9. Stock incentive plans

In March 2011, our board of directors approved the 2011 Equity Incentive Plan (“2011 Plan”). The 2011 Plan provides for the grant of incentive and non-statutory stock options, stock appreciation rights, restricted shares of our common stock, stock units, and performance cash awards. As of January 1st of each year, the number of shares of common stock reserved for issuance under the 2011 Plan shall automatically be increased by a number equal to the lesser of (a) 4.5% of the total number of shares of common stock then outstanding, (b) 3,000,000 shares of common stock and (c) as determined by our board of directors. The automatic “evergreen” share reserve increase feature will be terminated after January 2018, so that no additional automatic annual share increases will occur thereafter. As of March 31, 2016, 12,004,534 shares of common stock are reserved for issuance.

No further awards will be made under our Amended and Restated 2001 Stock Incentive Plan (“2001 Plan”), and it will be terminated. Options outstanding under the 2001 Plan will continue to be governed by their existing terms.

Stock-based compensation expense is allocated as follows on the accompanying condensed consolidated statements of operations:

	Three Months Ended March 31,
	2016		2015
Network operations	$	646	$	347
Development and technology	312		98
Selling and marketing	549		527
General and administrative	2,098		863

Total stock-based compensation	$	3,605	$	1,835

During the three months ended March 31, 2016 and 2015, we capitalized $182 and $216, respectively, of stock-based compensation expense.

Stock option awards

We grant stock option awards to both employees and non-employee directors. The grant date for these awards is the same as the measurement date. The stock option awards generally vest over a four year service period with 25% vesting when the individual completes 12 months of continuous service and the remaining 75% vesting monthly thereafter. These awards are valued as of the measurement date and the stock-based compensation expense, net of estimated and actual forfeitures, is recognized on a straight-line basis over the requisite service period.

A summary of the stock option activity is as follows:

	Number of Options (000’s)		Weighted Average Exercise Price		Weighted- Average Remaining Contract Life (years)	Aggregate Intrinsic Value
Outstanding at December 31, 2015	3,748		$	6.89	5.0	$	6,611
Exercised	(259	)	$	5.68
Canceled/forfeited	(30	)	$	7.19

Outstanding at March 31, 2016	3,459		$	6.97	4.7	$	8,505

Vested, exercisable and expected to vest at March 31, 2016	3,446		$	6.98	4.7	$	8,488
Exercisable at March 31, 2016	3,115		$	6.95	4.4	$	8,093

Restricted stock unit awards

We grant time-based restricted stock units (“RSU”) to executive and non-executive personnel and non-employee directors. The time-based RSUs granted to executive and non-executive personnel generally vest over a three year period subject to continuous service on each vesting date. The time-based RSUs for our non-employee directors generally vest over a one year period for existing members and 25% per year over a four-year period for new members subject to continuous service on each vesting date.

We grant performance-based RSUs to executive personnel. These awards vest subject to certain performance objectives based on the Company’s revenue growth and, for awards granted during the quarter ended March 31, 2016, EBITDA growth achieved during the specified performance period and certain long-term service conditions. The maximum number of RSUs that may vest is determined based on actual Company achievement and performance-based RSUs generally vest over a three year period subject to continuous service on each vesting date. We recognize stock-based compensation expense for performance-based RSUs when we believe that it is probable that the performance objectives will be met.

In 2016, our Compensation Committee determined to adjust its practice of making annual long-term equity grants and instead adopted a compensation cycle whereby it granted equity awards to our Chief Executive Officer and Chief Financial Officer covering the number of shares it might otherwise have granted in 2016 through 2018, with “cliff” vesting dates in 2019. These grants were made to focus our Chief Executive Officer and Chief Financial Officer on the Company’s overall long-term corporate and strategic goals, eliminate intervening quarterly vesting dates that force them to sell shares in the market to cover taxes triggered upon vesting, and strengthen the Company’s ability to retain our senior management team over the next three years. As a result of these larger-than-usual RSU grants, the Compensation Committee does not intend to grant additional equity awards to our Chief Executive Officer and Chief Financial Officer until 2019.

A summary of the non-vested RSU activity is as follows:

	Number of Shares (000’s)		Weighted Average Grant-Date Fair Value
Non-vested at December 31, 2015	1,819		$	6.39
Granted	2,901		$	6.14
Vested	(393	)	$	6.91
Canceled/forfeited	(80	)	$	6.99

Non-vested at March 31, 2016	4,247		$	6.16

During the three months ended March 31, 2016, 393,319 shares of RSUs vested. The Company issued 244,771 shares and the remaining shares were withheld to pay minimum statutory federal, state, and local employment payroll taxes on those vested awards.