Enom 2013 Annual Report Download - page 103

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Restricted stock units
Restricted stock units activity is as follows (in thousands, except per share data):
As of December 31, 2013, there was approximately $35. 6 million of unrecognized compensation cost related to non-vested RSUs and
restricted shares. The amount is expected to be recognized over a weighted average period of 2.6 years. To the extent that the forfeiture rate is
different from that anticipated, stock-based compensation expense related to these awards will be different.
In March 2014, the company issued 1.2 million RSUs as part of its annual employee compensation grant.
Employee Stock Purchase Plan
In May 2011, we commenced our first offering under the Demand Media, Inc. 2010 Employee Stock Purchase Plan (the “ESPP”), which
allows eligible employees to purchase, through payroll deductions, a limited amount of our common stock at a 15% discount to the lower of
market price as of the beginning or ending of each six-month purchase period. Participants can authorize payroll deductions for amounts up to
the lesser of 15% of their qualifying wages or the statutory limit under the U.S. Internal Revenue Code. The ESPP provides up to a 24-month
offering period which is comprised of four consecutive six-month purchase periods commencing May and November. A maximum of one
thousand two hundred fifty shares of common stock may be purchased by each participant at six-month intervals during the offering period. The
fair value of the ESPP options granted is determined using a Black-Scholes model and is amortized over the remaining life of the 24-month
offering period of the ESPP. The Black-Scholes-
Merton model included an assumption for expected volatility of between 30% and 43% for each
of the four purchase periods. During the years ended December 31, 2013 and 2012, respectively, we recognized an expense of $1.8 million and
$1.9 million in relation to the ESPP and there were 8.9 million shares of common stock remaining authorized for issuance under the ESPP at
December 31, 2013. As of December 31, 2013, all offering periods had ended.
Stock-based Compensation Expense
Stock-based compensation expense related to all employee and non-employee stock-based awards was as follows (in thousands):
Also included in the table above includes $1.1 million and $0.5 million of expense related to warrants granted to non employees for the
years ended December 31, 2012 and 2011, respectively.
During the years ended December 31, 2013, 2012 and 2011, $2 .0 million, $1.7 million and $1.0 million respectively, of stock-based
compensation expense related to stock options was capitalized, primarily as part of internally developed software projects.
F-27
Weighted
average
grant date
Shares
fair value
Unvested at December 31, 2012
4,099
$
9.82
Granted
5,285
$
7.98
Vested
(1,865
)
$
9.33
Forfeited
(2,065
)
$
9.03
Unvested at December 31, 2013
5,454
$
8.51
Year ended December 31,
2013
2012
2011
Service costs
$
2,778
$
2,820
$
2,052
Sales and marketing
5,328
6,118
4,857
Product development
5,186
6,452
5,013
General and administrative
14,092
15,978
16,934
Total stock
-
based compensation included in net income (loss)
27,384
31,368
28,856
Income tax benefit related to stock
-
based compensation included in net income (loss)
(782
)
(758
)
(1,625
)
$
26,602
$
30,610
$
27,231