Annual report pursuant to Section 13 and 15(d)

Stock Incentive Plans

v2.4.0.8
Stock Incentive Plans
12 Months Ended
Dec. 31, 2013
Stock Incentive Plans [Abstract]  
Stock Incentive Plans
Stock Incentive Plans
 
The Company's stock incentive plans allow for the granting of restricted stock or restricted stock unit awards and options to purchase common stock. Both incentive stock options and nonqualified stock options can be awarded under the plans. No option will be exercisable for longer than ten years after the date of grant. The plans have 1,414,240 shares available for future awards. Compensation expense for stock options and restricted stock unit awards is recognized on a straight-line basis over the vesting period, generally three to five years for stock options and 1 to 10 years for restricted stock or restricted stock unit awards. Certain restricted stock unit awards contain performance-based as well as service-based provisions. Certain awards provide for accelerated vesting if there is a change in control as defined in the plans. The total compensation cost that has been charged against income for the stock incentive plans was $36,153, $25,001 and $18,141 for the years ended December 31, 2013, 2012 and 2011, respectively. The total income tax benefit recognized in the income statement for stock-based compensation arrangements was $7,575, $8,952 and $5,804 for the years ended December 31, 2013, 2012 and 2011, respectively.

Option activity for the year ended December 31, 2013 is summarized below:

 
Shares
 
Weighted Average Exercise Price
 
Aggregate Intrinsic Value
 
Weighted Average Remaining Contractual Term
Outstanding as of December 31, 2012
1,299,396

 
$
22.39

 
 
 
 
Granted
10,000

 
44.58

 
 
 
 
Exercised
(361,538
)
 
20.32

 
 
 
 
Forfeited
(663
)
 
17.86

 
 
 
 
Outstanding as of December 31, 2013
947,195

 
$
23.41

 
$
33,659

 
2.8
 
 
 
 
 
 
 
 
Exercisable as of December 31, 2013
921,462

 
$
23.21

 
$
32,937

 
2.7


The fair value of each option grant is estimated on the date of the grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:
 
Year Ended December 31,
 
2013
 
2012 (1)
 
2011
Expected life (in years)
5.1
 
 
5.2
Risk-free interest rate
0.8%
 
 
0.9%
Expected volatility
48.1%
 
 
49.9%
Expected dividend yield
 
 
 
 
 
 
 
 
(1) No options were awarded in the year ended December 31, 2012.


For the years ended December 31, 2013, 2012 and 2011, the Company used a projected expected life for each award granted based on historical experience of employees' exercise behavior. The expected volatility is primarily based on historical volatility levels. The risk-free interest rates are based on the implied yield currently available on U.S. Treasury instruments with a remaining term equal to the expected life.

Other information pertaining to option activity is as follows:
 
Year Ended December 31,
 
2013
 
2012 (1)
 
2011
Weighted-average fair value of options granted
$
19.04

 
$

 
$
13.94

Total intrinsic value of stock options exercised
$
12,845

 
$
24,120

 
$
11,744

 
 
 
 
 
 
(1) No options were awarded in the year ended December 31, 2012.


A summary of the Company's non-vested restricted stock and restricted stock unit shares as of December 31, 2013, and changes during the year ended December 31, 2013, is presented below:
 
Shares
 
Weighted Average Grant Date Fair Value
Non-vested balance as of December 31, 2012
2,058,908

 
$
37.25

Granted
1,037,542

 
55.36

Vested
(961,741
)
 
33.57

Forfeited
(45,116
)
 
38.91

Non-vested balance as of December 31, 2013
2,089,593

 
$
47.90



The total fair value of restricted stock and restricted stock units vested during the years ended December 31, 2013, 2012 and 2011, was $49,032, $38,576 and $22,280, respectively.

As of December 31, 2013, there was $87,901 of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the plans; that cost is expected to be recognized over a weighted-average period of 1.7 years. The actual tax benefit realized for the tax deductions from disqualified dispositions of stock option exercises totaled $508, $1,078 and $955 for the years ended December 31, 2013, 2012 and 2011, respectively.

The Company maintains an employee stock purchase plan and has issued 42,084 shares, 47,613 shares, and 34,966 shares in 2013, 2012 and 2011, respectively.