Stock Incentive Plans

We are authorized to issue up to 8,000,000 shares of our common stock under our 2004 Stock Option and Incentive Plan, as amended (the “Incentive Plan”), of which we have issued or committed to issue 3,695,750 shares as of December 31, 2014. In addition to these shares, additional shares of common stock could be issued in connection with the market stock unit awards and performance stock unit awards as further described below.

Restricted Stock Awards

Restricted stock awards issued to our officers and employees vest over a 3-year period from the date of the grant based on continued employment. We measure compensation expense for the restricted stock awards based upon the fair market value of our common stock at the date of grant. Compensation expense is recognized on a straight-line basis over the vesting period and is included in corporate expenses in the accompanying consolidated statements of operations. A summary of our restricted stock awards from January 1, 2012 to December 31, 2014 is as follows:



	Number of Shares		Weighted- Average Grant Date Fair Value
Unvested balance at January 1, 2012	1,010,127		$	6.97
Granted	365,599		9.84
Additional shares from dividends	8,507		10.07
Forfeited	(11,563	)	10.05
Vested	(696,559	)	5.39
Unvested balance at December 31, 2012	676,111		10.10
Granted	323,526		9.33
Additional shares from dividends	1,040		9.30
Forfeited	(16,934	)	9.65
Vested	(400,722	)	9.94
Unvested balance at December 31, 2013	583,021		9.80
Granted	249,311		12.39
Forfeited	(537	)	9.32
Vested	(317,376	)	10.19
Unvested balance at December 31, 2014	514,419		$	10.82

The unvested share awards are expected to vest as follows: 255,828 during 2015, 169,826 during 2016, 81,523 during 2017, and 7,242 during 2018. As of December 31, 2014, the unrecognized compensation cost related to restricted stock awards was $3.4 million and the weighted-average period over which the unrecognized compensation expense will be recorded is approximately 23 months. For the years ended December 31, 2014, 2013, and 2012, we recorded $3.2 million, $3.4 million and $3.3 million, respectively, of compensation expense related to restricted stock awards. The compensation expense for the years ended December 31, 2014 and 2013 include $0.3 million and $0.7 million, respectively, related to the accelerated vesting of awards in connection with employee separations.

Market Stock Units

From 2010 to 2012, we awarded our executive officers market stock units (“MSUs”). MSUs are restricted stock units that vest three years from the date of grant. As of December 31, 2014, there are 98,381 unvested MSUs outstanding, which represent awards granted in 2012. The unrecognized compensation cost related to the MSUs was less than $0.1 million as of December 31, 2014 and is expected to be recognized on a straight-line basis over a weighted average period of 2 months. For the years ended December 31, 2014, 2013, and 2012, we recorded approximately $0.3 million, $0.8 million and $0.9 million, respectively, of compensation expense related to MSUs. The compensation expense for the year ended December 31, 2013 includes $0.2 million related to the accelerated vesting of awards in connection with the departure of our former President and Chief Operating Officer on May 1, 2013.

Performance Stock Units

We have awarded our executive officers performance stock units (“PSUs”). PSUs are restricted stock units that vest three years from the date of grant. Each executive officer is granted a target number of PSUs (the “PSU Target Award”). The actual number of shares of common stock issued to each executive officer is subject to the achievement of certain levels of total stockholder return relative to the total stockholder return of a peer group of publicly-traded lodging REITs over a three-year performance period. There will be no payout of shares of our common stock if our total stockholder return falls below the 30th percentile of the total stockholder returns of the peer group. The maximum number of shares of common stock issued to an executive officer is equal to 150% of the PSU Target Award and is earned if our total stockholder return is equal to or greater than the 75th percentile of the total stockholder returns of the peer group.

The fair values of the PSU awards are determined using a Monte Carlo simulation performed by a third-party valuation firm. Each simulation also considered the share performance of the Company and the peer group. The determination of the grant-date fair values of the awards included the following assumptions:



Award Grant Date	Volatility		Risk-Free Rate		Fair Value at Grant Date
March 3, 2013	39.2	%	0.36	%	$	9.55
May 15, 2013	37.9	%	0.40	%	$	10.41
March 3, 2014	33.5	%	0.66	%	$	12.77
May 15, 2014	33.1	%	0.80	%	$	9.88

A summary of our PSUs from January 1, 2013 to December 31, 2014 is as follows:



	Number of Units	Weighted- Average Grant Date Fair Value
Unvested balance at January 1, 2013	—	$	—
Granted	217,949	9.64
Additional units from dividends	5,227	10.37
Unvested balance at December 31, 2013	223,176	9.66
Granted	200,685	12.33
Additional units from dividends	12,309	12.01
Unvested balance at December 31, 2014	436,170	$	10.95

The unvested units are expected to vest as follows: 230,592 during 2016 and 205,578 during 2017. As of December 31, 2014, the unrecognized compensation cost related to the PSUs was $2.6 million and is expected to be recognized on a straight-line basis over a period of 22 months. For the years ended December 31, 2014 and 2013, we recorded approximately $1.4 million and $0.6 million of compensation expense related to the PSUs.