STOCK-BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2012

Compensation Related to Stock-Based Awards

During the years ended December 31, 2012, 2011 and 2010, the Company recorded compensation related to stock-based awards as follows:

	Year Ended December 31,
	2012		2011		2010
	(in thousands, except per share data)
Cost of revenues	$	4,225	$	4,325	$	4,403
Selling and marketing expenses		542		600		780
General and administrative expenses		1,611		1,747		2,195
Total stock-based compensation expense		6,378		6,672		7,378
Tax effect on stock-based compensation expense		797		834		924
Net effect of stock-based compensation expense	$	5,581	$	5,838	$	6,454
Effect of stock-based compensation expense on earnings (loss) per share	$	0.12	$	0.13	$	0.14

Assumptions Used to Calculate Fair Value of Stock-Based Award on the Date of Grant

The Company calculated the fair value of each stock-based award on the date of grant based on the following assumptions:

	Year Ended December 31,
	2012			2011			2010
For stock options issued by the Company:
Risk-free interest rates		1.0	%		2.2	%		2.5	%
Expected lives (in years)		5.0			5.1			5.1
Dividend yield		0.81	%		0.80	%		0.72	%
Expected volatility		47.2	%		46.4	%		47.6	%
Forfeiture rate		6.4	%		7.5	%		13.0	%

Summary of the Status of the 2004 Incentive Plan

The shares of common stock will be issued upon exercise of options or SARs from the Company’s authorized share capital.

	Year Ended December 31,
	2012					2011					2010
	Shares			Weighted Average Exercise Price		Shares			Weighted Average Exercise Price		Shares			Weighted Average Exercise Price
Outstanding at beginning of year		2,934		$	32.40		2,335		$	34.35		1,745		$	36.08
Granted, at fair value:
Stock Options		75			19.01		30			19.10		37			28.39
SARs*		602			20.13		622			25.65		592			29.95
Forfeited		(48	)		28.92		(53	)		31.69		(39	)		38.96
Outstanding at end of year		3,563			30.09		2,934			32.40		2,335			34.35
Options and SARs exercisable at end of year		1,592			36.61		1,086			37.46		621			37.65
Weighted-average fair value of options and SARs granted during the year				$	7.25				$	9.69				$	12.51

* Upon exercise, SARs entitle the recipient to receive shares of common stock equal to the increase in value of the award between the grant date and the exercise date.

Summary of Information about Stock-Based Awards Outstanding

The following table summarizes information about stock-based awards outstanding at December 31, 2012 (shares in thousands):

	Options Outstanding						Options Exercisable
Exercise Price	Number of Shares Outstanding		Weighted Average Remaining Contractual Life in Years		Aggregate Intrinsic  Value		Number of Shares Exercisable		Weighted Average Remaining Contractual Life in Years		Aggregate Intrinsic Value
					(Dollars in thousands)						(Dollars in thousands)
$15.00		32		1.8		$136		32		1.8		$136
18.56		45		6.8		32		—		—		—
19.10		30		5.8		5		30		5.8		5
19.69		30		6.6		—		—		—		—
20.10		8		1.8		—		8		1.8		—
20.13		594		6.3		—		—		—		—
25.65		598		5.3		—		—		—		—
25.74		23		2.8		—		23		2.8		—
26.84		552		3.2		—		276		3.2		—
28.19		30		4.8		—		30		4.8		—
29.21		8		4.3		—		8		4.3		—
29.95		567		4.3		—		139		4.3		—
34.13		225		3.3		—		225		3.3		—
37.90		15		.8		—		15		.8		—
38.50		23		3.8		—		23		3.8		—
38.85		8		1.2		—		8		1.2		—
42.08		340		1.3		—		340		1.3		—
45.78		412		2.3		—		412		2.3		—
52.98		23		1.8		—		23		1.8		—
		3,563		4.0		$173		1,592		2.6		$141

The following table summarizes information about stock-based awards outstanding at December 31, 2011 (shares in thousands):

	Options Outstanding						Options Exercisable
Exercise Price	Number of Shares Outstanding		Weighted Average Remaining Contractual Life in Years		Aggregate Intrinsic Value		Number of Shares Exercisable		Weighted Average Remaining Contractual Life in Years		Aggregate Intrinsic Value
					(Dollars in thousands)						(Dollars in thousands)
15.00		33		2.8	$	100		33		2.8	$	100
19.10		30		6.8		—		—		—		—
20.10		8		2.8		—		8		2.8		—
25.65		612		6.3		—		—		—		—
25.74		22		3.8		—		22		3.8		—
26.84		559		4.2		—		140		4.2		—
28.19		30		5.8		—		30		5.8		—
29.21		8		5.3		—		8		5.3		—
29.95		578		5.3		—		—		—		—
34.13		227		4.3		—		227		4.3		—
37.90		15		1.8		—		15		1.8		—
38.50		22		4.8		—		22		4.8		—
38.85		8		2.2		—		8		2.2		—
42.08		343		2.3		—		343		2.3		—
45.78		417		3.3		—		208		3.3		—
52.98		22		2.8		—		22		2.8		—
		2,934		4.5	$	100		1,086		3.3	$	100