Stock Plans and Equity Transactions

12 Months Ended

Dec. 31, 2011

Stock Plans and Equity Transactions [Abstract]

Stock Plans and Equity Transactions

10.  Stock Plans and Equity Transactions

Stock Plans

The company’s share-based incentive plans permit the company to grant restricted stock units, restricted stock, incentive or non-qualified stock options, and certain other instruments to employees, directors, consultants and advisers of the company.  Restricted stock units and stock options generally vest over three years and are not subject to any performance criteria.  Options expire no more than 10 years following the grant date.  Shares issued under the plans upon option exercise or stock unit conversion are generally issued from authorized but previously unissued shares.

The company also has an Employee Stock Purchase Plan (“ESPP”) whereby employees may purchase shares of stock at the lesser of 85% of the fair market value of shares at the beginning or the end of quarterly offering periods.  As of December 31, 2011, approximately 540,000 shares of common stock were available for purchase under the ESPP.  Compensation expense associated with the ESPP was $0.4 million for each of the years ended December 31, 2011, 2010 and 2009, respectively.

Equity Transactions

The following tables summarize information related to stock-based compensation transactions and plans:

	Restricted Stock Units			Stock Options
			Weighted Average			Weighted Average
	Number of		Measurement	Number of		Exercise
	Units		Date Fair Value	Options		Price
Outstanding at December 31, 2008	877,794	$	23.01	2,500,233		$	9.01
Granted (1)	86,760		15.14	—			—
Exercised	—		—	(107,728)			9.82
Vested	(466,155)		21.69	—			—
Forfeited	(24,784)		23.18	(7,500)			12.15
Expired	—		—	(83,700)			27.52
Outstanding at December 31, 2009	473,615		22.88	2,301,305			8.29
Granted (1)	520,470		14.47	—			—
Exercised	—		—	(1,038,624)			10.21
Vested	(300,969)		23.17	—			—
Forfeited	(8,442)		19.98	(2,599)			6.29
Expired	—		—	(33,500)			16.24
Outstanding at December 31, 2010	684,674		16.38	1,226,582			6.46
Granted (1)	442,110		17.39	—			—
Exercised	—		—	(317,647)			4.26
Vested	(330,356)		18.47	—			—
Forfeited	(14,316)		16.57	(448)			5.79
Expired	—		—	(6,200)			3.91
Outstanding at December 31, 2011	782,112	$	16.07	902,287	(2)	$	7.25

____________

(1) The fair value of restricted stock unit grants is determined based on the closing market price of Orbital’s common stock on the date of grant.  Such value is recognized as expense over the service period, net of estimated forfeitures.

(2) The weighted average remaining contractual term is 1.60 years.

		Options Outstanding (1)
				Weighted Average		Weighted
Range of		Number		Remaining Contractual		Average
Exercise Prices		Outstanding		Term (Years)		Exercise Price
	$4.33 - $7.08		545,711		1.29		$	5.89
	7.09 - 12.18		306,576		1.77			8.73
	12.19 - 12.98		50,000		4.01			12.98
	$4.33 - $12.98		902,287		1.60		$	7.25

_____________

(1) All outstanding options were exercisable as of December 31, 2011.

(in millions)	Years Ended December 31,
	2011		2010		2009
Stock-based compensation expense recognized	$	6.2	$	7.0	$	9.2
Income tax benefit related to stock-based compensation expense		2.0		2.3		3.1
Intrinsic value of options exercised, computed as the market price
on the exercise date less the price paid to exercise the options		3.8		8.1		0.6
Cash received from exercise of options		1.4		10.6		1.1
Grant date fair value of vested restricted stock units		6.1		7.0		10.1
Tax benefit (expense) recorded as an increase (decrease) to additional
paid-in capital related to stock-based compensation transactions		1.2		1.1		(1.1	)

	As of
(in millions)	December 31, 2011
Shares of common stock available for grant under the company’s stock-based incentive plans		0.9
Aggregate intrinsic value of restricted stock units that are expected to vest	$	11.4
Unrecognized compensation expense related to non-vested restricted stock units, expected to
be recognized over a weighted-average period of 2.17 years		10.1
Aggregate intrinsic value of stock options outstanding, all fully vested		6.6

Securities Repurchase Transactions

The company repurchased and retired 1.2 million shares of its common stock at a cost of $16.7 million during 2009.  There have been no other repurchases of the company’s common stock since 2009.