Share-Based Compensation

The following table summarizes share-based compensation expense for the three months ended March 31:



(in thousands)	2014			2013
Restricted stock	$	654		$	773
Performance unit incentive plan (“PUP”)	(231		)	863
Restricted stock units	(32		)	88
Stock options	—			95
Share-based compensation before income tax benefit	391			1,819
Income tax benefit	(152		)	(654		)
Share-based compensation, net of income tax benefit	$	239		$	1,165

In addition, a $311,000 reversal of PUP expense was recorded through restructuring expense for the three months ended March 31, 2014.

On January 24, 2014, Viad announced that its Board of Directors declared a special cash dividend of $1.50 per share, or $30.5 million in the aggregate, to shareholders of record at the close of business on February 7, 2014. The dividend was paid on February 14, 2014. In accordance with the mandatory provisions of the 2007 Viad Corp Omnibus Incentive Plan (the “2007 Plan”) and the 1997 Viad Corp Omnibus Incentive Plan, the Human Resources Committee of Viad’s Board of Directors approved equitable adjustments to the outstanding long-term incentive awards of stock options and PUP awards issued pursuant to those plans in order to prevent the special dividend from diluting the rights of participants under those plans. The equitable adjustment to the outstanding stock options reduced the exercise price and increased the number of shares of common stock underlying such options. The equitable adjustment to the PUP awards reflects the effect of the special dividend, but will be paid only if certain performance goals are met at the end of the 3-year performance period.

The following table summarizes the activity of the outstanding share-based compensation awards:



	Restricted Stock				PUP Awards				Restricted Stock Units
	Shares		Weighted-Average Grant Date Fair Value		Units		Weighted-Average Grant Date Fair Value		Units		Weighted-Average Grant Date Fair Value
Balance, December 31, 2013	430,899		$	22.78	299,768		$	23.46	28,560		$	22.91
Granted	83,300		23.95		123,300		23.71		6,700		24.95
Vested	(132,255	)	22.67		(94,600	)	23.01		(9,890	)	23.45
Forfeited	(5,140	)	22.44		—		—		—		—
Balance, March 31, 2014	376,804		23.09		328,468		23.69		25,370		23.24

As of March 31, 2014, the unamortized cost of all outstanding restricted stock awards was $4.4 million, which Viad expects to recognize in the consolidated financial statements over a weighted-average period of approximately 2.0 years. During the three months ended March 31, 2014 and 2013, the Company repurchased 44,358 shares for $1.0 million and 44,606 shares for $1.2 million, respectively, related to tax withholding requirements on vested share-based awards. As of March 31, 2014, there were 906,468 total shares available for future grant in accordance with the provisions of the 2007 Plan.

As of March 31, 2014 and December 31, 2013, Viad had liabilities recorded of $2.4 million and $5.9 million, respectively, related to PUP awards. In March 2014, the PUP units granted in 2011 vested and cash payouts totaling $2.9 million were distributed. There were no cash settlements of PUP awards during the three months ended March 31, 2013.

As of March 31, 2014 and December 31, 2013, Viad had aggregate liabilities recorded of $400,000 and $664,000, respectively, related to restricted stock unit liability awards. In February 2014, portions of the 2009, 2010 and 2011 restricted stock unit awards vested and cash payouts totaling $232,000 were distributed. Similarly, in February 2013 portions of the 2009 and 2010 restricted stock unit awards vested and cash payouts of $300,000 were distributed.

The following table summarizes stock option activity:



	Shares		Weighted- Average Exercise Price		Options Exercisable
Options outstanding at December 31, 2013	314,323		$	19.79	314,323
Exercised	(36,815	)	19.26
Forfeited or expired	(18,522	)	35.28
Award modification	17,865		N/A
Options outstanding at March 31, 2014	276,851		17.69		276,851

As of March 31, 2014, there were no unrecognized costs related to non-vested stock option awards. As previously discussed, the equitable adjustment to the outstanding stock options resulting from the February 14, 2014 special cash dividend reduced the exercise price and increased the number of shares of common stock underlying such options as reflected on the “Award modification” line above.