Equity Based Compensation

3 Months Ended

Mar. 31, 2013

Equity Based Compensation

Equity Based Compensation

11. Equity Based Compensation

        The Company accounts for stock-based compensation at fair value. The Company grants various types of stock-based awards including stock options, restricted stock and performance-based awards. The fair value of stock option awards is determined using the Black-Scholes-Merton option-pricing model. For restricted stock awards with market conditions, the fair value of the awards is measured using the asset-or-nothing option pricing model. Restricted stock awards without market conditions and the performance-based awards are valued using the market price of the Company's common stock on the grant date. The Company records compensation cost, net of estimated forfeitures, for stock-based compensation awards over the requisite service period except for performance-based awards. For performance-based awards, compensation cost is recognized over the requisite service period as and when the Company determines that the achievement of the performance condition is probable, using the per-share fair value measured at grant date.

        During the three months ended March 31, 2013, the Company granted a total of 427,796 shares of restricted stock and 959,597 stock options to employees. During the three months ended March 31, 2013, the Company also granted 3,155 shares of common stock as retainer awards to non-employee directors who elected to be compensated by stock in lieu of cash payments. In addition, the Company granted a total of 1,503 restricted stock units to non-employee directors during the three months ended March 31, 2013.

        For the three months ended March 31, 2013 and 2012, total equity based compensation recognized, net of forfeitures, was $6.3 million and $6.6 million, respectively. For the period November 5, 2005 (inception) through March 31, 2013, total equity based compensation recognized, net of forfeitures, was $67.0 million.