Stamps.com 2015 Annual Report Download - page 90
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STAMPS.COM INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
AsofDecember31,2015,therewas$55.1millionoftotalunrecognizedcompensationcostrelatedtonon-vestedshare-based
compensationarrangements,whichisexpectedtoberecognizedoveraweighted-averageperiodofapproximately2years.
Employee Stock Purchase Plan
InJune1999,ourBoardofDirectorsadoptedanEmployeeStockPurchasePlan(ESPP),whichallowsoureligibleemployeesto
purchasesharesofcommonstock,atsemi-annualintervals,withtheiraccumulatedpayrolldeductions.
Eligibleparticipantsmaycontributeupto15%ofcashearningsthroughpayrolldeductions,andtheaccumulateddeductionswill
beappliedtothepurchaseofsharesoneachsemi-annualpurchasedate.Thepurchasepricepershareisequalto85%ofthefairmarket
valuepershareontheparticipant’sentrydateintotheofferingperiodor,iflower,85%ofthefairmarketvaluepershareonthesemi-
annualpurchasedate.
Uponadoptionoftheplan,150,000sharesofcommonstockwerereservedforissuance.Thisreserveautomaticallyincreaseson
thefirsttradingdayinJanuaryeachyear,byanamountequalto1%ofthetotalnumberofoutstandingsharesofourcommonstockon
thelasttradingdayinDecemberintheprioryear.Innoeventwillanyannualincreaseexceed260,786shares.
InJuly2009,ourBoardofDirectorsamendedourESPPtoextenditforaperiodoftenyearsbeyonditsoriginalexpirationdateof
July31,2009.Underthisamendment,thetotalsharesavailableforissuancemaynotincrease.AsofDecember31,2015and2014,we
hadapproximately1.7millionsharesavailableforissuanceunderourESPP.Totalsharesofcommonstockissuedpursuanttothe
ESPPduring2015,2014and2013wereapproximately49,000,42,000,and56,000,respectively.
Savings Plan
During1999,weimplementedasavingsplanforalleligibleemployees,whichqualifyunderSection401(k)oftheInternal
RevenueCode.Participatingemployeesmaycontributeanypercentageoftheirpretaxsalary,butnotmorethanstatutorydollarlimits.
Wematch50%ofthefirst4%aparticipantcontributes.Weexpensedapproximately$650,000,$402,000and$326,000in2015,2014
and2013,respectively,relatedtothisplan.
12. Commitments and Contingencies
Legal Proceedings
OnAugust14,2014,RapidEnterprises,LLC,D/B/AExpressOne,filedsuitagainstShipStationandsomeofitsexecutivesinthe
ThirdJudicialDistrictCourtforSaltLakeCounty,Utah,alleging,amongotherclaims,thatShipStationbreacheditscontractwith
ExpressOnebyviolatinganexclusivityprovision.ExpressOnesoughtaninjunction,damages,attorneys’feesandcourtcosts.On
December12,2014,ExpressOneaddedadditionalclaimsandStamps.comandourChiefExecutiveOfficerasnameddefendants.
OnAugust6,2015,Stamps.comandExpressOneenteredintoasettlementagreementthatresolvedalldisputesbetweenthe
parties.Stamps.comagreedtopayExpressOne$10.0millioninexchangeforExpressOne’sdismissalandpermanentwithdrawalof
ExpressOne’stortclaims.Inaddition,thepartiesagreedtocontinueandexpandtheirbusinessrelationshipgoingforward.Theamount
wasexpensedandpaidin2015.
ExpressOneisasalesandsupportbusinesspartnerfortheUnitedStatesPostalServicethatprovidesdiscountedshippingrates
andtechnologysolutionstolowervolumeUSPSshippers.ThroughourpartnershipwithExpressOne,Stamps.comandoursubsidiaries
areabletoprovideExpressOne’sshippingdiscountstoourlowervolumecustomers,andExpressOneisabletoutilizeoursystems
andsoftwaretobetterserveitscustomers.
Weareapartytovariouslegalproceedings,includingthosenotedinthissection.Wehaveestablishedlossprovisionsonlyfor
mattersinwhichlossesareprobableandcanbereasonablyestimated.Ifeitherorbothofthecriteriaarenotmet,weassesswhether
thereisatleastareasonablepossibilitythataloss,oradditionallosses,mayhavebeenincurred.Ifthereisareasonablepossibilitythat
alossoradditionallossmayhavebeenincurred
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