14.	Stockholders’ Equity

Holders of common stock are entitled to one vote for each share on all matters voted upon by the stockholders, including the election of directors, and do not have cumulative voting rights. Subject to the rights of holders of any then outstanding shares of preferred stock, common stockholders are entitled to receive ratably any dividends that may be declared by the Board of Directors out of funds legally available for that purpose. Holders of common stock are entitled to share ratably in net assets upon any dissolution or liquidation after payment of provision for all liabilities and any preferential liquidation rights of our preferred stock then outstanding. Common stock shares are not subject to any redemption provisions and are not convertible into any other shares of capital stock. The rights, preferences and privileges of holders of common stock are subject to those of the holders of any shares of preferred stock that may be issued in the future.

The Board of Directors may authorize the issuance of one or more classes or series of preferred stock without stockholder approval and may establish the voting powers, designations, preferences and rights and restrictions of such shares. No preferred shares have been issued.

Treasury and Forfeited Shares

In October 2008, the Company announced a share-repurchase program to purchase up to $5 million in shares of common stock. In August 2010, the Company announced an increase to the share-repurchase program to purchase an additional $5 million in shares of common stock, for a total up to $10 million. The specific timing and amount of repurchase will vary based on market conditions, securities law limitations and other factors. There were no shares repurchases in 2015 and 2014 related to the share-repurchase program.

The Company accounts for the repurchase of treasury shares under the cost method. When shares are repurchased, cash is paid and the treasury stock account is debited for the price paid. Under the cost method, retirement of treasury stock would result in a debit to the common stock account for the original par value, a debit to additional paid-in capital for the excess between the par value and the original sales price, a debit to retained earnings for any excess amounts paid above the original sales price and a credit to the treasury stock account for the price paid.

Forfeited shares are generally the result of an employee’s separation from the Company. Forfeitures of our service-, performance- and market-based share awards are discussed below. Such stock is held briefly as treasury stock and canceled during the year. At December 31, 2015 and 2014, there was no treasury stock held by the Company.

Upon the vesting of unvested common stock (or restricted stock) the Company may withhold shares, based on the employee’s election, in order to satisfy federal tax withholdings. The shares held by the Company are considered constructively retired and are retired shortly after withholding. The Company then remits the withholding taxes required by the taxing agencies. During 2015 and 2014, there were 96,076 and 8,120 shares withheld for tax purposes and retired.

Stock-based Compensation and Grants

The Company has a stock-based incentive plan that is administered by the Compensation Committee of the Board of Directors (the “2001 Plan”). The 2001 Plan is in effect until May 2021 as a result of a May 2011 amendment to extend its term for an additional ten years. The 2001 Plan provides for the issuance of stock awards for up to 1,900,000 shares of the Company’s common stock. The Compensation Committee may reward employees and non-employees with various types of awards including but not limited to warrants, stock options, common stock, and unvested common stock (or restricted stock) vesting on service, performance or market criteria.

At December 31, 2015, there were 614,921 shares of common stock available under the 2001 Plan. All shares under the plan are available for issuance pursuant to future stock-based compensation awards.

There were no options outstanding at December 31, 2015 and 2014 and no shares are, or will be, available for grant under the Company’s other option plans, all of which have been terminated.

Common Stock Awards

The following table summarizes the Company’s service-based share compensation awards:

	Number of Shares			Weighted Average Fair Value Per Share
Nonvested at January 1, 2013		186,630		$	11.03
Granted		60,032			9.74
Vested		(56,602	)		10.57
Forfeited		(8,944	)		13.57
Nonvested at December 31, 2013		181,116			10.61
Granted		61,957			9.05
Vested		(73,190	)		6.88
Forfeited		(20,412	)		11.66
Nonvested at December 31, 2014		149,471			11.65
Granted		978,526			4.53
Vested		(166,622	)		8.56
Forfeited		(47,552	)		6.91
Nonvested at December 31, 2015		913,823			4.83

In 2015, 2014 and 2013, several key employees were granted an aggregate total of 917,851, 18,536 and 25,207 shares of unvested common stock, respectively, with a weighted average fair value per share of $4.55, $11.38 and $9.30 per share, respectively, resulting in compensation expense of $4.4 million, $0.2 million and $0.2 million, respectively, expected to be recognized ratably over a three- or five-year restriction period. Of the 917,851 shares awarded and the $4.4 million expense, $2.5 million, and 600,000 shares, is related to the award granted to the Company’s CEO in May 2015 which vests ratably over three years.

The 2001 plan provides for unvested (or restricted) and vested common stock grants, and pursuant to non-employee director compensation arrangements, non-employee directors of the Company were awarded unvested stock with one-year vesting as follows:

	Years Ended December 31,
	2015		2014		2013
Shares awarded to each non-employee director		12,135		6,203		4,975
Total shares awarded		60,675		43,421		34,825
Average grant-date market price per share	$	4.12	$	8.06	$	10.06
Total compensation cost attributable to shares awarded	$	250,000	$	350,000	$	350,000
Compensation cost recognized related to current and prior year awards	$	266,667	$	316,750	$	333,499

During the year ended December 31, 2014, a director of the Company retired and forfeited 6,203 unvested shares. The amortized expense was adjusted for this forfeiture.

In addition to the service based compensation awards discussed above, the Company also awarded performance-based awards. In 2013, the Company issued 100,000 shares of unvested common stock to the Company’s former CEO which were accelerated and distributed to him upon his separation in January 2015. In 2014 and 2015, there were a total of 7,500 and 10,000 performance-based shares issued, respectively. In 2015, 13,750 of performance based shares were forfeited. In order to recognize compensation expense for these performance based shares, the Company must assess, at each reporting period, whether it is probable that the performance condition will be met. These shares must also be re-valued at each reporting period until they vest. At December 31, 2015 and 2014, the Company assessed that it would not be probable that the performance conditions would be met, as such; no expense was incurred during either year.

On January 1, 2015, the Company launched a long- and short-term incentive program for certain employees. The short-term incentive plan is paid in cash if certain short-term achievements are met and the long-term incentive plan is paid with the Company’s stock if certain long-term achievements are met. The stock-based awards are awarded based in two parts; 50% is based on completing a service period of three years and 50% is based on the level of achievement of the Company’s total shareholder return (“TSR”) compared to the TSR of a designated peer group over a three-year period or a market based stock award. The service based awards are recorded as usual; however, the market-based awards of 86,483 shares were valued using a Monte Carlo simulation and their expense was included in the $1.2 million of total unvested and market-based awards discussed below. During the year ended December 31, 2015, 55,419 of these shares were forfeited and amortization expense was adjusted.

At December 31, 2015, total unrecognized compensation cost related to unvested common and market-based stock was $3.1 million. This cost is expected to be recognized over a weighted average period of 1.6 years. Compensation expense for unvested common stock (or restricted stock) and market-based grants were $1.2 million in 2015, and $0.8 million in each of 2014 and 2013. There were no proceeds received by the Company from the exercise of options in 2015 as there were no options outstanding in 2015, and in 2014 and 2013, the proceeds received were less than $0.1 million for each of these years.

The Company also awards common stock as part of its incentive plan with no service or performance vesting requirements. There were 119,343 shares with a grant date fair value of $0.5 million awarded in 2015 which was treated as compensation expense in 2015, no such shares were awarded in 2014 and 9,521 shares with a grant date fair value of $0.1 million were awarded in 2013 and recorded as compensation expense in 2013.

Stock Option Awards

The following tables summarize the stock option activity under the 2001 Plan and previously active plans:

	2001 Plan
	Shares			Weighted Average Exercise Price
Outstanding at December 31, 2013		7,500		$	3.10
Exercised		(4,000	)		3.10
Expired/forfeited		(3,500	)		3.10
Outstanding at December 31, 2014		--			--

At December 31, 2014, there were no outstanding options remaining and there was no unrecognized stock-based compensation expense related to stock options.

Stock Offering

On April 29, 2014, an amended “shelf” registration statement filed by the Company with the SEC became effective. Under the amended shelf registration statement, the Company may offer from time to time any combination of securities described in the prospectus in one or more offerings up to a total of $80 million. The securities described in the prospectus include common and preferred stock, depository shares, debt securities, warrants entitling the holders to purchase one or more classes or series of these securities or units consisting of two or more of these issuances, classes or series of securities. Net proceeds from the sales of the offered securities may be used for working capital needs, capital expenditures and other expenditures related to general corporate purposes, including future acquisitions.

On May 6, 2014, the Company closed a public offering with D.A. Davidson & Co. as sole underwriter (the “Underwriter”), pursuant to which the Underwriter purchased from the Company 2,100,000 shares of the Company’s common stock at a price of $6.90 per share. The net proceeds of $14.0 million from the offering, after deducting underwriting discounts and offering expenses, was used to repay a portion of the indebtedness outstanding under our Prior Credit Facility.