Stockholders' Equity

12 Months Ended

Dec. 31, 2013

Stockholders' Equity Note [Abstract]

Stockholders' Equity

Note 5. Stockholders’ Equity

Our authorized, issued, and outstanding shares (stated in whole numbers) at year end consist of the following:

	Par Value	2013	2012
Preferred stock	.01/share
Authorized		5,000,000	5,000,000
Shares issued and outstanding		—	—
Common stock	.01/share
Authorized		400,000,000	400,000,000
Shares issued and outstanding		296,753,544	296,564,382

Dividends

On January 14, 2014, our board of directors declared a quarterly dividend of $0.25 per share of common stock to be paid in cash on February 28, 2014 to shareholders of record at the close of business on January 31, 2014. We paid aggregate annual dividends per share of $0.80, $1.24, and $0.65 in 2013, 2012, and 2011, respectively.

Stock Options

The following tables summarize the details of grants made under our stock option plan that are still outstanding, and the assumptions used to value these grants. All options granted were effective at the close of business on the date of grant.

	Options Granted	Option Exercise (Strike) Price		Closing Stock Price on Date of Grant		December 31, 2013
Date of Grant						Options Outstanding	Options Exercisable
April 16, 2013	205,000	$	54.00	$	49.25	172,500	—
April 17, 2012	1,235,000	$	54.00	$	49.01	1,127,500	—
April 19, 2011	410,000	$	35.00	$	31.78	350,000	25,000
April 20, 2010	530,000	$	30.00	$	27.13	300,000	—
April 21, 2009	790,000	$	27.00	$	17.61	413,300	173,300
April 15, 2008	550,000	$	27.00	$	24.35	206,750	113,000
April 17, 2007	4,380,000	$	22.50	$	20.15	1,786,580	1,131,080
Total	8,100,000					4,356,630	1,442,380

Date of Grant	Risk-free Interest Rate		Expected Life of Option in Years	Expected Dividend Yield		Expected Stock Volatility		Estimated Fair Value of Stock Option
April 16, 2013	0.7	%	5.00	1.6	%	37.42	%	$	12.66
April 17, 2012	0.9	%	5.00	1.4	%	39.25	%	$	13.69
April 19, 2011	2.1	%	5.00	1.6	%	39.33	%	$	11.20
April 20, 2010	2.6	%	5.00	1.5	%	39.10	%	$	8.14
April 21, 2009	1.9	%	5.00	1.0	%	38.80	%	$	3.64
April 15, 2008	2.7	%	5.00	1.0	%	30.93	%	$	7.75
April 17, 2007	4.6	%	4.85	1.0	%	31.59	%	$	5.63

All of the options in the tables above vest and become exercisable over a period of up to eight years. Each option will terminate, to the extent not previously exercised, 13 months after the end of the relevant vesting period.

The fair value of each share-based option was estimated on the date of grant using a Black-Scholes valuation method that uses the assumptions listed above. The expected life is the average length of time over which we expect the employee groups will exercise their options, which is based on historical experience with similar grants. Expected volatilities are based on the movement of our stock over the most recent historical period equivalent to the expected life of the option. The risk-free interest rate is based on the U.S. Treasury rate over the expected life at the time of grant. The dividend yield is estimated over the expected life based on our current dividend payout, historical dividends paid, and expected future cash dividends.

A summary of the activity under our stock option plan is as follows:

	Options Outstanding		Exercise Price1		Remaining Life2
Outstanding as of January 1, 2013	4,835,792		$	32.51	5.40
Granted	205,000		$	54.00	8.41
Exercised	(389,162	)	$	23.91
Cancelled/forfeited	(295,000	)	$	35.89
Outstanding as of December 31, 2013	4,356,630		$	34.06	4.66
Exercisable as of December 31, 2013	1,442,380		$	23.61	2.74

	Options Outstanding		Exercise Price1		Remaining Life2
Outstanding as of January 1, 2012	5,132,750		$	24.92	4.72
Granted	1,235,000		$	54.00	8.41
Exercised	(1,305,708	)	22.70
Cancelled/forfeited	(226,250	)	$	34.12
Outstanding as of December 31, 2012	4,835,792		$	32.51	5.40
Exercisable as of December 31, 2012	1,168,792		$	22.95	3.45

¹  Weighted-average exercise price

²  Weighted-average remaining contractual life in years

The total intrinsic value of stock options exercised during the years ended December 31, 2013, 2012, and 2011 was $9,925, $34,424, and $4,977, respectively.The intrinsic value represents the difference between the exercise price and fair value of the underlying shares at a specified date.

At December 31, 2013, there was $15,976 of total unrecognized compensation cost related to unvested stock options granted under the plan. The cost is expected to be recognized over a weighted average period of 4.21 years. The total grant date fair value of options vested under our stock option plan during 2013, 2012, and 2011 was $3,508, $3,866, and $9,168, respectively.

Total stock-based compensation expense related to our stock option plan was $5,400, $4,800, and $4,050 for 2013, 2012, and 2011, respectively.

Earnings Per Share

The following tables present a reconciliation of the denominators used in the computation of basic and diluted earnings per share and a summary of the options to purchase shares of common stock which were excluded from the diluted earnings calculation because they were anti-dilutive:

Reconciliation	2013	2012	2011
Basic-weighted average shares outstanding	296,754,160	296,089,348	295,053,790
Weighted shares assumed upon exercise of stock options	929,428	1,061,602	814,936
Diluted-weighted average shares outstanding	297,683,588	297,150,950	295,868,726

Summary of Anti-dilutive Options Excluded	2013		2012	2011
Options to purchase shares of common stock	1,273,527		847,254	704,384
Weighted-average exercise prices of options	$	54.00	54.00	32.05

Any dilutive impact summarized above would relate to periods when the average market price of our stock exceeded the exercise price of the potentially dilutive option securities then outstanding.