Note 18. Share-Based Compensation

The following tables set forth certain share-based compensation information for 2012, 2011, and 2010, respectively:


	Years ended December 31,
	2012	2011	2010
Share-based compensation:

Expense relating to share grants (a)	$ 3,903,000	$ 5,665,000	$ 3,260,000
Adjustments to reflect changes in market price of
Company's common stock	10,000	(775,000)	(281,000)
Total charged to operations (b)	$ 3,913,000	$ 4,890,000	$ 2,979,000


		Weighted average
	Shares	grant date value
Unvested shares, December 31, 2011	1,106,000	$ 5.31
Restricted share grants (c)	2,948,000	4.68
Vested during period	(436,000)	4.86
Forfeitures/cancellations	(103,000)	5.73
Unvested shares, December 31, 2012	3,515,000	$ 4.83

(a) Includes expense relating to equity and liability awards, as discussed below.
(b) The 2012 and 2011 amounts include $362,000 and $1,980,000 applicable to accelerated vestings, respectively, and are included in management transition charges and employee termination costs.
(c) Includes 2,250,000 shares granted to the Company's President and Chief Executive Officer in 2011, but not issued until 2012, as discussed below.

During 2012, in addition to shares issued to the Company’s President and Chief Executive Officer, as discussed below, there were 698,000 other time-based restricted shares issued with a weighted average grant date fair value of $4.75 per share. The 2012 Plan authorized 4.5 million shares to be available for grant and increased the maximum number of shares that may be granted to a participant in any calendar year to 500,000. At December 31, 2012, 2.4 million shares remained available for grants pursuant to the 2012 Plan and, at that date, there remained an aggregate of approximately $12.1 million applicable to all grants and awards to be expensed over a weighted average period of 4.8 years.

The per share weighted average grant date fair values of shares granted during 2012, 2011, and 2010 were $4.68, $5.40 and $6.54, respectively. The total fair values of shares vested during 2012, 2011, and 2010 were $2,126,000, $5,507,000, and $996,000, respectively (the 2012 and 2011 amounts include $585,000 and $3,569,000, respectively, applicable to accelerated vestings).

In June 2011, in connection with the retirement of the Company’s Chairman of the Board, Chief Executive Officer and President, and the end of the employment of the Company’s Chief Financial Officer (see Note 17 – “Management Transition Charges and Employee Termination Costs”), all of their outstanding restricted share grants, consisting of time-based grants (284,000 shares) and performance-based grants (422,000 shares) became vested (an aggregate of 706,000 shares), and were expensed in full at the then market value of the shares (an aggregate of approximately $2.0 million).

The Company’s new President and Chief Executive Officer was to receive restricted share grants totaling 2.5 million shares, one-half of which to be time-based, vesting upon the seventh anniversary of the date of grant (vesting on June 15, 2018), and the other half to be performance-based, to be earned if the total annual return on an investment in the Company’s common stock (“TSR”) is at least an average of 6.5% per year for the seven years ending June 15, 2018. An independent appraisal determined the value of the performance-based award to be $4.39 per share compared to a market price at the date of grant of $4.98 per share. As a result of a per-person limitation within the 2004 Plan, only 500,000 shares had been issued through June 2012, 1.5 million shares had been accounted for as an “equity award”, and 500,000 shares had been accounted for as a “liability award”. The values of the equity and liability awards were expensed on a straight-line basis over the vesting period. As specifically provided in the 2012 Plan, the 2.0 million shares previously designated as equity and liability awards were issued, with the liability award being reclassified to equity. Consistent with such awards to other recipients, dividends were paid on all the shares, including the equity and liability award shares, with the dividends paid on the equity award shares treated as distributions to common shareholders and included in the statement of equity, and the dividends paid on the liability award shares treated as compensation and included in the statement of operations. In addition, with respect to the liability award, adjustments to reflect changes in the fair value of the award (based on changes in the market price of the Company’s common stock) were also charged to operations.

In January 2011 and 2010, the Company issued shares of common stock as performance-based grants, with vesting to be based on the TSR over the three calendar years commencing with the dates of grant. Portions of each grant would vest (1) if the TSR on the Company’s common stock is equal to or greater than a specified average return per year (the “Absolute TSR”), and (2) if there is a positive comparison of the TSR on the Company’s common stock to the Company’s peer group (the “Relative TSR”). The Company obtained independent appraisals to determine the values of each category of the performance-based shares issued. The following table summarizes information relating to the performance-based grants:


			Absolute TSR			Relative TSR
		Grant date		Annual
Grant	Shares	market	Portion of	average	Appraisal	Portion of	Appraisal
year	granted	price	grant	return	value	grant	value
2011	275,000	$ 6.54	50%	8%	$ 4.40	50%	$ 5.91
2010	227,000	$ 6.70	50%	6%	$ 4.56	50%	$ 6.00

After accelerated vestings in 2012 and 2011 of certain of these shares, there remained 100,000 shares and 73,000 shares, respectively, of the 2011 and 2010 performance-based awards. However, as the Company did not achieve either TSR measure for the three years ended December 31, 2012, none of the shares granted in 2010 vested. In addition to the performance-based grants, there were other time-based restricted shares issued of 436,000 shares and 279,000 shares for 2011 and 2010, respectively.