Stock-Based Compensation

12 Months Ended

Dec. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

STOCK-BASED COMPENSATION

We recorded stock-based compensation expense and related income tax effects for the years ended December 31, as follows:



(In millions)	2015		2014		2013
Stock-based compensation expense	$	7.2	$	7.3	$	6.9
Tax benefit recorded in consolidated statements of income	$	2.9	$	2.8	$	2.6

As of December 31, 2015, there was $11.3 million of unrecognized stock-based compensation expense for outstanding awards expected to be recognized over a weighted average period of 2.0 years.

Incentive Compensation Plan

We sponsor a stock-based compensation plan (the “Incentive Compensation Plan”) that provides certain incentives and awards to our officers, employees, directors and consultants. The Incentive Compensation Plan allows our Board of Directors (the “Board”) to make various types of awards to non-employee directors and the Compensation Committee (the “Committee”) of the Board to make various types of awards to other eligible individuals. Awards that may be issued include common stock, stock options, stock appreciation rights, restricted stock and stock units.

Grants of common stock options may be incentive and/or non-qualified stock options. Under the Incentive Compensation Plan, the exercise price for options cannot be less than the market value of our common stock at the date of grant. Options vest in accordance with the terms of the award as determined by the Committee, which is generally after three years of service, and expire no later than 10 years after the grant date. Restricted stock grants specify any applicable performance goals, the time and rate of vesting and such other provisions as determined by the Committee. Restricted stock grants generally vest after 3 years of service, but may also vest upon a change of control as defined in the Incentive Compensation Plan. A total of 3.7 million shares of our common stock are authorized to be issued under the Incentive Compensation Plan.

Restricted Stock Units

A summary of the non-vested restricted stock units as of December 31, 2015 and changes during the year is presented below:



	Shares		Weighted-Average Grant-Date Fair Value
Nonvested at December 31, 2014	1,122,553		$	21.06
Granted	299,378		$	35.48
Vested	(446,127	)	$	19.06
Forfeited	(2,566	)	$	25.86
Nonvested at December 31, 2015	973,238		$	26.93

We grant time-based and performance-based restricted stock units that vest after three years. The fair value of these awards is determined using the market value of our common stock on the grant date. Compensation cost is recognized over the lesser of the stated vesting period or the period until the employee reaches age 62, the retirement eligible age under the plan, and has completed ten years of service with the company.

For current year performance-based award grants, the number of shares to be issued is dependent upon our performance over the three year period ending December 31, 2017 with respect to cumulative earnings per share and average operating return on invested capital (ROIC). ROIC is defined as net income plus after tax net interest expense divided by average invested capital, which is an average of total shareholders equity plus debt plus future pension expenses held in AOCI less cash and cash equivalents. Based on the results achieved to date in 2015 and the forecasted amounts over the remainder of the performance period, we expect to issue a total of 196,217 shares at the vesting date in April 2018. Compensation cost has been measured in 2015 based on the projected performance values calculated against the established target.

The following summarizes values for restricted stock activity in each of the years in the three year period ended December 31:



	2015		2014		2013
Weighted-average grant-date fair value of restricted stock units granted (per share)	$	35.48	$	30.12	$	20.88
Fair value of restricted stock vested (in millions)	$	14.9	$	9.4	$	6.7

Stock Options

There were no options granted, forfeited, expired, or outstanding during the years ended December 31, 2015 or December 31, 2014. During the year ended December 31 2013, 23,651 options were exercised.