13. EQUITY INCENTIVE PLANS

In May 2004, the Company adopted its 2004 Equity Incentive Plan (“2004 Plan”), which replaced its 2000 Omnibus Equity Incentive Plan (“2000 Plan”). The 2000 Plan had allowed for the award of up to 11,500,000 shares of Class A common stock. The 2004 Plan allows for the award of up to 10,000,000 shares of Class A common stock, plus any grants remaining available at its adoption date under the 2000 Plan. Awards under the 2004 Plan may be in the form of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock or restricted stock units. The 2004 Plan is administered by a committee appointed by the Board. This committee determines the type, number, vesting requirements and other features and conditions of such awards. Generally, stock options granted from the 2000 Plan have a contractual term of ten years from the date of the grant and vest over four or five years and stock options granted from the 2004 Plan have a contractual term of ten years from the date of the grant and vest over four years.

The 2004 Plan was amended by the Compensation Committee effective July 13, 2006 to (i) eliminate automatic option grants for non-employee directors, making any grants to such directors discretionary by the Compensation Committee and (ii) eliminate the three-year minimum vesting period for performance-based restricted stock and restricted stock units, making the vesting period for such grants discretionary by the Compensation Committee.

The 2004 Plan was further amended by the Compensation Committee effective May 21, 2014 primarily to extend the end of the term until May 29, 2024.

The Company has issued stock options and restricted stock units to various employees and non-employee directors of the Company in addition to non-employee service providers under both the 2004 Plan and the 2000 Plan.

Stock Options

The fair value of each stock option is estimated on the date of grant using the Black-Scholes option pricing model that uses the assumptions noted in the following table. Stock-based compensation expense related to stock options is based on the fair value on the date of grant and is amortized over the vesting period, generally between 1 to 4 years. Expected volatilities are based on historical volatility of the Company’s stock. The Company uses historical data to estimate option exercise and employee termination within the valuation model. The expected term of stock options granted is based on historical contractual life and the vesting data of the stock options. The risk-free rate for periods within the contractual life of the stock option is based on the U.S. Treasury yield curve in effect at the time of grant.

The fair value of each stock option granted was estimated using the following weighted-average assumptions:

	Year Ended			Year Ended
	December 31,			December 31,
	2015			2014
Fair value of options granted	$	4.10		$	3.26
Expected volatility		84	%		117	%
Risk-free interest rate		1.6	%		2.0	%
Expected lives		6.0 years			6.1 years
Dividend rate		1.6%			2.3%

The following is a summary of stock option activity: (in thousands, except exercise price data and contractual life data):

Options	Number of Shares			Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at December 31, 2013		7,717		$	4.05
Granted		350		$	4.40
Exercised		(1,042	)		1.77			$	5,036
Forfeited or cancelled		(1,470	)		8.53
Outstanding at December 31, 2014		5,555		$	3.33			$	19,015
Granted		75		$	6.45
Exercised		(966	)		2.23			$	4,954
Forfeited or cancelled		(1,241	)		7.07
Outstanding at December 31, 2015		3,423		$	2.35			$	18,341
Exercised		(925	)		2.36			$	4,278
Forfeited or cancelled		(165	)		3.61
Outstanding at December 31, 2016		2,333		$	2.26		5.69	$	11,061
Vested and Exercisable at December 31, 2016		1,717		$	2.09		5.37	$	8,440
Vested and Expected to Vest at December 31, 2016		2,004		$	2.25		6.02	$	9,527

Stock-based compensation expense related to the Company’s employee stock option plans was $0.4 million, $1.5 million and $2.3 million for the years ended December 31, 2016, 2015 and 2014, respectively.

As of December 31, 2016, there was approximately $0.2 million of total unrecognized compensation expense related to the Company’s employee stock option plans that is expected to be recognized over a weighted-average period of 1.3 years.

Restricted Stock and Restricted Stock Units

The following is a summary of nonvested restricted stock and restricted stock units activity: (in thousands, except grant date fair value data):

	Number of Shares			Weighted-Average Grant Date Fair Value
Nonvested balance at December 31, 2013		494		$	2.73
Granted		1,181			4.51
Vested		(489	)		3.38
Forfeited or cancelled		(17	)		2.53
Nonvested balance at December 31, 2014		1,169		$	4.15
Granted		764			8.25
Vested		(614	)		4.91
Forfeited or cancelled		(51	)		4.52
Nonvested balance at December 31, 2015		1,268		$	6.39
Granted		931			6.78
Vested		(685	)		6.28
Forfeited or cancelled		(134	)		6.25
Nonvested balance at December 31, 2016		1,380		$	6.73

Stock-based compensation expense related to grants of restricted stock and restricted stock units was $4.6 million, $3.8 million and $2.1 million for the years ended December 31, 2016, 2015 and 2014, respectively.

As of December 31, 2016, there was approximately $5.4 million of total unrecognized compensation expense related to grants of restricted stock and restricted stock units that is expected to be recognized over a weighted-average period of 1.8 years.

The fair value of shares vested related to grants of restricted stock and restricted stock units was $4.2 million, $3.5 million, and $1.6 million for the years ended December 31, 2016, 2015 and 2014, respectively.

The Company’s restricted stock units are net settled by withholding shares of the Company’s common stock to cover minimum statutory incomes taxes and remitting the remaining shares of the Company’s common stock to an individual’s brokerage account. Authorized shares of the Company’s common stock are used to settle restricted stock units.

Performance Restricted Stock Units

Certain of the Company’s management-level employees were granted performance stock units that are contingent upon achievement of specified pre-established performance goals over the performance period, which is one year, and vesting period of three years, subject to the recipient's continued service with the Company. The performance goals are based on achievement of net revenue and/or EBITDA goals. Depending on the outcome of the performance goals, the recipient may ultimately earn performance restricted stock units between 0% and 200% of the number of performance restricted stock units granted.

For the year ended December 31, 2015, the Company granted 447,000 performance restricted stock units at a weighted average grant date fair value of $8.39 per share. For the year ended December 31, 2015, there was no share-based compensation expense related to performance restricted stock units and the performance goals were not achieved.

For the year ended December 31, 2016, the Company granted 608,500 performance restricted stock units at a weighted average grant date fair value of $6.75 per share. For the year ended December 31, 2016, there was no share-based compensation expense related to performance restricted stock units.