14.

STOCK COMPENSATION PLANS

The Company has four stock option plans that provide for the granting of stock options to key employees and non-employee members of the Board of Directors. The 1997 Employee Stock Option Plan ("1997 Plan") provides for granting incentive stock options and nonqualified stock options to officers and key employees of the Company. The 1997 Non-employee Director Stock Option Plan provides for granting nonqualified stock options and formula options to non-employee directors. The 2004 Equity Incentive Plan ("2004 Plan") and the 2009 Equity Incentive Plan ("2009 Plan") provide for granting options, restricted stock, restricted stock units or stock appreciation rights to employees and non-employee directors.

The Company was authorized to grant awards for up to 1,400,000 shares of common stock under the 1997 Plan, of which 28,583 options are currently outstanding at exercise prices between $1.68 and $27.40. These options have a 10-year term and vest over a 3-year period. The Company was also authorized to grant awards for up to 250,000 shares of common stock under the 1997 Non-employee Stock Option Director Plan, of which 3,000 options are currently outstanding at an exercise price of $21.56. The Company was also authorized to grant awards for up to 1,750,000 shares of common stock under the 2004 Plan, of which 397,170 options are currently outstanding at exercise prices between $12.50 and $31.06, and 5,251 restricted stock units are outstanding at a stock price of $13.04 to $24.30. These options and restricted stock units have a 10-year term (7 years on grants beginning in 2010) and vest over a 3-year period. The Company will not make any further grants under the 1997 Plan, the 1997 Non-employee Stock Option Director Plan or the 2004 Plan. The Company is authorized to grant awards for up to 1,781,546 shares of common stock under the 2009 Plan, as well as any shares underlying awards outstanding under the 2004 Plan as of the effective date of the 2009 Plan that thereafter terminate or expire unexercised or are canceled, forfeited or lapse for any reason. There are 436,692 options currently outstanding under the 2009 Plan at exercise prices between $17.04 and $39.33. Prior to 2009, upon election to the Board, each non-employee director was granted 3,400 restricted shares of common stock that vested ratably over three years. On the day following the Annual Meeting of Shareholders, each non-employee director, other than a non-employee director who received the initial equity grant in that same year, was granted 2,200 restricted shares of common stock that vested ratably over three years.

Beginning in 2009, upon election to the Board, each non-employee director receives an initial equity grant of shares of restricted common stock with a value equal to $100,000, calculated as of the closing share price on the date of the non-employee director's election to the Board. The initial restricted stock grant vests on the third anniversary of the grant date, subject to the non-employee director's continued membership on the board. Annually on the first business day following the annual meeting of stockholders, each non-employee director is granted restricted shares of common stock with a value equal to $70,000, calculated as of the closing share price on that day. The shares of restricted stock vest on the day prior to the following year's annual meeting date, subject to a director's continued membership on the Board. The Company records compensation cost associated with its restricted stock unit grants on a straight-line basis over the vesting term.

Compensation costs charged to operations associated with the Company's stock incentive plans were $2,756, $2,416, and $2,449 in 2011, 2010, and 2009, respectively. The changes in stock option associated compensation cost were due to the vesting of options and the accrual of expenses relating to the issuance of restricted stock.

The Company used the Black-Scholes option-pricing model to determine the fair value of grants made using the following assumptions:


	For the Years Ended December 31
	2011			2010			2009
Risk-free interest rate		0.66% and 1.83	%		1.85% and 2.14	%		1.38% and 1.44	%
Expected dividend yield		0	%		0	%		0	%
Expected option life		4 years			4 years			4 years
Expected volatility		47.9% - 48.7	%		43.5% and 46.5	%		48.3	%
Weighted-average expected volatility		48.7	%		46.5	%		48.3	%

Historical information was the primary basis for the selection of the expected dividend yield, expected volatility and the expected lives of the options. The risk-free interest rate was based on yields of U.S. zero coupon issues and U.S. Treasury issues, with a term equal to the expected life of the option being valued.

A summary of stock option activity and weighted average exercise prices follows:


	Options			Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term		Aggregate Intrinsic Value as of December 31, 2011
Outstanding at January 1, 2011		1,098,859		$	21.37
Granted		272,412			35.89
Forfeited		(34,129	)		27.93
Exercised		(471,697	)		19.41

Outstanding at December 31, 2011		865,445		$	26.72		4.7	$	16,684

Options exercisable at December 31, 2011		419,474		$	23.66		3.7	$	9,372

The weighted-average grant-date fair value of the stock options granted during the years ended December 31, 2011, 2010 and 2009 was $14.15, $9.30 and $5.08, respectively. The aggregate intrinsic value of stock options exercised during the years ended December 31, 2011, 2010 and 2009 was $10.4 million, $0.7 million and $0.05 million, respectively. The total fair value of stock options using the Black-Scholes option pricing model vested during the years ended December 31, 2011, 2010 and 2009 was $1.6 million, $1.7 million and $1.7 million, respectively.

The following table summarizes the restricted stock activity and weighted average grant-date fair values for the year ended December 31, 2011:


	Shares			Weighted-Average Grant Date Fair Value
Non-vested at beginning of period		40,313		$	23.53
Granted		32,045			42.04
Forfeited		(624	)		18.96
Vested		(28,207	)		26.10

Non-vested at December 31, 2011		43,527		$	32.31

As of December 31, 2011, there was $4.4 million in total unrecognized stock-based compensation expense related to non-vested stock-based compensation arrangements. The expense is expected to be recognized over a weighted average period of 2.0 years.