Share-Based Payments

6 Months Ended

Jun. 30, 2013

Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]

Share-Based Payments

7. Share-Based Payments

The Company has five share-based payment programs.

Stock Incentive Awards

On April 8, 2013 the Company’s Board of Directors granted the following stock incentive awards to the Company’s non-employee directors, executive officers and key employees under the 1999 Stock Incentive Plan, as amended:

Award	Shares/Units  Granted	Grant-Date  Fair Value  per Award	Vesting
Restricted Stock Granted to Nonemployee Directors	16,000	$31.03	25% per year through April 8, 2017
Restricted Stock Granted to Executive Officers	17,000	$31.03	25% per year through April 8, 2017
Stock Performance Awards Granted to Executive Officers	50,200	$37.51	December 31, 2015
Restricted Stock Units Granted to Employees	15,150	$25.30	100% on April 8, 2017

The restricted shares granted to the Company’s nonemployee directors and executive officers are eligible for full dividend and voting rights. Restricted shares not vested and dividends on those restricted shares are subject to forfeiture under the terms of the restricted stock award agreement. The grant date fair value of each share of restricted stock was the average of the high and low market price per share on the date of grant.

Under the performance share awards, the Company’s executive officers could earn up to an aggregate of 100,400 common shares based on the Company’s total shareholder return relative to the total shareholder return of the companies that comprise the Edison Electric Institute Index over the performance measurement period of January 1, 2013 through December 31, 2015. The aggregate target share award is 50,200 shares. Actual payment may range from zero to 200% of the target amount. The executive officers have no voting or dividend rights related to these shares until the shares, if any, are issued at the end of the performance period. The grant date fair value of the target amount of common shares projected to be awarded was determined under a Monte Carlo simulation valuation method. The average projected payout percentage rendered by the simulation was 118.7% of target, which would result in a payout of 57,587 shares with a current fair value of $1,883,000 or $32.70 per share, which equates to $37.51 per targeted share award. The terms of these awards are such that the entire award will be classified and accounted for as a liability, as required under ASC 718, and will be measured over the performance period based on the fair value of the award at the end of each reporting period subsequent to the grant date.

The grant date fair value of each restricted stock unit was based on the market value of one share of the Company’s common stock on the grant date, discounted for the value of the dividend exclusion over the four-year vesting period.

As of June 30, 2013 the remaining unrecognized compensation expense related to stock-based compensation was approximately $6.3 million (before income taxes) which will be amortized over a weighted-average period of 2.4 years.

Compensation expense recognized under the Company’s stock-based payment programs are presented in the table below:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
(in thousands)	2013		2012		2013		2012
Employee Stock Purchase Plan (15% discount)	$	42	$	49	$	59	$	88
Restricted Stock Granted to Directors		162		138		369		274
Restricted Stock Granted to Employees		112		87		204		145
Restricted Stock Units Granted to Employees		79		51		154		105
Stock Performance Awards Granted to Executive Officers		703		293		1,801		293
Totals	$	1,098	$	618	$	2,587	$	905