
4.	Share-Based Compensation Plans

Our share-based compensation is measured at fair value and expensed over the service period (generally the vesting period). The amount of compensation expense to be recognized is adjusted for an estimated forfeiture rate which is based on historical data. For the years ended December 31, 2015, 2014 and 2013, we recognized share-based compensation attributable to stock options and restricted shares of $3.9 million, $3.7 million and $3.0 million, respectively, primarily in selling, general and administrative expenses. There were no corresponding deferred income tax benefits for stock options or restricted shares.

Equity Incentive Plan

Amended and Restated 2007 Equity Incentive Plan. The Amended and Restated 2007 Equity Incentive Plan, (the “2007 Plan”) provides for the grant of the following types of incentive awards: (i) stock options, (ii) restricted stock, (iii) restricted stock units, (iv) stock appreciation rights, (v) performance units and performance shares and (vi) other stock or cash awards. Those eligible for awards include employees, directors and consultants who provide services to Amkor and its subsidiaries. The 2007 Plan has a contractual life of ten years and can be terminated at the discretion of the Board of Directors. There were originally 17.0 million shares of our common stock reserved for issuance under the 2007 Plan and at December 31, 2015 there were 11.5 million shares available for grant.

Stock options

Stock options are generally granted with an exercise price equal to the market price of the stock at the date of grant. Substantially all of the options granted are exercisable pursuant to a one to four year vesting schedule and the term of the options granted is no longer than ten years. Upon option exercise, we may issue new shares of common or treasury stock.

In order to calculate the fair value of stock options at the date of grant, we use the Black-Scholes option pricing model. Expected volatilities are based on historical performance of our stock. We also use historical data to estimate the timing and amount of option exercises and forfeitures within the valuation model. The expected term of the options is based on evaluations of historical and expected future employee exercise behavior and represents the period of time that options granted are expected to be outstanding. The risk-free interest rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant.

The following table summarizes our stock option activity for the year ended December 31, 2015:



	Number of Shares (In thousands)	Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (In thousands)
Outstanding at December 31, 2014	3,822	$	6.25
Granted	390	6.99
Exercised	(205)	4.57
Forfeited or expired	(280)	5.28
Outstanding at December 31, 2015	3,727	$	6.49	5.96	$	3,230
Fully vested at December 31, 2015 and expected to vest thereafter	3,709	$	6.50	5.95	$	3,213
Exercisable at December 31, 2015	2,571	$	6.91	4.92	$	2,018

The following assumptions were used to calculate the weighted average fair values of the options granted:



	For the Year Ended December 31,
	2015			2014			2013
Expected life (in years)	5.8			6.1			6.2
Risk-free interest rate	1.8		%	2.0		%	1.7		%
Volatility	45		%	57		%	60		%
Dividend yield	—			—			—
Weighted average grant date fair value per option granted	$	3.14		$	4.46		$	2.49

Total unrecognized compensation expense from stock options, net of a forfeiture estimate, was $2.8 million as of December 31, 2015, which is expected to be recognized over a weighted-average period of approximately 1.9 years beginning January 1, 2016.

Restricted Shares

We grant restricted shares to directors and employees under the 2007 Plan. Restricted shares granted to directors vest on the earlier of the one year anniversary of the grant date or the date of the next annual meeting of stockholders. All other restricted shares vest ratably over four years, with 25% of the shares vesting at the end of the first year and the remainder vesting quarterly thereafter such that 100% of the shares will become vested on the fourth anniversary of the award, subject to the recipient’s continued employment with us on the applicable vesting dates. In addition, provided that the restricted shares have not been forfeited earlier, for certain grants, the restricted shares will vest upon the recipient’s death or disability, or upon a change in control of Amkor. The value of the restricted shares is determined based on the fair market value of the underlying shares on the date of the grant and is recognized ratably over the vesting period. Upon vesting of restricted stock awards, we may issue new shares of common or treasury stock.

The following table summarizes our restricted share activity for the year ended December 31, 2015:



	Number of Shares (In thousands)		Weighted Average Grant Date Fair Value (Per Share)
Nonvested at December 31, 2014	660		$	4.58
Awards granted	49		7.30
Awards vested	(289	)	4.79
Awards forfeited	(35	)	4.46
Nonvested at December 31, 2015	385		$	4.78

Total unrecognized compensation cost from restricted shares, net of a forfeiture estimate, was $1.4 million as of December 31, 2015, which is expected to be recognized over a weighted average period of approximately 1.2 years beginning January 1, 2016.