Stock-Based Compensation

6 Months Ended

Jun. 30, 2017

A summary of restricted stock transactions during the six months ended June 30, 2017 follows:



	Number of shares
Non-vested stock awards outstanding at January 1, 2017	1,321,292
Awarded:
Time-vesting shares	144,141
Performance-based shares	149,843
Released:
Time-vesting shares	(351,403	)
Performance-based shares	(115,732	)
Forfeitures:
Time-vesting shares	(21,375	)
Performance-based shares	(58,749	)
Non-vested stock awards outstanding at June 30, 2017	1,068,017

The performance-based share awards are subject to either a market condition or a performance condition. For awards subject to a market condition, the performance metric is the Company's total shareholder return, which includes share price appreciation and dividends paid during the three-year term of the award, measured against a peer group of companies. These awards cliff vest at the end of three years. The number of performance-based shares that will ultimately vest is based on the level of market performance achieved, ranging between 0% and 200% of the shares originally awarded, and will be settled in stock.

For awards subject to a performance condition, the performance metric is the Company's average return on invested capital, over the three-year term. These awards cliff vest at the end of three years. The number of performance-based shares that will ultimately vest is based on the level of performance achieved ranging between 0% and 200% of the shares originally awarded, and will be settled in stock.

The time-vesting restricted and deferred stock awards vest ratably over three to five years.

The weighted average grant-date fair value of the 2017 time-vesting stock awards was $55.55 and the performance-based stock awards was $51.90.

The fair value of the performance-based shares subject to a market condition awarded in 2017 was calculated using a Monte Carlo valuation model, including a weighted average stock price volatility of 21.1%, an expected term of three years, and a weighted average risk-free interest rate of 1.43%.

At June 30, 2017, unrecognized compensation cost related to outstanding non-vested stock awards was $39. The weighted average period over which the expense is expected to be recognized is 2.0 years. The aggregate market value of the shares released on the vesting dates was $26 for the six months ended June 30, 2017.