STOCK BASED COMPENSATION

Under the 2012 Omnibus Equity Award Plan, the Company has granted stock options, restricted stock and Performance-Based Restricted Stock Units (“PSUs”) to certain employees and directors. Compensation expense for stock-based awards made to employees and directors in return for service is recorded in accordance with Compensation-Stock Compensation of the FASB ASC. The Company estimates forfeitures that it expects will occur and records expense based upon the number of awards expected to vest.

The Company recorded total stock based compensation expense of $11.1 million, which included $0.9 million of accelerated compensation due to Slashdot Media as shown in Note 12 during the year ended December 31, 2016. The Company recorded $10.2 million and $7.5 million during the years ended December 31, 2015 and 2014 respectively. At December 31, 2016, there was $14.8 million of unrecognized compensation expense related to unvested awards, which is expected to be recognized over a weighted-average period of approximately 1.6 years.

Restricted Stock—Restricted stock is granted to employees of the Company and its subsidiaries, and to non-employee members of the Company’s Board. These shares are part of the compensation plan for services provided by the employees or Board members. The closing price of the Company’s stock on the date of grant is used to determine the fair value of the grants. The expense related to the restricted stock grants is recorded over the vesting period. There was no cash flow impact resulting from the grants.

The restricted stock vests in various increments on the anniversaries of each grant, subject to the recipient’s continued employment or service through each applicable vesting date. Vesting occurs over one year for Board members and over four years for employees.

A summary of the status of restricted stock awards as of December 31, 2016, 2015, and 2014 and the changes during the periods then ended is presented below:



	Year Ended December 31,
	2016				2015				2014
	Shares		Weighted- Average Fair Value at Grant Date		Shares		Weighted- Average Fair Value at Grant Date		Shares		Weighted- Average Fair Value at Grant Date
Non-vested at beginning of the period	2,122,225		$	8.54	1,786,581		$	8.45	1,560,375		$	9.81
Granted	1,302,375		$	7.33	1,261,600		$	8.83	1,114,700		$	7.39
Forfeited	(327,750	)	$	8.17	(245,312	)	$	8.34	(288,450	)	$	8.72
Vested	(870,475	)	$	8.58	(680,644	)	$	8.91	(600,044	)	$	9.87
Non-vested at end of period	2,226,375		$	7.87	2,122,225		$	8.54	1,786,581		$	8.45

PSUs—PSUs are granted to employees of the Company and its subsidiaries. These shares are part of the compensation plan for services provided by the employees. The fair value of PSUs is measured using the Monte Carlo pricing model. The expense related to the PSUs is recorded over the vesting period. These shares will vest on the dates the Compensation Committee certifies the Company’s achievement of stock price performance relative to the Russell 2000 Index, provided that the recipient remains employed through such date. Performance will be measured over three separate measurement periods: a one-year measurement period, a two-year measurement period and a three-year measurement period. For performance periods one and two, vesting is not to exceed total grant divided by three. For performance period three, vesting is no less than zero and no greater than 150% of initial grant less shares vested in performance periods one and two. There was no cash flow impact resulting from the grants. The fair value of PSUs is measured using the Monte Carlo pricing model using the following assumptions:



	Year Ended December 31,
	2016			2015
Weighted average fair value of PSUs granted	$	7.24		$	9.25
Dividend yield	—		%	—		%
Risk free interest rate	0.9		%	1.1		%
Expected volatility	33.5		%	33.6		%

A summary of the status of PSUs as of December 31, 2016 and 2015 and the changes during the periods then ended is presented below:



	Year Ended December 31,
	2016				2015
	Shares		Weighted- Average Fair Value at Grant Date		Shares	Weighted- Average Fair Value at Grant Date
Non-vested at beginning of the period	415,000		$	9.25	—	$	—
Granted	417,500		$	7.24	415,000	$	9.25
Forfeited	(98,751	)	$	8.17	—	$	—
Vested	(153,745	)	$	9.13	—	$	—
Non-vested at end of period	580,004		$	8.02	415,000	$	9.25

Stock Options—The fair value of each option grant is estimated using the Black-Scholes option-pricing model using the weighted-average assumptions in the table below. This valuation model requires the Company to make assumptions and judgments about the variables used in the calculation, including the fair value of the Company’s common stock, the expected life (the period of time that the options granted are expected to be outstanding), the volatility of the Company’s common stock, a risk-free interest rate and expected dividends. The expected life of options granted is derived from historical exercise behavior. The risk-free rate for periods within the expected life of the option is based on the U.S. Treasury rates in effect at the time of grant. The stock options vest 25% after one year, beginning on the first anniversary date of the grant, and 6.25% each quarter following the first anniversary. There was no cash flow impact resulting from the grants. There was no cash flow impact resulting from the grants. No stock options were granted during the years ended December 31, 2016 and 2015.



	Year Ended December 31, 2014
The weighted average fair value of options granted	$	2.62
Dividend yield	—		%
Weighted average risk free interest rate	1.56		%
Weighted average expected volatility	40.16		%
Expected life (in years)	4.6

A summary of the status of options previously granted as of December 31, 2016, 2015, and 2014, and the changes during the periods then ended is presented below:



	Year Ended December 31, 2016
	Options		Weighted-Average Exercise Price		Aggregate Intrinsic Value
Options outstanding at January 1	2,673,512		$	7.46	$	5,485,248
Exercised	(641,710	)	$	4.37	$	2,209,260
Forfeited	(252,189	)	$	8.20	—
Options outstanding at December 31	1,779,613		$	8.46	$	50,869
Exercisable at December 31	1,552,642		$	8.52	$	50,869
Options expected to vest at December 31	225,127		$	8.06



	Year Ended December 31, 2015
	Options		Weighted-Average Exercise Price		Aggregate Intrinsic Value
Options outstanding at January 1	4,667,738		$	6.14	$	19,357,512
Exercised	(1,802,913	)	$	3.92	$	9,162,469
Forfeited	(191,313	)	$	10.76	—
Options outstanding at December 31	2,673,512		$	7.46	$	5,485,248
Exercisable at December 31	2,037,318		$	7.19	$	4,832,280



	Year Ended December 31, 2014
	Options		Weighted-Average Exercise Price		Aggregate Intrinsic Value
Options outstanding at January 1	7,536,601		$	5.53	$	17,493,907
Granted	659,500		$	7.32	—
Exercised	(3,126,522	)	$	4.51	$	13,035,677
Forfeited	(401,841	)	$	9.33	—
Options outstanding at December 31	4,667,738		$	6.14	$	19,357,512
Exercisable at December 31	3,513,920		$	5.43	$	17,239,884

In connection with the Company’s sale of Slashdot Media, the Company accelerated the vesting of 130,375 shares of restricted stock and 24,001 stock options to certain former employees during the year ended December 31, 2016, the expense of which is recorded in Disposition Related and Other Costs in the Consolidated Statements of Operations.

The weighted-average remaining contractual term of options exercisable at December 31, 2016 is 2.2 years. The following table summarizes information about options outstanding as of December 31, 2016:



	Options Outstanding		Options Exercisable
Exercise Price	Number Outstanding	Weighted- Average Remaining Contractual Life	Number Exercisable
		(in years)
$ 6.00 - $ 6.99	426,306	0.1	426,306
$ 7.00 - $ 7.99	421,969	3.8	284,874
$ 8.00 - $ 8.99	214,500	2.5	200,250
$ 9.00 - $ 9.99	480,000	3.3	420,624
$ 10.00 - $ 14.50	236,838	2.3	220,588
	1,779,613		1,552,642