STOCK-BASED COMPENSATION

12 Months Ended

Dec. 31, 2011

STOCK-BASED COMPENSATION

NOTE 13. STOCK-BASED COMPENSATION

The Silgan Holdings Inc. 2004 Stock Incentive Plan, as amended, or the Plan, provides for awards of stock options, stock appreciation rights, restricted stock, restricted stock units and performance awards to our officers, other key employees and outside directors. The Plan replaced our previous stock option plans, and all shares of our common stock reserved for issuance under those plans are no longer available for issuance except with respect to stock options granted thereunder prior to adoption of the Plan.

Shares of our common stock issued under the Plan shall be authorized but unissued shares or treasury shares. The maximum aggregate number of shares of our common stock that may be issued in connection with stock options, stock appreciation rights, restricted stock, restricted stock units and performance awards under the Plan shall not exceed 6,600,000 shares. Each award of stock options or stock appreciation rights under the Plan will reduce the number of shares of our common stock available for future issuance under the Plan by the number of shares of our common stock subject to the award. Each award of restricted stock or restricted stock units under the Plan, in contrast, will reduce the number of shares of our common stock available for future issuance under the Plan by two shares for every one restricted share or restricted stock unit awarded. As of December 31, 2011, 2,960,008 shares were available to be awarded under the Plan.

We measure the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. The cost is recognized over the period during which an employee is required to provide service in exchange for the award, usually the vesting period. Stock-based compensation expense for the years ended December 31, 2011, 2010 and 2009 recorded in selling, general and administrative expenses was $7.7 million, $5.8 million and $4.9 million, respectively.

STOCK OPTIONS

The table below summarizes stock option activity under our equity compensation plans for the year ended December 31, 2011:

	Options		Weighted Average Exercise Price		Remaining Contractual Life		Aggregate Intrinsic Value (in thousands)
Options outstanding at December 31, 2010		253,893	$	8.15
Exercised		217,360		8.63
Options outstanding and exercisable at December 31, 2011		36,533		5.32		1.2 years	$	1,222

We did not grant options in 2011, 2010 or 2009. The aggregate intrinsic value of options exercised for the years ended December 31, 2011, 2010 and 2009 was $6.5 million, $7.0 million and $8.1 million, respectively.

Our options typically vested in equal annual installments over the applicable service period, and the fair value at the grant date was amortized ratably over the respective vesting period. All compensation expense from stock options has been recognized, and all options are exercisable.

RESTRICTED STOCK UNITS

Restricted stock units issued are generally accounted for as fixed grants and, accordingly, the fair value at the grant date is being amortized ratably over the respective vesting period. The maximum contractual vesting period for restricted stock units outstanding at December 31, 2011 is five years. Unvested restricted stock units may not be disposed of or transferred during the vesting period. Restricted stock units carry with them the right to receive, upon vesting, dividend equivalents.

The table below summarizes restricted stock unit activity for the year ended December 31, 2011:

	Restricted Stock Units			Weighted Average Grant Date Fair Value
Restricted stock units outstanding at December 31, 2010		1,003,556		$	25.12
Granted		204,638			36.98
Released		(374,071	)		24.78
Cancelled		(27,860	)		26.32
Restricted stock units outstanding at December 31, 2011		806,263			28.31

The weighted average grant date fair value of restricted stock units granted during 2010 and 2009 was $28.62 and $24.68, respectively. The fair value of restricted stock units released during the years ended December 31, 2011, 2010 and 2009 was $13.7 million, $4.7 million and $3.4 million, respectively.

As of December 31, 2011, there was approximately $12.8 million of total unrecognized compensation expense related to restricted stock units. This cost is expected to be recognized over a weighted average period of 2.5 years.