16.

Long term retention plan

On August 8, 2008, the board of directors approved an employee retention program (LTRP) that would be payable 50% in cash and 50% in shares, in addition to the annual salary and bonus of certain executives. Payments were to be made in the first quarter on annual basis according to the following vesting schedule:

•

Year 1 (2008): 17%

•

Year 2 (2009): 22%

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Year 3 (2010): 27%

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Year 4 (2011): 34%

The shares granted for the 2008 LTRP were valued at the grant-date fair market value of $36.8 per share. As of December 31, 2012, the Company fully paid the 2008 LTRP.

On July 15, 2009, June 25, 2010, August 1, 2011 and June 5, 2012, the board of directors, upon the recommendation of the compensation committee approved the 2009, the 2010, 2011 and the 2012 employee retention programs (the “2009, 2010, 2011 and 2012 LTRP”). The awards under the 2009, 2010, 2011 and 2012 LTRP are fully payable in cash in addition to the annual salary and bonus of each employee.

The 2009, 2010, 2011 and 2012 LTRP will be paid in 8 equal annual quotas (12.5% each) commencing on March 31, 2010, March 31, 2011, and March 31, 2012 and March 31, 2013, respectively. Each quota is calculated as follows:

•

6.25% of the amount will be calculated in nominal terms (“the nominal basis share”),

•

6.25% is adjusted by multiplying the nominal amount by the average closing stock price for the last 60 trading days of the year previous to the payment date and divided by the average closing stock price for the last 60 trading days of 2008, 2009, 2010 and 2011 for the 2009, 2010, 2011 and 2012 LTRP, respectively. The average closing stock price for the 2009, 2010, 2011 and 2012 LTRP amounted to $13.81, $45.75, $65.41 and $77.77, respectively (“the variable share”).

In May 2013 the board of directors, upon the recommendation of the Compensation Committee, approved certain amendments to the 2009, 2010, 2011 and 2012 Long-Term Retention Plans (the Amended LTRPs), to give the Company (through the approval of the Compensation Committee) the option to pay the compensation due under the Amended LTRPs in cash, common stock or a combination thereof. The company has granted the right to any Amended LTRP participant to request settlement in cash. The Amended LTRPs have been considered to be a substantive liability and classified accordingly in the balance sheet.

On September 27, 2013 and March 31, 2014, the Board of Directors, upon the recommendation of the Compensation Committee approved the 2013 and 2014 employee retention programs (“2013 and 2014 LTRP”) respectively. The awards under 2013 and 2014 LTRP are payable in cash, common stock or a combination thereof, in addition to the annual salary and bonus of each employee. The Company has granted the right to any LTRP participant to request settlement in cash.

The 2013 and 2014 LTRP will be paid in 6 equal annual quotas (16.67% each) commencing on March 31, 2014 and March 31, 2015 respectively. Each quota is calculated as follows:

•

8.333% of the amount is calculated in nominal terms (“the nominal basis share”),

•

8.333% is adjusted by multiplying the nominal amount by the average closing stock price for the last 60 trading days of the year previous to the payment date and divided by the average closing stock price for the last 60 trading days of 2012 and 2013, respectively. The average closing stock price for the 2013 and 2014 LTRP amounted to $79.57 and $118.48 (“the variable share”) respectively.

The following tables summarize the 2009, 2010, 2011, 2012, 2013 and 2014 LTRP accrued compensation expense for the years ended December 31, 2014, 2013 and 2012:


	December 31, 2014				December 31, 2013				December 31, 2012
	Aggregate Intrinsic value		Weighted- average remaining contractual life (years)		Aggregate Intrinsic value		Weighted- average remaining contractual life (years)		Aggregate Intrinsic value		Weighted- average remaining contractual life (years)
Outstanding LTRP 2009		3,229,139		1.25		4,305,518		1.75		3,854,742		2.25
Outstanding LTRP 2010		2,307,641		1.75		2,884,551		2.25		3,461,461		2.75
Outstanding LTRP 2011		3,624,856		2.25		4,093,119		2.75		3,288,647		3.25
Outstanding LTRP 2012		4,354,116		2.74		4,806,997		3.25		3,800,492		3.75
Outstanding LTRP 2013		9,005,706		2.25		10,167,959		2.75		—		—
Outstanding LTRP 2014		7,525,925		2.74		—		—		—		—

The 2009, 2010, 2011, 2012, 2013 and 2014 LTRP have performance and/or eligibility conditions to be achieved at each year end and also require the employee to stay in the Company at the payment date.

The variable share compensation cost of the 2009, 2010, 2011, 2012, 2013 and 2014 LTRP is recognized in accordance with the graded-vesting attribution method and is accrued up to each payment date. The 2009, 2010, 2011, 2012, 2013 and 2014 LTRP nominal basis portion is recognized in straight line bases using the equal annual accrual method.

The following tables summarize the LTRP accrued compensation expense for the years ended December 31, 2014, 2013 and 2012:


	Year ended December 31,
	2014		2013		2012
LTRP 2008		—		—		20,595
LTRP 2009		664,619		1,562,957		587,106
LTRP 2010		930,244		1,611,521		1,006,740
LTRP 2011		1,107,795		1,698,285		1,236,275
LTRP 2012		1,385,407		2,013,011		1,603,142
LTRP 2013		3,935,215		4,759,303		—
LTRP 2014		3,828,335		—		—

	$	11,851,615	$	11,645,077	$	4,453,858