Share-based Compensation Plans

12 Months Ended

Dec. 31, 2013

Share-based Compensation Plans [Abstract]

Share-based Compensation Plans

18. Share-based Compensation Plans

We have certain share-based compensation plans. Under the fair value method, compensation cost is measured at the grant date based on the fair value of the award and is recognized over the service period which generally corresponds to the vesting period.  The fair value of awards classified as liabilities is remeasured at each reporting period until the award is settled. Awards under our plans generally vest over periods ranging from one to three years.

We have a stock incentive plan that was adopted in May 2011.  The purpose of the plan is to motivate and incent performance by, and to retain the services of, key employees and non-employee directors through receipt of equity-based and other incentive awards under the plan. The maximum number of shares of stock that can be awarded under the plan is 7.0 million. Awards issued under the plan that are subsequently forfeited will not count against the limit on the maximum number of shares that may be issued under the plan. In addition, shares used for income tax withholding or used for payment of the exercise price of an option will not be counted against such limit. The plan provides for the award of stock options, stock appreciation rights, restricted stock and restricted stock units, as well as cash incentive awards. No awards may be granted after May 5, 2021 under the plan. The vesting provisions of options, restricted stock and restricted stock units are determined at the time of grant. Shares issued under the plan are treasury shares if available, otherwise they will be newly issued shares.

The compensation cost that has been charged against income for the share-based plans was $6.6 million, $8.6 million and $12.1 million for the years ended December 31, 2013, 2012 and 2011, respectively.  The related income tax benefit, before valuation allowance, recognized for the share-based compensation plans was $2.3 million, $3.0 million and $4.2 million for the years ended December 31, 2013, 2012 and 2011, respectively. See Note 14 – “Income Taxes” for a discussion of our valuation allowance.

There have been no options granted since 2004, and no options exercised since 2007. At December 31, 2013, all 529,800 options outstanding were exercisable at a price of $68.20 each. All of these options expired in January 2014 without being exercised.

A summary of restricted stock or restricted stock unit (collectively called "restricted stock") activity during 2013 is as follows:

	Weighted
	Average
	Grant Date
	Fair Market
	Value		Shares
Restricted stock outstanding at December 31, 2012	$	7.08		3,077,582
Granted		2.75		1,853,800
Vested		6.36		(1,273,215	)
Forfeited		3.37		(35,460	)
Restricted stock outstanding at December 31, 2013	$	5.15		3,622,707

At December 31, 2013, the 3.6 million shares of restricted stock outstanding consisted of 2.7 million shares that are subject to performance conditions (“performance shares”) and 0.9 million shares that are subject only to service conditions (“time vested shares”). The weighted-average grant date fair value of restricted stock granted during 2012 and 2011 was $3.97 and $8.94, respectively. The fair value of restricted stock granted is the closing price of the common stock on the New York Stock Exchange on the date of grant.  The total fair value of restricted stock vested during 2013, 2012 and 2011 was $4.3 million, $6.9 million and $14.9 million, respectively.

As of December 31, 2013, there was $8.3 million of total unrecognized compensation cost related to nonvested share-based compensation agreements granted under the plans.  Of this total, $6.9 million of unrecognized compensation costs relate to performance shares and $1.4 million relates to time vested shares. The unrecognized costs associated with the performance shares may or may not be recognized in future periods, depending upon whether or not the performance conditions are met. The cost associated with the time vested shares is expected to be recognized over a weighted-average period of 1.6 years.

During 2011, we granted 449,350 shares that will be settled as cash payments over the vesting period under the 2002 stock incentive plan.  The grant date fair value of these restricted share units was $8.94 in 2011.  As of December 31, 2013, there was $0.1 million of total unrecognized compensation cost related to the nonvested shares under this grant.  The unrecognized compensation cost associated with this grant is expected to be recognized over a period of 0.1 years. A summary of activity related to these restricted share units for the years ended December 31, 2013, 2012 and 2011 is as follows:

	2013			2012			2011
Outstanding at beginning of year		294,782			443,950			-
Granted		-			-			449,350
Vested		(147,368	)		(147,968	)		-
Forfeited		(3,268	)		(1,200	)		(5,400	)
Outstanding at end of year		144,146			294,782			443,950
Cash payments at vesting (in millions)	$	0.4		$	0.6

At December 31, 2013, 3.6 million shares were available for future grant under the 2011 stock incentive plan.