Stock-based compensation

6 Months Ended

Jun. 30, 2011

Stock-based compensation [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments

Stock-based compensation

The Company accounts for its stock-based compensation in accordance with ASC Topic 718. Stock-based compensation expense totaled $4.9 million and $3.1 million for the three months ended June 30, 2011 and 2010, respectively. During the first six months of 2011 and 2010, stock-based compensation expense was $8.1 million and $7.3 million, respectively. During the six months ended June 30, 2011 and 2010, no associated future income tax benefit was recognized. As of June 30, 2011, there was approximately $20.8 million of total unrecognized compensation cost related to unvested stock-based compensation arrangements granted under the Company’s stock incentive plans. This unrecognized compensation cost is expected to be recognized over a weighted-average period of 2.3 years.

The weighted-average fair value at the grant date of stock options granted during the quarter ended June 30, 2011 and 2010 was $8.45 and $5.58, respectively. During the six months ended June 30, 2011 and 2010, the weighted-average fair value of options granted was $7.44 and $6.40, respectively. The fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton option pricing model with the following weighted-average assumptions for the three months and six months ended June 30, 2011 and 2010:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2011		2010		2011		2010
Weighted-average assumptions:
Expected stock price volatility	47.6	%	51.7	%	47.6	%	50.6	%
Risk-free interest rate	1.9	%	1.7	%	1.9	%	2.2	%
Expected option life (years)	4.6		4.5		4.6		4.5
Expected annual dividend yield	1.8	%	2.5	%	1.9	%	2.4	%

Stock option activity during the six months ended June 30, 2011 was as follows:

					Weighted-
					Average
			Weighted-		Remaining	Aggregate
			Average		Contractual	Intrinsic
	Options		Exercise		Term	Value
	(In Thousands)		Price		(Years)	(In Thousands)
Outstanding at December 31, 2010	4,850		$	20.46
Granted	4		20.90
Exercised	(250	)	13.44
Forfeited or expired	(114	)	24.47
Outstanding at June 30, 2011	4,490		$	20.75	4.1	$	20,533
Exercisable at June 30, 2011	3,101		$	21.91	2.5	$	11,701

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value that would have been realized by the option holders had all option holders exercised their options on June 30, 2011. The total intrinsic value of options exercised during the six months ended June 30, 2011 and 2010 was $1.9 million and $2.3 million, respectively. The intrinsic value of a stock option is the excess of ACI’s closing stock price on that date over the exercise price, multiplied by the number of in-the-money options.

The following table summarizes the Company’s unvested stock option activity for the six months ended June 30, 2011:

			Weighted-
	Shares		Average
	(Amounts in		Exercise Price
	Thousands)		(per Share)
Unvested at December 31, 2010	1,564		$	18.08
Granted	4		20.90
Vested	(157	)	17.52
Forfeited	(22	)	18.56
Unvested at June 30, 2011	1,389		$	18.15

The following table summarizes the Company’s unvested restricted stock unit activity for the six months ended June 30, 2011:

			Weighted-
	Units		Average Grant
	(Amounts in		Date Fair Value
	Thousands)		(per Unit)
Unvested at December 31, 2010	1,698		$	16.61
Granted	5		20.83
Vested	(155	)	15.64
Forfeited	(20	)	16.29
Unvested at June 30, 2011	1,528		$	16.70