Stock-Based Compensation

Stock Options and Restricted Stock

The Company previously offered a stock incentive plan whereby awards were granted to certain employees and non-employee directors of the Company in various forms including restricted shares of Company common stock and options to purchase Company common stock. Awards were discretionary and were determined by the Compensation Committee of the Board of Directors. Awards vested based upon service conditions. Option and share awards provided for accelerated vesting if there was a change in control (as defined in the award agreements). Non-vested restricted shares generally vested over requisite service periods of 4 years and were considered to be outstanding shares, beginning on the date of each grant. Stock option awards were granted with an exercise price equal to market price of the Company’s stock on the date of grant. No stock options were granted in 2013, 2012 or 2011. As of December 31, 2013, 1.5 million shares remained available for issuance under the 2009 Equity Incentive Plan.

The changes to the composition of the Company’s board of directors which occurred during the first quarter of 2011 constituted a “change in control event” under the terms of certain of the Company’s incentive plans. As a result, the Company accelerated the vesting of approximately 300,000 restricted stock units resulting in $6.2 million in accelerated stock compensation expense recognized in the first quarter of 2011.

Stock-based compensation cost is measured at the grant date based on the fair value of the award and is typically recognized as expense on a straight-line basis over the requisite service period, which is the vesting period. Upon exercise of stock options or vesting of restricted stock, the Company will issue new common stock.

Total stock-based compensation recorded in Corporate expense, net, on the Consolidated Statements of Operations for the three years ended December 31, 2013 is as follows:



	2013		2012			2011
Stock compensation expense before tax benefit	$	247	$	998		$	8,452
Income tax benefit	—		(384		)	(3,254		)
	$	247	$	614		$	5,198

The following table sets forth the summary of option activity outstanding under the stock option program for 2013:



	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value ($000)
Balance at December 31, 2012	105,100	$	52.96	3.7	—
Forfeited or expired	5,325	$	30.30	—	—
Balance at December 31, 2013	99,775	$	54.15	2.9	—
Vested or expected to vest at December 31, 2013	99,775	$	54.15	2.9	—
Exercisable at December 31, 2013	99,775	$	54.15	2.9	—

The total intrinsic value of options exercised during 2011 was less than $0.1 million. The intrinsic value is calculated as the difference between the market value as of the exercise date and the exercise price of the shares. Shares of Company stock issued upon the exercise of stock options in 2011 were 4,000. No options were exercised during 2013 or 2012.

Cash received for strike prices from options exercised under stock-based payment arrangements for 2011 was $0.1 million. The actual tax benefit realized for the tax deductions from options exercised under stock-based arrangements were zero for 2011.

The following table sets forth the summary of restricted stock unit activity outstanding under the restricted stock unit program for 2013:



Nonvested Service Based Restricted Stock Units	Number of Units	Weighted Average Grant Date Fair Value
Balance at December 31, 2012	11,387	$	21.52
Granted	11,898	$	20.49
Vested	23,285	$	21.52
Balance at December 31, 2013	—	$	—

The weighted average grant date fair value of restricted stock units during 2013, 2012 and 2011 was $20.49, $16.30 and $28.01, respectively. In 2013, less than 0.1 million of vested restricted stock awards were granted to certain of the Company’s directors as fees for services rendered.

The total fair values of restricted stock units and stock options which vested during 2013, 2012 and 2011 were $0.5 million, $1.5 million and $9.7 million, respectively.

Market Condition Grants

From time to time the Company has granted to select executives and other key employees restricted stock units whose vesting is based upon the achievement of certain market conditions, which are defined as the Company’s total shareholder return as compared to the total shareholder return of certain peer groups during a three year performance period. The Company used a Monte Carlo simulation pricing model to determine the fair value of its market condition awards. The determination of the fair value of market condition-based awards was affected by the stock price as well as assumptions regarding a number of other variables. These variables include expected stock price volatility over the requisite performance term of the awards, the relative performance of the Company’s stock price and shareholder returns compared to those companies in its peer groups and a risk-free interest rate assumption. Compensation cost is recognized regardless of the achievement of the market condition, provided the requisite service period is met.

At December 31, 2011, there were 23,192 restricted stock units granted with market conditions outstanding with a weighted average grant date fair value of $15.69 that vested, forfeited or were canceled in the first quarter of 2012.