SHARE-BASED COMPENSATION PLANS

Since May 2, 2013, our non-employee directors and key employees have been granted share-based awards through our SICP. Prior to May 2, 2013, they were awarded share-based awards through DSCP and PIP, respectively. We record these share-based awards as compensation costs over the respective service period for which services are received in exchange for an award of equity or equity-based compensation. The compensation cost is based primarily on the fair value of the shares awarded, using the estimated fair value of each share on the date it was granted and the number of shares to be issued at the end of the service period. We have 621,176 shares reserved for issuance under the SICP.

The table below presents the amounts included in net income related to share-based compensation expense for the awards granted under the SICP for the years ended December 31, 2014, 2013 and 2012:



	For the Year Ended December 31,
	2014			2013			2012
(in thousands)
Awards to non-employee directors	$	540		$	478		$	443
Awards to key employees	1,418			1,153			976
Total compensation expense	1,958			1,631			1,419
Less: tax benefit	(790		)	(657		)	(569		)
Share-Based Compensation amounts included in net income	$	1,168		$	974		$	850

Stock Options

We did not have any stock options outstanding at December 31, 2014, or 2013, nor were any stock options issued during 2014, 2013 and 2012.

Non-employee Directors

Shares granted to non-employee directors are issued in advance of the directors’ service periods and are fully vested as of the date of the grant. We record a prepaid expense equal to the fair value of the shares issued and amortize the expense equally over a service period of one year. In May 2014, each of our non-employee directors received an annual retainer of 1,209 shares of common stock under the SICP as of December 31, 2014.

A summary of stock activity for our non-employee directors for the years ended December 31, 2014, 2013 and 2012 is presented below.



	Number of Shares	Weighted Average Grant Date Fair Value
Outstanding — December 31, 2012	—	$	—
Granted	14,141	$	34.99
Vested	14,141	$	34.99
Outstanding — December 31, 2013	—	$	—
Granted⁽¹⁾	13,827	$	41.60
Vested ⁽¹⁾	13,827	$	41.60
Outstanding — December 31, 2014	—	$	—

⁽¹⁾ In November 2014, we added a new member to our Board of Directors. The number of shares granted to the director for his annual retainer was prorated.

The weighted average grant date fair value of shares granted to our non-employee directors during 2014, 2013 and 2012 was $41.60, $34.99 and $27.37 per share, respectively. The intrinsic values of the shares granted to our non-employee directors are equal to the fair value of these awards on the date of grant. At December 31, 2014, there was $201,000 of unrecognized compensation expense related to these awards. This expense will be fully recognized by April 2015, which approximates the expected remaining service period of those directors.

Key Employees

Our Compensation Committee is authorized to grant key employees of the Company the right to receive awards of shares of our common stock, contingent upon the achievement of established performance goals. These awards are subject to certain post-vesting transfer restrictions.

We currently have multi-year performance plans, which are based upon the successful achievement of long-term goals, growth and financial results, which comprised both market-based and performance-based conditions or targets. The fair value of each share of stock tied to a performance-based condition or target is equal to the market price of our common stock on the date of the grant. For the market-based conditions, we used the Black-Scholes pricing model to estimate the fair value of each share of market-based award granted.

The table below presents the summary of the stock activity for awards to key employees:



	Number of Shares	Weighted Average Fair Value
Outstanding — December 31, 2012	126,968	$	25.24
Granted	35,237	$	29.90
Vested	36,498	$	22.17
Expired	4,565	$	26.08
Outstanding — December 31, 2013	121,142	$	28.20
Granted	41,442	$	39.99
Vested	39,546	$	26.87
Outstanding — December 31, 2014	123,038	$	32.60

In 2014, 2013 and 2012, we withheld shares with value at least equivalent to the employees’ minimum statutory obligation for the applicable income and other employment taxes, and remitted the cash to the appropriate taxing authorities with the executives receiving the net shares. The total number of shares withheld of 12,687, 15,617 and 8,505 for 2014, 2013 and 2012, respectively, was based on the value of the shares on their vesting date, determined by the average of high and low of our stock price. Total payments for the employees’ tax obligations to the taxing authorities were approximately $503,000, $519,000, and $238,000, in 2014, 2013 and 2012, respectively. The tax benefit for 2014, 2013 and 2012 is $398,000, 202,000 and 172,000, respectively, and is included in additional paid-in capital in the consolidated statements of stockholders' equity.

The weighted average grant-date fair value of shares awards granted to key employees during 2014, 2013 and 2012 was $39.99, $29.90 and $26.41 per share, respectively. The intrinsic value of these awards was $6.1 million, $4.8 million and $3.8 million for 2014, 2013 and 2012, respectively. At December 31, 2014, there was of $1.2 million of unrecognized compensation cost related to these awards, which is expected to be recognized during 2015 and 2016.