Note 4.    Stock-based Compensation

The Company’s share-based compensation plans consist of its 2006 Long-Term Incentives Plan (the “2006 LTIP”) and its 2004 Stock Option Plan. As of December 31, 2015, there were 1,949,400 shares available for grant under the 2006 LTIP.

For the years ended December 31, 2015, 2014 and 2013, the Company recognized stock-based compensation expense of $4,620, $3,610, and $2,973, respectively. For the years ended December 31, 2015, 2014 and 2013, the Company capitalized stock-based compensation of $195, $307, and $130, respectively. The Company has not recognized and currently does not expect to recognize in the foreseeable future, any tax benefit related to stock-based compensation as a result of the full valuation allowance on its net deferred tax assets and its net operating loss carryforwards generated in the U.S.

The following table summarizes the components of stock-based compensation expense in the condensed consolidated statements of operations for the years ended December 31, 2015, 2014 and 2013:

 

 

As of December 31, 2015, the Company had unrecognized compensation costs for all share-based payment arrangements totaling $4,821.

2006 LTIP

The 2006 LTIP provides for grants and awards of stock options, stock appreciation rights (“SARs”), common stock, restricted stock, restricted stock units (“RSUs”), performance units and performance shares to directors and employees. The maximum number of shares available for grant is 9,714,827. Stock options granted pursuant to the 2006 LTIP Plan have a maximum term of 10 years. The SARs expire 10 years from the date of grant and may be payable in cash, shares of common stock or a combination of both upon exercise, as determined by the Compensation Committee. The 2006 LTIP is administrated by the Compensation Committee of the Company’s Board of Directors, which selects persons eligible to receive awards under the 2006 LTIP and determines the number, terms, conditions, performance measures and other provisions of the awards.

Time-Based Stock Appreciation Rights

A summary of the Company’s time-based SARs for the year ended December 31, 2015 is as follows:

 

 

For the years ended December 31, 2015, 2014 and 2013, the Company recorded stock-based compensation expense of $2,194, $1,659  and $1,412 relating to these SARs, respectively. As of December 31, 2015, $1,023 of total unrecognized compensation cost relating to the SARs is expected to be recognized through August 2018.

The weighted-average grant date fair value of the SARs granted in 2015, 2014 and 2013 was $3.40, $3.97 and $3.31 and per share, respectively.

For the year ended December 31, 2015, the intrinsic value of the SARs exercised was $348.

Performance-Based Stock Appreciation Rights

A summary of the Company’s performance-based SARs for the year ended December 31, 2015 is as follows:

 

 

For the years ended December 31, 2015, 2014 and 2013, the Company recorded stock-based compensation expense of $21, $47 and $247 relating to the performance-based SARs, respectively. As of December 31, 2015, $2 of total unrecognized compensation cost related to these SARs is expected to be recognized through March 2016.

The weighted-average grant date fair value of the performance-based SARs granted during the year ended December 31, 2015 was $3.32 per share. The weighted-average grant date fair value of the performance-based SARs granted during the year ended December 31, 2013 was $2.52 per share. There were no performance-based SARs granted during the year ended December 31, 2014.

For the year ended December 31, 2015, the intrinsic value of the performance-based SARs exercised was $69.

The fair value of each time-based and performance-based SAR award is estimated on the date of grant using the Black-Scholes option pricing model with the assumptions described below. For the periods indicated the expected volatility was based on the Company’s historical volatility over the expected terms of SAR awards. Estimated forfeitures were based on voluntary and involuntary termination behavior, as well as analysis of actual forfeitures. The risk-free interest rate was based on the U.S. Treasury yield curve at the time of the grant over the expected term of the SAR grants.

 

 

Time-Based Restricted Stock Units

A summary of the Company’s time-based RSUs for the year ended December 31, 2015 is as follows:

 

 

For the years ended December 31, 2015, 2014 and 2013, the Company recorded stock-based compensation expense of $636, $592 and $357 related to the RSUs, respectively. As of December 31, 2015, $1,891 of total unrecognized compensation cost related to the RSUs is expected to be recognized through December 2016.

Performance-based Restricted Stock Units

A summary of the Company’s performance-based RSUs for the year ended December 31, 2015 is as follows:

 

 

For the years ended December 31, 2015, 2014 and 2013, the Company recorded stock-based compensation expense of $1,124 $914 and $633 related to the performance-based RSUs, respectively. As of December 31, 2015, the Company has $1,905 of total unrecognized compensation cost related to these RSUs, of which $538 is expected to be recognized through the first quarter of 2016 and $1,367 is expected to be recognized through the first quarter of 2017.

The fair value of the time-based and performance-based RSU awards are based upon the closing stock price of the Company’s common stock on the date of grant.

Performance Units

The Company grants Market Performance Units (“MPUs”) to its senior executives based on stock price performance over a three-year period measured on December 31 for each performance period. The MPUs will vest at the end of each performance period only if the Company satisfies the stock price performance targets and continued employment by the senior executives through the dates the Compensation Committee has determined that the targets have been achieved. The value of the MPUs that will be earned each year ranges up to 15% of each of the senior executives’ base salaries in the year of the grant depending on the Company’s stock price performance target for that year. The value of the MPUs can be paid in either cash or common stock or a combination at the Company’s option. The MPUs are classified as a liability and are revalued at the end of each reporting period based on the awards fair value over a three-year period.

As of December 31, 2015, the compensation committee determined that the stock price performance targets was partially achieved for the fiscal year 2015, 2014 and 2013 performance targets.

As the MPUs contain both a performance and service condition, the MPUs have been treated as a series of three separate awards, or tranches, for purposes of recognizing stock-based compensation expense. The Company recognizes stock-based compensation expense on a tranche-by-tranche basis over the requisite service period for that specific tranche. The Company estimated the fair value of the MPUs using a Monte Carlo Simulation Model that used the following assumptions:

 

 

For the years ended December 31, 2015, 2014 and 2013, the Company recorded stock-based compensation of $643, $398 and $324 relating to these MPUs, respectively.

In January 2015, the Company issued 54,801 shares of its common stock as form of payment in connection with MPUs for achieving the fiscal year 2013 and 2014 stock performance target.

In January 2014, the Company issued 33,594 shares of its common stock as a form of payment in connection with MPUs for achieving the fiscal year 2013 stock performance target.

Stock Options

Options granted under the 2006 LTIP or 2004 Stock Option Plan have a maximum term of 10 years and vest over a period determined by the Company’s Board of Directors (generally four years) at an exercise price per share determined by the Board of Directors at the time of grant. The 2004 Stock Option Plan expires 10 years from the effective date, or when all options have been granted, whichever is sooner. The Company did not grant stock options in 2015, 2014 or 2013.

During the year ended December 31, 2015, 50,000 stock options were exercised at a weighted-average exercise price of $4.88 per share and a total intrinsic value of $55. There are no stock options outstanding and available for exercise as of December 31, 2015.