Equity

12 Months Ended

Dec. 31, 2011

Equity

Equity

Note 7—Equity

Stock-Based Compensation:

In May 2009, the Company adopted the 2009 Stock Purchase and Option Plan (the “2009 Option Plan”) for Key Employees of the Company and its subsidiaries.  The Company currently also maintains the 2000 Stock Purchase and Option Plan (the “2000 Option Plan”).  No additional options can be granted under the 2000 Option Plan.  The 2009 Option Plan authorizes the granting of additional stock options by a committee of the Company’s Board of Directors. As of December 31, 2011, there were 7,684,550 shares of common stock available for the granting of additional stock options under the 2009 Option Plan. Options granted under the 2000 Option Plan and the 2009 Option Plan vest ratably over a period of five years and are exercisable over a period of ten years from the date of grant.

In 2004, the Company adopted the 2004 Stock Option Plan for Directors of Amphenol Corporation (the “Directors Option Plan”). The Directors Option Plan is administered by the Company’s Board of Directors.  As of December 31, 2011, the maximum number of shares of common stock available for the granting of additional stock options under the Directors Option Plan was 80,000.  Options granted under the Directors Option Plan vest ratably over a period of three years and are exercisable over a period of ten years from the date of grant.

The grant-date fair value of each option grant under the 2000 Option Plan, the 2009 Option Plan and the Directors Option Plan is estimated using the Black-Scholes option pricing model. The fair value is then amortized on a straight-line basis over the requisite service period of the awards, which is generally the vesting period. Use of a valuation model requires management to make certain assumptions with respect to selected model inputs. Expected share price volatility was calculated based on the historical volatility of the common stock of the Company and implied volatility derived from related exchange traded options. The average expected life was based on the contractual term of the option and expected employee exercise and historical post-vesting employment termination experience. The risk-free interest rate is based on U.S. Treasury zero-coupon issues with a remaining term equal to the expected life assumed at the date of grant. The expected annual dividend per share is based on the Company’s dividend rate.

Stock-based compensation expense includes the estimated effects of forfeitures, which are adjusted over the requisite service period to the extent actual forfeitures differ or are expected to differ from such estimates.  Changes in estimated forfeitures are recognized in the period of change and impact the amount of expense to be recognized in future periods.

Stock option activity for 2009, 2010 and 2011 was as follows:

					Weighted
					Average
			Weighted Average		Remaining Contractual	Aggregate Intrinsic
	Options		Exercise Price		Term (in years)	Value
Options outstanding at December 31, 2008	11,229,837		$	25.82	6.69
Options granted	3,736,500		32.01
Options exercised	(2,029,874	)	12.55
Options forfeited	(232,160	)	35.89
Options outstanding at December 31, 2009	12,704,303		29.58		7.16
Options granted	2,602,500		43.00
Options exercised	(2,331,429	)	19.99
Options forfeited	(269,050	)	37.18
Options outstanding at December 31, 2010	12,706,324		33.93		7.18
Options granted	2,551,350		53.45
Options exercised	(1,037,674	)	25.14
Options forfeited	(203,100	)	39.75
Options outstanding at December 31, 2011	14,016,900		38.00		6.89	$	125,067
Vested and non-vested expected to vest at December 31, 2011	13,066,583		37.57		6.79	$	120,850
Exercisable at December 31, 2011	6,380,324		$	31.48	5.41	$	89,316

A summary of the status of the Company’s non-vested options as of December 31, 2011 and changes during the year then ended is as follows:

	Options		Weighted Average Fair Value at Grant Date
Non-vested options at December 31, 2010	7,623,976		$	12.78
Options granted	2,551,350		14.19
Options vested	(2,335,650	)	12.23
Options forfeited	(203,100	)	13.00
Non-vested options at December 31, 2011	7,636,576		$	13.41

The weighted-average fair value at the grant date of options granted during 2010 and 2009 was $14.69 and $11.12, respectively.

During the years ended December 31, 2011 and 2010, the following activity occurred under the Company’s option plans:

	2011		2010		2009
Total intrinsic value of stock options exercised	$	29,697	$	67,841	$	56,900
Total fair value of stock options vested	28,563		23,714		17,360

On December 31, 2011 the total compensation cost related to non-vested options not yet recognized is approximately $74,434, with a weighted average expected amortization period of 3.26 years.

Stock Repurchase Program:

In January 2011, the Company announced that its Board of Directors authorized a stock repurchase program under which the Company may repurchase up to 20,000,000 shares of its common stock during the three year period ending January 31, 2014 (the “Program”). During the twelve months ended December 31, 2011, the Company repurchased 13,428,389 shares of its common stock for approximately $672,200.  These treasury shares have been or will be retired by the Company and common stock and accumulated earnings were reduced accordingly.  The price and timing of any such purchases under the Program after December 31, 2011 will depend on factors such as levels of cash generation from operations, the volume of stock option exercises by employees, cash requirements for acquisitions, economic and market conditions and stock price.  As of December 31, 2011, 6,571,611 shares of common stock may be repurchased under the Program.  Through February 17, 2012, the Company has repurchased an additional 1,110,079 shares of its common stock for $60,621.  At February 17, 2012, approximately 5,461,532 additional shares of common stock may be repurchased under the Program.

Dividends:

After declaration by the Board of Directors, the Company paid a quarterly dividend on its common stock of $.015 per share in 2010 and 2011.  The Company paid its fourth quarterly dividend in the amount of $2,447 or $.015 per share on January 3, 2012 to shareholders of record as of December 14, 2011. Cumulative dividends declared during 2011 and 2010 were $10,097 and $10,449, respectively. Total dividends paid in 2011 were $10,282, including those declared in 2010 and paid in 2011, and total dividends paid in 2010 were $10,413, including those declared in 2009 and paid in 2010.  On January 26, 2012, the Company’s Board of Directors approved the first quarter 2012 dividend on its common stock in the amount of $.105 per share.  This represents an increase in the quarterly dividend rate from $.015 to $.105 per share effective with the first quarter 2012 dividend, which will be paid in April 2012.

Accumulated Other Comprehensive Income (Loss):

Balances of related after-tax components comprising accumulated other comprehensive income (loss) included in equity at December 31, 2011, 2010 and 2009 are as follows:

	Foreign Currency Translation Adjustment			Revaluation of Derivatives			Defined Benefit Plan Liability Adjustment			Accumulated Other Comprehensive Income (Loss)
Balance at January 1, 2009	$	348		$	(15,717	)	$	(125,222	)	$	(140,591	)
Translation adjustments	23,793			—			—			23,793
Revaluation of interest rate derivatives, net of tax of $7,843	—			13,354			—			13,354
Defined benefit plan liability adjustment, net of tax of $1,970	—			—			3,354			3,354
Balance at December 31, 2009	24,141			(2,363		)	(121,868		)	(100,090		)
Translation adjustments	17,465			—			—			17,465
Revaluation of interest rate derivatives, net of tax of $1,486	—			2,363			—			2,363
Defined benefit plan liability adjustment, net of tax of $2,639	—			—			(4,495		)	(4,495		)
Balance at December 31, 2010	41,606			—			(126,363		)	(84,757		)
Translation adjustments	(10,154		)	—			—			(10,154		)
Revaluation of forward contract derivatives, net of tax of $173	—			(287		)	—			(287		)
Defined benefit plan liability adjustment, net of tax of $12,959	—			—			(24,859		)	(24,859		)
Balance at December 31, 2011	$	31,452		$	(287	)	$	(151,222	)	$	(120,057	)