Stockholders' Equity

6 Months Ended

Jun. 30, 2013

Stockholders' Equity Note [Abstract]

Stockholders' Equity

(3) Stockholders’ Equity

Our authorized, issued, and outstanding shares (share amounts stated in whole numbers) consist of the following:

	Par Value		June 30, 2013	December 31, 2012	June 30, 2012
Preferred Stock	$.01	/share
Shares authorized			5,000,000	5,000,000	5,000,000
Shares issued and outstanding			—	—	—
Common Stock	$.01	/share
Shares authorized			400,000,000	400,000,000	400,000,000
Shares issued and outstanding			296,860,119	296,564,382	296,150,999

Dividends

On July 9, 2013, our board of directors declared a dividend of $0.25 per share of common stock. This dividend is to be paid in cash on August 23, 2013 to shareholders of record at the close of business on July 26, 2013. Since 2011 we have paid quarterly dividends and, in 2012, we paid a supplemental dividend late in the year. Our board of directors expect to continue paying quarterly dividends, provided the future determination as to payment of dividends will depend on the financial needs of the Company and such other factors as deemed relevant by the board of directors.

The following table presents the dividends either paid previously or declared by our board of directors for future payment:

	2013		2012
First quarter	$	0.10	$	0.17
Second quarter	0.20		0.17
Third quarter	0.25		0.19
Fourth quarter			0.21
Sub-Total	$	0.55	$	0.74
Supplemental			0.50
Total	$	0.55	$	1.24

Stock Options

The following tables summarize the details of grants made under our stock option plan of options that have been granted and are outstanding, and the assumptions used to value these options. All options granted were effective at the close of business on the date of grant.

		Option		Closing
		exercise		stock price		June 30, 2013
	Options	(strike)		on date		Options	Options
Date of grant	granted	price		of grant		outstanding	vested
April 16, 2013	205,000	$	54.00	$	49.25	182,500	—
April 17, 2012	1,235,000	$	54.00	$	49.01	1,132,500	—
April 19, 2011	410,000	$	35.00	$	31.78	370,000	—
April 20, 2010	530,000	$	30.00	$	27.13	320,000	—
April 21, 2009	790,000	$	27.00	$	17.61	425,800	180,800
April 15, 2008	550,000	$	27.00	$	24.35	225,900	124,650
April 17, 2007	4,380,000	$	22.50	$	20.15	1,860,855	1,191,355
Total	8,100,000					4,517,555	1,496,805

Date of grant	Risk-free interest rate		Expected life of option in years	Expected dividend yield		Expected stock volatility		Estimated fair value of stock option
April 16, 2013	0.7	%	5.00	1.6	%	37.42	%	$	12.66
April 17, 2012	0.9	%	5.00	1.4	%	39.25	%	$	13.69
April 19, 2011	2.1	%	5.00	1.6	%	39.33	%	$	11.20
April 20, 2010	2.6	%	5.00	1.5	%	39.10	%	$	8.14
April 21, 2009	1.9	%	5.00	1.0	%	38.80	%	$	3.64
April 15, 2008	2.7	%	5.00	1.0	%	30.93	%	$	7.75
April 17, 2007	4.6	%	4.85	1.0	%	31.59	%	$	5.63

All of the options in the tables above vest and become exercisable over a period of up to eight years. Each option will terminate, to the extent not previously exercised, 13 months after the end of the relevant vesting period.

The fair value of each share-based option is estimated on the date of grant using a Black-Scholes valuation method that uses the assumptions listed above. The expected life is the average length of time over which we expect the employee groups will exercise their options, which is based on historical experience with similar grants. Expected volatilities are based on the movement of our stock over the most recent historical period equivalent to the expected life of the option. The risk-free interest rate is based on the U.S. Treasury rate over the expected life at the time of grant. The dividend yield is estimated over the expected life based on our current dividend payout, historical dividends paid, and expected future cash dividends.

Compensation expense equal to the grant date fair value is recognized for all of these awards over the vesting period. The stock-based compensation expense for the six month periods ended June 30, 2013 and 2012 was $2,700 and $2,100, respectively. Unrecognized compensation expense related to outstanding stock options as of June 30, 2013 was $18,578 and is expected to be recognized over a weighted average period of 4.55 years. Any future changes in estimated forfeitures will impact this amount.

Earnings Per Share

The following tables present a reconciliation of the denominators used in the computation of basic and diluted earnings per share and a summary of the options to purchase shares of common stock which were excluded from the diluted earnings calculation because they were anti-dilutive:

	Six-month period		Three-month period
Reconciliation	2013	2012	2013	2012
Basic weighted average shares outstanding	296,711,326	295,826,501	296,778,588	296,110,167
Weighted shares assumed upon exercise of stock options	978,224	1,194,737	943,682	1,019,731
Diluted weighted average shares outstanding	297,689,550	297,021,238	297,722,270	297,129,898

	Six-month period		Three-month period
Summary of anti-dilutive options excluded	2013	2012	2013	2012
Options to purchase shares of common stock	1,238,356	501,566	1,307,857	1,353,132
Weighted average exercise price of options	$54.00	$54.00	$54.00	$49.09

Any dilutive impact summarized above would relate to periods when the average market price of our stock exceeded the exercise price of the potentially dilutive option securities then outstanding.