Share-Based Compensation

12 Months Ended

Dec. 31, 2015

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

5.	Share-Based Compensation

At December 31, 2015, total compensation cost related to nonvested awards not yet recognized was approximately $33,000,000. The weighted-average period over which this compensation cost is expected to be recognized is approximately three years. The aggregate intrinsic value for SARs and RSUs outstanding at December 31, 2015 and 2014 was approximately $104,000,000 and $198,100,000, respectively. The aggregate intrinsic value for SARs and RSUs vested totaled approximately $65,000,000 and $116,200,000 at December 31, 2015 and 2014, respectively. At December 31, 2015, the weighted-average contractual life for outstanding and exercisable SARs and RSUs was six and five years, respectively. Share-based compensation costs of $17,717,000, $16,239,000, and $12,648,000, were recorded for the years ended December 31, 2015, 2014, and 2013, respectively. The total income tax benefits recognized in the consolidated statements of income and comprehensive income for share-based compensation arrangements were approximately $7,100,000, $6,500,000, and $5,100,000 for 2015, 2014, and 2013, respectively. There have been no modifications to valuation methodologies or methods during the years ended December 31, 2015, 2014, or 2013.

For the years ended December 31, 2015, 2014, and 2013, the fair values for SARs granted were estimated using a Black-Scholes option pricing model with the following weighted-average assumptions, respectively: risk-free interest rate of 2.0%, 2.8%, and 2.0%; dividend yield of 2.6%, 2.8%, and 3.2%; annual historical volatility factor of the expected market price of the Company’s common stock of 19% for each of the three years; an average expected life and estimated turnover based on the historical pattern of existing grants of approximately seven years and 5.4%, respectively. The fair value of RSUs is based on the price of the Company’s stock on the date of grant. The total fair value of shares vested during the years ended December 31, 2015, 2014, and 2013 were $15,200,000, $13,800,000, and $8,100,000, respectively.

A summary of the Company’s share-based compensation activity and related information is as follows:


	2015
	Shares (1)			Weighted- Average Exercise Price (2)
	(In Thousands)
Outstanding at beginning of year		3,923		$	64
Granted		887			92
Exercised		(540	)		54
Forfeited		(89	)		81

Outstanding at end of year (3)		4,181		$	71

Exercisable at end of year		2,437		$	61

Shares available for future grants		10,000

(1)	Shares include Restricted Stock Units (RSUs).

(2)	The weighted-average exercise price excludes RSUs.

(3)	The exercise prices for SARs outstanding as of December 31, 2015 ranged from approximately $42 to $92. The weighted-average remaining contractual life of all SARs outstanding is approximately six years.

The weighted-average grant date fair value of SARs granted during the years 2015, 2014, and 2013 was $13.53, $13.77, and $10.14, respectively. The aggregate intrinsic value of SARs and RSUs exercised during the years ended December 31, 2015, 2014, and 2013 was $30,100,000, $65,200,000, and $43,900,000, respectively.

In 2015, the Company granted approximately 711,000 SARs and 176,000 RSUs. In 2014, the Company granted approximately 680,000 SARs and 165,000 RSUs. In 2013, the Company granted approximately 727,000 SARs and 172,000 RSUs.

A summary of the Company’s nonvested share awards activity is as follows:


Nonvested Share Awards (RSUs)	Shares			Weighted- Average Grant Date Fair Value
	(In Thousands)
Nonvested at January 1, 2015		420		$	72
Granted		176			92
Vested		(123	)		62
Forfeited		(40	)		76

Nonvested at December 31, 2015		433		$	82

For the years ended December 31, 2015, 2014, and 2013 approximately $7,000,000, $17,800,000, and $12,900,000, respectively, of excess tax benefits were classified as financing cash inflows.