Share-based compensation

1996 Stock Incentive Plan — We award performance-based and service-based (time vested) share awards and grant qualified incentive and nonqualified stock options to our salaried officers, non-employee directors, and other key employees from our 1996 Stock Incentive Plan (the “Stock Incentive Plan”). The Stock Incentive Plan has 10,000,000 shares authorized for issuance with approximately 7,190,000 shares remaining at December 31, 2013. Granted stock options have a term of 10 years and typically vest one-third on the grant date and an additional one-third on the first and second anniversary dates of the grant. Our independent non-employee directors receive annual grants of service-based share awards that vest following 12 months of service. In addition to the stock options, we grant service-based share awards that typically vest over a period of three years from the date of grant provided that the recipient is still our employee at the time of vesting.

At the time three directors designated for nomination to our Board of Directors were elected in June 2011, it was determined a “change of control” occurred under the terms of our share-based incentive compensation plans. As a result, certain outstanding share-based incentive awards immediately vested and we recognized compensation expense for the accelerated vesting of these awards in 2011.

As of December 31, 2013, options to purchase 619,833 shares of common stock and 442,737 service-based share awards were outstanding.

The Stock Incentive Plan provides for grants of performance share units upon the attainment of certain established performance goals. The performance share units represent the right to receive common stock, on a one-for-one basis on their vesting dates. Under the performance share plan, the performance share awards are granted at the beginning of a three-year performance period. These shares will vest at the end of the three-year performance period and are awarded to the plan participant if the participant is still an employee on the award date. The time-vested performance share awards are included in our service-based share awards. As of December 31, 2013, approximately 219,381 time-vested performance share units have been authorized.

Non-Employee Directors Stock Option Plan — Our non-employee directors’ stock option plan is no longer an active plan. As of December 31, 2013, this plan had 9,000 outstanding options. No new options will be issued out of this plan.

A summary of activity under our Stock Incentive Plan and the Non-Employee Directors Stock Option Plan during the year ended December 31, 2013 is presented below:



Options	Number		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (years)	Aggregate Intrinsic Value
Outstanding at January 1, 2013	626,334		$	24.60
Exercised	(6,000	)	7.43
Forfeited/expired	(501	)	19.01
Outstanding, fully vested and exercisable at December 31, 2013 (1)	619,833		$	24.77	4.86	$	1,065


(1)	As explained above, all unvested stock options immediately vested and became immediately exercisable in 2011. All such options will remain exercisable for their respective remaining term, regardless of whether the awardees remain employees of Century.



Service-based share awards
Outstanding at January 1, 2013	396,133
Granted	303,159
Vested	(128,048	)
Forfeited	(128,507	)
Outstanding at December 31, 2013	442,737



	Year ended December 31,
	2013	2012	2011
Weighted average per share fair value of service-based share grants	$8.19	$8.14	$15.49
Total intrinsic value of option exercises	13	—	72
Total fair value of stock options vested during the period	—	—	1,403

Fair Value Measurement of Share-Based Compensation Awards – We estimate the fair value of each stock option award using the Black-Scholes model on the date of grant. We have not granted any stock options since 2009. For our service-based awards, the fair value of our service-based awards is equal to the closing stock price on the date of grant. Other assumptions to estimate the fair value have no impact on the fair value of the service-based award. If we grant stock options in future periods, we will disclose the relevant assumptions used in the Black-Scholes model to estimate their fair value.

The following table summarizes the compensation cost recognized for the years ended December 31, 2013, 2012 and 2011 for all options, service-based share and performance-based share awards. No share-based compensation cost was capitalized during these periods and there were no significant modifications (other than the accelerated vesting in 2011 described above) of any share-based awards in 2013, 2012 and 2011.



	Year ended December 31,
	2013		2012		2011
Share-based compensation expense reported:
Performance-based share expense	$	475	$	27	$	1,836
Service-based share expense	603		586		692
Stock option expense	—		—		328
Total share-based compensation expense before income tax	1,078		613		2,856
Income tax	—		—		—
Total share-based compensation expense, net of income tax	$	1,078	$	613	$	2,856

As of December 31, 2013, we had unrecognized compensation expense of $794 before taxes. This expense will be recognized over a weighted average period of 0.75 years.