STOCK BASED COMPENSATION

At September 30, 2015, we had the following stock option and stock purchase plans:


•	the 2014 Incentive Stock Plan, which our stockholders approved in May 2014;


•	the 2011 Incentive Stock Plan, which our stockholders approved in May 2011;


•	the 2008 Incentive Stock Plan, which our stockholders approved in May 2008;


•	the 2005 Incentive Stock Plan, which our stockholders approved in April 2005;


•	the 2000 Non-statutory Stock Option Plan, which expired in February 2010;


•	the 1997 Stock Option Plan, which expired in January 2007;


•	the 1996 Directors Stock Option Plan, which expired in May 2006; and


•	the Employee Stock Purchase Plan ("ESPP"), which our stockholders approved in May 2001.

Stock-Based Compensation Expense:

The following table presents the total stock-based compensation expense resulting from stock option awards, restricted stock units ("RSUs"), and the ESPP included in the Condensed Consolidated Statements of Income:



In thousands
	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Cost of revenues – stock option plan	$	24	$	14	$	69	$	42
Selling, general and administrative – stock option plan	4,416		3,600		13,795		11,459
Selling, general and administrative – RSUs	382		319		1,103		948
Selling, general and administrative – ESPP	432		308		1,191		916
Total pre-tax expense	$	5,254	$	4,241	$	16,158	$	13,365

The following table sets forth the tax benefits related to stock compensation:



In thousands
	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Tax benefit recognized in Statement of Income	$	1,501	$	1,319	$	5,103	$	3,248
Excess tax benefit of stock options exercised	4,584		3,667		15,483		10,747

Stock Options:

Stock option activity for the nine months ended September 30, 2015, is summarized as follows:



	Number of Options		Weighted Average Exercise Price per Share		Weighted Average Remaining Contractual Life	Total Aggregate Intrinsic Value
					(in years)	(in thousands)
Outstanding at beginning of year	5,377,857		$	80.88
Granted	959,551		131.20
Exercised	(791,434	)	67.83
Forfeited	(138,249	)	108.71
Canceled or expired	(1,876	)	76.08
Outstanding at September 30, 2015	5,405,849		$	91.02	5.89	$	261,110
Exercisable at September 30, 2015	2,837,919		$	72.66	4.95	$	189,143
Vested and expected to vest at September 30, 2015	5,183,104		$	89.90

As of September 30, 2015, there was $44.0 million of total unrecognized compensation expense related to non-vested option awards, which is expected to be recognized over a weighted average period of 3.03 years.

The following table sets forth the total intrinsic value of options exercised:



In thousands
	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Total intrinsic value of options exercised	$	14,888	$	14,375	$	54,538	$	40,893

The total intrinsic value of options exercised represents the total pre-tax value (the difference between the sales price on that trading day the option was exercised and the exercise price associated with the respective option).

The Company uses historical data to estimate expected life and volatility. The estimated fair value of stock options at the time of the grant using the Black-Scholes option pricing model was as follows:



	Three Months Ended September 30,						Nine Months Ended September 30,
	2015			2014			2015			2014
Stock options granted (shares)	24,275			11,555			959,551			975,038
Weighted average fair value at grant date (per share)	$	23.88		$	21.32		$	22.83		$	21.30
Assumptions:
Expected term (in years)	4.79			4.78			4.79			4.75
Expected volatility	16.01		%	16.98		%	16.56		%	17.39		%
Expected dividend yield	—		%	—		%	—		%	—		%
Risk free interest rate	1.49		%	1.59		%	1.44		%	1.52		%

Restricted Stock Units:

Restricted stock units ("RSUs") vest at the end of three or five years. Our 2008, 2011 and 2014 Plans include a share reserve related to RSUs granted at a 2-1 ratio. A summary of the status of our non-vested RSUs and changes during the nine months ended September 30, 2015, are as follows:



	Number of Units		Weighted Average Grant Date Fair Value		Total Aggregate Intrinsic Value
					(in thousands)
Non-vested at beginning of year	63,600		$	96.04
Granted	10,624		130.40
Vested and released	—		—
Forfeited	(4,273	)	101.20
Non-vested at September 30, 2015	69,951		$	100.94	$	9,745

As of September 30, 2015, there was $4.2 million of total unrecognized compensation expense related to RSUs, which is expected to be recognized over a weighted average period of 2.44 years.