per share. Net proceeds to the
Company were approximately $88.2 million after deducting
underwriting discounts and commissions and offering expenses.</p>
</div>
814000
9000000
30000
0
-333000
79000
2666000
7069000
5223000
19464000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Property and equipment, net, consisted of the
following (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="71%"></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Computer equipment</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">13,353</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12,513</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Network and communication equipment</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,889</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,453</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Purchased software</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">898</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">667</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Furniture and fixtures</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,356</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,585</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Capital leases</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">743</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Leasehold improvements</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12,003</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,871</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Assets not yet in use</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">198</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">206</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Property and equipment, gross</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">37,440</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">32,771</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Less: Accumulated depreciation</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(21,057</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(13,390</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total property and equipment, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">16,383</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">19,381</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
32865000
12100000
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b><i>Property and Equipment</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">Property and equipment are stated at cost.
Depreciation is computed using a straight-line method over the
estimated useful lives, determined to be two years for purchased
software, two to three years for computer equipment, and five years
for network and communication equipment and furniture and fixtures.
Expenditures for repairs and maintenance are charged to expenses as
incurred. Leasehold improvements are amortized on a straight-line
basis over the term of the lease, or the useful life of the assets,
whichever is shorter.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b>5. PROPERTY AND EQUIPMENT, NET</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Property and equipment, net, consisted of the
following (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="71%"></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Computer equipment</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">13,353</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12,513</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Network and communication equipment</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,889</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,453</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Purchased software</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">898</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">667</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Furniture and fixtures</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,356</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,585</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Capital leases</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">743</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Leasehold improvements</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12,003</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,871</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Assets not yet in use</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">198</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">206</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Property and equipment, gross</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">37,440</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">32,771</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Less: Accumulated depreciation</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(21,057</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(13,390</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total property and equipment, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">16,383</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">19,381</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">Depreciation expense for the years ended
December 31, 2017, 2016 and 2015 was $8.8 million,
$7.2 million and $4.5 million, respectively. Interest
expense related to capital leases was immaterial for the years
ended December 31, 2017, 2016 and 2015. As of
December 31, 2017, the Company is obligated to make future
payments under capital leases of $0.4 million in 2018.</p>
</div>
176000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Revenue from Strategic Relationships and Reseller
Arrangements</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company has strategic relationships and
reseller arrangements with third parties (collectively,
“Partners”). Under these arrangements, the Company is
not the primary obligor for what is ultimately sold by the Partners
to their end customers. The amount recognized as revenue from sales
to end users represents the amount due to the Company from the
Partners and is generally recognized on a ratable basis over the
applicable services term under support subscription revenue.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Software Development Costs</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company develops open source software that is
generally freely available on the Apache Hadoop platform.
Capitalization of software development costs begins upon the
establishment of technological feasibility and ceases when the
product is available for general release. There is usually a very
minimal passage of time between the achievement of technological
feasibility and the availability of the Company’s software
for general release. Accordingly, there are no capitalized software
development costs for the years ended December 31, 2017 and
2016.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b>14. RELATED PARTY TRANSACTIONS</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In June 2011, the Company entered into
a <font style="WHITE-SPACE: nowrap">two-year</font> commercial
agreement with Yahoo!, which at that time was a principal
shareholder, that requires the Company to provide support
subscription offerings and certain rights to technology, and the
Company issued a preferred stock warrant to Yahoo!. The initial
total contract value was $2.0 million and was being paid in
quarterly installments of $250,000. In June 2013, the commercial
agreement was amended to automatically renew for an additional year
on an annual basis, unless otherwise terminated by either party 60
days prior to the end of the then-current renewal period. In
December 2015, the commercial agreement was further amended to
extend the current term until December 30, 2018, and
thereafter, the commercial agreement will automatically renew for
an additional year on an annual basis, unless otherwise terminated
by either party 60 days prior to the end of the then-current
renewal period. In 2017, Verizon acquired the operating assets of
Yahoo!. Yahoo! was subsequently renamed Altaba, and Yahoo!’s
share ownership in the Company, as well as the July 2011 warrant,
remained assets of Altaba.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In February 2012, the Company entered into a
development, distribution and marketing agreement with Teradata
Corporation (“Teradata”), which at that time was a
significant shareholder. Under this and subsequent arrangements,
the Company is providing support subscription and professional
services to Teradata and certain of its end users. In April 2012,
the Company received a nonrefundable prepayment of
$9.5 million from Teradata as consideration for support
subscription offerings and professional services performed by the
Company through 2016. In June 2015, the Company entered into an
amendment to their prior agreement with Teradata and received a
second prepayment of $1.5 million in August 2015 as
consideration for support subscription offerings and professional
services performed by the Company through 2017. In September 2016,
the Company entered into an amendment with Teradata and received a
third prepayment of $1.5 million in the same month as
consideration for support subscription offerings and professional
services performed by the Company through 2017. As of
February 2, 2016, Teradata was no longer a Hortonworks
shareholder and as such, was not considered to be a related party
as of December 31, 2017 and 2016.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In September 2013, the Company entered into a
common stock purchase agreement with an affiliate of AT&T Inc.
(“AT&T”) covering the sale and issuance of 390,269
shares of the Company’s stock for a nominal amount of
consideration. The initial grant included restricted shares that
were subject to repurchase rights by the Company. Fifty percent of
the shares vested on an equal and ratable basis over
an <font style="WHITE-SPACE: nowrap">18-month</font> period
beginning on October 1, 2013 and the remaining 50 percent
of shares vested in their entirety on March 31, 2015.
Concurrently, the Company also entered into a commercial agreement
with AT&T to provide specified support subscription and
professional services over a three-year term with a minimum annual
fee of $6.0 million. Due to the lack of VSOE, this fee is
being recognized ratably over the three-year term. In January 2014,
the Company entered into an amended stock purchase agreement with
an affiliate of AT&T in which the Company relinquished its
repurchase rights, at which point the fair value of the remaining
shares was recognized as a reduction in revenue. As of
December 31, 2017 and 2016, AT&T did not hold more than
five percent of the Company’s outstanding common stock and
therefore, the Company did not consider AT&T to be a related
party.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In June 2014, the Company issued a warrant to
purchase a number of shares of common stock in exchange for
the amendment of certain rights held by Yahoo! under the
Investors’ Rights Agreement to approve certain corporate
transactions involving the Company. The warrant became exercisable
upon the consummation of the IPO. As described above, in 2017,
Verizon acquired the operating assets of Yahoo!, and Yahoo! was
subsequently renamed Altaba. The June 2014 warrant remained as an
asset of Altaba. As of December 31, 2017, the warrant is
exercisable for 476,368 shares of the Company’s common
stock.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In July 2014, the Company entered into a Series D
preferred stock purchase agreement with Hewlett Packard Enterprise
Company (“Hewlett Packard Enterprise”) covering the
sale and issuance of 2,051,349 shares of the Company’s common
stock for a total of $50.0 million. Under this and subsequent
arrangements, Hewlett Packard Enterprise resells the
Company’s support subscription services. The Company receives
a net percentage of the gross dollars collected from Hewlett
Packard Enterprise’s <font style="WHITE-SPACE: nowrap">end-user</font> customers
related to such support and professional services. Hewlett Packard
Enterprise was the former employer of the Company’s director
Martin Fink until October 2016. As Martin Fink was no longer
associated with Hewlett Packard Enterprise as of December 31,
2017 and 2016, the Company no longer considers Hewlett Packard
Enterprise to be a related party.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The following table summarizes the Company’s
common stock shares/warrants owned by entities that were related
parties as of December 31, 2017, 2016 and 2015. See Note
9—“Stockholders’ (Deficit) Equity” for
information regarding the terms of the Altaba (formerly, Yahoo!)
warrants issued in July 2011 and June 2014.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="64%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>December 31,</b></font><br />
<font style="FONT-FAMILY: "Times New Roman""><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>Altaba</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Shares/warrants owned by related party:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">3,845,806</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock warrants</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">3,726,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 1pt">
<td height="16"></td>
<td height="16" colspan="4"></td>
<td height="16" colspan="4"></td>
<td height="16" colspan="4"></td>
<td height="16" colspan="4"></td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>December 31,<br />
2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>Altaba</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Shares/warrants owned by related party:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">3,845,806</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock warrants</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">3,726,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 1pt">
<td height="16"></td>
<td height="16" colspan="16"></td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="14" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>December 31,
2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>Altaba</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>Teradata</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>AT&T</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>Hewlett<br />
Packard</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Shares/warrants owned by related party:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">3,845,806</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">15,269</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2,051,349</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock warrants</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">3,726,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: "Times New Roman"">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">For the years ended December 31, 2017, 2016
and 2015, the Company recognized revenue from sales to related
parties of $0.8 million, $2.6 million and
$10.1 million, respectively. As of December 31, 2017 and
2016, the Company’s deferred revenue from related parties was
$0.8 million and $1.6 million, respectively, and accounts
receivable from related parties was $0.8 million and
$1.6 million, respectively. The Company’s payables due
to related parties were immaterial as of December 31, 2017 and
2016.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company does not separately record routine cost
of revenue and operating expenses on a per related party contract
basis.</p>
</div>
101094000
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b><i>Research and Development Expenses</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">Research and development expenses consist primarily
of personnel costs (including cash compensation, benefits and
stock-based compensation expense) for the Company’s research
and development employees, costs associated with subcontractors and
equipment lease expenses, plus allocated shared costs. The
Company’s research and development expenses include costs for
development related to the distribution of its solutions, including
security updates, fixes, functionality enhancements, upgrades to
the technology and new versions of the software, quality assurance
personnel, technical documentation personnel and at times, expenses
related to engineering resources for its subscription and
professional services offerings.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Deferred Revenue</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Deferred revenue consists of amounts billed to
customers but not yet recognized in revenue.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">As of December 31, 2017 and 2016,
substantially all of the Company’s accounts receivable
represents amounts billed to customers but not yet received or
recognized as revenue and are thus recorded as deferred
revenue.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Multiple-Element Arrangements</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company’s multiple-element arrangements
generally include support subscription combined with professional
services. The Company has not established vendor-specific objective
evidence of fair value (“VSOE”) for its support
subscriptions and professional services offerings, and the Company
recognizes revenue on a ratable basis over the period beginning
when both the support subscription and professional services have
substantially commenced, and ending at the conclusion of the
support subscription or professional services period, whichever is
longer. Under the Company’s multiple-element arrangements,
the support subscription element generally has the longest service
period and the professional services element is performed during
the earlier part of the support subscription period. On occasion,
the Company may sell engineering services and/or a premium
subscription agreement that provides a customer with development
input and the opportunity to work more closely with its
developers.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company’s agreements with customers often
include multiple support subscription and/or professional services
elements, and these elements are sometimes included in separate
contracts. The Company considers an entire customer arrangement to
determine if separate contracts should be considered linked
arrangements for the purposes of revenue recognition.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Revenue recognition requires judgment, including
whether a software arrangement includes multiple elements, and if
so, whether VSOE exists for those elements. A portion of revenue
may be recorded as unearned due to undelivered elements. Changes to
the elements in a software arrangement, the ability to identify the
VSOE for those elements and the VSOE of all respective elements
could materially impact the amount of earned and unearned revenue
in a given period.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following outstanding shares of common stock
equivalents were excluded from the computation of diluted net loss
per share of common stock for the periods presented because
including them would have been anti-dilutive:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="61%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>As of
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock warrants</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,250,000</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,250,000</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,250,000</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Exercise and conversion of common stock warrants</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock subject to repurchase</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,500</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">30,708</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">55,603</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Outstanding stock options</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,490,445</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">7,430,094</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">11,552,487</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested restricted stock</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">137,919</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">275,835</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">789,982</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested RSUs</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,579,841</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,836,508</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,169,301</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested PSUs</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">839,857</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">424,503</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">683,318</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Estimated ESPP shares to be issued</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">292,978</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">442,992</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">151,468</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">19,077,908</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23,167,008</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">22,128,527</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The components of income tax expense for the years
ended December 31, 2017, 2016 and 2015 are as follows (in
thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="72%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="4%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Current:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Federal</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
State and local</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">67</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">58</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Foreign</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,793</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,130</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">514</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total current tax expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,816</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,197</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">572</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total deferred tax (benefit) expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(330</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">27</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(140</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Income tax expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,486</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,224</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">432</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following table summarizes the Company’s
revenue by customer domicile (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="61%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top"><font style="FONT-FAMILY: Times New Roman">United
States</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">$187,926</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">$137,933</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">$105,842</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top"><font style="FONT-FAMILY: Times New Roman">United
Kingdom</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">21,929</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">21,025</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">3,815</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Rest of world</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">51,955</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">25,503</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12,287</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total revenue</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">261,810</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">184,461</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">121,944</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Revenue Recognition</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Apache Hadoop, Apache NiFi and associated open
source technology projects within the Apache Software Foundation
are made freely available within the open source
community. While these technologies have emerged to enable the
modern data center architecture, they are complex to deploy and
consume as individual components inhibiting broad adoption by
enterprises. The Company’s efforts are thus focused on
creating a software distribution of these projects by assembling
key component software projects into an open platform that address
the needs of enterprises. By working in concert with the Apache
community to develop Connected Data Platforms, Hortonworks Data
Platform (“HDP”), Hortonworks DataFlow
(“HDF”) and other offerings, the Company’s
software distribution provides customers with a scalable, secure
and governed environment for their data requirements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Connected Data Platforms are made available under
an Apache open source license. Open source software is an
alternative to proprietary developed software and represents a
different model for the development and licensing of commercial
software code than that typically used for proprietary software.
Because open source software code is generally freely shared, the
Company does not typically generate any direct revenue from its
software development activities.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company generates the predominant amount of its
revenue through support (support subscription) and consulting and
education services (professional services) arrangements with its
enterprise customers. The Company’s professional services
provide assistance in the implementation process and education
related activities.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company prices support subscription offerings
based on the number of servers in a cluster, or nodes, core or edge
devices, data under management and/or the scope of support
provided. The Company’s consulting services are priced
primarily on a time and materials basis, and to a lesser extent, a
fixed fee basis, and education services are priced based on
attendance.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Under the Company’s support subscription and
professional services arrangements, revenue is recognized when
(i) persuasive evidence of an arrangement exists;
(ii) the services have been delivered; (iii) the
arrangement fee is fixed or determinable; and
(iv) collectability is probable.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Significant components of the Company’s
deferred tax assets are as follows (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="69%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap"></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; break-inside: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: rgb(0,0,0) 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: "Times New Roman""><b>2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Deferred tax assets:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Net operating loss carryforwards</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">136,596</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">132,744</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Research and development credits</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">14,445</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">8,997</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Warrant expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">12,528</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">19,312</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Depreciation and amortization</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,191</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,105</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Accruals and reserves</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,206</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">3,005</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top"><font style="FONT-FAMILY: "Times New Roman"">Deferred revenue</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">14,000</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">9,093</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top"><font style="FONT-FAMILY: "Times New Roman"">Stock-based compensation
expense</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">8,412</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: "Times New Roman"">15,865</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Other</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">1,145</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">2,037</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Gross deferred tax assets</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">189,523</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">192,158</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Valuation allowance</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(189,298</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(192,152</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Intangibles</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(201</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(312</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; break-inside: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Net deferred tax assets (liabilities)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">24</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman""> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: "Times New Roman"">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: "Times New Roman"">(306</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: "Times New Roman"">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: rgb(0,0,0) 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<br class="Apple-interchange-newline" />
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following table sets forth the computation of
basic and diluted net loss per share (in thousands, except share
and per share amounts):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="64%"></td>
<td valign="bottom" width="2%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="2%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="2%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Net loss</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(204,507</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(251,688</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(179,117</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Weighted-average shares used in computing net loss per share of
common stock</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">66,356,474</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">57,203,067</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">43,318,044</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Net loss per share, basic and diluted</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(3.08</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(4.40</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(4.13</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Total stock-based compensation expense, including
stock-based compensation expense to <font style="WHITE-SPACE: nowrap">non-employees,</font> by category was as
follows (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="65%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cost of revenue</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">7,676</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,700</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,702</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Sales and marketing</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,210</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">25,787</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">11,688</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Research and development</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">38,771</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">36,540</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">15,193</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
General and administrative</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">28,379</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">30,796</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">11,356</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total stock-based compensation expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">110,036</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">98,823</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">40,939</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The components of loss before income taxes by
United States and foreign jurisdictions are as follows (in
thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="61%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top"><font style="FONT-FAMILY: Times New Roman">United
States</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">$157,688</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">$209,882</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">$137,713</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top"><font style="FONT-FAMILY: Times New Roman">Foreign</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">44,333</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">40,582</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">40,972</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Loss before income tax</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">202,021</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">250,464</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">178,685</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
800000
261810000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The following table summarizes the Company’s
intangible assets, net (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="61%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2017</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross Carrying<br />
Amount</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Accumulated<br />
Amortization</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Net</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Developed technology</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,395</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2,153</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,242</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Intangible assets, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,395</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2,153</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,242</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="61%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Gross Carrying<br />
Amount</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Accumulated<br />
Amortization</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Net</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Developed technology</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,395</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(1,274</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,121</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Intangible assets, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,395</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(1,274</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,121</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">A summary of information related to RSUs for the
year ended December 31, 2017 is presented below:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="69%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Number of<br />
Shares Issued<br />
Under Stock<br />
Plans</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b><font style="WHITE-SPACE: nowrap">Weighted-Average</font><br />
Grant Date Fair<br />
Value Per Share</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2016</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,836,508</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12.90</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Granted</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,463,870</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12.60</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Vested</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(7,919,416</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12.73</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Canceled/forfeited</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2,801,121</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">11.70</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,579,841</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">13.10</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">A reconciliation of the Company’s
unrecognized tax benefits is as follows (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="68%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="86%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Balance as of December 31, 2015</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,585</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Increases related to prior years’ tax positions</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">875</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Increases related to current year’s tax positions</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,076</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Balance as of December 31, 2016</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,536</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Increases related to prior years’ tax positions</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">333</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Increases related to current year’s tax positions</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,444</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Balance as of December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,313</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following is a reconciliation of the statutory
federal income tax rate to the Company’s effective tax
rate:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="75%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="4%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="4%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Tax at federal statutory rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">34.00</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">34.00</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">34.00</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
State and local taxes, net of federal benefit</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2.28</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2.54</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2.93</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Permanent differences and other items not individually
material</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(0.16</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(0.08</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(0.26</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Stock-based compensation expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1.39</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(8.24</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2.29</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Credits</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2.24</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2.01</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">0.62</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Foreign tax differential</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(8.68</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(5.97</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(8.01</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Change in valuation allowance</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1.41</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(24.75</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(27.23</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Change in federal tax rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(40.86</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Adoption of ASU <font style="WHITE-SPACE: nowrap">2016-09</font></p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">7.15</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Income tax expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(1.23</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">)% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(0.49</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">)% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(0.24</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">)% </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">A summary of information related to PSUs for the
year ended December 31, 2017 is presented below:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="68%"></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="9%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Number of<br />
Shares Issued<br />
Under Stock<br />
Plans</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b><font style="WHITE-SPACE: nowrap">Weighted-Average</font><br />
Grant Date Fair<br />
Value Per Share</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2016</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">424,503</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">21.16</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Granted</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">714,711</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">13.39</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Vested</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(183,048</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">15.87</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Canceled/forfeited</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(116,309</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23.26</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">839,857</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">14.58</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">A summary of information related to stock options
for the year ended December 31, 2017 is presented below:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="55%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="14" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Options
Outstanding</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Number of<br />
Shares<br />
Underlying<br />
Outstanding<br />
Options</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Weighted-<br />
Average<br />
Exercise<br />
Price Per<br />
Share</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Weighted-<br />
Average<br />
Remaining<br />
Contractual Life<br />
(Years)</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Aggregate<br />
Intrinsic<br />
Value</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>(in thousands)</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Outstanding—December 31, 2016</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">7,430,094</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9.81</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.73</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">16,523</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Granted</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Exercised</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2,277,179</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5.30</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Canceled/forfeited</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(662,470</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">16.74</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Outstanding—December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,490,445</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">11.08</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.14</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">41,525</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Exercisable—December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,879,080</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10.38</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.05</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">38,393</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">As of December 31, 2017, future minimum lease
commitments under <font style="WHITE-SPACE: nowrap">non-cancelable</font> leases are as follows
(in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="68%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="84%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom" nowrap="nowrap">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman; WIDTH: 95.55pt; BORDER-BOTTOM: #000000 1pt solid; MARGIN-TOP: 0pt; DISPLAY: inline">
<b>Years Ending December 31,</b></p>
</td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Leases</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
2018</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,942</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
2019</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,741</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
2020</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,702</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
2021</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,097</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
2022</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">429</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Thereafter</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,735</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Gross lease payments</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">15,646</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Less: <font style="WHITE-SPACE: nowrap">Non-cancelable</font>
subtenant receipts</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(604</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Net lease payments</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">15,042</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The following table summarizes the Company’s
common stock shares/warrants owned by entities that were related
parties as of December 31, 2017, 2016 and 2015. See Note
9—“Stockholders’ (Deficit) Equity” for
information regarding the terms of the Altaba (formerly, Yahoo!)
warrants issued in July 2011 and June 2014.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="64%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font><br />
<font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Altaba</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Shares/warrants owned by related party:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,845,806</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock warrants</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,726,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 1pt">
<td height="16"></td>
<td height="16" colspan="4"></td>
<td height="16" colspan="4"></td>
<td height="16" colspan="4"></td>
<td height="16" colspan="4"></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,<br />
2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Altaba</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Shares/warrants owned by related party:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,845,806</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock warrants</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,726,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 1pt">
<td height="16"></td>
<td height="16" colspan="16"></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="14" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,
2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Altaba</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Teradata</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>AT&T</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Hewlett<br />
Packard</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Shares/warrants owned by related party:</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,845,806</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">15,269</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,051,349</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock warrants</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,726,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
</table>
</div>
P6Y1M20D
5.30
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b>9. STOCKHOLDERS’ (DEFICIT) EQUITY</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt">
<b><i>Common Stock</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Each share of common stock is entitled to one vote
for matters to be voted on by the stockholders of the Company. The
holders of common stock are also entitled to receive dividends
whenever declared by the Board of Directors from legally available
funds. The Company has not paid a dividend since its inception, and
has no current plans to do so.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 18pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt">
<b><i>Common Stock Reserved for Issuance</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company reserved shares of common stock, on an
<font style="WHITE-SPACE: nowrap">as-if</font> converted basis, for
future issuance as follows:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="80%"></td>
<td valign="bottom" width="1%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="1%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock warrants</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,250,000</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,250,000</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Exercise and conversion of common stock warrants</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock subject to repurchase</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,500</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">30,708</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Outstanding stock options</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,490,445</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">7,430,094</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested restricted stock</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">137,919</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">275,835</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested RSUs</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,579,841</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,836,508</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested PSUs</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">839,857</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">424,503</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Shares available for issuance under Amended 2014 Stock Option and
Incentive Plan</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">706,994</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,234,205</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Shares available for purchase under Amended 2014 Employee Stock
Purchase Plan</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,933,343</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,451,215</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">21,425,267</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">29,409,436</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>2011 Stock Option and Grant Plan</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company adopted the Hortonworks, Inc. 2011
Stock Option and Grant Plan in June 2011 and amended such plan in
March 2014 (as amended, the “2011 Plan”). The 2011 Plan
allows for the grant of incentive stock options
(“ISOs”), <font style="WHITE-SPACE: nowrap">non-statutory</font> stock options
(“NSOs”), restricted common stock and RSUs to the
Company’s full or part-time officers, employees, <font style="WHITE-SPACE: nowrap">non-employee</font> directors and
consultants. The exercise price of an option is determined by the
Board of Directors when the option is granted, and may not be less
than 100 percent of the fair market value of the shares on the
date of grant, provided that the exercise price of ISOs granted to
a 10 percent stockholder is not less than 110 percent of
the fair market value of the shares on the date of grant. ISOs
granted under the 2011 Plan generally vest 25 percent after
the completion of 12 months of service and the balance in
equal monthly installments over the next 36 months of service,
and expire 10 years from the date of grant (subject to earlier
expiration upon the occurrence of certain events). ISOs granted to
a 10 percent stockholder expire five years from the date of
grant (subject to earlier expiration upon the occurrence of certain
events). NSOs vest according to the specific option agreement, and
expire 10 years from the date of grant.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">In December 2014, in connection with the closing of
the Company’s IPO, the 2011 Plan was terminated as to future
grants and shares authorized for issuance under the 2011 Plan were
canceled (except for those shares reserved for issuance upon
exercise of outstanding stock options). As of December 31,
2017, options to purchase 3,936,786 shares of common stock were
outstanding under the 2011 Plan pursuant to their original terms
and no shares were available for future grant.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>2014 Stock Option and Incentive Plan</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Hortonworks, Inc. 2014 Stock Option and
Incentive Plan (the “2014 Plan”) was adopted by the
Company’s Board of Directors in September 2014. The 2014 Plan
was approved by the Company’s stockholders in November 2014
and became effective immediately prior to the closing of the
Company’s IPO. All shares that had been available for
issuance but not covered by outstanding awards under the 2011 Plan
rolled into the 2014 Plan following the consummation of the IPO.
The 2014 Plan allows the plan administrator to make equity-based
incentive awards to the Company’s full or part-time officers,
employees, <font style="WHITE-SPACE: nowrap">non-employee</font>
directors and consultants. An amendment and restatement of the 2014
Plan (the “Amended 2014 Plan”) to increase the number
of shares reserved for issuance, among other things, was approved
by the Board of Directors in April 2016 and by the Company’s
stockholders in May 2016.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The exercise price of an option is determined by
the plan administrator when the option is granted, and it may not
be less than 100 percent of the fair market value of the
shares on the date of grant, provided that the exercise price of
ISOs granted to a 10 percent stockholder is not less than
110 percent of the fair market value of the shares on the date
of grant. ISOs granted under the Amended 2014 Plan generally vest
25 percent after the completion of 12 months of service
and the balance in equal monthly installments over the next
36 months of service, and expire 10 years from the date
of grant (subject to earlier expiration upon occurrence of certain
events). ISOs granted to a 10 percent stockholder expire five
years from the date of grant (subject to earlier expiration upon
occurrence of certain events). NSOs vest according to the specific
option agreement, and expire 10 years from the date of grant.
In general, RSUs granted to employees and <font style="WHITE-SPACE: nowrap">non-employees</font> typically vest over no
more than three years.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company initially reserved 6,000,000 shares of
the Company’s common stock for the issuance of awards under
the 2014 Plan. This was in addition to the 923,732 shares of the
Company’s common stock that remained available for issuance
under the Company’s 2011 Plan as of the Company’s IPO
date and that rolled into the 2014 Plan. The 2014 Plan also
provides that the number of shares reserved and available for
issuance under the plan will automatically increase each
January 1, beginning on January 1, 2015, by five percent
of the outstanding number of shares of the Company’s common
stock on the immediately preceding December 31 or such lesser
number of shares as determined by the plan administrator. This
number is subject to adjustment in the event of a stock split,
stock dividend or other change in the Company’s
capitalization. The amendment and restatement of the 2014 Plan
increased the number of shares reserved for issuance under the
Amended 2014 Plan by 7,000,000 shares.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">In April, June and July 2015, under the 2014 Plan,
the Company granted an aggregate of 421,484 PSUs to certain
executive and senior officers (the “Grantees”) that
vest upon (a) the achievement of specified performance targets
as set by the Compensation Committee and (b) the Grantee
remaining employed during the respective performance cycles over a
service period of up to three years, with such service periods
commencing on July 1, 2015. The performance target value for
each performance cycle is based on an average of the applicable
internal and external billings amounts for the respective
performance cycle. The number of PSUs that vest for a given
performance cycle is based on the Company’s achievement of
actual billings relative to the performance target value.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">In October 2015, under the 2014 Plan, the Company
granted an aggregate of 266,084 PSUs to the Grantees that vest upon
(a) the achievement of specified performance targets as set by
the Compensation Committee and (b) the Grantee remaining
employed for the duration of the <font style="WHITE-SPACE: nowrap">respective 12-month performance</font>
cycles over a service period of up to two years, with such service
periods commencing on January 1, 2016. The number of PSUs
that vest for a given performance cycle is based on the
Company’s achievement of earnings before interest, taxes,
depreciation and amortization growth and revenue growth relative to
the linear ranking of <font style="WHITE-SPACE: nowrap">a pre-selected group</font> of the
Company’s peers.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">In September 2017, under the Amended 2014 Plan, the
Company granted 714,711 market-based PSUs to our Chief Executive
Officer that vest upon (a) the achievement of a specific
market-based performance goal related to the price of our common
stock over forty consecutive trading days during a performance
cycle of four years, with such performance cycle commencing on
September 10, 2017 and (b) the Chief Executive Officer
remaining employed through achievement of the performance goal. If
the Company achieves the performance goal within the performance
cycle, and the Chief Executive Officer remains employed through
such achievement, 100 percent of the PSUs will vest upon
achievement of the market-based performance goal.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">As of December 31, 2017, options to purchase
shares of stock, RSUs and PSUs covering an aggregate of 10,973,357
shares of common stock were outstanding under the Amended 2014
Plan.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">On January 1, 2017, the shares reserved for
issuance under the Amended 2014 Plan increased by 3,071,470,
resulting in 22,606,183 total shares reserved for issuance under
the Amended 2014 Plan as of December 31, 2017, of which
706,994 shares remained available for issuance.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 18pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt">
<b><i>Stock Options</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">A summary of information related to stock options
for the year ended December 31, 2017 is presented below:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="55%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="14" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Options
Outstanding</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Number of<br />
Shares<br />
Underlying<br />
Outstanding<br />
Options</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Weighted-<br />
Average<br />
Exercise<br />
Price Per<br />
Share</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Weighted-<br />
Average<br />
Remaining<br />
Contractual Life<br />
(Years)</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Aggregate<br />
Intrinsic<br />
Value</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2"> </td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>(in thousands)</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Outstanding—December 31, 2016</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">7,430,094</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9.81</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.73</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">16,523</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Granted</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Exercised</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2,277,179</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5.30</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Canceled/forfeited</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(662,470</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">16.74</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Outstanding—December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,490,445</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">11.08</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.14</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">41,525</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Exercisable—December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,879,080</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10.38</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.05</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">38,393</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">There were no options granted during the years
ended December 31, 2017 and 2016. The weighted-average grant
date fair value of all options to purchase common stock granted
during the year ended December 31, 2015 was $23.17 per
share.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Aggregate intrinsic value represents the difference
between the exercise price of the options to purchase common stock
and the fair value of the Company’s common stock. The
aggregate intrinsic value of options exercised during the years
ended December 31, 2017, 2016 and 2015 was $23.5 million,
$13.2 million and $42.9 million, respectively.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Cash received from option exercises during the year
ended December 31, 2017 was $12.1 million.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">As of December 31, 2017, there was
$4.6 million of unrecognized stock-based compensation expense
related to unvested stock options which is expected to be
recognized over a weighted-average period of 0.68 years.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Restricted Stock</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">A summary of information related to restricted
stock for the year ended December 31, 2017 is presented
below:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="76%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Number of<br />
Shares Issued<br />
Outside the Stock<br />
Plans</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Weighted-<br />
Average<br />
Grant<br />
Date Fair<br />
Value<br />
Per Share<sup style="FONT-SIZE: 85%; VERTICAL-ALIGN: top">(*)</sup></b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2016</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">275,835</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23.76</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Granted</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Vested</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(137,916</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23.76</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Canceled/forfeited</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">137,919</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23.76</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 6pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr style="PAGE-BREAK-INSIDE: avoid">
<td valign="top" width="4%" align="left">(*)</td>
<td valign="top" align="left">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The weighted-average grant date fair value per
share relates to 1,424,946 shares of restricted stock paid as part
of the acquisition of Onyara, of which 137,919 shares are unvested
as of December 31, 2017. See Note 4—“Business
Combinations” for additional information regarding this
transaction.</p>
</td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The fair value of the restricted stock that vested
during the years ended December 31, 2017 and 2016 was
$2.3 million and $4.5 million, respectively. The fair
value of the restricted stock that vested during the year ended
December 31, 2015 was $14.4 million and
$26.5 million, related to restricted stock vesting over a
requisite service period and fully vested common shares issued as
part of Onyara purchase consideration, respectively.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">As of December 31, 2017, there was
$2.2 million of unrecognized stock-based compensation expense
related to restricted stock which is expected to be recognized over
a weighted-average period of 0.67 years.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Restricted Stock Units</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">A summary of information related to RSUs for the
year ended December 31, 2017 is presented below:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="69%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Number of<br />
Shares Issued<br />
Under Stock<br />
Plans</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b><font style="WHITE-SPACE: nowrap">Weighted-Average</font><br />
Grant Date Fair<br />
Value Per Share</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2016</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,836,508</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12.90</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Granted</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,463,870</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12.60</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Vested</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(7,919,416</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12.73</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Canceled/forfeited</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(2,801,121</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">11.70</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,579,841</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">13.10</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The fair value of the RSUs that vested during the
year ended December 31, 2017 and 2016 was
$113.1 million and $25.3 million, respectively. The fair
value of the RSUs vested during the year ended
December 31, 2015 was $1.1 million and
$1.1 million, related to RSUs vesting over a requisite
service period and vested RSUs issued as part of
SequenceIQ purchase consideration, respectively.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">As of December 31, 2017, there was
$106.1 million of unrecognized stock-based compensation
expense related to RSUs which is expected to be recognized over a
weighted-average period of 1.65 years.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Performance-Based Restricted Stock Units</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">A summary of information related to PSUs for the
year ended December 31, 2017 is presented below:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="68%"></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="9%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Number of<br />
Shares Issued<br />
Under Stock<br />
Plans</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b><font style="WHITE-SPACE: nowrap">Weighted-Average</font><br />
Grant Date Fair<br />
Value Per Share</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2016</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">424,503</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">21.16</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Granted</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">714,711</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">13.39</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Vested</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(183,048</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">15.87</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Canceled/forfeited</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(116,309</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">23.26</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested balance—December 31, 2017</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">839,857</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">14.58</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom"></td>
<td valign="bottom"></td>
<td valign="bottom"></td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The fair value of the PSUs that vested during the
year ended December 31, 2017 and 2016 was
$1.9 million and $1.5 million, respectively. There were
no PSUs that vested during the year ended December 31,
2015.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">As of December 31, 2017, there was
$6.7 million of unrecognized stock-based compensation expense
related to PSUs which is expected to be recognized over a
weighted-average period of 0.65 years.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 18pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt">
<b><i>Determining Fair Value for Employee Stock Option
Grants</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company estimated the fair value of stock
options granted using the Black-Scholes option pricing model with
weighted-average assumptions as follows:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="76%"></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected term (in years)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.0</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Risk-free interest rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1.59</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected volatility</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">44</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Dividend rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The fair value of each grant of stock options was
determined using the Black-Scholes option pricing model and
assumptions discussed below. Each of these inputs is subjective and
generally requires significant judgment to determine.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><i>Fair Value of Common Stock</i>. Since the
Company’s IPO, the Company has used the market closing price
of its common stock as reported on the NASDAQ Global Select
Market.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><i>Expected Term.</i> The Company estimates
the expected term for stock options using the simplified method due
to limited historical exercise activity for the Company. The
simplified method calculates the expected term as the midpoint
between the vesting date and the contractual expiration date of the
award.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><i>Expected Volatility.</i> Due to the limited
trading history of its common stock, the expected volatility was
derived from the average historical stock volatilities of several
unrelated public companies within the Company’s industry that
it considers to be comparable to its business over a period
equivalent to the expected term of the stock option grants.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><i>Risk-Free Interest Rate.</i> The risk-free
interest rate is based on the U.S. Treasury yield curve in effect
at the time of grant for the expected term of the stock-based
award.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><i>Dividend Rate.</i> The expected dividend
yield is zero, as the Company does not currently pay a dividend and
does not expect to do so in the foreseeable future.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Determining Fair Value for Market-Based PSUs</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">For PSUs that are market-based, the fair value of
the Company’s common stock on the grant date is determined
using the Monte Carlo valuation model. The Company estimated the
fair value of market-based PSUs granted using the Monte Carlo
valuation model with the following assumptions:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="76%"></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Risk-free interest rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1.51</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected volatility</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">67</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Dividend rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><i>Expected Term.</i> The full contractual
term is used to determine the median derived service period which
could be shorter than the full contractual term.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><i>Expected Volatility.</i> The expected
volatility was derived from simulating the Company’s stock
price over the remaining performance period using the historical
volatility calculated from the daily stock returns over a lookback
term from the grant date.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify"><i>Risk-free Interest Rate.</i> The risk-free
interest rate is based on the U.S. Treasury yield curve in effect
at the time of grant for the derived service period of the
stock-based award.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify"><i>Dividend Rate.</i> The expected dividend
yield is zero, as the Company does not currently pay a dividend and
does not expect to do so in the foreseeable future.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Restricted Stock and Stock Options Subject to
Repurchase</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The 2011 Plan allowed for the granting of options
that may be exercised before the options have vested. Shares issued
as a result of early exercise are shares that have not vested and
are deemed to be restricted stock; they are subject to a vesting
schedule identical to the vesting schedule of the related options,
as well as certain other restrictions. Shares issued as a result of
early exercise that have not vested are subject to repurchase by
the Company upon termination of the purchaser’s employment or
services, at the price paid by the purchaser, and are not deemed to
be issued for accounting purposes until those related shares vest.
The amounts received in exchange for these shares have been
recorded as a liability on the accompanying consolidated balance
sheets and will be reclassified into common stock and additional
<font style="WHITE-SPACE: nowrap">paid-in</font> capital as the
shares vest. The Company’s right to repurchase these shares
generally lapses with respect to 1/48 of the original grant amount
per month over four years.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The number of shares of restricted stock and early
exercised options to purchase common stock outstanding subject to
the Company’s right of repurchase as of December 31,
2017 and 2016 was 10,500 and 30,708, respectively, which had
repurchase prices ranging from $8.46 to $14.22 per share. The
liability for shares subject to repurchase as of December 31,
2017 and 2016 was $0.1 million and $0.4 million,
respectively.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>2014 Employee Stock Purchase Plan</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company’s ESPP was adopted and approved
by the Company’s Board of Directors in September 2014, was
adopted and approved by the Company’s stockholders in
November 2014, and was amended in August 2015 to allow employees of
certain of the Company’s <font style="WHITE-SPACE: nowrap">non-U.S.</font> subsidiaries to participate
in the ESPP. The ESPP initially reserved and authorized the
issuance of up to a total of 2,500,000 shares of common stock
to participating employees. The ESPP provides that the number of
shares reserved and available for issuance will automatically
increase each January 1, beginning on January 1, 2015, by
the lesser of (i) 1,000,000 shares of common stock,
(ii) one percent of the outstanding number of shares of the
Company’s common stock on the immediately preceding
December 31, or (iii) such lesser number of shares as
determined by the ESPP administrator. This number is subject to
adjustment in the event of a stock split, stock dividend or other
change in the Company’s capitalization. On January 1,
2017, the shares reserved for issuance increased by 614,294
resulting in total shares reserved for issuance under the ESPP of
4,006,767 as of December 31, 2017, of which 1,933,343 remained
available for purchase.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following table summarizes the assumptions used
in the Black-Scholes option pricing model to determine fair value
of the Company’s common shares to be issued under the
ESPP:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr>
<td width="52%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="5" align="center"><b>Years Ended
December 31,</b></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" align="center"><b>2017</b></td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" align="center"><b>2016</b></td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" align="center"><b>2015</b></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected term (in years)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.5-1.0</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.5-1.0</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.5-1.0</font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Risk-free interest rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.51%-1.24%</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.25%-0.70%</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.10%-0.40%</font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected volatility</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">18%-47%</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">26%-52%</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">35%-41%</font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Dividend rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center">—%</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center">—%</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center">—%</td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">Each employee who is a participant in the ESPP may
purchase shares by authorizing payroll deductions of up to
15 percent of his or her base compensation during an offering
period. Unless the participating employee has previously withdrawn
from the offering, his or her accumulated payroll deductions will
be used to purchase shares on the last business day of the offering
period at a price equal to 85 percent of the fair market value
of the shares on the first business day or the last business day of
the offering period, whichever is lower. Under applicable tax
rules, an employee may purchase no more than $25,000 worth of
shares of common stock, valued at the start of the purchase period,
under the ESPP in any calendar year.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">As of December 31, 2017, there was
$1.4 million of unrecognized stock-based compensation expense
related to the ESPP, which is expected to be recognized over a
weighted-average period of 0.32 years.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Cash received from the purchases of shares under
the ESPP during the year ended December 31, 2017 was
$7.4 million.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Determining Fair Value for <font style="WHITE-SPACE: nowrap">Non-Employees</font></i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Stock-based compensation expense related to stock
options and RSUs granted to <font style="WHITE-SPACE: nowrap">non-employees</font> is recognized as the
stock options and RSUs vest.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">During the years ended December 31, 2017, 2016
and 2015, the Company granted <font style="WHITE-SPACE: nowrap">non-employees</font> RSUs covering 13,200,
193,000 and 7,416 shares of common stock, respectively, which had
weighted-average grant date fair values of $13.04, $8.99 and $21.71
per share, respectively. As of December 31, 2017, options to
purchase 38,533 shares of common stock granted to <font style="WHITE-SPACE: nowrap">non-employees</font> were outstanding with a
weighted-average exercise price of $3.23 per share and RSUs
covering 9,783 shares of common stock granted to <font style="WHITE-SPACE: nowrap">non-employees</font> were unvested with a
weighted-average grant date fair value of $15.04 per share. As of
December 31, 2016, options to purchase 59,677 shares of common
stock granted to <font style="WHITE-SPACE: nowrap">non-employees</font> were outstanding with a
weighted-average exercise price of $2.29 per share and RSUs
covering 95,529 shares of common stock granted to <font style="WHITE-SPACE: nowrap">non-employees</font> were unvested with a
weighted-average grant date fair value of $9.52 per share.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Stock-based compensation expense related to
<font style="WHITE-SPACE: nowrap">non-employee</font> options and
RSUs was $0.5 million, $1.3 million and $0.6 million
for the years ended December 31, 2017, 2016 and 2015,
respectively.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company believes that the fair value of the
stock options is more reliably measurable than the fair value of
services received. The fair value of the stock options granted is
calculated at each reporting date using the Black-Scholes option
pricing model with the following weighted-average assumptions as of
each of the following periods ended:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="78%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="4%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="4%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected term (in years)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.3</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Risk-free interest rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2.20</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1.40</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1.74</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected volatility</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">29</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">47</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">45</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Dividend rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt">
<b><i>Stock-Based Compensation Expense</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Total stock-based compensation expense, including
stock-based compensation expense to <font style="WHITE-SPACE: nowrap">non-employees,</font> by category was as
follows (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="65%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cost of revenue</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">7,676</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,700</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,702</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Sales and marketing</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">35,210</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">25,787</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">11,688</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Research and development</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">38,771</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">36,540</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">15,193</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
General and administrative</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">28,379</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">30,796</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">11,356</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total stock-based compensation expense</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">110,036</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">98,823</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">40,939</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">In February 2016, one of the executives of the
Company voluntarily canceled a stock option to purchase 1,185,000
shares. As a result, the Company recognized in general and
administrative expense a stock-based compensation expense of
$10.0 million during the year ended December 31,
2016.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Warrants</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">In July 2011, the Company issued a warrant to
purchase 6,500,000 shares of Series A preferred stock at an
exercise price of $0.005 per share. The warrant was issued to
Yahoo! Inc. (“Yahoo!”) in connection with the
Company’s Series A financing and the transactions
contemplated thereby, including commercial agreements with Yahoo!
providing for support subscription offerings and certain rights to
technology. In 2017, Verizon Communications, Inc.
(“Verizon”) acquired the operating assets of Yahoo!.
Yahoo! was subsequently renamed Altaba Inc. (“Altaba”),
and the July 2011 warrant remained an asset of Altaba. As of
December 31, 2017, the warrant was exercisable into 3,250,000
shares of common stock.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">In June 2014, the Company issued to Yahoo!
a warrant to purchase a number of shares of common stock up to
one percent of the sum of (i) 45,585,496, plus (ii) the
number of shares of Series D preferred stock or shares of such
stock issuable upon exercise of warrants to purchase such stock (on
an as converted to common stock basis) issued or issuable upon
exercise of warrants to purchase Series D preferred stock that
were sold, if any, by the Company during the period commencing on
June 9, 2014 and ending immediately prior to the occurrence of
a corporate event at an exercise price of $8.46 per
share. As described above, in 2017, Verizon acquired the operating
assets of Yahoo!, and Yahoo! was subsequently renamed Altaba. The
June 2014 warrant remained an asset of Altaba. As of
December 31, 2017, the warrant was exercisable into 476,368
shares of common stock.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">Each warrant expires nine years from the date of
issuance. The warrants vested upon consummation of the
Company’s IPO in December 2014. As of December 31, 2017,
neither warrant had been exercised into shares of common stock.
Refer to Note 14—“Related Party
Transactions” for additional information regarding related
party transactions.</p>
</div>
200188000
0.00
P6Y0M18D
662470
16.74
0
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Stock-Based Compensation Expense</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company recognizes compensation costs related
to employee stock options, time-based restricted stock units
(“RSUs”), performance-based restricted stock units
(“PSUs”), restricted stock awards and participation in
the Company’s 2014 Employee Stock Purchase Plan, as amended
(“ESPP”), based on the estimated fair value of each
award on the grant date and forfeitures as they occur beginning on
January 1, 2017. The Company estimates the grant date fair
value of options using the Black-Scholes option pricing model. The
Company estimates the grant date fair value of RSUs and PSUs that
are not market-based using the closing market price of the
Company’s common stock on the grant date. The Company
estimates the grant date fair value of market-based PSUs with
<font style="WHITE-SPACE: nowrap">pre-established</font> market
conditions using the Monte Carlo valuation model. The Company
estimates fair value of each ESPP purchase at the beginning of the
offering period using the Black-Scholes option pricing model. The
respective grant date fair values of stock options, restricted
stock, RSUs, PSUs that are not market-based and each ESPP purchase
are recognized on a straight-line basis over the requisite service
periods, which correspond to the vesting periods.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company recognizes compensation costs related
to restricted stock granted in connection with an acquisition based
upon the fair market value of the underlying shares of common stock
on the grant date, which is generally considered to be the closing
date of the acquisition.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The Company recognizes compensation costs related
to stock options and RSUs issued <font style="WHITE-SPACE: nowrap">to non-employees based</font> on
the fair value of the awards on the grant date, determined using
the Black-Scholes option pricing model and the closing market price
of the Company’s common stock on the grant date,
respectively. The fair values of stock options and RSUs granted
<font style="WHITE-SPACE: nowrap">to non-employees are</font>
remeasured each period as the stock options and RSUs vest, and the
resulting change in value, if any, is recognized in the
consolidated statements of operations during the period the related
services are performed.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">PSUs allow the recipients of such awards to earn
fully vested shares of the Company’s common stock upon the
achievement <font style="WHITE-SPACE: nowrap">of pre-established performance</font>
objectives. For PSUs that are not market-based, stock-based
compensation expense is recognized when the performance objective
is expected to be achieved. On a quarterly basis, the Company
evaluates the performance criteria attainment for these PSUs. The
cumulative effect on current and prior periods of a change in the
estimated number of PSUs expected to be earned is recognized as
compensation expense or as a reduction of previously recognized
compensation expense in the period of the revised estimate. For
market-based PSUs, stock-based compensation expense is recognized
over a derived service period. The derived service period is
inferred from the Monte Carlo valuation model and may be shorter in
duration than the performance period for a particular market-based
PSU award. If the PSU award vests as a result of market performance
of the Company’s common stock prior to the end of the derived
service period, the compensation expense related to the vested
award that had not previously been recognized would be recognized
upon vesting.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b>12. SEGMENT AND GEOGRAPHICAL INFORMATION</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company’s chief operating decision maker
reviews financial information on a consolidated basis for the
purposes of allocating resources and evaluating financial
performance. The Company’s chief operating decision maker has
direct reports responsible for various functions within the Company
(<i>e.g.</i> business strategy, finance, legal, business
development, products, etc.) on a consolidated basis. There are no
segment managers who are held accountable for operations or
operating results. The Company’s primary growth strategy is
predicated upon the growth of the support subscription business,
and the Company’s key business metrics reflect this strategy.
Professional services are offered with the overall goal of securing
and retaining support subscription customers and growing support
subscription revenue. Accordingly, management has determined that
the Company operates in one reportable segment.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following table summarizes the Company’s
revenue by customer domicile (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="61%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended
December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top"><font style="FONT-FAMILY: Times New Roman">United
States</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">$187,926</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">$137,933</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">$105,842</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top"><font style="FONT-FAMILY: Times New Roman">United
Kingdom</font></td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">21,929</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">21,025</font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td valign="bottom" colspan="2" align="right"><font style="FONT-FAMILY: Times New Roman">3,815</font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Rest of world</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">51,955</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">25,503</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">12,287</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total revenue</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">261,810</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">184,461</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">121,944</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt" align="justify">No individual country other than the United States
and the United Kingdom accounted for more than 10 percent of
total revenue during any of the periods presented.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following table summarizes the Company’s
tangible long-lived assets by country (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="76%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="74%"></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
United States</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,671</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">15,838</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Ireland</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,120</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,033</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
India</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,578</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">471</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Rest of world</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,014</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,039</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 3em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total property and equipment, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">16,383</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">19,381</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">No individual country other than the United States,
Ireland and India accounted for more than 10 percent of total
tangible long-lived assets as of December 31, 2017 and 2016,
respectively.</p>
</div>
23500000
0
2277179
7397000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b>2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Basis of Presentation and Consolidation</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The consolidated financial statements have been
prepared in accordance with generally accepted accounting
principles (“GAAP”) in the United States
(“U.S.”) and include the accounts of the Company and
its wholly owned subsidiaries. All intercompany transactions and
balances have been eliminated in consolidation.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Use of Estimates</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The preparation of consolidated financial
statements in conformity with U.S. GAAP requires management to make
estimates and assumptions that affect the reported amounts of
assets, liabilities, revenue, and expenses, the related disclosure
of contingent assets and liabilities at the date of the
consolidated financial statements and the reported amounts of
expenses during the reporting period. The Company bases its
estimates and judgments on its historical experience, knowledge of
current conditions and its beliefs regarding what may occur in the
future given available information. Estimates, assumptions and
judgments are used for, but are not limited to, revenue
recognition, stock-based awards, accounting for income taxes,
allowance for doubtful accounts, valuation and determination of
other-than-temporary impairments of notes receivable and certain
accrued liabilities. Actual results may differ from these
estimates.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Concentration of Risk</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; MARGIN-LEFT: 75px; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Credit Risk</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; MARGIN-LEFT: 75px; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Financial instruments, which potentially subject
the Company to concentration of credit risk, consist primarily of
cash and cash equivalents and investments. The Company places its
cash and cash equivalents with major financial institutions, which
management assesses to be of high-credit quality.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; MARGIN-LEFT: 75px; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company’s investment policies limit
investments to those that are investment grade, liquid securities
and restricts placement of these investments to issuers evaluated
as creditworthy.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 18pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; MARGIN-LEFT: 75px; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Concentration of Revenue and Accounts Receivable</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; MARGIN-LEFT: 75px; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company generally does not require collateral
or other security in support of accounts receivable. Allowances are
provided for individual accounts receivable when the Company
becomes aware of a customer’s inability to meet its
financial obligations, such as in the case of bankruptcy,
deterioration in the customer’s operating results or change
in financial position. If circumstances related to customers
change, estimates of the recoverability of receivables would be
further adjusted. The Company also considers broad factors in
evaluating the sufficiency of its allowances for doubtful accounts,
including the length of time receivables are past due,
significant <font style="WHITE-SPACE: nowrap">one-time</font>events, creditworthiness of
customers and historical experience.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; MARGIN-LEFT: 75px; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Significant customers are those which represent
10 percent or more of the Company’s total revenue or
gross accounts receivable balance for each respective consolidated
statement of operations and consolidated balance sheet period. For
the years ended December 31, 2017, 2016 and 2015, there were
no customers that represented 10 percent or more of the
Company’s total revenue.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; MARGIN-LEFT: 75px; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">As of both December 31, 2017 and 2016, there
were no customers that represented 10 percent or more of the
Company’s gross accounts receivable balance.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Cash and Cash Equivalents</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Cash and cash equivalents consist of cash, money
market funds, U.S. Treasury bills, commercial paper, and corporate
notes and bonds with original maturities of three months or less at
the time of purchase.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Operating cash deposits held with banks may exceed
the amount of insurance provided on such deposits. Generally, these
deposits may be redeemed upon demand and are maintained with
financial institutions with reputable credit and therefore bear
minimal credit risk. The Company seeks to mitigate its credit risk
by spreading such risk across multiple counterparties and
monitoring the risk profiles of these counterparties.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Investments</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company classifies its debt securities as
“trading,” <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">“available-for-sale”</font></font> or <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">“held-to-maturity,”</font></font> depending
on management’s intent at the time of purchase. Unrealized
losses on <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">available-for-sale</font></font> securities
are charged against net earnings when a decline in fair value is
determined to be other-than-temporary. The Company’s
management reviews several factors to determine whether a loss is
other-than-temporary, such as the length and extent of the fair
value decline and the financial condition and near-term prospects
of the issuer. For debt securities, management also evaluates
whether the Company has the intent to sell or will likely be
required to sell before its anticipated recovery. Realized gains
and losses are accounted for on the specific identification
method.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify"><font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">Available-for-sale</font></font> debt
instruments with original maturities at the date of purchase
greater than approximately three months and remaining maturities of
less than one year are classified as short-term
investments. <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">Available-for-sale</font></font> debt
instruments with remaining maturities beyond one year are
classified as long-term investments.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Fair Value Measurement</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Fair value is defined as the price that would be
received to sell an asset or paid to transfer a liability in the
principal market (or most advantageous market, in the absence of a
principal market) for the asset or liability in an orderly
transaction between market participants at the measurement date.
Further, entities are required to maximize the use of observable
inputs and minimize the use of unobservable inputs in measuring
fair value, and to utilize a three-level fair value hierarchy that
prioritizes the inputs used to measure fair value. The three levels
of inputs used to measure fair value are as follows:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify"><i>Level</i><i> 1</i>—Quoted prices in
active markets for identical assets or liabilities.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify"><i>Level</i><i> 2</i>—Observable inputs
other than quoted prices included within Level 1, including
quoted prices for similar assets or liabilities in active markets;
quoted prices for identical or similar assets or liabilities in
markets that are not active; and inputs other than quoted prices
that are observable or are derived principally from, or
corroborated by, observable market data by correlation or other
means.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify"><i>Level</i><i> 3</i>—Unobservable
inputs that are supported by little or no market activity, are
significant to the fair value of the assets or liabilities, and
reflect the Company’s own assumptions about the assumptions
market participants would use in pricing the asset or liability
developed based on the best information available in the
circumstances.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Restricted Cash</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Restricted cash includes collateral used to secure
a credit card, and may not be used or transferred until the
restriction is released by the issuing bank. Restricted cash also
includes amounts to secure letters of credit issued in lieu of
deposits on office space.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Software Development Costs</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company develops open source software that is
generally freely available on the Apache Hadoop platform.
Capitalization of software development costs begins upon the
establishment of technological feasibility and ceases when the
product is available for general release. There is usually a very
minimal passage of time between the achievement of technological
feasibility and the availability of the Company’s software
for general release. Accordingly, there are no capitalized software
development costs for the years ended December 31, 2017 and
2016.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Internal Use Software</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company’s capitalized internal use
software costs were not material for the years ended
December 31, 2017 and 2016.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Property and Equipment</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Property and equipment are stated at cost.
Depreciation is computed using a straight-line method over the
estimated useful lives, determined to be two years for purchased
software, two to three years for computer equipment, and five years
for network and communication equipment and furniture and fixtures.
Expenditures for repairs and maintenance are charged to expenses as
incurred. Leasehold improvements are amortized on a straight-line
basis over the term of the lease, or the useful life of the assets,
whichever is shorter.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Goodwill and Long-Lived Assets</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Goodwill is tested for impairment on an annual
basis and between annual tests if events or circumstances indicate
that an impairment loss may have occurred. The test is based on a
comparison of the reporting unit’s book value to its
estimated fair market value. The annual impairment test is
performed by the Company during the fourth quarter of each fiscal
year using the opening consolidated balance sheet as of the first
day of the fourth quarter, with any resulting impairment recorded
in the fourth quarter of the fiscal year. During the year ended
December 31, 2017, the Company determined that the fair value
of its sole reporting unit exceeded its carrying value, and as a
result, no goodwill impairment was recorded in fiscal 2017. Since
the Company’s inception, goodwill has not been impaired.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Long-lived assets (including property and
equipment) are reviewed for impairment whenever events or changes
in circumstances indicate that the carrying amount of such assets
may not be recoverable. In such instances, the recoverability of
assets to be held and used is measured first by a comparison of the
carrying amounts of the assets or asset groups to future
undiscounted net cash flows expected to be generated by the assets
or asset groups. If such assets or asset groups are considered to
be impaired, an impairment loss would be recognized if the carrying
amount of the assets or asset groups exceeds the fair value of the
assets or asset groups. During the year ended
December 31, 2016, the Company recognized an
impairment charge of $2.7 million in operating expenses due to
a promissory note and related interest receivable. During the year
ended December 31, 2016, the Company determined that it is
probable that the promissory note and related interest receivable
are unrecoverable due to our estimate of the third-party service
provider’s illiquidity and unfavorable rate of cash use.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Revenue Recognition</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Apache Hadoop, Apache NiFi and associated open
source technology projects within the Apache Software Foundation
are made freely available within the open source
community. While these technologies have emerged to enable the
modern data center architecture, they are complex to deploy and
consume as individual components inhibiting broad adoption by
enterprises. The Company’s efforts are thus focused on
creating a software distribution of these projects by assembling
key component software projects into an open platform that address
the needs of enterprises. By working in concert with the Apache
community to develop Connected Data Platforms, Hortonworks Data
Platform (“HDP”), Hortonworks DataFlow
(“HDF”) and other offerings, the Company’s
software distribution provides customers with a scalable, secure
and governed environment for their data requirements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Connected Data Platforms are made available under
an Apache open source license. Open source software is an
alternative to proprietary developed software and represents a
different model for the development and licensing of commercial
software code than that typically used for proprietary software.
Because open source software code is generally freely shared, the
Company does not typically generate any direct revenue from its
software development activities.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company generates the predominant amount of its
revenue through support (support subscription) and consulting and
education services (professional services) arrangements with its
enterprise customers. The Company’s professional services
provide assistance in the implementation process and education
related activities.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company prices support subscription offerings
based on the number of servers in a cluster, or nodes, core or edge
devices, data under management and/or the scope of support
provided. The Company’s consulting services are priced
primarily on a time and materials basis, and to a lesser extent, a
fixed fee basis, and education services are priced based on
attendance.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Under the Company’s support subscription and
professional services arrangements, revenue is recognized when
(i) persuasive evidence of an arrangement exists;
(ii) the services have been delivered; (iii) the
arrangement fee is fixed or determinable; and
(iv) collectability is probable.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 18pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Support Subscription Revenue</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In single-element arrangements, support
subscription fees are recognized on a ratable basis over the
support subscription term. The Company’s support subscription
arrangements do not typically contain refund provisions for fees
earned related to support services performed.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Professional Services Revenue</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Professional services revenue is derived from
customer fees for consulting services engagements and education
services. The Company’s consulting services are provided
primarily on a time and materials basis and, to a lesser extent, a
fixed fee basis, and education services are priced based on
attendance. Revenue from professional services, when such services
are sold in single-element arrangements, is recognized as the
services are performed.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Multiple-Element Arrangements</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company’s multiple-element arrangements
generally include support subscription combined with professional
services. The Company has not established vendor-specific objective
evidence of fair value (“VSOE”) for its support
subscriptions and professional services offerings, and the Company
recognizes revenue on a ratable basis over the period beginning
when both the support subscription and professional services have
substantially commenced, and ending at the conclusion of the
support subscription or professional services period, whichever is
longer. Under the Company’s multiple-element arrangements,
the support subscription element generally has the longest service
period and the professional services element is performed during
the earlier part of the support subscription period. On occasion,
the Company may sell engineering services and/or a premium
subscription agreement that provides a customer with development
input and the opportunity to work more closely with its
developers.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company’s agreements with customers often
include multiple support subscription and/or professional services
elements, and these elements are sometimes included in separate
contracts. The Company considers an entire customer arrangement to
determine if separate contracts should be considered linked
arrangements for the purposes of revenue recognition.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Revenue recognition requires judgment, including
whether a software arrangement includes multiple elements, and if
so, whether VSOE exists for those elements. A portion of revenue
may be recorded as unearned due to undelivered elements. Changes to
the elements in a software arrangement, the ability to identify the
VSOE for those elements and the VSOE of all respective elements
could materially impact the amount of earned and unearned revenue
in a given period.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Revenue from Strategic Relationships and Reseller
Arrangements</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company has strategic relationships and
reseller arrangements with third parties (collectively,
“Partners”). Under these arrangements, the Company is
not the primary obligor for what is ultimately sold by the Partners
to their end customers. The amount recognized as revenue from sales
to end users represents the amount due to the Company from the
Partners and is generally recognized on a ratable basis over the
applicable services term under support subscription revenue.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Deferred Revenue</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Deferred revenue consists of amounts billed to
customers but not yet recognized in revenue.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">As of December 31, 2017 and 2016,
substantially all of the Company’s accounts receivable
represents amounts billed to customers but not yet received or
recognized as revenue and are thus recorded as deferred
revenue.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Accounts Receivable and Allowance for Doubtful
Accounts</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Accounts receivable are recorded at the invoiced
amount, net of allowances for doubtful accounts. The allowance for
doubtful accounts is based on the assessment of the collectability
of accounts. The Company regularly reviews the adequacy of the
allowance for doubtful accounts by considering the age of each
outstanding invoice and the collection history of each customer to
determine whether a specific allowance is appropriate. When deemed
uncollectable, accounts receivable are reserved via the allowance
for doubtful accounts and charged against bad debt expense or the
related deferred revenue, as applicable.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Cost of Revenue</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Cost of support subscription revenue consists
primarily of personnel costs (including cash compensation, benefits
and stock-based compensation expense) for employees, including
support engineers, associated with the Company’s support
subscription offerings mainly related to technology support and
allocated shared costs. Cost of professional services revenue
consists primarily of personnel costs (including cash compensation,
benefits and stock-based compensation expense) for employees and
fees to subcontractors associated with the Company’s
professional service contracts, travel costs and allocated shared
costs.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company allocates shared costs such as rent,
information technology and employee benefits to all departments
based on headcount. As such, allocated shared costs are reflected
in cost of revenue and each operating expense category. Cost of
revenue for support subscription and professional services is
expensed as incurred.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Sales and Marketing Expenses</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Sales and marketing expenses consist primarily of
personnel costs (including cash compensation, commissions, benefits
and stock-based compensation expense) for the Company’s sales
and marketing employees. In addition, sales and marketing expense
include the cost of advertising, online marketing, promotional
events, corporate communications, product marketing, other
brand-building activities, plus allocated shared costs. All costs
of advertising, including cooperative marketing arrangements, are
expensed as incurred. Advertising expense totaled
$8.9 million, $9.1 million and $11.1 million for the
years ended December 31, 2017, 2016 and 2015,
respectively.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Research and Development Expenses</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Research and development expenses consist primarily
of personnel costs (including cash compensation, benefits and
stock-based compensation expense) for the Company’s research
and development employees, costs associated with subcontractors and
equipment lease expenses, plus allocated shared costs. The
Company’s research and development expenses include costs for
development related to the distribution of its solutions, including
security updates, fixes, functionality enhancements, upgrades to
the technology and new versions of the software, quality assurance
personnel, technical documentation personnel and at times, expenses
related to engineering resources for its subscription and
professional services offerings.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>General and Administrative Expenses</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">General and administrative expenses consist
primarily of personnel costs (including cash compensation, benefits
and stock-based compensation expense) for our executive, finance,
human resources, information technology, legal and other
administrative employees. In addition, general and administrative
expenses include fees for third-party professional services,
including consulting, accounting and legal services and other
corporate expenses and allocated overhead.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Stock-Based Compensation Expense</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company recognizes compensation costs related
to employee stock options, time-based restricted stock units
(“RSUs”), performance-based restricted stock units
(“PSUs”), restricted stock awards and participation in
the Company’s 2014 Employee Stock Purchase Plan, as amended
(“ESPP”), based on the estimated fair value of each
award on the grant date and forfeitures as they occur beginning on
January 1, 2017. The Company estimates the grant date fair
value of options using the Black-Scholes option pricing model. The
Company estimates the grant date fair value of RSUs and PSUs that
are not market-based using the closing market price of the
Company’s common stock on the grant date. The Company
estimates the grant date fair value of market-based PSUs
with <font style="WHITE-SPACE: nowrap">pre-established</font> market
conditions using the Monte Carlo valuation model. The Company
estimates fair value of each ESPP purchase at the beginning of the
offering period using the Black-Scholes option pricing model. The
respective grant date fair values of stock options, restricted
stock, RSUs, PSUs that are not market-based and each ESPP purchase
are recognized on a straight-line basis over the requisite service
periods, which correspond to the vesting periods.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company recognizes compensation costs related
to restricted stock granted in connection with an acquisition based
upon the fair market value of the underlying shares of common stock
on the grant date, which is generally considered to be the closing
date of the acquisition.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company recognizes compensation costs related
to stock options and RSUs issued <font style="WHITE-SPACE: nowrap">to non-employees based</font> on
the fair value of the awards on the grant date, determined using
the Black-Scholes option pricing model and the closing market price
of the Company’s common stock on the grant date,
respectively. The fair values of stock options and RSUs
granted <font style="WHITE-SPACE: nowrap">to non-employees are</font> remeasured
each period as the stock options and RSUs vest, and the resulting
change in value, if any, is recognized in the consolidated
statements of operations during the period the related services are
performed.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">PSUs allow the recipients of such awards to earn
fully vested shares of the Company’s common stock upon the
achievement <font style="WHITE-SPACE: nowrap">of pre-established performance</font> objectives.
For PSUs that are not market-based, stock-based compensation
expense is recognized when the performance objective is expected to
be achieved. On a quarterly basis, the Company evaluates the
performance criteria attainment for these PSUs. The cumulative
effect on current and prior periods of a change in the estimated
number of PSUs expected to be earned is recognized as compensation
expense or as a reduction of previously recognized compensation
expense in the period of the revised estimate. For market-based
PSUs, stock-based compensation expense is recognized over a derived
service period. The derived service period is inferred from the
Monte Carlo valuation model and may be shorter in duration than the
performance period for a particular market-based PSU award. If the
PSU award vests as a result of market performance of the
Company’s common stock prior to the end of the derived
service period, the compensation expense related to the vested
award that had not previously been recognized would be recognized
upon vesting.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Income Taxes</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company accounts for income taxes using an
asset and liability approach. Deferred income tax assets and
liabilities are computed for differences between the financial
statement and income tax basis of assets and liabilities that will
result in taxable or deductible amounts in the future. Such
deferred income tax asset and liability computations are based on
enacted tax laws and rates applicable to periods in which the
differences are expected to affect taxable income. A valuation
allowance is established, when necessary, for any portion of
deferred income tax assets where it is considered more likely than
not that it will not be realized.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The tax effects of the Company’s income tax
positions are recognized only if determined “more likely than
not” to be sustained based solely on the technical merits as
of the reporting date. The Company considers many factors when
evaluating and estimating its tax positions and tax benefits, which
may require periodic adjustments and which may not accurately
anticipate actual outcomes.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company accounts for excess tax benefits and
tax deficiencies as income tax expense or benefit, treated as
discrete items in the reporting period in which they occur, and
recognizes previously unrecognized deferred tax assets that arose
directly from (or the use of which was postponed by) tax deductions
related to equity compensation in excess of compensation recognized
for financial reporting.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Foreign Currency</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The remeasurement of foreign currencies creates
remeasurement adjustments that are included in the consolidated
statements of operations. For the year ended December 31,
2017, the net loss from remeasurement adjustments was
$3.1 million. For the years ended December 31, 2016 and
2015, the net gains from remeasurement adjustments were
immaterial.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">For subsidiaries
with <font style="WHITE-SPACE: nowrap">non-U.S.</font> dollar
functional currencies, the impact of changes in foreign currency
exchange rates resulting from the translation of foreign currency
financial statements into U.S. dollars for financial reporting
purposes is included in other comprehensive gain (loss). Assets and
liabilities are translated into U.S. dollars at exchange rates in
effect at the balance sheet date. Income and expense items are
translated at average rates for the period. Foreign transaction
gains and losses are recorded as they are realized and were
immaterial in 2017, 2016, and 2015.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Net Loss Per Share of Common Stock</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Basic net loss per share of common stock is
calculated by dividing the net loss by the weighted-average number
of common shares outstanding during the period, less restricted
common stock and common stock issued that is subject to repurchase,
and excludes any dilutive effects of share-based awards. Diluted
net loss per share of common stock is the same as basic net loss
per share of common stock, because the effects of potentially
dilutive securities are anti-dilutive.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Recently Issued Accounting Pronouncements</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In May 2017, the Financial Accounting Standards
Board (“FASB”) issued Accounting Standards Update
(“ASU”) <font style="WHITE-SPACE: nowrap">No. 2017-09,</font> <i>Compensation-Stock
Compensation (Topic 718): Scope of Modification
Accounting,</i> which provides guidance about
which changes to the terms or conditions of a share-based payment
award require an entity to apply modification accounting under
Topic 718. The ASU is effective for all entities for fiscal years
beginning after December 15, 2017, including interim periods
within those fiscal years. The Company anticipates
that <font style="WHITE-SPACE: nowrap">ASU 2017-09 will</font> not
have a material impact on its consolidated financial
statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In January 2017, FASB
issued <font style="WHITE-SPACE: nowrap">ASU No. 2017-04,</font><i> Intangibles-Goodwill
and Other (Topic 350): Simplifying the Test for Goodwill
Impairment</i>, which eliminates Step 2 from the goodwill
impairment test. The standard requires an entity to perform its
annual, or interim, goodwill impairment test by comparing the fair
value of a reporting unit with its carrying amount. An entity
should recognize an impairment charge for the amount by which the
carrying amount exceeds the reporting unit’s fair value. In
addition, the ASU eliminates the requirements for any
reporting unit with a zero or negative carrying amount to perform a
qualitative assessment. The ASU is effective for public
companies for fiscal years beginning after December 15, 2019.
Early adoption is permitted. The Company anticipates
that <font style="WHITE-SPACE: nowrap">ASU 2017-04 will</font> not
have a material impact on its consolidated financial
statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In January 2017, FASB
issued <font style="WHITE-SPACE: nowrap">ASU No. 2017-01,</font><i> Business
Combinations (Topic 805): Clarifying the Definition of a
Business,</i> which clarifies the definition of a business
with the objective of adding guidance to assist entities with
evaluating whether transactions should be accounted for as
acquisitions (or disposals) of assets or businesses. The ASU is
effective for public companies for fiscal years beginning after
December 15, 2017, including interim periods within those
fiscal years. The Company anticipates
that <font style="WHITE-SPACE: nowrap">ASU 2017-01 will</font> not
have a material impact on its consolidated financial
statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In November 2016, FASB issued
ASU <font style="WHITE-SPACE: nowrap">No. 2016-18,</font> <i>Statement
of Cash Flows (Topic 230): Restricted Cash</i>, which provides
guidance to decrease the diversity in practice in the
classification and presentation of changes in restricted cash on
the statements of cash flows. The ASU is effective for public
companies for fiscal years beginning after December 15, 2017,
including interim periods within those fiscal years. Early adoption
is permitted. The Company anticipates that
ASU <font style="WHITE-SPACE: nowrap">2016-18</font> will not
have a material impact on its consolidated financial
statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In August 2016, FASB issued
ASU <font style="WHITE-SPACE: nowrap">No. 2016-15,</font> <i>Statement
of Cash Flows (Topic 230): Classification of Certain Cash Receipts
and Cash Payments</i>, which provides guidance to decrease the
diversity in practice in how certain cash receipts and cash
payments are presented and classified in the statements of cash
flows. The ASU is effective for public companies for fiscal years
beginning after December 15, 2017, including interim periods
within those fiscal years. Early adoption is permitted. The Company
anticipates that ASU <font style="WHITE-SPACE: nowrap">2016-15</font> will not
have a material impact on its consolidated financial
statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In February 2016, FASB issued
ASU <font style="WHITE-SPACE: nowrap">No. 2016-02,</font> <i>Leases
(Topic 842),</i> which, for operating leases,
requires a lessee to recognize a <font style="WHITE-SPACE: nowrap"><font style="WHITE-SPACE: nowrap">right-of-use</font></font> asset
and a lease liability, initially measured at the present value of
the lease payments, in its balance sheet. The standard also
requires a lessee to recognize a single lease cost, calculated so
that the cost of the lease is allocated over the lease term, on a
generally straight-line basis. The ASU is effective for public
companies for fiscal years beginning after December 15, 2018,
including interim periods within those fiscal years. Early adoption
is permitted. The Company is currently evaluating the effect that
adoption of ASU <font style="WHITE-SPACE: nowrap">2016-02</font> will have on
its consolidated financial statements.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In May 2014, FASB
issued <font style="WHITE-SPACE: nowrap">ASU No. 2014-09,</font><i> Revenue
from Contracts with Customers (Topic
606) </i>(the “new standard”), which
will replace most existing revenue recognition guidance in U.S.
GAAP when it becomes effective. The new standard requires an entity
to recognize the amount of revenue to which it expects to be
entitled upon transfer of promised goods or services to customers.
The new standard defines a five-step process in order to
achieve this core principle, which may require the use of judgment
and estimates, and also requires expanded qualitative and
quantitative disclosures relating to the nature, amount, timing and
uncertainty of revenue and cash flows arising from contracts with
customers, including significant judgments and estimates used.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In August 2015, FASB
issued <font style="WHITE-SPACE: nowrap">ASU No. 2015-14,</font><i> Revenue
from Contracts with Customers (Topic 606): Deferral of Effective
Date</i>, which defers the effective date of the new
standard by one year allowing early adoption as of the
original effective date of January 1, 2017. The deferral
results in the new revenue standard being effective for the Company
as of January 1, 2018. Additional ASUs have been issued to
amend or clarify the new standard as follows:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 6pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr style="break-inside: avoid">
<td width="5%"> </td>
<td valign="top" width="2%" align="left">•</td>
<td valign="top" width="1%"> </td>
<td valign="top" align="left">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-TOP: 0pt" align="justify"><font style="WHITE-SPACE: nowrap">ASU No. 2016-12,</font><i> Revenue
from Contracts with Customers (Topic 606)</i>:<i> Narrow-Scope
Improvements and Practical Expedients</i> was issued in May
2016. <font style="WHITE-SPACE: nowrap">ASU 2016-12 amends</font> the
new revenue recognition standard to clarify the guidance on
assessing collectability, <font style="WHITE-SPACE: nowrap">measuring non-cash consideration,</font> presenting
sales taxes and certain transition matters.</p>
</td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 6pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr style="break-inside: avoid">
<td width="5%"> </td>
<td valign="top" width="2%" align="left">•</td>
<td valign="top" width="1%"> </td>
<td valign="top" align="left">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-TOP: 0pt" align="justify"><font style="WHITE-SPACE: nowrap">ASU No. 2016-10,</font><i> Revenue
from Contracts with Customers (Topic 606): Identifying Performance
Obligations and Licensing</i> was issued in April
2016. <font style="WHITE-SPACE: nowrap">ASU 2016-10 addresses</font> implementation
issues identified by the FASB-International Accounting Standards
Board Joint Transition Resource Group (“TRG”) for
Revenue Recognition concerning identifying performance obligations
and accounting for licenses of intellectual property.</p>
</td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 6pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 0pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WORD-SPACING: 0px; BORDER-COLLAPSE: collapse; TEXT-TRANSFORM: none; ORPHANS: 2; WIDOWS: 2; LETTER-SPACING: normal; TEXT-INDENT: 0px; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" cellspacing="0" cellpadding="0" width="100%" border="0">
<tr style="break-inside: avoid">
<td width="5%"> </td>
<td valign="top" width="2%" align="left">•</td>
<td valign="top" width="1%"> </td>
<td valign="top" align="left">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; MARGIN-TOP: 0pt" align="justify"><font style="WHITE-SPACE: nowrap">ASU No. 2016-08,</font><i> Revenue
from Contracts with Customers (Topic 606): Principal versus Agent
Considerations (Reporting Revenue Gross versus Net)</i> was
issued in March 2016. <font style="WHITE-SPACE: nowrap">ASU 2016-08 requires</font> an
entity to determine whether the nature of its promise to provide
goods or services to a customer is performed in a principal or
agent capacity and to recognize revenue in a gross or net manner
based on its principal or agent designation.</p>
</td>
</tr>
</table>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The new standard permits adoption either by using
(i) a full retrospective approach for all periods presented or
(ii) a modified retrospective approach with the cumulative
effect of initially applying the new standard recognized at the
date of initial application and providing certain additional
disclosures. The Company adopted the new standard as of
January 1, 2018 using the modified retrospective approach. The
Company’s decision was based on a number of factors such as
the significance of the impact of the new standard on the
Company’s financial results, system readiness, including that
of software procured from third-party providers, and the
Company’s ability to accumulate and analyze the information
necessary to assess the cumulative effect of the new standard
through January 1, 2018.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company has substantially completed its
evaluation of the impact of the new standard on its accounting
policies, processes and system requirements. The Company has
assigned internal resources in addition to the engagement of
third-party service providers to assist in the evaluation and to
provide periodic updates to management and the Audit Committee. In
evaluating the risks associated with the adoption of the new
accounting standard, the Company has identified and scoped the
different revenue streams and reviewed contracts in each revenue
stream for terms and conditions that could result in different
accounting treatment. Furthermore, the Company has made and will
continue to make investments in systems to enable timely and
accurate reporting under the new standard. While the Company
continues to assess all potential impacts under the new standard,
significant impacts are expected to the timing and amount of
support subscription and professional services revenue recognized,
as well as the capitalization and amortization of contract
acquisition costs. In addition, the Company
will update certain disclosures, as
applicable, included in its filings pursuant to the Securities
Exchange Act of 1934, as amended, to meet the requirements of the
new standard.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Under current industry-specific software revenue
recognition guidance, the Company has concluded it has not
established VSOE for support subscriptions and professional
services offerings in multiple-element arrangements where support
subscriptions are sold with professional services. The Company
recognizes revenue on a ratable basis over the period beginning
when both the support subscription and professional services have
substantially commenced, and ending at the conclusion of the
support subscription or professional services period, whichever is
longer. The new standard, which does not retain the concept of
VSOE, requires an evaluation of whether support subscriptions and
professional services are distinct performance obligations, and
therefore should be separately recognized as the respective
performance obligations are satisfied based on the standalone
selling price for each performance obligation, which may not be on
a ratable basis. Based on the Company’s evaluation under the
new standard, the timing of revenue recognition will change
significantly for professional services bundled in multiple-element
arrangements and currently recognized ratably due to lack of VSOE
for support subscriptions. In particular, professional services
revenue will be recognized in an earlier period and over a shorter
timeframe under the new standard as the services are delivered
compared to the Company’s current accounting policy under the
existing standards and guidance. Also, the timing of recognition
will change to begin in an earlier period for some support
subscriptions bundled in multiple-element arrangements compared to
the Company’s current accounting policy for multiple-element
arrangements whereby recognition generally begins when both the
support subscription and professional services have substantially
commenced.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">As part of its evaluation, the Company has also
considered the impact of the guidance in Accounting Standards
Codification <font style="WHITE-SPACE: nowrap">(“ASC”) 340-40</font><i>,</i><i> Other
Assets and Deferred Costs; Contracts with Customers</i>, and the
interpretations of the FASB TRG for Revenue Recognition from their
November 7, 2016 meeting with respect to the capitalization
and amortization of incremental costs of obtaining a contract
(<i>e.g.</i>, sales commissions). For contracts with an expected
duration greater than one year, the new standard requires the
capitalization of incremental costs that the Company incurs to
obtain a contract with a customer that it would not have incurred
if the contract had not been obtained, provided the Company expects
to recover the costs. Such capitalized costs are then to be
amortized on a systematic basis that is consistent with the
transfer to the customer of the services to which such costs
relate, and the amortization period may extend beyond the initial
contract term if renewal commissions on expected renewals are not
commensurate with the commission on the initial contract. Under the
Company’s current accounting policy, incremental costs
incurred to obtain a contract are expensed when incurred. Thus, the
application of the new standard will result in a significant change
to the Company’s current accounting policy for contract
acquisition costs, which will result in the Company recognizing the
expense for contract acquisition costs in a different period, and
over a longer period, compared to the Company’s current
practice under the existing standards and guidance.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The Company adopted the new standard effective
January 1, 2018, by recognizing the cumulative effect of
initially applying the new standard. As a result of adopting
ASU <font style="WHITE-SPACE: nowrap">2014-09</font> <i>(Topic
606)</i> and its corresponding ASUs, accumulated
deficit will decrease by approximately $23.0 million to
$28.0 million and as a result of adopting
ASC <font style="WHITE-SPACE: nowrap">340-40,</font>accumulated deficit will
decrease by approximately $47.0 million to
$52.0 million.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 18pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial">
<b><i>Recently Adopted Accounting Pronouncements</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 6pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">In March 2016, FASB
issued <font style="WHITE-SPACE: nowrap">ASU No. 2016-09,</font><i> Compensation-Stock
Compensation (Topic 718): Improvements to Employee Share-Based
Payment Accounting</i>, which simplifies several aspects of the
accounting for employee share-based payment transactions for both
public <font style="WHITE-SPACE: nowrap">and non-public entities,</font> including
the accounting for income taxes, forfeitures and statutory tax
withholding requirements, as well as classification in the
statements of cash flows. The ASU is effective for public companies
for fiscal years beginning after December 15, 2016, including
interim periods within those fiscal years. The Company adopted the
standard as of January 1, 2017. As a result of adopting this
standard, the Company made an accounting policy election to account
for forfeitures as they occur. This change was applied on a
modified retrospective basis, resulting in a cumulative-effect
adjustment increasing accumulated deficit by $0.7 million as
of January 1, 2017.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Prior to January 1, 2017, the Company
recognized the excess tax benefits of stock-based compensation
expense as <font style="WHITE-SPACE: nowrap">additional paid-in capital,</font> and
tax deficiencies of stock-based compensation expense in the income
tax provision or as <font style="WHITE-SPACE: nowrap">additional paid-in capital</font> to
the extent that there were sufficient recognized excess tax
benefits previously recognized. As a result of the prior
requirement that excess tax benefits reduce taxes payable prior to
being recognized as an increase in
additional <font style="WHITE-SPACE: nowrap">paid-in</font> capital, the
Company had not recognized certain deferred tax assets (all tax
attributes such as loss or credit carryforwards) that could be
attributed to tax deductions related to equity compensation in
excess of compensation recognized for financial reporting.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">Effective as of January 1, 2017, the Company
adopted a change in accounting policy in accordance with the
standard to account for excess tax benefits and tax deficiencies as
income tax expense or benefit, treated as discrete items in the
reporting period in which they occur, and to recognize previously
unrecognized deferred tax assets that arose directly from (or the
use of which was postponed by) tax deductions related to equity
compensation in excess of compensation recognized for financial
reporting. The change was applied on a modified retrospective
basis; no prior periods were restated as a result of this change in
accounting policy.</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: "Times New Roman"; WHITE-SPACE: normal; WORD-SPACING: 0px; TEXT-TRANSFORM: none; FONT-WEIGHT: 400; COLOR: rgb(0,0,0); FONT-STYLE: normal; ORPHANS: 2; WIDOWS: 2; MARGIN-TOP: 12pt; LETTER-SPACING: normal; TEXT-INDENT: 0px; font-variant-ligatures: normal; font-variant-caps: normal; -webkit-text-stroke-width: 0px; text-decoration-style: initial; text-decoration-color: initial" align="justify">The standard also eliminates the requirement that
excess tax benefits be realized as a reduction in current taxes
payable before the associated tax benefit can be recognized as an
increase in additional <font style="WHITE-SPACE: nowrap">paid-in</font> capital.
Approximately $38.4 million of federal net operating losses
(“NOLs”) and $24.4 million of state NOLs (none of
which were included in the deferred tax assets recognized in the
consolidated balance sheet as of December 31, 2016) have been
attributed to tax deduction for stock-based compensation expense in
excess of the related book expense. Under the standard, these
previously unrecognized deferred tax assets were recognized on a
modified retrospective basis as of January 1, 2017. The U.S.
federal and state NOLs recognized as of January 1, 2017, as
described above, have been offset by a valuation allowance. As a
result, there was <font style="WHITE-SPACE: nowrap">no tax-related cumulative-effect</font> to
accumulated deficit.</p>
</div>
50354000
62875000
1444000
198935000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b>15. SUBSEQUENT EVENT</b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">On January 31, 2018, Altaba (formerly, Yahoo!)
net exercised the warrants issued in July 2011 and June 2014 for a
total of 3,522,730 shares of the Company’s common stock. As a
result of such exercises, neither the July 2011 nor the June 2014
warrants is outstanding.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Accounts Receivable and Allowance for Doubtful
Accounts</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Accounts receivable are recorded at the invoiced
amount, net of allowances for doubtful accounts. The allowance for
doubtful accounts is based on the assessment of the collectability
of accounts. The Company regularly reviews the adequacy of the
allowance for doubtful accounts by considering the age of each
outstanding invoice and the collection history of each customer to
determine whether a specific allowance is appropriate. When deemed
uncollectable, accounts receivable are reserved via the allowance
for doubtful accounts and charged against bad debt expense or the
related deferred revenue, as applicable.</p>
</div>
HDP
333000
66356474
2900000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Use of Estimates</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The preparation of consolidated financial
statements in conformity with U.S. GAAP requires management to make
estimates and assumptions that affect the reported amounts of
assets, liabilities, revenue, and expenses, the related disclosure
of contingent assets and liabilities at the date of the
consolidated financial statements and the reported amounts of
expenses during the reporting period. The Company bases its
estimates and judgments on its historical experience, knowledge of
current conditions and its beliefs regarding what may occur in the
future given available information. Estimates, assumptions and
judgments are used for, but are not limited to, revenue
recognition, stock-based awards, accounting for income taxes,
allowance for doubtful accounts, valuation and determination of
other-than-temporary impairments of notes receivable and certain
accrued liabilities. Actual results may differ from these
estimates.</p>
</div>
5294000
0
396000
-1151000
0
12322000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>Sales and Marketing Expenses</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">Sales and marketing expenses consist primarily of
personnel costs (including cash compensation, commissions, benefits
and stock-based compensation expense) for the Company’s sales
and marketing employees. In addition, sales and marketing expense
include the cost of advertising, online marketing, promotional
events, corporate communications, product marketing, other
brand-building activities, plus allocated shared costs. All costs
of advertising, including cooperative marketing arrangements, are
expensed as incurred. Advertising expense totaled
$8.9 million, $9.1 million and $11.1 million for the
years ended December 31, 2017, 2016 and 2015,
respectively.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt">
<b><i>Support Subscription Revenue</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">In single-element arrangements, support
subscription fees are recognized on a ratable basis over the
support subscription term. The Company’s support subscription
arrangements do not typically contain refund provisions for fees
earned related to support services performed.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt">
<b><i>General and Administrative Expenses</i></b></p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">General and administrative expenses consist
primarily of personnel costs (including cash compensation, benefits
and stock-based compensation expense) for our executive, finance,
human resources, information technology, legal and other
administrative employees. In addition, general and administrative
expenses include fees for third-party professional services,
including consulting, accounting and legal services and other
corporate expenses and allocated overhead.</p>
</div>
<div>
<p style="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">
<b><i>Professional Services Revenue</i></b></p>
<p style="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" align="justify">Professional services revenue is derived from
customer fees for consulting services engagements and education
services. The Company’s consulting services are provided
primarily on a time and materials basis and, to a lesser extent, a
fixed fee basis, and education services are priced based on
attendance. Revenue from professional services, when such services
are sold in single-element arrangements, is recognized as the
services are performed.</p>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company reserved shares of common stock, on an
<font style="WHITE-SPACE: nowrap">as-if</font> converted basis, for
future issuance as follows:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="100%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="80%"></td>
<td valign="bottom" width="1%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
<td valign="bottom" width="1%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
                     </td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="6" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock warrants</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,250,000</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,250,000</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Exercise and conversion of common stock warrants</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">476,368</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock subject to repurchase</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,500</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">30,708</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Outstanding stock options</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,490,445</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">7,430,094</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested restricted stock</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">137,919</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">275,835</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested RSUs</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,579,841</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">10,836,508</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Unvested PSUs</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">839,857</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">424,503</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Shares available for issuance under Amended 2014 Stock Option and
Incentive Plan</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">706,994</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,234,205</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Shares available for purchase under Amended 2014 Employee Stock
Purchase Plan</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,933,343</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2,451,215</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">21,425,267</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">29,409,436</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
<td valign="bottom"> </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company estimated the fair value of
market-based PSUs granted using the Monte Carlo valuation model
with the following assumptions:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="76%"></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Risk-free interest rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1.51</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected volatility</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">67</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Dividend rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
</table>
</div>
0
176000
1.00
3100000
176000
0.35
0.0715
3250000
10500
476368
292978
9579841
137919
4490445
839857
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt" align="justify">The Company estimated the fair value of stock
options granted using the Black-Scholes option pricing model with
weighted-average assumptions as follows:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="76%"></td>
<td valign="bottom" width="7%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="6%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>Years Ended December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected term (in years)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" nowrap="nowrap" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.0</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Risk-free interest rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1.59</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected volatility</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">44</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Dividend rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
</table>
</div>
0.00
P0Y7M24D
1900000
15.87
23.26
13.39
116309
714711
183048
183048
P1Y7M24D
113100000
12.73
11.70
12.60
2801121
9463870
7919416
-1000
7919416
1000
13200
P0Y8M2D
2300000
23.76
0
0
0
0
137916
P6Y3M19D
0.00
0.0220
0.29
P10Y
P4Y
0.020833333
ISOs granted under the 2011 Plan generally vest 25 percent after the completion of 12 months of service and the balance in equal monthly installments over the next 36 months of service, and expire 10 years from the date of grant (subject to earlier expiration upon the occurrence of certain events). ISOs granted to a 10 percent stockholder expire five years from the date of grant (subject to earlier expiration upon the occurrence of certain events)
ISOs granted under the Amended 2014 Plan generally vest 25 percent after the completion of 12 months of service and the balance in equal monthly installments over the next 36 months of service, and expire 10 years from the date of grant (subject to earlier expiration upon occurrence of certain events). ISOs granted to a 10 percent stockholder expire five years from the date of grant (subject to earlier expiration upon occurrence of certain events)
P10Y
P5Y
P36M
P12M
0.25
P0Y8M5D
0.00
0.0151
0.67
2015-04-23
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The acquisition date fair value of the purchase
consideration was $10.0 million, which included the following
(in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="90%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">3,721</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash holdback for a period of 15 months for general representations
and warranties</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,875</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash payable upon <font style="WHITE-SPACE: nowrap">18-month</font>
anniversary of closing date</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,651</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Contingent consideration</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,625</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Vested RSUs (49,102 shares at fair value of $21.97 per share)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1,079</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,951</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following table summarizes the allocation of
the consideration paid of approximately $10.0 million to the
fair values of the assets acquired and liabilities assumed at the
acquisition date (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="68%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="86%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Tangible assets acquired, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">191</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Developed technology</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,395</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Goodwill</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">5,785</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Deferred tax liabilities, net</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(420</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">9,951</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
2015-08-31
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The acquisition date fair value of the purchase
consideration was $26.5 million, which included the following
(in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="89%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Common stock (921,643 shares at fair value of $23.76 per share)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">21,898</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Holdback of 194,259 shares of common stock for a period of 12
months for general representations and warranties</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">4,616</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">26,514</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 0pt" align="justify">The following table summarizes the allocation of
the consideration paid of approximately $26.5 million to the
fair values of the assets acquired and liabilities assumed at the
acquisition date (in thousands):</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="68%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="84%"></td>
<td valign="bottom" width="8%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Goodwill</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">26,429</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Cash</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">180</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Tangible liabilities acquired</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">(95</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 1px solid; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Total</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">26,514</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td valign="bottom">
<p style="MARGIN-BOTTOM: 0pt; BORDER-TOP: #000000 3px double; MARGIN-TOP: 0pt">
 </p>
</td>
<td> </td>
</tr>
</table>
</div>
0.10
0.10
P2Y
P5Y
7676000
28379000
879000
38771000
35210000
The state tax credits do not expire and will carry forward indefinitely until utilized.
2018
The federal tax credits will expire at various dates beginning in 2031, unless previously utilized.
2031
In general, RSUs granted to employees and non-employees typically vest over no more than three years.
0.10
P3Y
1.00
1.10
P0Y3M26D
7400000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The following table summarizes the assumptions used
in the Black-Scholes option pricing model to determine fair value
of the Company’s common shares to be issued under the
ESPP:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="92%" align="center" border="0">
<tr>
<td width="52%"></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
<td valign="bottom" width="3%"></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="5" align="center"><b>Years Ended
December 31,</b></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" align="center"><b>2017</b></td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" align="center"><b>2016</b></td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" align="center"><b>2015</b></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected term (in years)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.5-1.0</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.5-1.0</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.5-1.0</font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Risk-free interest rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.51%-1.24%</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.25%-0.70%</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">0.10%-0.40%</font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected volatility</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">18%-47%</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">26%-52%</font></td>
<td valign="bottom">  </td>
<td valign="bottom" align="center"><font style="WHITE-SPACE: nowrap">35%-41%</font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Dividend rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center">—%</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center">—%</td>
<td valign="bottom">  </td>
<td valign="bottom" align="center">—%</td>
</tr>
</table>
</div>
0.85
P1Y
0.00
0.0124
0.47
P6M
0.00
0.0051
0.18
0.00
P3Y
P2Y
P5Y
P5Y
P15Y
2031
P1Y
2018
P3M
2666000
110036000
651000
7397000
0
12322000
176000
844000
0
-184903
1132166
0
137916
2297387
-651000
-204507000
0
21929000
187926000
51955000
110036000
500000
<div>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 12pt" align="justify">The fair value of the stock options granted is
calculated at each reporting date using the Black-Scholes option
pricing model with the following weighted-average assumptions as of
each of the following periods ended:</p>
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 12pt; MARGIN-TOP: 0pt">
 </p>
<table style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; BORDER-COLLAPSE: collapse" cellspacing="0" cellpadding="0" width="84%" align="center" border="0">
<tr style="COLOR: white; LINE-HEIGHT: 0pt; VISIBILITY: hidden">
<td width="78%"></td>
<td valign="bottom" width="5%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="4%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
<td valign="bottom" width="4%"></td>
<td></td>
<td style="FONT-SIZE: 8pt" nowrap="nowrap">
<b>                     </b></td>
<td></td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="10" align="center"><font style="FONT-FAMILY: Times New Roman"><b>December 31,</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 8pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="bottom"> </td>
<td valign="bottom">  </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2017</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2016</b></font></td>
<td valign="bottom"> </td>
<td valign="bottom"> </td>
<td style="BORDER-BOTTOM: #000000 1pt solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman"><b>2015</b></font></td>
<td valign="bottom"> </td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected term (in years)</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.3</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.1</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">6.4</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman"> </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Risk-free interest rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">2.20</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1.40</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">1.74</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid" bgcolor="#CCEEFF">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Expected volatility</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">29</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">47</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">45</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
<tr style="FONT-SIZE: 10pt; FONT-FAMILY: Def.-Times; PAGE-BREAK-INSIDE: avoid">
<td valign="top">
<p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-LEFT: 1em; MARGIN-TOP: 0pt; TEXT-INDENT: -1em">
Dividend rate</p>
</td>
<td valign="bottom">  </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
<td valign="bottom"> </td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman">—</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman">% </font></td>
</tr>
</table>
</div>
13.04
0.21
474000
9100000
2683000
23167008
98823000
881000
10000
682000
17584000
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0
1130000
1197000
72170000
67000
23030000
27000
7244000
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-0.0049
0.3400
-0.2475
0.0824
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-602000
0.0254
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0.0201
335000
112291000
80723000
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1074000
79493000
5630000
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29584000
464000
1224000
1773000
11000
856000
52000
9093000
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363467000
91533000
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712000
0
-517000
-551000
9900000
34000
0
43000
243000
520000
80519000
12781000
1625000
9466000
89248000
13156000
514000
99202000
2638000
184461000
P6Y8M23D
183542000
13200000
0
5631000
87693000
49140000
57772000
1076000
126689000
875000
57203067
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0
3526000
88153000
172000
460000
2334000
46000
4349000
0
3250000
30708
476368
442992
10836508
275835
7430094
424503
0.00
1500000
120474
25300000
2561364
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P6Y1M6D
0.00
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30796000
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P1Y
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9688750
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421727
3223
1957888
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21025000
137933000
25503000
98823000
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