Share-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2014

A summary of the Company’s stock option activity as of September 30, 2014, and changes during the nine months ended September 30, 2014, is presented in the following table:



Stock Options	Shares		Weighted Average Price		Weighted-Average Remaining Contractual Term	Aggregate Intrinsic Value
Outstanding at January 1, 2014	2,516,618		$	39.60	6.87	$	86,200,655
Granted	511,850		72.80
Exercised	(398,579	)	34.56
Forfeited/Expired	(107,984	)	50.23
Outstanding at September 30, 2014	2,521,905		$	46.68	6.91	$	65,012,309
Vested and expected to vest as of September 30, 2014	2,397,330		$	45.92	6.81	$	63,608,285
Exercisable at September 30, 2014	1,239,830		$	36.47	5.40	$	44,513,426

Stock Option

Schedule of Weighted Average Option Fair Values and Assumptions

Weighted average option fair values and assumptions for the periods specified are disclosed below. The fair value of each option grant was estimated on the date of the grant using the Binomial lattice option pricing model.



	Three Months Ended September 30,
	2014	2013
Weighted average fair value of option grants	$20.34	$15.09
Dividend yield	1.44%	1.57%
Volatility	30.24%	30.65%
Risk-free forward interest rate	0.12% - 3.67%	0.11% - 4.60%
Expected life (in years)	5.87	5.85




	Nine Months Ended September 30,
	2014	2013
Weighted average fair value of option grants	$19.54	$12.94
Dividend yield	1.26%	1.57%
Volatility	30.36%	30.93%
Risk-free forward interest rate	0.12% - 4.66%	0.17% - 4.12%
Expected life (in years)	5.89	5.86

Schedule of Compensation Cost for Stock Options and Unvested Shares and Performance Share Units

Total compensation cost for stock options is as follows:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
Cost of goods sold	$	126		$	94		$	501		$	385
Selling, general and administrative expenses	1,411			1,238			5,026			4,659
Total expense before income taxes	1,537			1,332			5,527			5,044
Income tax benefit	(492		)	(439		)	(1,743		)	(1,620		)
Total expense after income taxes	$	1,045		$	893		$	3,784		$	3,424

Performance Shares

Schedule of Weighted Average Option Fair Values and Assumptions

Weighted average performance share unit fair values and assumptions for the period specified are disclosed below. The performance share units are market condition awards and have been assessed at fair value on the date of grant using a Monte Carlo simulation model.



	Three and Nine Months Ended September 30,
	2014	2013
Weighted average fair value of performance share units	$94.55	$50.45
Dividend yield	0.00%	0.00%
Volatility	26.41%	28.99%
Risk-free forward interest rate	0.65%	0.40%
Expected life (in years)	2.88	2.87

Schedule of Compensation Cost for Stock Options and Unvested Shares and Performance Share Units

Total compensation cost for performance share units is as follows:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
Cost of goods sold	$	—		$	—		$	—		$	—
Selling, general and administrative expenses	843			229			2,327			634
Total expense before income taxes	843			229			2,327			634
Income tax benefit	(294		)	(82		)	(768		)	(195		)
Total expense after income taxes	$	549		$	147		$	1,559		$	439

Unvested Shares

Schedule of Compensation Cost for Stock Options and Unvested Shares and Performance Share Units

Total compensation cost for unvested shares is as follows:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
Cost of goods sold	$	259		$	338		$	1,424		$	1,065
Selling, general and administrative expenses	1,843			2,077			7,167			6,721
Total expense before income taxes	2,102			2,415			8,591			7,786
Income tax benefit	(447		)	(551		)	(1,778		)	(1,864		)
Total expense after income taxes	$	1,655		$	1,864		$	6,813		$	5,922