Share-based Compensation

6 Months Ended

Jun. 30, 2014

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

8.	Share-based Compensation

The Company has one active stock incentive plan for employees and directors: the 2007 Stock Incentive Plan, which provides for awards of stock options to purchase shares of common stock, stock appreciation rights, restricted and unrestricted shares of common stock, restricted stock units (RSUs) and performance share awards (PSAs). In addition, the Company has one inactive stock option plan, the 1995 Stock Option Plan for Nonemployee Directors, under which previously granted options remain outstanding.

The Company recognizes compensation cost as service is rendered based on the fair value of the awards. The following table summarizes share-based compensation expense recorded (in thousands):


	Three months ended June 30,				Six months ended June 30,
	2014		2013		2014		2013
Cost of sales	$	81	$	139	$	92	$	267
Selling, general and administrative expenses		749		627		1,093		1,025

Total	$	830	$	766	$	1,185	$	1,292

As of June 30, 2014, unrecognized compensation expense related to the unvested portion of the Company’s RSUs and PSAs was $5.9 million, which is expected to be recognized over a weighted average period of 2.1 years.

Stock Option Awards

A summary of the status of the Company’s stock options as of June 30, 2014 and changes during the six months then ended is presented below:


	Options Outstanding			Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
								(In thousands)
Balance, January 1, 2014		40,000		$	25.44
Options granted		—			—
Options exercised or exchanged		(2,000	)		14.00
Options canceled		—			—

Balance, June 30, 2014		38,000			26.05		4.38	$	543

Exercisable, June 30, 2014		38,000			26.05		4.38	$	543

Restricted Stock Units and Performance Awards

A summary of the status of the Company’s RSUs and PSAs as of June 30, 2014 and changes during the six months then ended is presented below:


	Number of RSUs and PSAs			Weighted Average Grant Date Fair Value
Unvested RSUs and PSAs at January 1, 2014		257,087		$	30.69
RSUs and PSAs granted		87,353			41.76
RSUs and PSAs vested		(80,469	)		25.82
RSUs and PSAs canceled		(29,121	)		32.09

Unvested RSUs and PSAs at June 30, 2014		234,850			36.31

RSUs and PSAs are measured at the estimated fair value on the date of grant. RSUs are service-based awards and vest according to vesting schedules, which range from immediate to ratably over a three-year period. PSAs are service-based awards with a market-based vesting condition. Vesting of the market-based PSAs is dependent upon the performance of the market price of the Company’s stock relative to a peer group of companies and ranges from two to three years. The unvested balance of RSUs and PSAs at June 30, 2014 includes approximately 188,000 PSAs at a target level of performance; the actual number of common shares that will ultimately be issued will be determined by multiplying this number of PSAs by a payout percentage ranging from 0% to 200%.

Stock Awards

For the six months ended June 30, 2014 and 2013, stock awards of 7,640 and 4,912 shares, respectively, were granted to non-employee directors, which vested immediately upon issuance. The Company recorded compensation expense based on the fair market value per share of the awards on the grant date of $36.00 and $27.49 in 2014 and 2013, respectively.

- 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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