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Share-Based Compensation
 6 Months Ended
Jun. 30, 2012
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Share-Based Compensation
Share-Based Compensation
Stock Options
Options activity for the six months ended June 30, 2012 was as follows:
 
(In thousands, except per share data)
Six Months Ended June 30, 2012
Options
Number of
Shares
 
Weighted-
Average
Exercise 
Price
 
Aggregate
Intrinsic 
Value
 
Weighted-Average      
Remaining      
Contractual
 Term (Yrs)      
Outstanding at beginning of year
12,909

 
$
23.78

 
 
 
 
Granted
1,663

 
81.71

 
 
 
 
Exercised
(1,556
)
 
16.48

 
 
 
 
Forfeited and expired
(176
)
 
46.26

 
 
 
 
Outstanding as of June 30, 2012
12,840

 
$
31.86

 
$
652,462

 
6.49
 
 
 
 
 
 
 
 
Exercisable as of June 30, 2012
7,966

 
$
16.88

 
$
523,941

 
5.25


We valued options granted in 2012 under the Cerner Corporation 2011 Omnibus Equity Incentive Plan using the following weighted average assumptions: 
Expected volatility (%)
 
34.7

Expected term (yrs)
 
9.1

Risk-free rate (%)
 
2.1

Fair value per option
 
$
37.4


As of June 30, 2012, there was $107.6 million of total unrecognized compensation cost related to stock options granted under all plans. That cost is expected to be recognized over a weighted-average period of 3.52 years.
Non-vested Shares
Non-vested share activity for the six months ended June 30, 2012 was as follows: 
 
Six Months Ended
(In thousands, except per share data)
June 30, 2012
Restricted Stock
Number of Shares
 
Weighted-Average
Grant Date Fair Value
Outstanding at beginning of year
254

 
$
47.75

Granted
58

 
77.11

Vested
(48
)
 
50.85

Forfeited
—

 
—

Outstanding as of June 30, 2012
264

 
$
53.72


As of June 30, 2012, there was $8.5 million of total unrecognized compensation cost related to non-vested share awards granted under all plans. That cost is expected to be recognized over a weighted-average period of 1.54 years.

The following table presents the total compensation expense recognized in the Condensed Consolidated Statements of Operations with respect to stock options, non-vested shares and our Associate Stock Purchase Plan: 

 
 
Three Months Ended
 
Six Months Ended
(In thousands)
 
2012
 
2011
 
2012
 
2011
 
 
 
 
 
 
 
 
 
Stock option and non-vested share compensation expense
 
$
8,252

 
$
6,187

 
$
16,583

 
$
13,131

Associate stock purchase plan expense
 
613

 
566

 
1,345

 
1,048

Amounts capitalized in software development costs, net of amortization
 
(268
)
 
(185
)
 
(382
)
 
(250
)
 
 
 
 
 
 
 
 
 
Amounts charged against earnings, before income tax benefit
 
$
8,597

 
$
6,568

 
$
17,546

 
$
13,929

 
 
 
 
 
 
 
 
 
Amount of related income tax benefit recognized in earnings
 
$
3,288

 
$
2,502

 
$
6,711

 
$
5,307