Shareholders' Equity

9 Months Ended

Sep. 30, 2012

Shareholders' Equity

Shareholders' Equity

(10) Shareholders' Equity

a. Common Stock

On October 20, 2010, the Company's Board of Directors authorized a stock repurchase program for up to $40,000,000 of the Company's shares of common stock to be purchased over the following 18 months. On April 24, 2012, the Board of Directors authorized a new stock purchase program for up to $40,000,000 of the Company's shares of common stock through November 1, 2013.

During the nine months ended September 30, 2012, the Company purchased 415,084 shares of the Company's common stock for approximately $11,838,000, at an average price of $28.50 per share, in order to mitigate the dilutive effect of shares issued upon the exercise of stock options pursuant to the Company's stock incentive plans.During the nine months ended September 30, 2011, the Company purchased 248,100 shares of the Company's common stock for approximately $6,185,000, at an average price of $25 per share. In addition, during the nine months ended September 30, 2012, and September 30, 2011, the Companyrepurchased 48,139 sharesand 22,802 shares, respectively, of common stock to cover payroll withholding taxes in connection with the vesting of restricted stock awards in accordance with the restricted stock agreements.

b. Stock Incentive Plans

In May 2006, the Company adopted the AmSurg Corp. 2006 Stock Incentive Plan. The Company also has options outstanding under the AmSurg Corp. 1997 Stock Incentive Plan, under which no additional options may be granted. Under these plans, the Company has granted restricted stock and non-qualified options to purchase shares of common stock to employees and outside directors from its authorized but unissued common stock. At September 30, 2012, 2,760,250 shares were authorized for grant under the 2006 Stock Incentive Plan and 1,069,084 shares were available for future equity grants, including 933,263 shares available for issuance as restricted stock. Restricted stock granted to outside directors prior to 2010 is fully vested butis restricted from trading for five years from the date of grant. Restricted stock granted to outside directors in 2011 and 2012vests over a two and one year period, respectively, and is subject to certain holding restrictions. Restricted stock granted to employees during 2009 and thereafter vests over four years in three equal installments beginning on the second anniversary of the date of grant. Restricted stock granted to employees prior to 2009is fully vested. In addition, shares held by the Company's senior management are subject to certain holding restrictions. The fair value of restricted stock is determined based on the closing bid price of the Company's common stock on the grant date.

Options are granted at market value on the date of the grant. Prior to 2007, granted options vested in four equal annual installments, commencing on the date of grant. Options granted in 2007 and 2008 vest at the end of four years from the grant date. No options have been issued subsequent to 2008. Outstanding options have a term of ten years from the date of grant.

Other information pertaining to share-based activity during the three and nine months ended September 30, 2012and 2011 was as follows (in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2012		2011		2012		2011
Share-based compensation expense	$	1,707	$	1,591	$	5,119	$	4,762
Fair value of shares vested		-		227		6,425		2,589
Cash received from option exercises		5,256		132		11,928		4,760
Tax benefit from option exercises		739		26		1,268		489

As of September 30, 2012, the Company had total unrecognized compensation cost of approximately $8,051,000 related to non-vested awards, which the Company expects to recognize through 2016 and over a weighted average period of 1.1 years.

Average outstanding share-based awards to purchase approximately 26,041and 1,023,000 shares of common stock that had an exercise price in excess of the average market price of the common stock during the periods ended September 30, 2012 and 2011, respectively, were not included in the calculation of diluted securities options under the treasury method for purposes of determining diluted earnings per share due to their anti-dilutive impact.

A summary of the status of non-vested restricted shares at September 30, 2012 and changes during the nine months ended September 30, 2012 is as follows:

			Weighted
		Number	Average
		of	Grant
		Shares	Price
Non-vested shares at December 31, 2011		732,412	$	21.91
	Shares granted	281,429		26.78
	Shares vested	(183,019)		25.98
	Shares forfeited	(2,136)		26.26
Non-vested shares at September 30, 2012		828,686	$	22.50

A summary of stock option activity for the nine months ended September 30, 2012 is summarized as follows:

					Weighted
					Average
			Weighted		Remaining
		Number	Average		Contractual
		of	Exercise		Term
		Shares	Price		(in years)
Outstanding at December 31, 2011		2,510,054	$	23.09	3.4
	Options exercised with total intrinsic value of $11,928,000	(579,598)		20.58
	Options terminated	(5,625)		21.85
Outstanding at September 30, 2012 with aggregate intrinsic value of $8,728,000		1,924,831	$	23.85	2.9
Vested at September 30, 2012 with aggregate intrinsic value of $8,728,000		1,924,831	$	23.85	2.9
Exercisable at September 30, 2012 with aggregate intrinsic value of $8,728,000		1,924,831	$	23.85	2.9

The aggregate intrinsic value represents the total pre-tax intrinsic value received by the option holders on the exercise date or that would have been received by the option holders had all holders of in-the-money outstanding options at September 30, 2012 exercised their options at the Company's closing stock price on September 30, 2012.

c. Earnings per Share

The following is a reconciliation of the numerator and denominators of basic and diluted earnings per share (in thousands, except per share amounts):

		Three Months Ended September 30,					Nine Months Ended September 30,
					Per					Per
		Earnings		Shares	Share		Earnings		Shares	Share
		(Numerator)		(Denominator)	Amount		(Numerator)		(Denominator)	Amount
2012:
Net earnings from continuing operations attributable to
	AmSurg Corp. per common share (basic)	$	15,437	30,819	$	0.50	$	47,352	30,727	$	1.54
Effect of dilutive securities options and
	non-vested shares		-	878				-	831
Net earnings from continuing operations attributable to
	AmSurg Corp. per common share (diluted)	$	15,437	31,697	$	0.49	$	47,352	31,558	$	1.50
Net earnings attributable to AmSurg Corp.
	per common share (basic)	$	15,437	30,819	$	0.50	$	45,749	30,727	$	1.49
Effect of dilutive securities options and
	non-vested shares		-	878				-	831
Net earnings attributable to AmSurg Corp.
	per common share (diluted)	$	15,437	31,697	$	0.49	$	45,749	31,558	$	1.45
2011:
Net earnings from continuing operations attributable to
	AmSurg Corp. per common share (basic)	$	13,017	30,436	$	0.43	$	37,305	30,424	$	1.23
Effect of dilutive securities options and
	non-vested shares		-	726				-	750
Net earnings from continuing operations attributable to
	AmSurg Corp. per common share (diluted)	$	13,017	31,162	$	0.42	$	37,305	31,174	$	1.20
Net earnings attributable to AmSurg Corp.
	per common share (basic)	$	13,126	30,436	$	0.43	$	36,449	30,424	$	1.20
Effect of dilutive securities options and
	non-vested shares		-	726				-	750
Net earnings attributable to AmSurg Corp.
	per common share (diluted)	$	13,126	31,162	$	0.42	$	36,449	31,174	$	1.17