Equity Incentive Plan

12 Months Ended

Dec. 31, 2012

EQUITY INCENTIVE PLAN [Abstract]

Equity Incentive Disclosure

EQUITY INCENTIVE PLAN

The Company’s equity incentive plan provides employees and directors of the Company additional incentives to join and/or remain in the service of the Company as well as to maintain and enhance the long-term performance and profitability of the Company. The Company’s 2004 equity incentive plan was approved by shareholders on May 6, 2004 and provides that 3.5 million shares of common stock, plus any options outstanding under the Company’s prior option plan that terminate without being exercised, may be the subject of awards. Of the 3.5 million shares of common stock available for awards, up to 2.1 million shares may be issued in the form of restricted stock or restricted stock units. The plan provides for the grant of options, restricted stock, restricted stock units and other equity-based awards. The exercise price of options granted shall not be less than the fair market value of the common stock on the date of the award. Options primarily vest equally over a five-year period from the date of grant and have a maximum term of up to ten years and six months. Restricted units primarily vest equally over a five-year period from the date of grant. Since 2005, the compensation committee of the Board of Directors has generally granted restricted share units to participating managers and non-qualified stock options to executive officers.

All share-based compensation arrangements granted to employees, including stock option grants, are recognized in the consolidated statement of operations based on the grant-date fair value of the award over the period during which an employee is required to provide service in exchange for the award. Share-based compensation expense is recorded within selling, general and administrative in the consolidated statement of operations with a corresponding offset to additional paid-in capital in the consolidated balance sheet.

The fair values of stock options granted were calculated using the Black-Scholes pricing model. The aggregate intrinsic value of an option is the amount by which the fair value of the underlying stock exceeds its exercise price. The following table summarizes all stock option activity from December 31, 2011 through December 31, 2012:

	Number of Options		Weighted Average Exercise Price	Aggregate Intrinsic Value (in millions)
Outstanding at December 31, 2011	2,394,938		$82.16	$157.4
Granted	182,506		169.37
Exercised	(410,019	)	53.48
Forfeited	(62,650	)	107.93
Outstanding at December 31, 2012	2,104,775		$94.45	$208.9
Options exercisable at December 31, 2012	1,337,939		$73.91	$159.7

The following table details the weighted average remaining contractual life of options outstanding at December 31, 2012 by range of exercise prices:

Number of Options Outstanding	Weighted Average Exercise Price		Remaining Contractual Life of Options Outstanding	Options Exercisable
307,498	$	43.26	1.6	307,498
398,000	$	60.22	3.7	398,000
500,732	$	81.33	6.3	354,906
344,800	$	109.09	4.9	161,550
371,239	$	141.47	8.3	115,985
182,506	$	169.37	9.8	—
2,104,775			5.6	1,337,939

As of the date granted, the weighted average grant-date fair value of the options granted during the years ended December 31, 2012, 2011 and 2010 was approximately $46.72, $42.43 and $37.84, respectively.

Such weighted average grant-date fair value was determined using an option pricing model that incorporated the following assumptions:

	2012		2011		2010
Risk-free interest rate	0.71	%	1.09	%	1.17	%
Expected life in years	5		5		5
Expected volatility	30	%	30	%	30	%
Expected dividend yield	—		—		—

The total intrinsic value of options exercised during the years ended December 31, 2012, 2011 and 2010 was approximately $50.9 million, $44.7 million and $39.3 million, respectively.

The total fair value of options vested during the years ended December 31, 2012, 2011 and 2010 was approximately $6.9 million, $6.8 million and $6.9 million, respectively.

The following table summarizes all restricted stock unit activity from December 31, 2011 through December 31, 2012:

	Number of Restricted Stock Units		Aggregate Intrinsic Value (in millions)
Outstanding at December 31, 2011	139,774		$	20.6
Granted	43,078
Vested	(47,713	)
Forfeited	(4,114	)
Outstanding at December 31, 2012	131,025		$	25.3

The total fair value of restricted stock units vested during the years ended December 31, 2012, 2011 and 2010 was approximately $5.3 million, $4.5 million and $4.1 million, respectively.

At December 31, 2012, a total of 925,597 shares of common stock were available for grant in the form of stock options or restricted stock units.

As of December 31, 2012, the unrecorded deferred share-based compensation balance related to both stock options and restricted stock units was $13.2 million and will be recognized using a straight-line method over an estimated weighted average amortization period of 2.3 years.