Stock-Based Compensation

12 Months Ended

Dec. 31, 2014

13. Stock-Based Compensation

Key employees, outside directors, consultants and advisors of PAG are eligible to receive stock-based compensation pursuant to the terms of our 2012 Equity Incentive Plan. This plan allows for the issuance of shares for stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares and other awards. The plan is a three year plan which originally allowed for 2,000,000 awards of which 1,121,582 shares of common stock were available for grant as of December 31, 2014. Compensation expense related to these plans was $12.8 million, $9.8 million, and $6.8 million during 2014, 2013, and 2012, respectively.

Restricted Stock

During 2014, 2013, and 2012, we granted 314,677, 448,026, and 431,339 shares, respectively, of restricted common stock and restricted stock units at no cost to participants under the plan. These awards provide the holder voting and dividend rights prior to vesting. The awards are subject to forfeiture and are non-transferable, which restrictions generally lapse over a four year period from the grant date at a rate of 15%, 15%, 20% and 50% per year. We have determined that the grant date quoted market price of the underlying common stock is the appropriate measure of compensation cost. This cost is amortized as expense over the restriction period. As of December 31, 2014, there was $20.0 million of unrecognized compensation cost related to the restricted stock, which is expected to be recognized over the restricted period.

Presented below is a summary of the status of our restricted stock as of December 31, 2013 and 2014, and changes during the year ended December 31, 2014:

	Shares			Weighted Average Grant-Date Fair Value		Aggregate Intrinsic Value
December 31, 2013		1,168,200		$	23.75
Granted		314,677			44.03
Vested		(373,450	)		20.00
Forfeited		(7,042	)		27.12

December 31, 2014		1,102,385		$	30.78	$	54.1

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

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