Equity Compensation Plans

As of September 30, 2014, the Company’s equity compensation plans consisted of the 2003 Stock Incentive Compensation Plan (the “2003 Plan”) and the 2012 Stock Incentive Plan (the “2012 Plan” and together with the 2003 Plan, the “Plans”) under which incentive and non-qualified stock options and time and performance based restricted shares have been granted to employees and directors from authorized but unissued shares of common stock or treasury shares. The 2003 Plan is not active, but continues to govern all outstanding awards granted under the plan until the awards themselves are exercised or terminate in accordance with their terms. The 2012 Plan, approved by shareholders on April 27, 2012, authorizes 1.75 million shares of common stock for awards. The 2012 Plan also authorizes an additional 1.2 million shares of common stock to the extent awards granted under prior stock plans that were outstanding as of April 27, 2012 are forfeited. The 2012 Plan provides for the following types of awards: options, restricted stock, restricted stock units and other stock-based awards.

The Company incurred compensation expense of $0.7 million and $0.5 million for the quarters ended September 30, 2014 and September 30, 2013, respectively, and $2.0 million and $1.2 million for the nine months ended September 30, 2014 and September 30, 2013, respectively, for the Plans, including restricted stock awards. No compensation costs were capitalized as part of inventory.

Stock Options

The following table is a summary of outstanding and exercisable options as of September 30, 2014:



In thousands except per share amounts and years	Shares	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (years)	Aggregate Intrinsic Value
Outstanding at September 30, 2014	571	$	10.90	6.1	$	9,195
Exercisable at September 30, 2014	319	$	9.43	4.5	$	5,599
Expected to Vest at September 30, 2014	240	$	12.76	8.1	$	3,422

There were no stock options granted and 92,050 stock options exercised during the quarter ended September 30, 2014 and no stock options granted and 183,267 stock options exercised during the nine months ended September 30, 2014. The amount of cash received from the exercise of stock options was $0.7 million during the quarter ended September 30, 2014 and $1.6 million during the nine months ended September 30, 2014. The intrinsic value of stock options exercised was $1.9 million with a tax benefit of $0.6 million during the quarter ended September 30, 2014 and the intrinsic value of stock options exercised was $3.2 million with a tax benefit of $1.1 million during the nine months ended September 30, 2014. There were no stock options granted and 30,074 stock options exercised during the quarter ended September 30, 2013 and 12,500 stock options granted and 128,060 exercised during the nine months ended September 30, 2013. The amount of cash received from the exercise of stock options was $0.3 million during the quarter ended September 30, 2013 and $1.2 million during the nine months ended September 30, 2013. The intrinsic value of stock options exercised was $0.2 million with a minimal tax-benefit during the quarter ended September 30, 2013 and the intrinsic value of stock options exercised was $0.7 million with a tax benefit of $0.2 million during the nine months ended September 30, 2013. At September 30, 2014, the total unrecognized compensation cost related to non-vested stock option awards was approximately $1.1 million, with a weighted average expected amortization period of 2.3 years.

Restricted Stock

Restricted stock includes both performance-based and time-based awards. There were no time-based restricted shares granted during the quarter ended September 30, 2014 and 28,769 time-based restricted shares granted during the nine months ended September 30, 2014. There were no performance-based restricted shares granted during the quarter ended September 30, 2014 and 138,000 performance-based restricted shares granted during the nine months ended September 30, 2014, which have a 2016 earnings per share target. During the nine months ended September 30, 2014, there were 64,200 performance-based shares that vested in accordance with Plan provisions. There were 6,750 time-based shares that vested during the nine months ended September 30, 2014. There were 5,000 time-based restricted shares granted during the nine months ended September 30, 2013. There were 84,790 performance-based restricted shares granted during the nine months ended September 30, 2013, which have a 2015 earnings per share target. During the nine months ended September 30, 2013, there were 61,800 performance-based shares that vested in accordance with Plan provisions. At September 30, 2014, there were 410,664 unvested restricted stock awards with total unrecognized compensation cost related to these awards of $3.5 million with a weighted average expected amortization period of 2.1 years. Compensation expense for performance based awards is recorded based on management’s assessment of the probability of achieving the performance goals and service period.