Stock Incentive Plans

12 Months Ended

Dec. 31, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Incentive Plans

STOCK INCENTIVE PLANS

The Company has one active equity compensation plan under which new grants are made, the Graphic Packaging Holding Company Amended and Restated 2004 Stock and Incentive Compensation Plan (the “2004 Plan”). Under the 2004 Plan, the Company may grant stock options, stock appreciation rights, restricted stock, restricted stock units (“RSUs”) and other types of stock-based and cash awards to employees and directors of the Company. Stock options and other awards granted under the Company’s 2004 plan generally vest and expire in accordance with terms established at the time of grant. Shares issued pursuant to awards under the 2004 plan are from the Company’s authorized but unissued shares. Compensation costs are recognized on a straight-line basis over the requisite service period of the award.

Stock Options

GPC and the Company have not granted any stock options since 2004. As of December 31, 2013, there are no options outstanding and all stock options outstanding as of December 31, 2012 have been exercised or have expired and been cancelled.

A summary of option activity during the three years ended December 31, 2013 is as follows:

	Options		Weighted Average Exercise Price
Outstanding — December 31, 2010	5,280,267		$	7.50
Exercised	(71,350	)	2.12
Canceled	(27,000	)	5.69
Outstanding — December 31, 2011	5,181,917		$	7.58
Exercised	(300,000	)	1.56
Canceled	(2,130,754	)	7.88
Outstanding — December 31, 2012	2,751,163		$	8.01
Exercised	(1,756,629	)	6.66
Canceled	(994,534	)	10.40
Outstanding — December 31, 2013	—		$	—

During 2013, 2012 and 2011 the intrinsic value of options exercised was $2.1 million, $1.1 million and $0.2 million, respectively.

Stock Awards, Restricted Stock and Restricted Stock Units

The Company’s 2004 Plan permits the grant of stock awards, restricted stock and RSUs. Generally, all RSUs vest and become payable in three years from date of grant. RSUs granted to employees generally contain performance conditions based on various financial targets and service requirements that must be met for the shares to vest. Upon vesting, RSUs granted in 2011, 2012 and 2013 are payable solely in shares of common stock. RSUs granted in 2010 were payable in cash and shares of common stock based on the proportion set forth in the grant agreement. Stock awards granted to non-employee directors as part of their compensation for service on the Board are unrestricted on the grant date.

Data concerning RSUs and stock awards granted in the years ended December 31:

	2013		2012		2011
RSUs — Employees	3,335,039		3,793,045		3,979,591
Weighted-average grant date fair value	$	7.34	$	5.44	$	5.16
Stock Awards — Board of Directors	103,842		207,288		198,888
Weighted-average grant date fair value	$	7.80	$	5.21	$	5.43

A summary of the changes in the number of unvested RSUs from December 31, 2010 to December 31, 2013 is presented below:

	Shares		Weighted Average Grant Date Fair Value
Outstanding — December 31, 2010	13,843,484		$	2.05
Granted	3,979,591		5.16
Released	(276,700	)	1.75
Forfeited	(787,524	)	2.94
Outstanding — December 31, 2011	16,758,851		$	2.75
Granted	3,793,045		5.44
Released	(8,024,847	)	1.09
Forfeited	(216,762	)	4.53
Outstanding — December 31, 2012	12,310,287		$	4.63
Granted	3,335,039		7.34
Released	(5,299,116	)	3.94
Forfeited	(510,077	)	5.94
Outstanding — December 31, 2013	9,836,133		$	5.86

The initial value of the RSUs is based on the market value of the Company’s common stock on the date of grant. RSUs payable in cash are subject to variable accounting and marked to market accordingly. RSUs payable in cash are recorded as liabilities, whereas the RSUs payable in shares are recorded in Shareholders’ Equity. The unrecognized expense at December 31, 2013 is approximately $25 million and is expected to be recognized over a weighted average period of 2 years.

The value of stock awards granted to the Company's directors are based on the market value of the Company’s common stock on the date of grant. These awards are unrestricted on the date of grant.

During 2013, 2012 and 2011, $19.0 million, $27.8 million and $17.6 million, respectively, were charged to compensation expense for stock incentive plans. During 2013, 2012 and 2011, cash payments for share-based liabilities were $13.3 million, $21.3 million and $12.0 million, respectively.

During 2013, 2012, and 2011, RSUs with an aggregate fair value of $27.3 million, $20.7 million and $0.7 million, respectively, vested and were paid out. Approximately two-thirds of each of these amounts were payable in shares of common stock and one-third was payable in cash. The RSUs vested in 2013 were granted primarily during 2010.