7. Stock-Based Compensation

Total stock-based compensation expense charged as a selling, general and administrative expense in our unaudited consolidated statements of comprehensive income related to our stock compensation plans was $3.0 million and $3.7 million for the three months ended March 31, 2013 and 2012, respectively.

The total income tax benefit related to stock-based compensation expense recognized in our unaudited consolidated statements of comprehensive income was $3.0 million and $5.5 million, for the three months ended March 31, 2013 and 2012, respectively.

Presented below is a summary of our stock option activity for the three months ended March 31, 2013 (shares in thousands):

	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Terms	Aggregate Intrinsic Value

Outstanding at December 31, 2012	4,604		$	14.11
Granted	3		$	28.74
Exercised	(514	)	$	10.46
Forfeited	(121	)	$	22.28
Expired	(1	)	$	5.81
Outstanding at March 31, 2013	3,971		$	14.24	4.51	$	53,419
Expected to vest at March 31, 2013	1,502		$	22.98	6.26	$	7,261
Exercisable at March 31, 2013	2,429		$	8.55	3.27	$	45,970

The fair value of each option grant was estimated using the Black-Scholes option pricing model. Expected volatilities are calculated based on the historical volatility of our common stock. Management monitors stock option exercises and employee termination patterns to estimate forfeiture rates within the valuation model. Separate groups of employees that have similar historical exercise behavior are considered separately for valuation purposes. The expected holding period of options represents the period of time that options granted are expected to be outstanding. The expected terms of options granted are based on our historical experience for similar types of stock option awards. The risk-free interest rate is based on U.S. Treasury Notes.

We estimated the fair value of each stock option grant on the date of grant using a Black-Scholes option-pricing model and the weighted-average assumptions set forth in the following table:

	Three months ended March 31,
	2013		2012
Expected dividend yield	—		—
Risk-free interest rate	0.67	%	—
Expected volatility	40.05	%	—
Expected life	4.47 years		—

During the three months ended March 31, 2013 and 2012, we issued 0.5 million shares and 0.7 million shares, respectively, of our common stock upon the exercise of outstanding stock options and received proceeds of $5.4 million and $5.7 million, respectively. For the three months ended March 31, 2013 and 2012, we realized a tax benefit of $3.0 million and $5.5 million, respectively from the exercise of stock options.

For the three months ended March 31, 2013, and 2012, approximately $1.8 million, and $2.9 million, respectively, of stock-based compensation cost relating to stock options has been charged against income. As of March 31, 2013, there was approximately $10.4 million of total unrecognized compensation cost, adjusted for estimated forfeitures, related to stock options outstanding, which is expected to be recognized over a weighted-average period of 1.5 years.

The aggregate intrinsic value in the previous table reflects the total pretax intrinsic value (the difference between our closing stock price on the last trading day of the period and the exercise price of the options, multiplied by the number of in-the-money stock options) that would have been received by the option holders had all option holders exercised their options on March 31, 2013. The intrinsic value of our stock options changes based on the closing price of our common stock. The total intrinsic value of options exercised (the difference in the market price of our common stock on the exercise date and the price paid by the optionee to exercise the option) for the three months ended March 31, 2013 and 2012 was approximately $9.9 million and $15.9 million, respectively.

Restricted Stock Units

Our non-employee members of the Board and certain employees have received restricted stock units under our 2006 Stock Plan, as amended. The fair value of restricted stock units is estimated based on the closing sale price of our common stock on the NASDAQ Global Select Market on the date of issuance. The total number of restricted stock units expected to vest is adjusted by estimated forfeiture rates. Shares withheld to pay taxes upon the vesting of the restricted stock units are retired.

For the three months ended March 31, 2013, we granted 196,837 restricted stock units with an aggregate fair market value of $5.7 million. At March 31, 2013, 302,094 restricted stock units remained unvested and there was $7.5 million of unamortized compensation cost related to restricted stock units, which is expected to be recognized over the remaining weighted-average vesting period of 2.0 years. Stock-based compensation expense related to restricted stock units was $1.0 million and $0.5 million for the three months ended March 31, 2013 and 2012, respectively.

A summary of the status of our restricted stock units as of March 31, 2013 and of changes in restricted stock units outstanding under the 2006 Stock Plan, as amended, for the three months ended March 31, 2013 is as follows (in thousands, except for weighted average grant date fair value per unit):

	Number of Units		Weighted Average Grant Date Fair Value per Unit		Aggregate Intrinsic Value
Outstanding balance at December 31, 2012	237		$	25.44
Granted	197		$	28.74
Vesting of restricted stock units, net of shares withheld for taxes	(35	)	$	24.87
Shares withheld for taxes	(20	)	$	24.87
Forfeitures	(29	)	$	24.79
Outstanding balance at March 31, 2013	350		$	26.62	$	9,495

Restricted Stock Awards

Our executive officers have received grants of restricted stock awards under the 2006 Stock Plan. The vesting of restricted stock awards is subject to the executive officers’ continued employment with us. Recipients of restricted stock awards are not required to provide us with any consideration other than rendering service. Holders of restricted stock are permitted to vote and to receive dividends.

The stock-based compensation expense for restricted stock awards is determined based on the closing market price of our common stock on the grant date of the awards applied to the total number of awards that are anticipated to fully vest. Shares withheld to pay taxes are retired upon the vesting of the restricted stock awards. We did not issue restricted stock awards during the three months ended March 31, 2013. At March 31, 2013 approximately 81,549 shares underlying restricted stock awards remained unvested and there was approximately $0.6 million of unrecognized compensation cost related to restricted stock awards, which is expected to be recognized over the weighted-average period of 0.9 years. Stock-based compensation expense related to restricted stock awards was $0.2 million and $0.3 million for the three months ended March 31, 2013 and 2012, respectively.

A summary of the status of our restricted stock awards at March 31, 2013 and of changes in restricted stock awards outstanding under the 2006 Stock Plan for the three months ended March 31, 2013 is as follows (in thousands, except for weighted average grant date fair value):

	Shares		Weighted Average Grant Date Fair Value per Share		Aggregate Intrinsic Value
Outstanding balance at December 31, 2012	192		$	10.42
Granted	—		—
Vesting of restricted stock awards	(61	)	$	10.42
Shares withheld for payment of taxes upon vesting of restricted stock awards	(35	)	$	10.42
Forfeitures	(14	)	$	10.42
Outstanding balance at March 31, 2013	82		$	10.42	$	2,214

The total fair value of restricted stock awards vested during the three months ended March 31, 2013 was $1.0 million.