STOCKHOLDERS’ EQUITY AND EQUITY COMPENSATION

Share Repurchase Plan

Effective November 2015, and in connection with the terms of the amended Credit Facility, the Company’s Board of Directors authorized the open market repurchase of up to $20.0 million of the Company’s common stock to be made during 2015 and 2016 (the “November 2015 Program”). In March 2016, the Company’s Board of Directors authorized the open market repurchase of up to an additional $20.0 million of the Company’s common stock during 2016 (the “March 2016 Program”) following the expiration or completion of the November 2015 Program. The Company began repurchasing shares under the March 2016 Program in April 2016 immediately following completion of the November 2015 Program. In August 2016, the Company’s Board of Directors authorized the open market repurchase of up to an additional $10.0 million of the Company’s common stock during 2016 (the “August 2016 Program”) following the expiration or completion of the March 2016 Program. The Company began repurchasing shares under the August 2016 Program in October 2016 immediately following completion of the March 2016 Program. In addition to the above, the Company has authorization under the Credit Facility to repurchase up to an additional $10.0 million of the Company’s common stock during 2016 in open market repurchases. Once repurchased, the Company promptly retires such 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 and restricted stock unit 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 and restricted stock unit 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 (i) 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 (ii) 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 nine months ended September 30, 2016, the Company acquired 1,908,380 shares of the Company’s common stock for $35.4 million ($18.57 average price per share) through the open market repurchase programs discussed above and 58,967 shares of the Company’s common stock for $1.2 million ($19.67 average price per share) in connection with the vesting of restricted stock and restricted stock units and the exercise of stock options. Once repurchased, the Company promptly retired all such shares.

Equity-Based Compensation Plans

In April 2016, the Company’s stockholders approved the 2016 Employee Equity Incentive Plan (the “2016 Employee Plan”), which replaced the 2013 Employee Equity Incentive Plan. The 2016 Employee Plan provides for equity-based compensation awards, including restricted shares of common stock, performance awards, stock options, stock units and stock appreciation rights. The 2016 Employee Plan is administered by the Compensation Committee of the Board of Directors, which determines eligibility, timing, pricing, amount and other terms or conditions of awards. There are 1,132,739 shares of the Company’s common stock registered for issuance under the 2016 Employee Plan and, at September 30, 2016, 1,126,702 shares of common stock were available for issuance.

In April 2016, the Company’s stockholders also approved the 2016 Director Equity Incentive Plan (the “2016 Director Plan”), which replaced the 2011 Non-Employee Director Equity Incentive Plan. The 2016 Director Plan provides for equity-based compensation awards, including non-qualified stock options and stock units. The Board of Directors administers the 2016 Director Plan and has the authority to establish, amend and rescind any rules and regulations related to the 2016 Director Plan. There are 166,456 shares of the Company’s common stock registered for issuance under the 2016 Director Plan and, at September 30, 2016, 165,414 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 to be recorded as a reduction of current period expense.

A summary of the stock award activity is as follows:



	Nine Months Ended September 30, 2016
	Stock Awards		Weighted Average Award Date Fair Value
Outstanding at January 1, 2016	1,275,707		$	19.60
Restricted shares awarded	—		—
Restricted stock units awarded	318,205		18.42
Performance stock units awarded	244,937		18.35
Restricted shares distributed	(159,406	)	23.48
Restricted stock units distributed	(14,034	)	21.50
Performance stock units distributed	—		—
Restricted shares forfeited	(18,499	)	23.16
Restricted stock units forfeited	(64,871	)	17.56
Performance stock units forfeited	(55,936	)	18.58
Outstanding at September 30, 2016	1,526,103		$	18.81

Expense associated with stock awards was $2.1 million and $2.2 million for the quarters ended September 30, 2016 and 2015, respectively, and $6.7 million and $5.8 million for the nine months ended September 30, 2016 and 2015, respectively. Unrecognized pre-tax expense of $15.1 million related to stock awards is expected to be recognized over the weighted average remaining service period of 1.89 years for awards outstanding at September 30, 2016.

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.

A summary of deferred stock unit activity is as follows:



	Nine Months Ended September 30, 2016
	Deferred Stock Units		Weighted Average Award Date Fair Value
Outstanding at January 1, 2016	247,219		$	19.92
Awarded	44,824		21.22
Distributed	(39,660	)	21.29
Outstanding at September 30, 2016	252,383		$	19.93

Expense associated with awards of deferred stock units was immaterial for the quarters ended September 30, 2016 and 2015, respectively, and $1.0 million and $1.0 million for the nine months ended September 30, 2016 and 2015, 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.

A summary of stock option activity is as follows:



	Nine Months Ended September 30, 2016
	Shares		Weighted Average Exercise Price
Outstanding at January 1, 2016	288,383		$	21.73
Granted	—		—
Exercised	(18,193	)	16.80
Canceled/Expired	(1,836	)	25.58
Outstanding at September 30, 2016	268,354		$	22.04
Exercisable at September 30, 2016	268,354		$	22.04

Expense associated with stock option grants was zero and $0.1 million for the nine months ended September 30, 2016 and 2015, respectively. There was no unrecognized pre-tax expense related to stock option grants at September 30, 2016.

Financial data for stock option exercises are summarized as follows (in thousands):



	Nine Months Ended September 30,
	2016		2015
Amount collected from stock option exercises	$	306	$	1,465
Total intrinsic value of stock option exercises	47		282
Tax shortfall of stock option exercises recorded in additional paid-in-capital	315		109
Aggregate intrinsic value of outstanding stock options	102		379
Aggregate intrinsic value of exercisable stock options	102		379

The intrinsic value calculations are based on the Company’s closing stock price of $19.07 and $16.48 on September 30, 2016 and 2015, 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 are based on the Company’s historical experience. The risk-free rate is 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 2016 or 2015.