Equity-Based Compensation

9 Months Ended

Sep. 30, 2016

Equity-Based Compensation

Equity-Based Compensation

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.

The Company recognizes equity-based compensation expense in “Selling, operating and administrative expenses” in the accompanying Condensed Consolidated Statements of Income.  The Company recognizes corporate income tax benefits relating to the exercise of options and vesting of restricted stock units in “Provision for income taxes” in the accompanying Condensed Consolidated Statements of Income. 

Employee stock-based compensation expense under the Company’s 2013 Incentive Plan was as follows (in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2016		2015		2016		2015
Employee stock-based compensation expense	$	501	$	430	$	1,812	$	1,098
Excess tax benefit		-		(50)		(201)		(2,411)
Net effect on net income attributable to RE/MAX Holdings, Inc.	$	501	$	380	$	1,611	$	(1,313)

The following table summarizes equity-based compensation activity related to restricted stock units (“RSUs”) and stock options as of and for the nine months ended September 30, 2016:  

	Restricted Stock	Stock
	Units	Options
Balance, January 1, 2016	96,765	28,057
Granted	89,359	—
Exercised	—	(28,057)
Shares vested (including tax withholding)(a)	(43,688)	—
Forfeited	(5,334)	—
Balance, September 30, 2016	137,102	—
Weighted average grant date fair value per share	32.19	—

(a) Pursuant to the terms of the 2013 Incentive Plan, RSUs withheld by the Company for the payment of the employee's tax withholding related to an RSU vesting are added back to the pool of shares available for future awards.

At September 30, 2016, there was $3,122,000 of total unrecognized stock-based compensation expense, all of which is related to unvested RSUs. This compensation expense is expected to be recognized over the weighted-average remaining vesting period of 1.10 years.

At September 30, 2016, there were 2,165,277 additional shares available for the Company to grant under the 2013 Incentive Plan.