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Share-Based Compensation
 6 Months Ended
Jun. 30, 2012
Share-Based Compensation  
Share-Based Compensation

12.    Share-Based Compensation

 

We have a stockholder approved stock incentive plan, the 2008 Stock Incentive Plan as amended and restated in 2009, 2011 and 2012, or the Plan, that provides for the granting of options, restricted stock awards, stock appreciation rights, performance awards and other share-based awards to our employees and officers.  The Compensation Committee of the Board of Directors, or the Compensation Committee, may determine the type, amount and terms, including vesting, of any awards made under the Plan.

 

On June 13, 2012, our stockholders approved an amendment and restatement of the Plan, which included the following key modifications: adoption of an aggregate share reserve of 95,981,641 shares of Common Stock, which includes 14,000,000 new shares of Common Stock; extension of the term of the plan through April 18, 2022; a change in the weighting of  full-value awards such as restricted stock and restricted stock units such that the weighting of grants of full-value awards will be increased from 1.6 shares for every share granted to 2.1 shares for every share granted for purposes of determining usage of the aggregate share reserve.

 

The following table summarizes the components of share-based compensation expense in the Consolidated Statements of Income for the three- and six-month periods ended June 30, 2012 and 2011:

 

 

 

Three-Month Periods Ended

 

Six-Month Periods Ended

 

 

 

June 30,

 

June 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

 

 

 

 

 

 

 

 

 

 

Cost of goods sold

 

$

2,983

 

$

2,419

 

$

5,859

 

$

4,427

 

Research and development

 

23,556

 

22,880

 

48,584

 

55,472

 

Selling, general and administrative

 

27,075

 

25,613

 

53,891

 

48,706

 

Total share-based compensation expense

 

53,614

 

50,912

 

108,334

 

108,605

 

Tax benefit related to share-based compensation expense

 

 

 

 

 

 

 

 

 

 

 

14,117

 

12,417

 

28,736

 

27,869

 

Reduction in income

 

$

39,497

 

$

38,495

 

$

79,598

 

$

80,736

 

 

Share-based compensation cost included in inventory was $1.1 million and $2.0 million at June 30, 2012 and December 31, 2011, respectively.

 

We utilize share-based compensation in the form of stock options, restricted stock units, or RSUs, and performance-based restricted stock units, or PSUs.  The following table summarizes the activity for stock options, RSUs and PSUs for the six-month period ended June 30, 2012:

 

 

 

 

 

 

 

 

Performance-

 

 

 

 

 

 

Restricted

 

Based Restricted

 

 

 

Stock

 

 

Stock

 

Stock

 

 

 

Options

 

 

Units

 

Units

 

 

 

 

 

 

 

 

 

 

Outstanding at December 31, 2011

 

44,526,748

 

 

3,019,943 

 

28,500  

 

 

 

 

 

 

 

 

 

 

Changes during the Year:

 

 

 

 

 

 

 

 

Granted

 

4,804,055

 

 

1,534,372 

 

-   

 

Exercised / Released

 

(5,407,630

)

 

(389,874)

 

-   

 

Forfeited

 

(687,456

)

 

(85,975)

 

(1,500)

 

Expired

 

(46,016

)

 

N/A

 

N/A

 

Outstanding at June 30, 2012

 

43,189,701

 

 

4,078,466  

 

27,000 

 

 

Total compensation cost related to nonvested awards not yet recognized and the weighted-average periods over which the awards are expected to be recognized at June 30, 2012 were as follows (dollars in thousands):

 

 

 

 

 

Restricted

 

Performance-

 

 

 

Stock

 

Stock

 

Based Restricted

 

 

 

Options

 

Units

 

Stock Units

 

Unrecognized compensation cost

 

$

285,062 

 

$

180,670 

 

$

1,004 

 

Expected weighted-average period in years of compensation cost to be recognized

 

2.3

 

2.1

 

1.5