Stock Option Plans (Tables)

6 Months Ended

Jun. 30, 2011

Summary of stock-based compensation expense

The following table is a summary of the stock-based compensation expense recognized for the three and six months ended June 30, 2011 and 2010 (in thousands of dollars):

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010

Stock-based compensation expense	$	2,001		$	1,145		$	2,873		$	1,924
Tax benefit		(740	)		(424	)		(1,063	)		(712	)
Stock-based compensation expense, net of tax	$	1,261		$	721		$	1,810		$	1,212

Stock option valuation assumptions

The fair value of each option grant during the first six months of 2011 and 2010 was estimated on the date of grant using the Black-Scholes option-pricing model, based on the following assumptions:

	2011			2010

Expected dividend yield		.60% - .80	%		1.25% - 1.60	%
Expected stock price volatility		40.5% - 57.9	%		51.3% - 57.0	%
Risk free interest rate		.28% - 2.39	%		1.37% - 2.96	%
Expected life options	2 - 5 years			3 - 6 years
Weighted-average fair value per share at grant date	$	27.36		$	27.79

The expected life of options was determined based on the exercise history of employees and directors since the inception of the plans. The expected stock price volatility is based upon the historical weekly and daily stock price for the prior number of years equivalent to the expected life of the stock option. The expected dividend yield was based on the dividend yield of the Company’s common stock at the date of the grant. The risk free interest rate was based upon the yield of U.S. Treasuries, the terms of which were equivalent to the expected life of the stock option.

Summary of stock option activity

A summary of stock option activity under the plans during the six months ended June 30, 2011, is presented below:

						Weighted-
				Weighted-		Average		Aggregate
				Average		Remaining		Intrinsic
				Exercise		Contractual		Value
Options	Shares			Price		Term		($000's)

Outstanding at January 1, 2011		1,321,637		$	33.26
Granted		139,000			73.97
Exercised		(161,264	)		26.62
Forfeited or expired		(7,750	)		38.54
Outstanding at June 30, 2011		1,291,623		$	38.44		7.7	$	61,493
Exercisable at June 30, 2011		465,949		$	33.28		6.8	$	24,586

As of June 30, 2011, there was $7.2 million of total unrecognized compensation expense related to non-vested stock options. That cost is expected to be recognized over a weighted-average period of 2.5 years. The intrinsic value of stock options exercised in the first six months of 2011 was $8.2 million.