STOCKHOLDERS’ EQUITY AND EQUITY COMPENSATION

Share Repurchase Plan

In February 2015, the Company’s board of directors authorized the open market repurchase of up to $20.0 million of the Company’s common stock during 2015. Once a repurchase is complete, the Company promptly retires the shares. The Company is also authorized to utilize up to $10.0 million in cash to purchase shares of the Company’s common stock in each calendar year in connection with the Company’s equity compensation programs for employees. The participants in the Company’s equity plans may surrender shares of common stock in satisfaction of tax obligations arising from the vesting of restricted stock awards under such plans and in connection with the exercise of stock option awards. The deemed price paid is the closing price of the Company’s common stock on the Nasdaq Global Select Market on the date that the restricted stock vests or the shares of the Company’s common stock are surrendered in exchange for stock option exercises. The option holder may elect a “net, net” exercise in connection with the exercise of employee stock options such that the option holder receives a number of shares equal to (1) the built-in gain in the option shares divided by the market price of the Company’s common stock on the date of exercise, less (2) a number of shares equal to the taxes due upon the exercise of the option divided by the market price of the Company’s common stock on the date of exercise. The shares of Company common stock surrendered to the Company for taxes due on the exercise of the option are deemed repurchased by the Company.

During the six months ended June 30, 2015, the Company acquired 1,091,122 shares of the Company’s common stock for $20.0 million ($18.33 average price per share) through the open market repurchase program discussed above and 31,377 shares of the Company’s common stock for $0.5 million ($16.96 average price per share) in connection with the satisfaction of tax obligations from the vesting of restricted stock and the exercise of stock options. In addition, during the six months ended June 30, 2015, the Company acquired 88,834 shares of the Company’s common stock in connection with “net, net” exercises of employee stock options for a gross value of $1.4 million ($0.1 million in cash value). Once repurchased, the Company immediately retired all such shares.

Equity-Based Compensation Plans

At June 30, 2015, the Company had two active equity-based compensation plans under which awards may be made, including stock appreciation rights, restricted shares of common stock, performance awards, stock options and stock units. The Company’s 2013 Employee Equity Incentive Plan (the “2013 Employee Plan”) has 2,895,000 shares of the Company’s common stock reserved for issuance and, at June 30, 2015, 1,019,009 shares of common stock were available for issuance. The Company’s 2011 Non-Employee Director Equity Incentive Plan (“2011 Director Plan”) has 250,000 shares of the Company’s common stock registered for issuance and, at June 30, 2015, 72,654 shares of common stock were available for issuance.

Stock Awards

Stock awards, which include shares of restricted stock, restricted stock units and restricted performance units, are awarded from time to time to executive officers and certain key employees of the Company. Stock award compensation is recorded based on the award date fair value and charged to expense ratably through the requisite service period. The forfeiture of unvested restricted stock, restricted stock units and restricted performance units causes the reversal of all previous expense recorded as a reduction of current period expense.

The following table summarizes all stock award activity during the six months ended June 30, 2015:



	Stock Awards		Weighted Average Award Date Fair Value
Outstanding at January 1, 2015	767,540		$	21.93
Restricted shares awarded	—		—
Restricted stock units awarded	691,781		17.25
Restricted shares distributed	(87,600	)	19.07
Restricted stock units distributed	(10,856	)	19.17
Restricted shares forfeited	(45,207	)	23.64
Restricted stock units forfeited	(27,950	)	20.06
Outstanding at June 30, 2015	1,287,708		$	19.62

Expense associated with stock awards was $2.0 million and $1.0 million for the quarters ended June 30, 2015 and 2014, respectively, and $3.5 million and $1.9 million for the six-month periods ended June 30, 2015 and 2014, respectively. Unrecognized pre-tax expense of $18.2 million related to stock awards is expected to be recognized over the weighted average remaining service period of 2.25 years for awards outstanding at June 30, 2015.

Deferred Stock Unit Awards

Deferred stock units are generally awarded to directors of the Company and represent the Company’s obligation to transfer one share of the Company’s common stock to the grantee at a future date and are generally fully vested on the date of grant. The expense related to the issuance of deferred stock units is recorded as of the date of the award.

The following table summarizes all deferred stock unit activity during the six months ended June 30, 2015:



	Deferred Stock Units		Weighted Average Award Date Fair Value
Outstanding at January 1, 2015	221,471		$	20.10
Awarded	51,199		18.61
Distributed	(12,819	)	19.89
Outstanding at June 30, 2015	259,851		$	19.81

Expense associated with awards of deferred stock units for the quarters and six months ended June 30, 2015 and 2014 was $0.9 million and $0.8 million, respectively.

Stock Options

Stock options on the Company’s common stock are awarded from time to time to executive officers and certain key employees of the Company. Stock options granted generally have a term of seven to ten years and an exercise price equal to the market value of the underlying common stock on the date of grant.

The following table summarizes all stock option activity during the six months ended June 30, 2015:



	Shares		Weighted Average Exercise Price
Outstanding at January 1, 2015	503,134		$	18.18
Granted	—		—
Exercised	(100,191	)	12.97
Canceled/Expired	(5,546	)	24.21
Outstanding at June 30, 2015	397,397		$	19.41
Exercisable at June 30, 2015	392,338		$	19.44

Expense associated with stock option grants was $0.0 million and $0.1 million in the quarters ended June 30, 2015 and 2014, respectively, and $0.1 million and $0.5 million for the six months ended June 30, 2015 and 2014, respectively. Unrecognized pre-tax expense related to stock option grants was immaterial and expected to be recognized over the weighted average remaining contractual term of 1.09 years for awards outstanding at June 30, 2015.

Financial data for stock option exercises are summarized in the following table (in thousands):



	Six Months Ended June 30,
	2015		2014
Amount collected from stock option exercises	$	1,299	$	7,645
Total intrinsic value of stock option exercises	273		3,088
Tax shortfall (benefit) of stock option exercises recorded in additional paid-in-capital	100		(459		)
Aggregate intrinsic value of outstanding stock options	744		3,452
Aggregate intrinsic value of exercisable stock options	738		3,113

The intrinsic value calculations are based on the Company’s closing stock price of $18.94 and $23.27 on June 30, 2015 and 2014, respectively.

The Company uses a binomial option-pricing model for valuation purposes to reflect the features of stock options granted. Volatility, expected term and dividend yield assumptions were based on the Company’s historical experience. The risk-free rate was based on a U.S. treasury note with a maturity similar to the option grant’s expected term. There were no stock options awarded during the six-month period ended June 30, 2015. The fair value of stock options awarded during the six-month period ended June 30, 2014 was estimated at the date of grant based on the assumptions presented in the table below:



	Six Months Ended June 30, 2014
Grant-date fair value	$11.27
Volatility	41.6%
Expected term (years)	7.0
Dividend yield	—%
Risk-free rate	2.3%