Stock Compensation Plans

Pursuant to the Company’s 2016 Stock Incentive Plan, as amended, the Company may issue stock options, RSAs, RSUs, stock appreciation rights, stock purchase warrants, phantom stock and dividend equivalents to certain employees and non-employee directors of the Company and its subsidiaries. An aggregate of 14.0 million shares of common stock were authorized under the 2016 Stock Incentive Plan, and the total number of shares available for grant was approximately 4.7 million as of December 31, 2017.

The following table presents a summary of the total share-based compensation expense and the related net tax benefit associated with the Company’s various employee share-based compensation plans for the years ended December 31, 2017, 2016 and 2015:




($ in thousands)	Year Ended December 31,
($ in thousands)	2017		2016		2015
Stock compensation costs	$	24,657	$	22,102	$	16,502
Related net tax benefits for stock compensation plans	$	4,775	$	1,055	$	3,291

RSAs and RSUs — RSAs and RSUs are granted under the Company’s long-term incentive plan at no cost to the recipient. RSAs vest ratably over three years, cliff vest after three years, or vest at a rate of 50% each at the fourth and fifth year of continued employment from the date of the grant. RSUs vest ratably over three years or cliff vest after three or five years of continued employment from the date of the grant. RSAs and RSUs entitle the recipient to receive cash dividends equivalent to any dividends paid on the underlying common stock during the period the RSAs and RSUs are outstanding. The RSAs have nonforfeitable rights to dividends or dividend equivalents and, as such, are considered participating securities as discussed in Note 1 — Summary of Significant Accounting Policies to the Consolidated Financial Statements. During 2015, all RSAs have vested and there were no outstanding RSAs as of December 31, 2017, 2016 and 2015. RSU dividends are accrued during the vesting period and are paid at the time of vesting. While a portion of RSUs are time-vesting awards, others vest subject to the attainment of specified performance goals and considerations of market conditions referred to as “Performance-based RSUs.” All RSUs are subject to forfeiture until vested.

Performance-based RSUs are granted at the target amount of awards. Based on the Company’s attainment of specified performance goals and consideration of market conditions, the number of shares that vest can be adjusted to a minimum of zero and to a maximum of 200% of the target. The amount of performance-based RSUs that are eligible to vest is determined at the end of each performance period and is then added together to determine the total number of performance shares that are eligible to vest. Performance-based RSUs cliff vest three years from the date of grant.

Compensation costs for the time-based awards are based on the quoted market price of the Company’s stock at the grant date. Compensation costs associated with performance-based RSUs are based on grant date fair value which considers both market and performance conditions, and is subject to subsequent adjustments based on changes in the Company’s stock price and the projected outcome of the performance criteria. Compensation costs of both time-based and performance-based awards are recognized on a straight-line basis from the grant date until the vesting date of each grant.

Effective January 1, 2017, the Company adopted ASU 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. As a result of the adoption of this new guidance, all excess tax benefits and deficiencies on share-based payment awards were recognized within Income tax expense on the Consolidated Statement of Income for the year ended December 31, 2017. For the year ended December 31, 2016 and 2015, these tax benefits were recorded as increases to Additional paid-in capital on the Consolidated Statement of Changes in Stockholders’ Equity. The Company continues to estimate the total number of awards expected to be forfeited in recognizing compensation expense.

The following table presents a summary of the activity for the Company’s time-based and performance-based RSUs for the year ended December 31, 2017 based on the target amount of awards:




	2017
	Time-Based RSUs				Performance-Based RSUs
	Shares		Weighted- Average Grant Date Fair Value		Shares		Weighted- Average Grant Date Fair Value
Outstanding at beginning of year	1,218,714		$	35.92	410,746		$	35.27
Granted	411,290		55.28		131,597		56.59
Vested	(312,226	)	36.55		(118,044	)	36.85
Forfeited	(151,198	)	40.38		—		—
Outstanding at end of year	1,166,580		$	42.00	424,299		$	41.44

The weighted-average fair value of the time-based awards granted during the years ended December 31, 2017, 2016 and 2015 was $55.28, $31.86 and $40.36, respectively. The weighted-average fair value of the performance-based awards granted during the years ended December 31, 2017, 2016 and 2015 was $56.59, $29.18 and $41.15, respectively. The total fair value of time-based awards that vested during the years ended December 31, 2017, 2016, and 2015 was $17.2 million, $4.2 million and $9.1 million, respectively. The total fair value of performance-based awards that vested during the years ended December 31, 2017, 2016 and 2015 was $13.0 million, $4.4 million and $5.8 million, respectively.

As of December 31, 2017, total unrecognized compensation costs related to time-based and performance-based RSUs amounted to $25.3 million and $14.1 million, respectively. These costs are expected to be recognized over a weighted-average period of 2.02 years and 1.85 years, respectively.

Stock Options — The Company issues stock options to certain employees, officers and directors. Stock options are issued at the current market price on the date of grant. No options have been granted since 2011. The options had a four-year vesting period and contractual term of seven years. During 2015, all outstanding stock options have been fully exercised and there were no outstanding options as of December 31, 2017, 2016 and 2015.

The following table presents information related to stock options for the years ended December 31, 2017, 2016 and 2015:




($ in thousands)	Year Ended December 31,
($ in thousands)	2017		2016		2015
Cash proceeds from options exercised	$	—	$	—	$	874
Net tax benefit recognized from options exercised	$	—	$	—	$	320
Total intrinsic value of options exercised	$	—	$	—	$	760

Stock Purchase Plan — The 1998 Employee Stock Purchase Plan (the “Purchase Plan”) provides eligible employees of the Company the right to purchase shares of its common stock at a discount. Employees could purchase shares at 90% of the fair market price subject to an annual purchase limitation of $22,500 per employee. As of December 31, 2017, the Purchase Plan qualifies as a non-compensatory plan under Section 423 of the Internal Revenue Code and, accordingly, no compensation expense has been recognized. 2,000,000 shares of the Company’s common stock have been made available-for-sale under the Purchase Plan. During the years ended December 31, 2017 and 2016, 45,343 shares totaling $2.3 million and 67,198 shares totaling $2.1 million, respectively, have been sold to employees under the Purchase Plan. As of December 31, 2017, there were 526,687 shares available under the Purchase Plan.