4. 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, 2017, the Company had 1,081,911 shares of common stock available for grant under stock incentive plans.

Restricted Stock

The following is a summary of restricted stock grants, fair value and performance-based awards:

For the year ended December 31,	Unvested restricted stock awards	Weighted average grant date fair value		Awards with performance vesting requirements
2017	105,785	$	22.56	28,025
2016	105,662	$	19.99	60,153
2015	76,714	$	27.37	41,792

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. Short-term performance based grants can be achieved over a period of one year, and long-term performance grants can be earned through December 31, 2020. Earned grants are then subject to either a 3 year or 5 year service 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. For performance-based awards, the Company assesses the probability of the achievement of the awards during the year and recognizes expense accordingly.

The following is a summary of restricted stock activity during years 2017, 2016 and 2015:

	Number of Nonvested Restricted Shares
Balance, December 31, 2014	487,678
Awarded	76,714
Forfeited	(7,066	)
Vested	(190,127	)

Balance, December 31, 2015	367,199
Awarded	105,662
Forfeited	(5,912	)
Vested	(158,407	)

Balance, December 31, 2016	308,542
Awarded	105,785
Forfeited	(17,676	)
Vested	(174,683	)

Balance, December 31, 2017	221,968

The following is a summary of performance-based restricted stock activity during years 2017, 2016 and 2015:

	Total performance grants
Outstanding, December 31, 2014	5,892
Awarded	41,792
Performance criteria met	(14,200	)
Forfeited	(4,296	)

Outstanding, December 31, 2015	29,188
Awarded	60,153
Performance criteria met	(38,167	)
Forfeited	(6,302	)

Outstanding, December 31, 2016	44,872
Awarded	28,025
Performance criteria met	(7,670	)
Forfeited	(27,445	)

Outstanding, December 31, 2017	37,782

The performance criteria and forfeitures in the above table did not occur until the Board of Directors approved them during the February 2018, 2017 and 2016 meetings.

Share-Based Compensation Expense

Restricted Stock

During 2017, 2016 and 2015 compensation expense net of forfeitures of $2,026, $1,893 and $1,744 was respectively recorded. As of December 31, 2017, there was $2,704 of total unrecognized compensation expense related to restricted stock awards, of which approximately $1,692 is expected to be recognized in 2018.

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 2017, 2016 and 2015) or ii) the annual interest payable on any loan outstanding to the Company from the ESOP. Company contributions to the Plan accrued for 2017, 2016 and 2015, respectively, were $849, $674 and $812. 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 its U.S. based employees. The plan provides for the deferral of employee compensation under Section 401(k) and a discretionary Company match. In 2017, 2016 and 2015 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 $1,090, $1,085 and $1,076 in 2017, 2016 and 2015, respectively.

Dividends

For the years ended December 31, 2017, 2016 and 2015 a total of $0.10 per share on all outstanding shares was declared and paid. Total dividends paid for the years ended December 31, 2017, 2016 and 2015 were $959, $942 and $923, 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.