Stockholders’ Equity and Stock Based Compensation — Our authorized capital stock consists of 75 million shares of common stock, par value $0.0001 per share, and 25 million shares of preferred stock, par value $0.0001 per share.

Changes in Stockholders’ Equity. Changes in stockholders’ equity for the three months ended March 31, 2016 consisted of:



	(Dollars in thousands)
Balance at January 1, 2016	$	333,553
Net income for the three months ended March 31, 2016	3,444
Cash dividends declared	(2,638		)
Amortization of stock based compensation	637
Common stock repurchase program	(4,905		)
Balance at March 31, 2016	$	330,091

General. At March 31, 2016 and December 31, 2015, there were 20,603,617 and 20,886,261 shares of common stock outstanding, respectively, and no shares of preferred stock outstanding.

The following table summarizes the activities under the 2012 Equity Incentive Award Plan (the "2012 Equity Plan") from January 1, 2016 through March 31, 2016:



	Activity
Total equity securities available at January 1, 2016	1,483,235
Less: 2015 LTIP Restricted Stock Units ("RSUs") awarded to eligible employees, net	227,958
Less: Restricted common stock awarded to non-executive members of the Board of Directors	5,869
Total equity securities available at March 31, 2016	1,249,408

2015 LTIP. On December 9, 2014, our Board of Directors adopted an LTIP (which provides for a 36 month vesting period) that included a stock component in the form of RSUs. Under this incentive program, RSUs will be granted to eligible employees annually and each annual grant will generally vest over a three year performance period. Our Board of Directors also approved that future cash dividends related to the RSUs will be set aside and paid in cash to each eligible employee when the RSUs are converted into shares of common stock. RSUs would be converted into shares of common stock on the earlier of a change in control of the Company (as defined in the 2015 LTIP) or on or after the third business day following the day that we file the Annual Report on Form 10-K with the SEC for the grant's final vesting year, but in no event later than December 31 of the year following the vesting date if the pre-established performance conditions are achieved. Any unvested RSUs awarded under the 2015 LTIP and the related cash dividends are forfeited if the participant terminates employment with the Company.

On January 2, 2015, our Board of Directors granted 254,777 RSUs to eligible employees under the 2012 Equity Plan for the 2015 LTIP pursuant to a Restricted Stock Unit Agreement with a grant date fair value of $4.4 million. Eligible employees have the opportunity to earn RSUs based upon the achievement of performance goals established by our Board of Directors for our consolidated revenue and operating cash flows (as defined by the Company) during the period of January 1, 2015 through December 31, 2017 (“the 2015-2017 performance period”), and continued employment with the Company. As of December 31, 2015, 242,468 shares related to this grant remained outstanding. For the three months ended March 31, 2016, 2,161 RSUs were forfeited by eligible employees who left the company. As of March 31, 2016 there were 240,307 RSUs outstanding relating to shares granted in January 2015. A total of $0.3 million was included in stock based compensation expense for the three months ended March 31, 2016 relating to this grant.

On January 28, 2016, our Board of Directors granted 227,082 RSUs to eligible employees under the 2012 Equity Plan for the 2015 LTIP pursuant to a Restricted Stock Unit Agreement with a grant date fair value of $3.8 million. Eligible employees have the opportunity to earn RSUs based upon the achievement of performance goals established by our Board of Directors for our consolidated revenue and operating cash flows (as defined by the Company) during the period of January 1, 2016 through December 31, 2018 (“the 2016-2018 performance period”), and continued employment with the Company. For the three months ended March 31, 2016, 2,046 RSUs were forfeited by eligible employees who left the company and 5,082 RSUs were granted to eligible employees who joined the company during the period. As of March 31, 2016 there were 230,118 RSUs outstanding relating to shares granted in January 2016. A total of $0.2 million was included in stock based compensation expense for the three months ended March 31, 2016 relating to this grant.

The following table details activities with respect to RSUs issued and outstanding under the 2015 LTIP for the three months ended March 31, 2016:



	Shares		Weighted- Average Grant Date Fair Value		Total Unrecognized Compensation Cost		Weighted-Average Period Over Which Cost is Expected to be Recognized (In months)
Non-vested RSUs at January 1, 2016	242,468		$	17.35
Granted	232,164		16.83
Vested	—		—
Forfeited	(4,207	)	17.09
Non-vested RSUs at March 31, 2016	470,425		$	17.09	$	6,085	27

Stock Based Compensation. Compensation expense associated with RSUs and restricted common stock ("restricted stock") was recognized based on the fair value of the instruments, over the instruments’ vesting period. The following table reflects the statements of income line items for stock based compensation expense for the periods stated:



	For the Three Months Ended March 31,
Operating Expense Category	2016		2015
	(Dollars in thousands)
Cost of revenue (LTIP)	$	49	$	34
Service, rental and maintenance (LTIP)	52		29
Selling and marketing (LTIP)	48		51
General and administrative (LTIP)	380		236
General and administrative (Board of Directors Restricted Stock)	108		93
Total stock based compensation	$	637	$	443

The increase in stock based compensation expense during the three months ended March 31, 2016, compared to the same period in 2015, was due primarily to the second RSU grant under the 2015 LTIP in January 2016. Each grant is amortized over the corresponding three year performance period beginning in the year of issuance.

Cash Dividends to Stockholders. The following table details our cash dividend payments made in 2016. Cash dividends paid as disclosed in the statements of cash flows for the three months ended March 31, 2016 and 2015 included previously declared cash dividends on shares of vested restricted stock issued to our non-executive directors and dividends related to vested RSUs issued to eligible employees. Cash dividends on RSUs and restricted stock have been accrued and are paid when the applicable vesting conditions are met. Accrued cash dividends on forfeited restricted stock and RSUs are also forfeited.

Declaration Date

Record Date

Payment Date

Per Share Amount

Total Payment⁽¹⁾

(Dollars in thousands)

February 24

March 18

March 30

0.125

2,580

(1) The total payment reflects the cash dividends paid in relation to common stock and vested restricted stock.

Future Cash Dividends to Stockholders. On April 27, 2016, our Board of Directors declared a regular quarterly cash dividend of $0.125 per share of common stock with a record date of May 23, 2016, and a payment date of June 24, 2016. This cash dividend of approximately $2.6 million will be paid from available cash on hand.

Common Stock Repurchase Program. In October 2015, the Board of Directors extended the common stock repurchase program through December 31, 2016. In extending the common stock repurchase plan the Board of Directors reset the purchase authority to $10.0 million with the repurchase authority to begin the earlier of January 4, 2016 or the completion of the existing common stock repurchase program. The following table presents information with respect to purchases made by the Company during the three months ended March 31, 2016:



Period	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of the Publicly Announced Plans or Programs⁽¹⁾	Approximate Dollar Value of Shares That May Yet Be Purchased Under the Publicly Announced Plans or Programs⁽¹⁾
					(Dollars in thousands)
Beginning Balance					$	10,000
January 1 through January 31, 2016	152,198	$	16.53	152,198	7,484
February 1 through February 29, 2016	101,736	17.24		101,736	5,730
March 1 through March 31, 2016	37,927	16.44		37,927	5,107
Total	291,861	$	16.76	291,861

(1) In October 2015, the Board of Directors extended the common stock repurchase program through December 31, 2016, and maintained the repurchase authority of $10.0 million as of January 4, 2016.

Additional Paid-in Capital. For the three months ended March 31, 2016, additional paid-in capital decreased by $4.2 million to $106.2 million at March 31, 2016 from $110.4 million at December 31, 2015. The decrease in the three months ended March 31, 2016 was due primarily to the repurchase of shares of common stock under the current stock repurchase program.

Net Income per Common Share. Basic net income per common share is computed on the basis of the weighted average common shares outstanding. Diluted net income per common share is computed on the basis of the weighted average common shares outstanding plus the effect of all potentially dilutive common shares including outstanding restricted stock and RSUs, which are treated as contingently issuable shares, using the “treasury stock” method. The components of basic and diluted net income per common share were as follows for the periods stated:



	For the Three Months Ended March 31,
	2016		2015
	(Dollars in thousands, except share and per share amounts)
Net income	$	3,444	$	3,917
Weighted average shares of common stock outstanding	20,683,719		21,898,792
Dilutive effect of restricted stock and RSUs	161,942		154,223
Weighted average shares of common stock and common stock equivalents	20,845,661		22,053,015
Net income per common share
Basic	$	0.17	$	0.18
Diluted	$	0.17	$	0.18