Quarterly report pursuant to Section 13 or 15(d)

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

3 Months Ended

Mar. 31, 2016

11. STOCK-BASED COMPENSATION

Stock-based compensation recognized in the first three months of 2016 and 2015 was approximately $647,000 and $701,000, respectively.

Restricted Stock Awards

On March 1, 2016, we awarded approximately 135,000 shares of restricted stock to officers at a grant date price of $9.39. One-half of the restricted stock vests ratably over 3 years. The other half vests at the end of the three years based upon the performance metrics of return on invested capital and earnings per share growth. The number of shares actually granted will be adjusted based upon relative performance to our peers. Compensation expense recognized during the three months ended March 31, 2016, was approximately $35,000.

On January 29, 2016, we awarded 35,333 shares of restricted stock to a director at a grant date price of $10.52. The restricted stock award vests over 5 years in 20% increments with the first tranche issued on January 29, 2016. Director’s compensation recognized during the three months ended March 31, 2016, was approximately $87,000.

Directors’ compensation of approximately $19,000 during the three months ended March 31, 2016, was recognized related to restricted stock grants vesting through 2020.

Employee compensation of approximately $108,000 and $72,000 during the three months ended March 31, 2016, and 2015, respectively, was recognized related to restricted stock with a 4 year vesting period which was awarded to officers. This restricted stock vests through 2019.

Employee compensation of approximately $181,000 during the three months ended March 31, 2015, for fully vested restricted stock which was awarded to various employees.

Restricted stock activity in the first three months of 2016 was as follows:

	Shares of Restricted Stock			Weighted Average Grant Date Price per Share

Outstanding at January 1, 2016		148,040		$	14.14
Granted		170,264			9.62
Vested		(36,575	)		13.80
Outstanding at March 31, 2016		281,729		$	11.46

Stock Option and Warrant Awards

A summary of the status of our stock option awards and warrants is presented below:

	Number of StockOptions & Warrants			Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Life

Outstanding at January 1, 2016		1,376,437		$	7.68
Granted		--			--
Exercised		(8,000	)		2.84
Expired		--			--
Cancelled		--			--
Forfeited		--			--
Outstanding at March 31, 2016		1,368,437		$	7.71		5.9
Exercisable at March 31, 2016		793,437		$	7.58		5.8

The fair value of the options granted below was calculated using the Black Scholes option valuation model with the assumptions as disclosed in prior quarterly and annual filings.

Directors’ compensation of approximately $66,000 and $76,000 during the three months ended March 31, 2016, and 2015, respectively, was recognized related to options to purchase shares vesting through 2017.

Employee compensation of approximately $308,000 and $348,000 during the three months ended March 31, 2016, and 2015, respectively, was recognized related to options with a 4 year vesting period which were awarded to officers and key employees. These options vest through 2018.

Post-retirement compensation of approximately $24,000 was recognized during the three months ended March 31, 2016, and 2015, related to options awarded to Mr. Hatem El Khalidi in July 2009. On May 9, 2010, the Board of Directors determined that Mr. El Khalidi forfeited these options and other retirement benefits when he made various demands against the Company and other AMAK Saudi shareholders which would benefit him personally and were not in the best interests of the Company and its shareholders. The Company is litigating its right to withdraw the options and benefits and as such, these options and benefits continue to be shown as outstanding. See further discussion in Note 17.

See the Company’s Annual Report on Form 10-K for the year ended December 31, 2015, for additional information.