Note 6 - Stockholders' Equity and Equity Compensation

6 Months Ended

Jun. 30, 2013

Shareholders' Equity and Share-based Payments [Text Block]

Shareholders' Equity and Share-based Payments [Text Block]

6.      STOCKHOLDERS’ EQUITY AND EQUITY COMPENSATION

Share Repurchase Plan

In December 2012, the Company’s Board of Directors authorized the repurchase of up to $5.0 million of the Company’s common stock to be made during 2013. This amount represented the then maximum open market repurchases authorized in any calendar year under the terms of the Credit Facility. In May 2013, the Company’s Board of Directors authorized the repurchase of up to an additional $10.0 million of the Company’s common stock to be made during the balance of the 2013 calendar year. The Company simultaneously executed an amendment to the Credit Facility to allow the additional open market purchases.

In addition to the open market repurchases, the Company also is authorized to purchase up to $5.0 million of the Company’s common stock in each calendar year in connection with the Company’s equity compensation programs for employees and directors. The participants in the Company’s equity plans may surrender shares of previously issued common stock in satisfaction of tax obligations arising from the vesting of restricted stock awards under such plans, in connection with the exercise of stock option awards and with the lapse of restricted periods of deferred stock unit awards. The deemed price paid is the closing price of the Company’s common stock on the Nasdaq Global Select Market on the date that the restricted stock vests, the shares of the Company’s common stock are surrendered in exchange for stock option exercises or the lapse of the restricted periods of deferred stock unit awards.

During the first six months of 2013, the Company acquired 645,732 shares of the Company’s common stock for $14.7 million ($22.69 average price per share) through the two open market repurchase programs discussed above and 50,578 shares of the Company’s common stock for $1.2 million ($23.32 average price per share) in connection with the satisfaction of tax obligations in connection with the vesting of restricted stock, exercise of stock options and distribution of deferred stock units. Once repurchased, the Company immediately retired all such shares.

Equity-Based Compensation Plans

At June 30, 2013, the Company had two active equity-based compensation plans under which awards may be made, including stock appreciation rights, restricted shares of common stock, performance awards, stock options and stock units. The Company’s 2013 Employee Equity Incentive Plan (the “2013 Employee Plan”) has 2,895,000 shares of the Company’s common stock reserved for issuance and, at June 30, 2013, 2,895,000 shares of common stock were available for issuance. The Company intends to register with the Securities and Exchange Commission the 2,895,000 shares reserved and available for issuance under the 2013 Employee Plan shortly after filing this report with the Securities and Exchange Commission. The Company’s 2011 Non-Employee Director Equity Incentive Plan (“2011 Director Plan”) has 250,000 shares of the Company’s common stock registered for issuance, and at June 30, 2013, 168,390 shares of common stock were available for issuance.

Stock Awards

Stock awards, which include shares of restricted stock, restricted stock units and restricted performance units, are awarded from time to time to executive officers and certain key employees of the Company. Stock award compensation is recorded based on the award date fair value and charged to expense ratably through the requisite service period. The forfeiture of unvested restricted stock, restricted stock units and restricted performance units causes the reversal of all previous expense recorded as a reduction of current period expense.

A summary of stock award activity during the six-month period ended June 30, 2013 follows:

	Stock Awards			Weighted Average Award Date Fair Value
Outstanding at January 1, 2013		701,918		$	19.42
Restricted shares awarded		398,497			24.15
Restricted stock units awarded		112,401			25.11
Restricted shares distributed		(274,028	)		19.03
Restricted stock units distributed		(11,112	)		20.70
Restricted shares forfeited		(13,992	)		20.76
Restricted stock units forfeited		(52,434	)		20.39
Outstanding at June 30, 2013		861,250		$	22.38

Expense associated with stock awards was $2.1 million and $2.2 million in the six months ended June 30, 2013 and 2012, respectively. Unrecognized pre-tax expense of $14.5 million related to stock awards is expected to be recognized over the weighted average remaining service period of 2.5 years for awards outstanding at June 30, 2013.

Expense associated with stock awards was $0.9 million and $1.2 million for the quarters ended June 30, 2013 and 2012, respectively.

Deferred Stock Unit Awards

Deferred stock units generally are awarded to directors of the Company and represent the Company’s obligation to transfer one share of the Company’s common stock to the grantee at a future date and generally are fully vested on the date of grant. The expense related to the issuance of deferred stock units is recorded as of the date of the award.

A summary of deferred stock unit activity during the six-month period ended June 30, 2013 follows:

	Deferred Stock Units			Weighted Average Award Date Fair Value
Outstanding at January 1, 2013		181,518		$	19.06
Awarded		39,876			22.33
Shares distributed		(3,171	)		21.78
Forfeited	–			–
Outstanding at June 30, 2013		218,223		$	19.62

Expense associated with awards of deferred stock units for the quarters and six months ended June 30, 2013 and 2012 was $0.9 million and $0.7 million, respectively.

Stock Options

Stock options on the Company’s common stock are awarded from time to time to executive officers and certain key employees of the Company. Stock options granted generally have a term of seven to ten years and an exercise price equal to the market value of the underlying common stock on the date of grant.

A summary of stock option activity during the six-month period ended June 30, 2013 follows:

	Shares			Weighted Average Exercise Price
Outstanding at January 1, 2013		1,223,618		$	18.49
Granted		29,025			25.11
Exercised		(29,511	)		20.14
Canceled/Expired		(7,150	)		24.36
Outstanding at June 30, 2013		1,215,982		$	18.58
Exercisable at June 30, 2013		936,863		$	17.89

Expense associated with stock option grants was $0.4 million and $0.5 million in the quarters ended June 30, 2013 and 2012, respectively. In the six months ended June 30, 2013 and 2012, the Company recorded expense of $1.0 million and $1.1 million, respectively, related to stock option grants. Unrecognized pre-tax expense of $1.8 million related to stock option grants is expected to be recognized over the weighted average remaining contractual term of 1.6 years for awards outstanding at June 30, 2013.

Financial data for stock option exercises are summarized in the following table (in thousands):

	For the Six Months Ended June 30,
	2013		2012
Amount collected from stock option exercises	$	738	$	456
Total intrinsic value of stock option exercises		131		103
Tax benefit of stock option exercises recorded in additional paid-in-capital		55		12
Aggregate intrinsic value of outstanding stock options		2,722		2,295
Aggregate intrinsic value of exercisable stock options		3,538		2,295

The intrinsic value calculations are based on the Company’s closing stock price of $22.51 and $17.89 on June 30, 2013 and 2012, respectively.

The Company uses a binomial option-pricing model for valuation purposes to reflect the features of stock options granted. The fair value of stock options awarded during the six-month periods ended June 30, 2013 and 2012 were estimated at the date of grant based on the assumptions presented in the table below. Volatility, expected term and dividend yield assumptions were based on the Company’s historical experience. The risk-free rate was based on a U.S. treasury note with a maturity similar to the option grant’s expected term.

	Six Months Ended June 30,
	2013			2012
Weighted average grant-date fair value	$	12.92		$	8.19
Volatility		49.8	%		45.2	%
Expected term (years)		7.0			7.0
Dividend yield		0.0	%		0.0	%
Risk-free rate		1.1	%		1.5	%