NOTE 15 STOCK‑BASED COMPENSATION

The Company issues stock options and restricted stock units (“RSUs”) to employees under Stock Awards Plans approved by stockholders. RSUs are issued to non-employee directors under a Director Restricted Stock Unit Plan and the 2016 Equity Incentive Plan, and stock options were formerly issued to non-employee directors under a Director Stock Option Plan. Options are awarded with the exercise price equal to the market price on the date of grant and generally become exercisable over three years and expire 10 years after grant. RSUs granted to employees generally vest over three years. Director RSUs generally vest over one year.

Compensation expense recorded attributable to stock options for the year ended December 31, 2017 was approximately $15.2 million ($10.5 million after tax). The income tax benefit related to this compensation expense was approximately $4.7 million. Approximately $13.2 million of the compensation expense was recorded in SG&A expenses and the balance was recorded in cost of sales. Compensation expense recorded attributable to stock options for the year ended December 31, 2016 was approximately $16.9 million ($11.3 million after tax). The income tax benefit related to this compensation expense was approximately $5.6 million. Approximately $15.0 million of the compensation expense was recorded in SG&A and the balance was recorded in cost of sales. Compensation expense recorded attributable to stock options for the year ended December 31, 2015 was approximately $17.9 million ($11.6 million after tax). The income tax benefit related to this compensation expense was approximately $6.3 million. Approximately $15.7 million of the compensation expense was recorded in SG&A expenses and the balance was recorded in cost of sales.

The Company uses historical data to estimate expected life and volatility. The weighted‑average fair value of stock options granted under the Stock Awards Plans was $11.86, $10.59 and $12.83 per share in 2017, 2016 and 2015, respectively. These values were estimated on the respective dates of grant using the Black‑Scholes option‑pricing model with the following weighted‑average assumptions:


Stock Awards Plans:
Years Ended December 31,	2017		2016		2015

Dividend Yield	1.7	%	1.8	%	1.7	%
Expected Stock Price Volatility	15.8	%	16.9	%	21.9	%
Risk-free Interest Rate	2.2	%	1.6	%	1.6	%
Expected Life of Option (years)	6.7		6.7		6.9

A summary of option activity under the Company’s stock option plans as of December 31, 2017, and changes during the period then ended is presented below:


	Stock Awards Plans					Director Stock Option Plans
			Weighted Average				Weighted Average
		Options	Exercise Price			Options	Exercise Price
Outstanding, January 1, 2017		8,070,444	$	56.36		281,334	$	56.45
Granted		1,622,082		74.90		—		—
Exercised		(1,501,210)		46.65		(66,367)		53.23
Forfeited or expired		(131,997)		70.70		—		—
Outstanding at December 31, 2017		8,059,319	$	61.67		214,967	$	57.44
Exercisable at December 31, 2017		5,151,257	$	55.72		214,967	$	57.44
Weighted-Average Remaining Contractual Term (Years):
Outstanding at December 31, 2017		6.1				5.0
Exercisable at December 31, 2017		4.8				5.0
Aggregate Intrinsic Value:
Outstanding at December 31, 2017	$	198,358			$	6,199
Exercisable at December 31, 2017	$	157,436			$	6,199
Intrinsic Value of Options Exercised During the Years Ended:
December 31, 2017	$	51,140			$	1,995
December 31, 2016	$	44,972			$	548
December 31, 2015	$	43,041			$	1,478

The grant date fair value of options vested during the years ended December 31, 2017, 2016 and 2015 was $16.9 million, $17.2 million and $16.1 million, respectively. Cash received from option exercises was approximately $73.9 million and the actual tax benefit realized for the tax deduction from option exercises was approximately $15.8 million in the year ended December 31, 2017. As of December 31, 2017, the remaining valuation of stock option awards to be expensed in future periods was $13.6 million and the related weighted‑average period over which it is expected to be recognized is 1.8 years.

The fair value of RSU grants is the market price of the underlying shares on the grant date. A summary of restricted stock unit activity as of December 31, 2017, and changes during the period then ended is presented below:


				Director Restricted
	Stock Awards Plans			Stock Unit Plan
		Weighted Average			Weighted Average
	RSUs	Grant-Date Fair Value		RSUs	Grant-Date Fair Value
Nonvested at January 1, 2017	72,127	$	69.31	15,745	$	75.56
Granted	89,110		74.43	14,793		80.45
Vested	(51,963)		68.52	(15,745)		75.56
Nonvested at December 31, 2017	109,274	$	73.86	14,793	$	80.45

Compensation expense recorded attributable to restricted stock unit grants for the years ended December 31, 2017, 2016 and 2015 was approximately $3.7 million, $3.0 million and $2.7 million, respectively. The actual tax benefit realized for the tax deduction from RSUs was approximately $1.6 million for the year ended December 31, 2017. The fair value of units vested during the years ended December 31, 2017, 2016 and 2015 was $4.7 million, $1.9 million and $757 thousand, respectively. The intrinsic value of units vested for the years ended December 31, 2017, 2016 and 2015 was $5.2 million, $2.3 million and $877 thousand, respectively. As of December 31, 2017, there was $5.0 million of total unrecognized compensation cost relating to restricted stock unit awards which is expected to be recognized over a weighted average period of 1.9 years.

During the first quarter of 2014, the Company approved a new long-term incentive program for certain employees. Each award is based on the cumulative total stockholder return of our common stock during a three year performance period. Total expense related to this program is expected to be approximately $3.4 million over the performance period. For the years ended December 31, 2017, 2016 and 2015, we recognized expense of $1.5 million, income of $1.0 million and expense of $1.2 million, respectively.