Stock-Based Compensation

12 Months Ended

Dec. 31, 2011

Stock-Based Compensation

Stock-Based Compensation

13. Stock-Based Compensation

        The 1995 Executive Incentive Compensation Plan, as amended, authorizes the issuance of up to 8,000,000 shares of the Company's common stock for use in paying incentive compensation awards in the form of stock options or other equity awards such as restricted stock, restricted stock units or stock appreciation rights. The 1995 Non-Employee Directors' Stock Plan authorizes the issuance of up to 600,000 shares of the Company's common stock for equity awards. Both plans have been approved by the Company's stockholders. At December 31, 2011, there were 1,564,039 and 212,808 shares available for granting equity awards under the 1995 Executive Incentive Compensation Plan and the 1995 Non-Employee Directors' Stock Plan, respectively.

        The Board approves the granting of performance-based restricted stock units as the long-term equity component of director, officer and certain key employee compensation. The restricted stock units require no payment from the recipient and compensation cost is measured based on the market price on the grant date and is generally recorded over the vesting period. The vesting period for restricted stock units granted to non-employee directors is one year, and each restricted stock unit is exchanged for a like number of shares of Company stock following the termination of the participant's service as a director. Restricted stock units granted to officers and certain key employees generally vest on a pro rata basis over a three-year period, and the specified retirement age is 62. Upon vesting, each restricted stock unit is exchanged for a like number of new shares of the Company's stock. Restricted stock units do not have an option for cash payment.

        The following table summarizes restricted stock units issued and the compensation expense recorded for 2011, 2010 and 2009:

Stock-Based Compensation Expense (Income)

					Expense (Income)
	Restricted Stock Units		Fair Value per Unit
(Dollars in thousands, except per unit)					2011		2010		2009
Directors:
May 1, 2008		16,000	$	58.36	$	—	$	—	$	311
May 1, 2009		16,000		27.28		—		145		291
May 3, 2010		16,000		30.99		165		331		—
May 2, 2011		20,192		34.79		468		—		—
Employees:
January 24, 2006		93,100		33.85		—		—		(191	)(a)
January 23, 2007		101,700		38.25		—		41		761
January 22, 2008		130,950		45.95		68		1,601		1,371
January 27, 2009		106,625		25.15		614		667		1,174
November 19, 2009		15,000		31.90		12		298		169
January 25, 2010		1,000		31.49		10		20		—
September 22, 2010		25,000		23.47		373		194		—
April 26, 2011		3,750		32.10		29		—		—
September 20, 2011		13,500		21.18		111		—		—
Total					$	1,850	$	3,297	$	3,886

(a)

Due primarily to forfeitures of restricted stock units.

        Restricted stock unit activity for 2011, 2010 and 2009 was as follows:

	Restricted Stock Units			Weighted-Average Grant-Date Fair Value
Nonvested at January 1, 2009		257,730		$	41.40
Granted		137,625			26.13
Vested		(153,283	)		38.46
Forfeited		(12,581	)		36.97
Nonvested at December 31, 2009		229,491		$	34.45
Granted		42,000			26.53
Vested		(124,424	)		35.81
Forfeited		(6,532	)		35.23
Nonvested at December 31, 2010		140,535		$	30.83
Granted		37,442			29.61
Vested		(113,136	)		33.55
Forfeited		(2,200	)		25.15
Nonvested at December 31, 2011		62,641		$	25.39

        At December 31, 2011, the total unrecognized compensation cost related to nonvested restricted stock units was $0.6 million, the majority of which is expected to be recognized over a period of approximately one year.

        From time to time, the Company may grant incentive stock options and nonqualified stock options to officers, certain key employees and non-employee directors under the two plans noted above. The stock options would generally vest three years from the date of grant, which is the date the Board of Directors approved the grants, and expire no later than ten years after the date of grant. The exercise price of the stock would be fair value on the grant date. Upon exercise, a new share of Company stock is issued for each option.

        Stock option activity for 2011, 2010 and 2009 was as follows:

	Shares Under Option			Weighted-Average Exercise Price		Aggregate Intrinsic Value (in millions)(a)
Outstanding, January 1, 2009		483,820		$	15.39	$	5.7
Exercised		(92,250	)		14.25		—
Expired		(1,600	)		14.57		—
Outstanding, December 31, 2009		389,970		$	15.66	$	6.7
Exercised		(115,493	)		13.77		—
Expired		(805	)		16.33		—
Outstanding, December 31, 2010		273,672		$	16.46	$	3.3
Granted		617,500			31.75		—
Exercised		(199,032	)		15.95		—
Forfeited/Expired		(30,300	)		30.92		—
Outstanding, December 31, 2011		661,840		$	30.22	$	0.2

(a)

Intrinsic value is defined as the difference between the current market value and the exercise price, for those options where the market price exceeds the exercise price.

        In January 2011, 617,500 stock options were granted. The Company used a binomial lattice model to estimate the fair value of $10.90 for this stock-based award. The fair value was estimated with the following assumptions: Dividend yield—2.5%; Volatility—40.6%; Risk-free interest rate—0.6%; and Expected life—7 years. These assumptions are based on multiple factors, including the historical volatility of the Company's stock price. The options vest three years from the grant date and expire seven years after the grant date. Compensation expense recognized in 2011 for stock options totaled $2.0 million. There was no compensation expense for stock options in 2010 or 2009.

        At December 31, 2011, the total unrecognized compensation cost related to nonvested stock options was $4.4 million, which is expected to be recognized over a period of approximately two years.

        Net cash proceeds from the exercise of stock options totaled $2.4 million, $1.0 million and $1.0 million in 2011, 2010 and 2009, respectively.

        The total intrinsic value of options exercised during 2011, 2010 and 2009 was $2.2 million, $1.7 million and $1.4 million, respectively.

        The following table summarizes information concerning outstanding and exercisable options at December 31, 2011.

	Options Outstanding								Options Exercisable
Range of Exercisable Prices	Vested		Unvested		Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contractual Life in Years		Number Exercisable		Weighted-Average Exercise Price Per Share
16.32-16.33		28,840		—	$	16.33		0.05		28,840	$	16.33
16.96-16.96		24,000		—	$	16.96		1.33		24,000	$	16.96
20.96-20.96		20,000		—	$	20.96		0.33		20,000	$	20.96
31.75-31.75		—		589,000	$	31.75		6.07		—		—
		72,840		589,000	$	30.22		5.46		72,840	$	17.81

        At December 31, 2011, outstanding options, substantially all of which are expected to vest, have a weighted-average remaining contractual life of 5.46 years and an aggregate intrinsic value of $0.2 million. Vested and currently exercisable options have a weighted-average remaining contractual life of 0.55 years and an aggregate intrinsic value of $0.2 million.

        Weighted-average grant-date fair value of unvested options during the year ended December 31, 2011, were as follows:

	Shares Under Option			Weighted-Average Grant-Date Fair Value
Outstanding, January 1, 2011		—		$	—
Granted		617,500			10.90
Forfeited		(28,500	)		10.90
Outstanding, December 31, 2011		589,000		$	10.90

        There was a $1.1 million increase and a $0.1 million and $0.3 million decrease of excess tax benefits principally from restricted stock units and the exercise of nonqualified stock options recognized in 2011, 2010 and 2009, respectively.