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Share-Based Compensation

Share-based compensation is measured at the grant date based on the fair value of the award and is recognized as an expense over the requisite service period (generally the vesting period of the equity grant).

The Company issues share-based awards through several plans that are described in detail in the notes to the consolidated financial statements for the year ended

December 31, 2017.

The compensation cost charged against income for those plans is included in selling, general & administrative expenses as follows (in thousands):

	Three Months Ended March 31,
Share-based compensation related to:	2018		2017
Common stock grants	$	100	$	100
Stock option grants		15		9
Restricted Stock Unit awards ("RSUs")		122		100
Total share-based compensation	$	237	$	209

The total income tax benefit recognized in the condensed consolidated statements of income for share-based compensation arrangements was approximately

$155,000

and

$137,000

for the

three

-month periods ended

March 31, 2018

and

2017

, respectively.

The following is a summary of stock option activity under all plans for the

three

-month period ended

March 31, 2018

	Shares Under Options			Weighted Average Exercise Price (per share)		Weighted Average Remaining Contractual Life (in years)		Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2017		202,379		$	18.23
Granted		-			-
Exercised		(30,452	)		28.94
Outstanding at March 31, 2018		171,927		$	19.32		3.60	$	1,750
Exercisable at March 31, 2018		155,677		$	18.48		3.60	$	1,715
Vested and expected to vest at March 31, 2018		171,927		$	19.32		3.60	$	1,750

During the

three

-month period ended

March 31, 2018

, the total intrinsic value of all options exercised (i.e., the difference between the market price on the exercise date and the price paid by the employees to exercise the options) was approximately

$514,000,

and the total amount of consideration received by the Company from the exercised options was approximately

$368,000.

During the

three

-month period ended

March 31, 2017

, the total intrinsic value of all options exercised (i.e., the difference between the market price on the exercise date and the price paid by the employees to exercise the options) was approximately

$184,000,

and the total amount of consideration received by the Company from the exercised options was approximately

$79,000.

At its discretion, the Company allows option holders to surrender previously-owned common stock in lieu of paying the exercise price and withholding taxes. During both of the

three

month periods ended

March 31, 2018

and

2017,

there

were

zero

surrendered for this purpose.

February 21

2018,

the Company’s Compensation Committee approved the award of

$400,000,

payable in shares of common stock to the Company’s Chairman, Chief Executive Officer, and President under the

2003

Incentive Plan. The shares will be issued in

December 2018.

The following table summarizes information about RSUs activity during the

three

-month period ended

March 31, 2018:

	Restricted Stock Units			Weighted Average Award Date Fair Value
Outstanding at December 31, 2017		57,395		$	21.03
Awarded		22,399			29.30
Shares vested		(16,050	)		23.55
Outstanding at March 31, 2018		63,744		$	22.11

At the Company’s discretion, RSU holders are given the option to net-share settle to cover the required minimum withholding tax and the remaining amount is converted into the equivalent number of common shares. During the

three

-month periods ended

March 31, 2018

and

2017,

5,238

and

4,377

shares were surrendered at an average market price of

$27.60

and

$24.50,

respectively.

As of

March 31, 2018,

the Company had approximately

$1.5

million of unrecognized compensation expense that is expected to be recognized over a period of

years