Capital Transactions

9 Months Ended

Sep. 30, 2011

10. CAPITAL TRANSACTIONS

Net Income Per Share

Basic net income per share has been computed by dividing net income by the basic number of weighted average shares outstanding. Diluted net income per share has been computed by dividing net income by the diluted number of weighted average shares outstanding using the treasury stock method. The share effect is as follows:

(In thousands)	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2011		2010		2011		2010
Weighted average shares outstanding:
Common shares		25,605		27,793		25,991		29,835
Vested restricted stock units		428		270		406		247
Basic number of weighted average shares outstanding		26,033		28,063		26,397		30,082

Dilutive effect of stock options		70		320		116		351
Dilutive effect of restricted stock and restricted stock units		33		69		60		107
Dilutive number of weighted average shares outstanding		26,136		28,452		26,573		30,540

For the three and nine months ended September 30, 2011 and 2010, there were no stock options, restricted stock or restricted stock units that would have been anti-dilutive.

Stock Repurchases

During the first quarter of 2011, we commenced a tender offer to repurchase 1.9 million shares of our common stock at a price of $65.625 per share. Upon expiration of the tender offer during the first quarter of 2011, we repurchased 1.9 million common shares at a cost of $125.0 million, which included 1.3 million shares beneficially owned by Donald A. Foss, our Chairman of the Board, and 0.5 million shares beneficially owned by the trustee of certain grantor retained annuity trusts created by Mr. Foss. We financed the repurchase of our common stock in the tender offer using the proceeds from the issuance of $100.0 million of Senior Notes and by borrowing under our revolving secured line of credit facility.

Stock Compensation Plans

Pursuant to our Amended and Restated Incentive Compensation Plan (the "Incentive Plan"), the number of shares reserved for granting of restricted stock, restricted stock units, stock options, and performance awards to team members, officers, directors, and contractors at any time prior to April 6, 2019 is 1.5 million shares. The shares available for future grants under the Incentive Plan totaled 333,937 as of September 30, 2011.

A summary of the restricted stock activity under the Incentive Plan for the nine months ended September 30, 2011 and 2010 is presented below:

(In thousands)	Number of Shares
	For the Nine Months Ended September 30,
Restricted Stock	2011			2010
Outstanding Beginning Balance		112			242
Granted		9			19
Vested		(63	)		(143	)
Forfeited		(7	)		(6	)
Outstanding Ending Balance		51			112

A summary of the restricted stock unit activity under the Incentive Plan for the nine months ended September 30, 2011 and 2010 is presented below:

(In thousands, except per share data)	Nonvested					Vested				Total
Restricted Stock Units	Number of Restricted Stock Units			Weighted Average Grant-Date Fair Value Per Share		Number of Restricted Stock Units		Weighted Average Grant-Date Fair Value Per Share		Number of Restricted Stock Units
Outstanding as of December 31, 2010		521		$	19.99		270	$	22.94		791
Granted		25			58.54		-		-		25		(1)
Vested		(158	)		20.99		158		20.99		-		(2)
Forfeited		(34	)		20.50		-		-		(34	)
Outstanding as of September 30, 2011		354		$	22.07		428	$	22.14		782


(In thousands, except per share data)	Nonvested					Vested				Total
Restricted Stock Units	Number of Restricted Stock Units			Weighted Average Grant-Date Fair Value Per Share		Number of Restricted Stock Units		Weighted Average Grant-Date Fair Value Per Share		Number of Restricted Stock Units
Outstanding as of December 31, 2009		648		$	19.35		120	$	26.30		768
Granted		33			39.89		-		-		33		(3)
Vested		(150	)		20.24		150		20.24		-		(4)
Forfeited		(10	)		39.89		-		-		(10	)
Outstanding as of September 30, 2010		521		$	19.99		270	$	22.94		791

(1)	The distribution date of vested restricted stock units is February 22, 2018 for 5 restricted stock units and February 18, 2019 for 20 restricted stock units.

(2)	The distribution date of vested restricted stock units is February 22, 2014 for 60 restricted stock units, February 22, 2016 for 90 restricted stock units and February 22, 2017 for 8 restricted stock units.

(3)	The distribution date of vested restricted stock units is February 22, 2017.

(4)	The distribution date of vested restricted stock units is February 22, 2014 for 60 restricted stock units and February 22, 2016 for 90 restricted stock units.

Stock compensation expense consists of the following:

(In thousands)	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2011		2010		2011		2010
Restricted stock	$	113	$	255	$	493	$	715
Restricted stock units		251		632		1,063		2,340
Total	$	364	$	887	$	1,556	$	3,055

While the restricted stock units are expected to vest in equal, annual installments over a five-year period, the related stock compensation expense is not recognized on a straight-line basis over this period. Each installment is accounted for as a separate award and as a result, the fair value of each installment is recognized as stock compensation expense on a straight-line basis over the related vesting period.