8.	STOCKHOLDERS' EQUITY

Restricted Stock

The Company has two stock incentive plans: a Long-Term Incentive Plan (the “LTIP”) and a Non-Employee Directors Restricted Stock Plan (the “Non-Employee Directors Plan”).

Under the LTIP, certain employees received awards of restricted shares of common stock based on service and performance. The number of shares granted to each employee is based on the fair market value of a share of common stock on the date of grant.

On May 13, 2016, performance-based shares were granted which vest over two years on March 15, 2017 and March 15, 2018 based upon the attainment of a financial responsibility ratio during each fiscal year ending December 31, 2016 and 2017. As of December 31, 2017 half of the shares have vested as the vesting criteria was achieved. There is no restriction on the right to vote or the right to receive dividends with respect to any of the restricted shares.

On December 18, 2014, performance-based shares were granted which vest over four years based upon the attainment of (i) a specified operating income margin during any one or more of the fiscal years in the period beginning January 1, 2015 and ending December 31, 2018 and (ii) the attainment of earnings before interest, taxes, depreciation and amortization targets during each of the fiscal years ended December 31, 2015 through 2018. As of December 31, 2017 half of the shares have vested as the vesting criteria was achieved. There is no restriction on the right to vote or the right to receive dividends with respect to any of the restricted shares.

Pursuant to the Non-Employee Directors Plan, each non-employee director of the Company receives an annual award of restricted shares of common stock on the date of the Company’s annual meeting of shareholders. The number of shares granted to each non-employee director is based on the fair market value of a share of common stock on that date. There is no restriction on the right to vote or the right to receive dividends with respect to any of the restricted shares.

In 2017, 2016 and 2015, the Company completed a net share settlement for 189,420, 71,805 and 85,740 restricted shares and stock options exercised, respectively, on behalf of certain employees that participate in the LTIP upon the vesting of the restricted shares pursuant to the terms of the LTIP or exercise of the stock options. The net share settlement was in connection with income taxes incurred on restricted shares or stock option exercises that vested and were transferred to the employee during 2017, 2016 and/or 2015, creating taxable income for the employee. At the employees’ request, the Company will pay these taxes on behalf of the employees in exchange for the employees returning an equivalent value of restricted shares or shares acquired upon the exercise of stock options to the Company. These transactions resulted in a decrease of approximately $0.4 million, $0.2 million and $0.2 million in 2017, 2016 and 2015, respectively, to equity as the cash payment of the taxes effectively was a repurchase of the restricted shares or shares acquired through the exercise of stock options granted in previous years.

The following is a summary of transactions pertaining to restricted stock:

	Shares			Weighted Average Grant Date Fair Value Per Share
Nonvested restricted stock outstanding at December 31, 2015		450,494		$	3.69
Granted		1,105,487			1.67
Cancelled		(76,200	)		2.98
Vested		(336,182	)		3.33
Nonvested restricted stock outstanding at December 31, 2016		1,143,599			1.89

Granted		181,208			2.58
Cancelled		(52,398	)		5.63
Vested		(664,415	)		1.77
Nonvested restricted stock outstanding at December 31, 2017		607,994			1.90

The restricted stock expense for each of the years ended December 31, 2017, 2016 and 2015 was $1.2 million, $1.4 million and $1.1 million, respectively. The unrecognized restricted stock expense as of December 31, 2017 and 2016 was $0.3 million and $1.5 million, respectively. As of December 31, 2017, unrecognized restricted stock expense will be expensed over the weighted-average period of approximately 3 months. As of December 31, 2017, outstanding restricted shares under the LTIP had an aggregate intrinsic value of $1.2 million. For the year ended December 31, 2017 and 2016, respectively, 52,398 and 26,200 shares were cancelled as the performance criteria was not met.

Stock Options

During 2017, 2016 and 2015 there were no new stock option grants. The following is a summary of transactions pertaining to the option plans:

	Shares			Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value
Outstanding January 1, 2015		424,167		$	13.65	4.18 years	$	-
Cancelled		(178,000	)		15.20			-

Outstanding December 31, 2015		246,167			12.52	3.98 years		-
Cancelled		(28,000	)		15.76			-

Outstanding December 31, 2016		218,167			12.11	3.33 years		-
Cancelled		(50,500	)		12.09

Outstanding December 31, 2017		167,667			12.11	2.97 years		-

Vested as of December 31, 2017		167,667			12.11	2.97 years		-

Exercisable as of December 31, 2017		167,667			12.11	2.97 years		-

As of December 31, 2017, there are no unrecognized pre-tax compensation expense for unvested stock option awards.

The following table presents a summary of options outstanding at December 31, 2017:

		At December 31, 2017
		Stock Options Outstanding						Stock Options Exercisable
Range of Exercise Prices		Shares		Contractual Weighted Average life (years)		Weighted Average Exercise Price		Shares		Weighted Average Exercise Price
$	4.00-$13.99		119,667		3.22	$	8.79		119,667	$	8.79
$	14.00-$19.99		17,000		1.84		19.98		17,000		19.98
$	20.00-$25.00		31,000		2.59		20.62		31,000		20.62

			167,667		2.97		12.11		167,667		12.11