STOCK-BASED COMPENSATION

Stock-based compensation expense included in general and administrative expenses consisted of the following:



	Years Ended December 31,
	2013		2012		2011
PBF LLC Series A Unit compensatory warrants and options	$	779	$	1,589	$	1,135
PBF LLC Series B Units	530		1,277		1,381
PBF Energy options	2,444		88		—
	$	3,753	$	2,954	$	2,516

PBF LLC Series A warrants and options

PBF LLC granted compensatory warrants to employees of the Company in connection with their purchase of Series A units in PBF LLC. The warrants grant the holder the right to purchase PBF LLC Series A Units. One-quarter of the PBF LLC Series A compensatory warrants were exercisable at the date of grant and the remaining three-quarters become exercisable over equal annual installments on each of the first three anniversaries of the grant date subject to acceleration in certain circumstances. A total of 551,759 PBF LLC Series A compensatory warrants were granted during the year ended December 31, 2011. They are exercisable for ten years from the date of grant. The remaining warrants became fully exercisable in connection with the IPO of PBF Energy.

A total of 205,000 and 620,000 options to purchase PBF LLC Series A units were granted to certain employees, management and directors in 2012 and 2011, respectively. Options vest over equal annual installments on each of the first three anniversaries of the grant date subject to acceleration in certain circumstances. The options are exercisable for ten years from the date of grant.

The Company did not issue PBF LLC Series A Units compensatory warrants or options in 2013.

The estimated fair value of compensatory PBF LLC Series A warrants and options granted during the years ended December 31, 2012 and 2011 was determined using the Black-Scholes pricing model with the following weighted average assumptions:



	Years Ended December 31,
	2012			2011
Expected life (in years)	6.00			5.75
Expected volatility	55.00		%	40.00		%
Dividend yield	1.00		%	1.06		%
Risk-free rate of return	0.91		%	2.43		%
Exercise price	$	12.55		$	10.00

The following table summarizes activity for PBF LLC Series A compensatory warrants and options for the years ended December 31, 2013, 2012 and 2011:



	Number of PBF LLC Series A Compensatory Warrants and Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)
Stock-based awards, outstanding January 1, 2011	691,320		$	10.00	9.74
Granted	1,171,759		10.00		10.00
Exercised	(25,000	)	10.00		—
Forfeited	(2,500	)	10.00		—
Outstanding at December 31, 2011	1,835,579		$	10.00	8.99
Granted	205,000		12.55		10.00
Exercised	(849,186	)	10.00		—
Forfeited	(6,667	)	10.00		—
Outstanding at December 31, 2012	1,184,726		$	10.44	8.23
Granted	—		—		—
Exercised	(301,979	)	10.11		—
Forfeited	(41,668	)	11.27		—
Outstanding at December 31, 2013	841,079		$	10.52	7.40
Exercisable and vested at December 31, 2013	545,247		$	10.24	7.23
Exercisable and vested at December 31, 2012	608,039		$	10.00	8.00
Expected to vest at December 31, 2013	841,079		$	10.52	7.40

The total estimated fair value of PBF LLC Series A warrants and options granted in 2012 and 2011 was $1,207 and $2,116, respectively, and the weighted average fair value per unit was $5.89 and $1.81, respectively. The total intrinsic value of stock options outstanding and exercisable at December 31, 2013, was $17,612 and $11,569, respectively. The total intrinsic value of stock options exercised during the years ended December 31, 2013, 2012, and 2011 was $4,298, $13,112, and $0, respectively.

Unrecognized compensation expense related to PBF LLC Series A warrants and options at December 31, 2013 was $595, which will be recognized in 2014 and 2015.

As of December 31, 2013 and 2012, members of management of the Company had also purchased an aggregate of 2,740,718 non-compensatory Series A warrants in PBF LLC with an exercise price of $10.00 per unit, all of which were immediately exercisable. During the year ended December 31, 2012, 2,672,299 of the warrants were exercised, with a portion being exercised on a cashless basis. At December 31, 2013 and December 31, 2012, there were 68,419 non-compensatory warrants outstanding.

PBF LLC Series B Units

PBF LLC Series B Units were issued and allocated to certain members of management during the years ended December 31, 2011 and 2010. One-quarter of the PBF LLC Series B Units vested at the time of grant and the remaining three-quarters vested in equal annual installments on each of the first three anniversaries of the grant date, subject to accelerated vesting upon certain events. The Series B Units fully vested during the year ended December 31, 2013.

The following table summarizes activity for PBF LLC Series B Units for the years ended December 31, 2013, 2012 and 2011:



	Number of PBF LLC Series B units		Weighted Average Grant Date Fair Value
Non-vested units at January 1, 2011	712,500		$	5.11
Allocated	50,000		5.11
Vested	(262,500	)	5.11
Forfeited	—		—
Non-vested units at December 31, 2011	500,000		$	5.11
Allocated	—		—
Vested	(250,000	)	5.11
Forfeited	—		—
Non-vested units at December 31, 2012	250,000		$	5.11
Allocated	—		—
Vested	(250,000	)	5.11
Forfeited	—		—
Non-vested units at December 31, 2013	—		$	—

PBF Energy options

The Company grants awards of its Class A common stock under the 2012 Equity Incentive Plan which authorizes the granting of various stock and stock-related awards to employees, prospective employees and non-employees. Awards include options to purchase shares of Class A common stock and restricted Class A common stock that vest over a period determined by the plan.

A total of 697,500 and 682,500 options to purchase shares of PBF Energy Class A common stock were granted to certain employees and management of the Company in the year ended December 31, 2013 and 2012, respectively. The PBF Energy options vest over equal annual installments on each of the first four anniversaries of the grant date subject to acceleration in certain circumstances. The options are exercisable for ten years from the date of grant.

The estimated fair value of PBF Energy options granted during the years ended December 31, 2013 and 2012 was determined using the Black-Scholes pricing model with the following weighted average assumptions:




	December 31, 2013			December 31, 2012
Expected life (in years)	6.25			6.25
Expected volatility	52.1		%	51.0		%
Dividend yield	4.43		%	3.01		%
Risk-free rate of return	1.53		%	0.89		%
Exercise price	$	27.79		$	26.00

The following table summarizes activity for PBF Energy options for the year ended December 31, 2013 and 2012. There were no options granted, exercised or forfeited prior to 2012.



	Number of PBF Energy Class A Common Stock Options		Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)
Stock-based awards, outstanding at January 1, 2012	—		$	—	—
Granted	682,500		26.00		10.00
Exercised	—		—		—
Forfeited	—		—		—
Outstanding at December 31, 2012	682,500		$	26.00	9.95
Granted	697,500		$	27.79	10.00
Exercised	—		—		—
Forfeited	(60,000	)	25.36		—
Outstanding at December 31, 2013	1,320,000		26.97		9.33
Exercisable and vested at December 31, 2013	158,125		$	26.00	8.95
Exercisable and vested at December 31, 2012	—		$	—	—
Expected to vest at December 31, 2013	1,320,000		$	26.97	9.33

The total estimated fair value of PBF Energy options granted in 2013 and 2012 was $6,499 and $6,327 and the weighted average per unit value was $9.32 and $9.27. The total intrinsic value of stock options outstanding and exercisable at December 31, 2013, was $6,756 and $863, respectively.

Unrecognized compensation expense related to PBF Energy options at December 31, 2013 was $10,140, which will be recognized from 2014 through 2017.