10.

Stock-Based Compensation

The Company’s incentive compensation plans allow the Company to grant awards to certain employees in the form of stock options, stock awards, restricted stock units, stock appreciation rights, performance stock units, dividend equivalents and other awards. Compensation related to these awards is determined based on the fair value on the date of grant and is amortized to expense over the vesting period. The Company recognizes compensation expense based on the earlier of the vesting date or the date when the employee becomes eligible to retire without forfeiture of the award. If awards can be settled in cash, these awards are recorded as liabilities and marked to market.

The following table discloses the amount of stock-based compensation expense for the three-month periods ended March 31, 2016 and 2015:


	Three Months Ended March 31,
	2016		2015
Stock options	$	431	$	1,053
Restricted stock units		1,823		1,259
Performance stock units		2,498		327

Total stock-based compensation	$	4,752	$	2,639

Stock Options

In February 2013, employees participating in the 2013-2015 Long-Term Incentive Plan were granted 330,639 stock options which vest one-third each year through February 2016. In February 2014, employees participating in the 2014-2016 Long-Term Incentive Plan were granted 380,064 stock options which vest one-third each year through February 2017. No stock options were granted in the three-month periods ended March 31, 2016 or 2015, respectively.

The following table provides details of the stock option activity for the three months ended March 31, 2016:


	Number of
	Shares
Outstanding at December 31, 2015		668,132
Exercised		(138,486	)
Canceled		(4,398	)


Outstanding at March 31, 2016		525,248
Exercisable		411,021

Restricted Stock Units

In February 2016, employees participating in the 2016-2018 Long-Term Incentive Plan were granted 106,287 restricted stock units which vest one-third each year through February 2019. In February 2015, employees participating in the 2015-2017 Long-Term Incentive Plan were granted 105,102 restricted stock units which vest one-third each year through February 2018. Compensation related to the restricted stock units granted is determined based on the fair value of the Company’s stock on the date of grant and is amortized to expense over the vesting period. The Company recognizes compensation expense based on the earlier of the vesting date or the date when the employee becomes eligible to retire without forfeiture of the award. The weighted average fair values of restricted stock units granted in 2016 and 2015 were $36.76 and $36.78, respectively.

The following table provides details of the nonvested restricted stock unit activity for the three months ended March 31, 2016:


	Number of
	Restricted Stock
	Units
Nonvested at December 31, 2015		197,388
Granted		106,287
Vested		(33,458	)
Canceled		(987	)
Accrued dividend equivalents		778


Nonvested at March 31, 2016		270,008

Performance Stock Units

Employees participating in the Company’s Long-Term Incentive Plan earn performance stock units. Under the Company’s 2016 – 2018 Long-Term Incentive Plan, any units earned during 2016 will vest at December 31, 2018. Under the Company’s 2015 – 2017 Long-Term Incentive Plan, any units earned during 2015 and 2016 will vest at December 31, 2017. Under the Company’s 2014 – 2016 Long-Term Incentive Plan, any units earned during 2014, 2015 and 2016 will vest at December 31, 2016.

The following table provides details of the nonvested performance stock units under the Company’s Long-Term Incentive Plan:


	Number of
	Performance Stock
	Units
Performance stock units outstanding at December 31, 2015		191,536
Granted		109,581
Canceled		(2,220	)
Accrued dividend equivalents		584


Performance stock units outstanding at March 31, 2016		299,481

The Company’s restricted stock units and performance stock units are not participating securities. These units will be converted into shares of Company common stock in accordance with the distribution date indicated in the agreements. Restricted stock units earn dividend equivalents from the time of the award until distribution is made in common shares. Performance stock units earn dividend equivalents from the time the units have been earned based upon Company performance metrics, until distribution is made in common shares. Dividend equivalents are only earned subject to vesting of the underlying restricted stock units and performance stock units. Accordingly, such units do not represent participating securities.