Equity Compensation Plans

As of September 30, 2018, 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 accounts for the expense of all share-based compensation by measuring the awards at fair value on the date of grant. The Company recognizes expense on a straight-line basis over the vesting period of the entire award. Options issued by the Company under its stock option plans have a term of ten years and generally vest ratably over a period of three to four years. Time-based restricted stock grants are expensed over the vesting period of the award, which is typically two to four years. The number of performance based restricted shares that vest or forfeit depend upon achievement of certain targets during the performance period. The Company accounts for forfeitures as they occur. Compensation expense for performance based awards is recorded based upon the service period and management’s assessment of the probability of achieving the performance goals and will be adjusted based upon actual achievement.

The Company incurred equity compensation expense of $0.6 million and $1.0 million for the quarters ended September 30, 2018 and September 30, 2017, respectively, and $3.2 million for each of the nine months ended September 30, 2018 and September 30, 2017., for the Plans, including restricted stock awards. No equity 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, 2018:



In thousands except per share amounts	Shares	Weighted- Average Exercise Price		Aggregate Intrinsic Value
Outstanding at September 30, 2018	398	$	35.57	$	4,688
Exercisable at September 30, 2018	188	$	23.18	$	3,944
Unvested at September 30, 2018	210	$	46.64	$	744

There were no stock options granted and 19,250 stock options exercised during the quarter ended September 30, 2018. There were 11,180 stock options granted and 46,291 stock options exercised during the nine months ended September 30, 2018. The amount of cash received from the exercise of stock options was $0.2 million during the quarter ended September 30, 2018. The amount of cash received from the exercise of stock options was $0.8 million during the nine months ended September 30, 2018. The intrinsic value of stock options exercised was $0.6 million with a tax benefit of $0.1 million during the quarter ended September 30, 2018. The intrinsic value of stock options exercised was $1.3 million with a tax benefit of $0.3 million during the nine months ended September 30, 2018.

There were no stock options granted and 6,170 stock options exercised during the quarter ended September 30, 2017 and no stock options granted and 34,634 stock options exercised during the nine months ended September 30, 2017. The amount of cash received from the exercise of stock options was $0.1 million during the quarter ended September 30, 2017 and $0.4 million during the nine months ended September 30, 2017. The intrinsic value of stock options exercised was $0.2 million with a tax benefit of $0.1 million during the quarter ended September 30, 2017 and the intrinsic value of stock options exercised was $1.4 million with a tax benefit of $0.4 million during the nine months ended September 30, 2017.

At September 30, 2018, the total unrecognized compensation cost related to non-vested stock option awards was approximately $2.6 million, with a weighted average expected amortization period of 2.6 years.

Restricted Stock

Restricted stock includes both performance-based and time-based awards. There were 10,790 time-based restricted stock shares granted during the quarter ended September 30, 2018 and 18,896 time-based restricted stock shares granted during the nine months ended September 30, 2018. There were no performance-based restricted shares granted during the quarter ended September 30, 2018 and 15,190 performance-based restricted shares granted during the nine months ended September 30, 2018. There were no performance-based restricted shares that vested during the quarter ended September 30, 2018 and 48,035 performance-based restricted shares that vested during nine months ended September 30, 2018, in accordance with plan provisions. There were 14,570 time-based restricted shares that vested during the quarter ended September 30, 2018 and 19,734 time-based restricted shares that vested during nine months ended September 30, 2018.

There were no time-based restricted stock shares granted during the quarter and nine month period ended September 30, 2017. There were no performance-based restricted shares granted during the quarter ended September 30, 2017 and 18,100 performance-based restricted shares granted for the nine months ended September 30, 2017. There were no performance-based restricted shares that vested during the quarter ended September 30, 2017 and 108,600 performance-based restricted shares that vested during the nine months ended September 30, 2017 in accordance with plan provisions. There were 6,000 time-based restricted shares that vested during the quarter ended September 30, 2017 and 15,288 time-based restricted shares that vested during the nine months ended September 30, 2017.

At September 30, 2018, there were 179,772 unvested restricted stock awards with total unrecognized compensation cost related to these awards of $4.3 million with a weighted average expected amortization period of 1.9 years. Compensation expense for performance based awards is recorded based on the service period and management’s assessment of the probability of achieving the performance goals.