(15) Stock Compensation Plans

Nonqualified stock options, incentive stock options, and stock appreciation rights

We provide compensation to certain employees using stock based awards. For purposes of calculating compensation cost, we estimate the fair value of each award on the date of grant using the Black-Scholes option-pricing model. We used the following assumptions in calculating the fair value of awards granted in each of the following years:

	2012			2011			2010
Risk-free interest rate		1.0	%		2.2	%		2.7	%
Expected life of option in years		5.39			5.51			5.61
Expected dividend yield of stock		2.3	%		2.5	%		3.2	%
Expected volatility of stock price		56.4	%		49.0	%		50.8	%
Weighted-average per share fair value of options granted	$	12.36		$	11.42		$	8.62

1998 Long-Term Incentive Plan

This plan provides for the award of incentive stock options, nonqualified stock options, restricted stock, stock appreciation rights and phantom stock. We reserved 3,900,000 shares of our common stock for issuance to our officers, directors and key employees. Different terms and conditions apply to each form of award made under the plan. Awards granted since 2003 vest ratably over a three year period and expire six years after the date of grant, except in the event of termination, retirement or death of the optionee or a change in control of the Company. Options awarded under this plan prior to 2003 generally vest 40% after two years and continue to vest at the rate of 20% per year for each year thereafter until they are fully vested. These options are exercisable as they vest and expire 10 years after the date of grant, except in the event of termination, retirement or death of the optionee or a change in control of the Company.

Changes in options outstanding are summarized as follows:

	December 31, 2012					December 31, 2011					December 31, 2010
1998 Long-Term Incentive Plan	Shares			Weighted Average Exercise Price		Shares			Weighted Average Exercise Price		Shares			Weighted Average Exercise Price
Options outstanding at January 1		169,051		$	21.82		413,710		$	19.88		720,791		$	18.19
Granted		-			-		-			-		-			-
Exercised		(165,401	)		21.80		(243,659	)		18.54		(306,548	)		15.93
Forfeited							-			-		-			-
Expired		(3,650	)		22.57		(1,000	)		14.79		(533	)		4.76
Options outstanding at December 31		-			-		169,051			21.82		413,710			19.88
Options exercisable at December 31		-			-		169,051			21.82		413,710			19.88

2006 Long-Term Incentive Plan

	December 31, 2012					December 31, 2011					December 31, 2010
2006 Long-Term Incentive Plan	Awards			Weighted Average Exercise Price		Awards			Weighted Average Exercise Price		Awards			Weighted Average Exercise Price
Awards outstanding at January 1		1,189,012		$	22.91		1,389,598		$	23.02		1,060,057		$	22.89
Granted		-			-		-			-		390,750			23.24
Exercised		(297,528	)		23.11		(170,998	)		24.04		(29,862	)		21.62
Forfeited		(3,125	)		23.24		(20,087	)		20.48		(22,722	)		19.92
Expired		(5,250	)		23.89		(9,501	)		23.64		(8,625	)		29.62
Awards outstanding at December 31		883,109			22.84		1,189,012			22.91		1,389,598			23.02
Awards exercisable at December 31		781,574			22.79		885,003			23.67		754,622			24.86

Our AMCOL International Corporation 2006 Long-Term Incentive Plan permits a total of 1,500,000 shares of AMCOL common stock to be awarded to eligible directors and employees through the use of nonqualified stock options, incentive stock options, restricted stock or restricted stock units, and stock appreciation rights. Different terms and conditions apply to each form of award made under the plan. Awards granted prior to 2009 have a six year life from the date of grant and vest ratably over a three year period from the date of grant. Awards granted in 2009 have a ten year life from the date of grant and vest ratably over a three year period from the date of the grant. No awards could be made pursuant to this plan after May 2010 when the AMCOL International Corporation 2010 Long-Term Incentive Plan was adopted as discussed later herein.

2010 Long-Term Incentive Plan

	December 31, 2012					December 31, 2011
2010 Long-Term Incentive Plan	Awards			Weighted Average Exercise Price		Awards			Weighted Average Exercise Price
Awards outstanding at January 1		356,050		$	30.66				$	-
Granted		417,420			29.80		379,425			30.66
Exercised		(567	)		30.66		-			-
Forfeited		(22,107	)		30.12		(23,375	)		30.66
Expired		(500	)		30.66		-			-
Awards outstanding at December 31		750,296			30.20		356,050			30.66
Awards exercisable at December 31		117,219			30.66		-			-

On May 6, 2010, our shareholders approved the AMCOL International Corporation 2010 Long-Term Incentive Plan. This plan permits a total of 2,000,000 shares of AMCOL common stock to be awarded to eligible directors and employees through the use of nonqualified stock options, incentive stock options, restricted stock or restricted stock units, and stock appreciation rights. Different terms and conditions apply to each form of award under the plan. Awards granted under this plan have a ten year life from the date of grant and vest ratably over a three year period from the date of the grant. At any time, the Board of Directors may amend the plan, which automatically expires on May 7, 2020.

All Stock Compensation Plans

All Stock Compensation Plans	2012		2011		2010

Intrinsic value of awards exercised during the year	$	3.6	$	5.1	$	3.9
Fair value of awards vested during the year		2.9		2.4		3.9
Grant date fair value of awards granted during the year		5.2		4.3		3.4

The following table summarizes information about stock compensation awards outstanding and exercisable at December 31, 2011:

Weighted

Average

All Stock Compensation Plans

Number

Average

Remaining

Exercise

Intrinsic

Contractual

Awards

Price

Value

Life (Yrs.)

Awards outstanding at December 31, 2012

1,633,405

26.22

7.3

6.29

Awards exercisable at December 31, 2012

898,793

23.82

6.2

4.46

The following table summarizes information about our nonvested stock compensation awards outstanding:

	December 31, 2012					December 31, 2011					December 31, 2010
All Stock Compensation Plans- Nonvested Awards	Awards			Weighted Average Grant date Fair value		Awards			Weighted Average Grant date Fair value		Awards			Weighted Average Grant date Fair value
Nonvested awards outstanding at January 1		660,059		$	9.80		635,726		$	7.87		721,442		$	7.46
Granted		417,420			12.36		379,425			11.42		390,750			8.62
Vested		(317,635	)		8.99		(311,630	)		7.80		(453,744	)		8.50
Forfeited		(25,232	)		11.59		(43,462	)		9.77		(22,722	)		7.59
Nonvested awards outstanding at December 31		734,612			11.55		660,059			9.80		635,726			7.87

We recorded stock compensation expense of $4.5, $3.2 and $4.1 in 2012, 2011 and 2010, respectively. At December 31, 2012, we had approximately $3.0 of unrecognized stock compensation expense, which is expected to be recognized over a weighted-average period of 1.4 years. We expect to satisfy the exercise of stock compensation awards by issuing new shares of common stock.

Restricted Stock Awards

The tables above exclude the impact of all restricted stock awards.

Restricted stock awards are subject to performance conditions established by the Compensation Committee of the Board of Directors. The cost of these awards, determined to be the fair market value of the shares at the date of the grant, is expensed ratably over the performance period.

In February 2011, we granted 75,000 shares of performance based restricted stock to our executive officers pursuant to our 2010 Long-Term Incentive Plan. These restricted stock awards have a grant date fair value of $30.66 per share, and vest ratably over a three-year period from grant date, provided that the Company, or certain reporting segments, meet certain established performance targets. One-third of these shares vested in February 2012, and another one-third of these shares vested in February 2013, as the performance targets were met.

In 2009, we granted 40,000 shares of performance based restricted stock with December 2012 vest date to our executive officers pursuant to our 2006 Long-Term Incentive Plan. These restricted awards have a grant date fair value of $28.42 per share. All these shares were cancelled in December 2012 as the performance targets were not met.

We recorded expense of $0.0, $1.7 and $0.5 for our restricted stock awards in 2012, 2011 and 2010, respectively. We expect to satisfy any future distribution of shares of restricted stock by issuing new shares of common stock.