Stock-Based Compensation Plans

9 Months Ended

Sep. 30, 2015

7. Stock-Based Compensation Plans

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 available in the form of either restricted stock or stock options. On May 28, 2015, the Company’s shareholders authorized an increase in the number of shares of Common Stock available for grant by 800,000 shares bringing the total to 2,800,000 shares authorized. 2,263,712 shares of restricted stock were granted under the 2007 Stock Incentive Plan by September 30, 2015. Of this amount, 135,368 shares of restricted stock were cancelled and returned to the pool of shares which could be granted under the 2007 Stock Incentive Plan resulting in a net number of 671,656 shares which were available as of September 30, 2015 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 year ended December 31, 2014 and the nine months ended September 30, 2015.


		Shares
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
Granted in 2015 (vesting over 1 year)		16,440
Granted in 2015 (vesting over 4 years)		5,000
Granted in 2015 (vesting over 3 years)		125,000
Vested in 2015		(187,856)
Restricted stock at September 30, 2015		483,940

All cancelled shares have reverted to the share reserve and are available for issuance at a later date, in accordance with the 2007 Plan.

Our accounting policy is to recognize the associated expense of such awards on a straight-line basis over the vesting period. At September 30, 2015, the stock compensation expense related to the restricted stock awards that will be recognized over the average remaining vesting period of 1.9 years totals $5.8 million. At September 30, 2015, the intrinsic value of unvested restricted stock awards is $7.9 million. The 2007 Plan terminates on May 24, 2017.

In the nine months ended September 30, 2015, 49,000 stock options under the 1996 Stock Options/Stock Issuance Plan (the 1996 Plan) were exercised. As of September 30, 2015, there are no options remaining under the 1996 Plan. In the nine months ended September 30, 2014, 26,437 options under the 1996 Stock Options/Stock Issuance Plan (the 1996 Plan) were exercised.