(14) Stock-Based Compensation Plans

The components of stock compensation expense for the years ended December 31, 2014, 2013, and 2012, included in the accompanying consolidated statements of income were as follows:


	2014		2013		2012
	(in thousands)
2007 Stock Incentive Plan	$	3,459	$	3,393	$	3,092
Employee Stock Purchase Plan		50		46		52
Total Stock Compensation Expense	$	3,509	$	3,439	$	3,144

The significant stock compensation plans are described below.

Our 2007 Stock Incentive Plan (the 2007 Plan) was adopted on May 24, 2007. Under this 2007 Plan, a total of 2,000,000 shares are authorized for stock based compensation in the form of either restricted stock or stock options. 2,117,272 shares of restricted stock were granted under the 2007 Stock Incentive Plan by December 31, 2014. Of this amount, 135,368 shares of restricted stock were withheld or forfeited and returned to the pool of shares which could be granted under the 2007 Stock Incentive Plan resulting in a net number of 18,096 shares which were available as of December 31, 2014 for future issuance under the 2007 Incentive Plan. The fair value of the restricted stock awards equaled the stock price at the date of grants. The following table summarizes restricted stock activity during the years ended December 31:


		Shares
Restricted stock at December 31, 2011		651,294
Granted in 2012 (vesting over 4 years)		283,000
Granted in 2012 (vesting on first anniversary from date of issuance)		28,040
Cancelled in 2012		(8,988)
Vested in 2012		(270,692)
Restricted stock at December 31, 2012		682,654
Granted in 2013 (vesting over 4 years)		130,000
Granted in 2013 (vesting on first anniversary from date of issuance)		21,408
Cancelled in 2013		(60,110)
Vested in 2013		(258,822)
Restricted stock at December 31, 2013		515,130
Granted in 2014 (vesting over 3 years)		174,500
Granted in 2014 (vesting over 4 years)		13,000
Granted in 2014 (vesting on first anniversary from date of issuance)		50,208
Cancelled in 2014		(5,750)
Vested in 2014		(221,732)
Restricted stock at December 31, 2014		525,356

Our accounting policy is to recognize the associated expense of such awards on a straight-line basis over the vesting period. At December 31, 2014 the stock compensation expense related to the restricted stock awards that will be recognized over the average remaining vesting period of 1.8 years totals $6.1 million. At December 31, 2014, the intrinsic value of unvested restricted stock awards is $11.5 million. The Plan terminates on May 24, 2017.

A summary of activity under the 2007 Plan for the years ended December 31, 2014, 2013, and 2012 is as follows:


		Weighted Average
	Number Outstanding	Grant Date Fair Value		Aggregate Value
Balance as of December 31, 2011	651,294	$	11.79	$	7,680,578
Shares granted	311,040		13.68		4,256,290
Shares cancelled	(8,988)		12.52		(112,521)
Shares vested	(270,692)		11.33		(3,067,357)
Balance as of December 31, 2012	682,654	$	12.83	$	8,756,990
Shares granted	151,408		14.25		2,158,011
Shares cancelled	(60,110)		12.41		(745,876)
Shares vested	(258,822)		12.01		(3,108,651)
Balance as of December 31, 2013	515,130	$	13.71	$	7,060,474
Shares granted	237,708		19.84		4,710,362
Shares cancelled	(5,750)		14.02		(80,630)
Shares vested	(221,732)		13.24		(2,903,595)
Balance as of December 31, 2014	525,356	$	16.72	$	8,786,611

Employee Stock Purchase Plan: Under our Employee Stock Purchase Plan (ESPP), as amended and restated effective May 20, 2010, 250,000 shares of common stock have been reserved for issuance. The Purchase Plan was effective in September 1996. Eligible employees may designate not more than 10% of their cash compensation to be deducted each pay period for the purchase of common stock under the Purchase Plan. Participants may purchase not more than 1,000 shares or $25,000 of common stock in any one calendar year. Each January 31 and July 31 shares of common stock are purchased with the employees’ payroll deductions from the immediately preceding six months at a price per share of 85% of the lesser of the market price of the common stock on the purchase date or the market price of the common stock on the date of entry into an offering period. In 2014 and 2013, 14,068 and 14,026 shares of common stock, respectively, were issued under the Purchase Plan. We issue new shares through our transfer agent upon employee stock purchase. The weighted average per share fair value of the employee’s purchase rights under the Purchase Plan for the rights granted was $6.17, $3.19 and $3.19 for 2014, 2013 and 2012, respectively.

1996 Stock Option/Stock Issuance Plan: We granted stock options under our 1996 Stock Option/Stock Issuance Plan (the 1996 Plan), as amended and restated as of March 1, 2003, until the plan terminated in June 2006. Under this Plan, a total of 3,025,000 shares were authorized for grant. These options have a contractual term of ten years and vest at a rate of 25% annually commencing on the first anniversary of the date of grant. For shares outstanding with graded vesting, our accounting policy is to value the options as one award and recognize the associated expense on a straight-line basis over the vesting period. We issue new shares through our transfer agent upon stock option exercise. In the year ended December 31, 2012, 306,653 options were exercised with a total intrinsic value at exercise date of approximately $2.4 million and no options were cancelled. In the year ended December 31, 2013, 54,991 options were exercised with a total intrinsic value at exercise date of approximately $0.4 million and 6,500 options were cancelled. In the year ended December 31, 2014, 26,437 options were exercised with a total intrinsic value at exercise date of approximately $0.2 million. There are 49,000 stock options vested and expected to vest under the 1996 Stock Option/Stock Issuance Plan which have an intrinsic value of $0.6 million.

A summary of the activity under the 1996 Plan for the years ended December 31, 2014, 2013, and 2012 is as follows:


					Weighted
					Average
					Remaining
	Options		Weighted		Contractual
	Available		Average		Term (in	Aggregate
	for Grant	Options	Exercise Price		years)	Intrinsic Value
Outstanding as of December 31, 2011	—	443,581	$	6.35	1.82	$	2,484,009
Options exercised	—	(306,653)		5.34
Options cancelled	—	—		—
Outstanding as of December 31, 2012	—	136,928	$	8.60	2.23	$	781,692
Options exercised	—	(54,991)		7.96
Options cancelled	—	(6,500)		5.01
Outstanding as of December 31, 2013	—	75,437	$	9.38	1.49	$	601,991
Options exercised	—	(26,437)		9.71
Options cancelled	—	—		—
Outstanding as of December 31, 2014	—	49,000	$	9.20	0.59	$	622,300

Vested and expected to vest at:
December 31, 2014		49,000	$	9.20	0.59	$	622,300

Options exercisable at:
December 31, 2012		136,928	$	8.60	2.23	$	781,692
December 31, 2013		75,437	$	9.38	1.49	$	601,991
December 31, 2014		49,000	$	9.20	0.59	$	622,300

The following table summarizes information concerning outstanding and exercisable options at December 31, 2014:

Options Outstanding

Options Exercisable

Weighted

Average

Remaining

Number

Contractual

Weighted Average

Number

Weighted Average

Exercise Prices

Outstanding

Life (in years)

Exercise Price

Exercisable

Exercise Price

From $9.20 to $9.20

49,000

0.59

9.20

49,000

9.20