STOCK-BASED COMPENSATION PLANS

12 Months Ended

Dec. 31, 2014

STOCK-BASED COMPENSATION PLANS

STOCK-BASED COMPENSATION PLANS

5. STOCK-BASED COMPENSATION PLANS

Stock Incentive Plans

        The Company's Stock Incentive Plans provide for the granting of stock awards, including stock options, stock appreciation rights and restricted stock, to employees and non-employees, including directors of the Company.

        As of December 31, 2014, the Company had 760,800 shares of Common Stock available for grant under stock incentive plans.

Restricted Stock

        During 2014 and 2013, 168,334 and 423,518 shares of unvested restricted stock were awarded with a weighted average value of $11.26 and $7.73 per share, respectively. Of the restricted shares granted in 2014 and 2013, 88,566 and 58,909 shares have performance based vesting requirements. The value at the date of award is amortized to compensation expense over the related service period, which is generally three years (for time vested grants), or over the performance period. Shares of non-vested restricted stock are forfeited if a recipient leaves the Company before the vesting date. Shares that are forfeited become available for future awards.

        The following is a summary of restricted stock activity during years 2014 and 2013:

	Number of Nonvested Restricted Shares
Balance, December 31, 2012		243,124
Awarded		423,518
Forfeited		(3,181	)
Vested		(143,266	)
Balance, December 31, 2013		520,195
Awarded		168,334
Forfeited		(42,141	)
Vested		(158,710	)
Balance, December 31, 2014		487,678

        The following is a summary of performance based restricted stock activity during years 2013 and 2014:

	Total performance grants
Outstanding, December 31, 2012		10,000
Awarded		58,909
Performance criteria met		(18,775	)
Forfeited		(34,944	)
Outstanding, December 31, 2013		15,190
Awarded		88,566
Performance criteria met		(92,583	)
Forfeited		(5,281	)
Outstanding, December 31, 2014		5,892

        The performance criteria and forfeitures in the above table did not occur until the Board of Directors approved them during the February 2015 and 2014 meetings.

Share-Based Compensation Expense

Restricted Stock

        During 2014 and 2013, compensation expense net of forfeitures of $1,541 and $927 was recorded, respectively. As of December 31, 2014, there was $3,324 of total unrecognized compensation expense related to restricted stock awards, of which approximately $1,368 is expected to be recognized in 2015.

Employee Stock Ownership Plan

        The Company sponsors an Employee Stock Ownership Plan ("ESOP") that covers all non-union U.S. employees who work over 1,000 hours per year. The terms of the ESOP require the Company to make an annual contribution equal to the greater of i) the Board established percentage of pretax income before the contribution (5% in 2014 and 2013) or ii) the annual interest payable on any loan outstanding to the Company. Company contributions to the Plan accrued for 2014 and 2013, respectively, were $980 and $304. These amounts are included in General and Administrative costs in the consolidated statements of income and comprehensive income.

Defined Contribution Plan

        The Company sponsors the Allied Motion 401(k) Tax Advantaged Investment Plan ("401(k)") which covers substantially all of its U.S. based employees. The plan provides for the deferral of employee compensation under Section 401(k) and a discretionary Company match. In 2014 and 2013, this match was 100% per dollar of the first 3% of participant deferral and 50% per dollar of the next 2% contribution, up to 4% of a total 5% participant deferral. Net costs related to this defined contribution plan were $1,036 in 2014 and $506 in 2013.

Dividends

        For the years ended December 31, 2014 and 2013, a total of $0.10 per share on all outstanding shares was declared and paid. Total dividends paid for the years ended December 31, 2014 and 2013 were $963 and $873, respectively. Based on the terms of the Company's Credit Agreement, dividends paid to shareholders are acceptable, subject to the Company's compliance with the covenants under the Credit Agreement.