10. Equity-Based Compensation

On September 30, 2013, the Company’s Board of Directors adopted the RE/MAX Holdings, Inc. 2013 Omnibus Incentive Plan (the “2013 Incentive Plan”) that provides for the grant of incentive stock options to the Company’s employees, and for the grant of shares of RE/MAX Holdings’ Class A common stock, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights, cash-based awards and any combination thereof to employees, directors and consultants of the Company.

On May 5, 2016, RE/MAX Holdings granted an aggregate of 1,639 restricted stock units at a value of $36.61 per unit to a director, which vest on March 1, 2017. The grant-date fair value of $36.61 per unit equaled the closing price of RE/MAX Holdings’ Class A common stock on May 5, 2016. On February 23, 2016, RE/MAX Holdings granted an aggregate of 75,057 restricted stock units at a value of $33.18 per unit to certain employees, which vest in three equal installments, on March 1, 2017, March 1, 2018 and March 1, 2019, and an aggregate of 12,663 restricted stock units at a value of $33.18 per unit to its directors, excluding David Liniger, the Company’s Chief Executive Officer, Chairman and Co-Founder, and Gail Liniger, the Company’s Vice Chair and Co-Founder, which vest on March 1, 2017. The grant-date fair value of $33.18 per unit equaled the closing price of RE/MAX Holdings’ Class A common stock on February 23, 2016.

On June 24, 2015, RE/MAX Holdings granted 2,941 shares of RE/MAX Holdings’ Class A common stock to an employee at a grant-date fair value of $34.01. Of this amount, 940 shares were withheld and cancelled to cover the Company’s minimum statutory tax withholding obligation. On March 11, 2015, RE/MAX Holdings granted an aggregate of 74,893 restricted stock units at a value of $32.45 per unit to certain employees, which vest in three equal installments, on April 1, 2016, April 1, 2017 and April 1, 2018, and an aggregate of 10,787 restricted stock units at a value of $32.45 per unit to its directors, excluding David Liniger, the Company’s Chief Executive Officer, Chairman and Co-Founder, and Gail Liniger, the Company’s Vice Chair and Co-Founder, which vest on April 1, 2016. The grant-date fair value of $32.45 per unit equaled the closing price of RE/MAX Holdings’ Class A common stock on March 11, 2015.

For the three months ended June 30, 2016 and 2015, the Company recognized equity-based compensation expense of $545,000 and $526,000, respectively, in “Selling, operating and administrative expenses” in the accompanying Condensed Consolidated Statements of Income resulting from the aforementioned restricted stock units granted. For the six months ended June 30, 2016 and 2015, the Company recognized equity-based compensation expense of $1,311,000 and $668,000, respectively, in “Selling, operating and administrative expenses” in the accompanying Condensed Consolidated Statements of Income resulting from the aforementioned restricted stock units granted.

The following table summarizes equity-based compensation activity related to restricted stock units and stock options as of and for the six months ended June 30, 2016:


	Restricted Stock	Stock
	Units	Options
Balance, January 1, 2016	96,765	28,057
Granted	89,359	—
Exercised (a)	—	(28,057)
Forfeited	—	—
Delivered and exchanged for shares of Class A common stock (b) (c)	(33,288)	—
Cancelled (d)	(10,400)	—
Balance, June 30, 2016	142,436	—

As of June 30, 2016
Vested	—	—
Unvested	142,436	—

(a)

Cash received from stock option exercises for the six months ended June 30, 2016 was $101,000. The Company recorded a corporate income tax benefit relating to the options exercised during the three and six months ended June 30, 2016 of $186,000 in “Provision for income taxes” in the accompanying Condensed Consolidated Statements of Income.

(b)

The Company recorded a corporate income tax benefit relating to the vesting of restricted stock units during the three and six months ended June 30, 2016 of $15,000 in “Provision for income taxes” in the accompanying Condensed Consolidated Statements of Income.

(c)

In connection with a separation and transition agreement entered into with the Company’s former Chief Financial Officer and Chief Operating Officer as described in Note 11, Leadership Changes and Restructuring Activities, 12,109 unvested restricted stock units granted in October 2013 and March 2015 vested in April 2016 on an accelerated timeline. As such, incremental equity-based compensation expense of $331,000 was recognized during the six months ended June 30, 2016.

(d)

Of the 43,688 restricted stock units that vested during the six months ended June 30, 2016, 10,400 shares were withheld and cancelled with an estimated value of $360,000 to cover the Company’s minimum statutory tax withholding obligation.

At June 30, 2016, there were 2,159,943 additional shares available for the Company to grant under the 2013 Incentive Plan.