Shareholders' Equity

12 Months Ended

Dec. 31, 2011

Shareholders' Equity [Abstract]

Shareholders' Equity

(9) Shareholders' Equity

The Company recognized approximately $14.3 million, $6.7 million and $4.8 million in share-based compensation expense in 2011, 2010 and 2009, respectively. The Company recognizes compensation expense on grants of share-based compensation awards on a straight-line basis over the vesting period of each award. As of December 31, 2011, total unrecognized compensation cost related to share-based compensation awards was approximately $19.5 million, net of estimated forfeitures, which the Company expects to recognize over a weighted average period of approximately 3.1 years. The total income tax benefit recognized relating to share-based compensation for the year ended December 31, 2011 was approximately $1.4 million.

Under the Company's stock plans, the Company was authorized as of December 31, 2011 to deliver up to 5.0 million shares of common stock upon exercise of non-qualified stock options or incentive stock options, or upon grant or in payment of stock appreciation rights, and restricted stock. Approximately 1.3 million shares were available for future grant or payment under the various plans at December 31, 2011.

During 2011, the Company issued 2,834,026 shares of common stock in connection with the acquisition of EPC.

During 2010, the Company issued approximately 0.9 million shares to former Convertible Note holders in settlement of the conversion premium of their redemption (see Note 7 to the Consolidated Financial Statements).

On May 22, 2009, the Company completed the sale of 4,312,500 shares of common stock to the public at a price of $36.25 per share. Net proceeds of $150.4 million were received by the Company.

Share-based Incentive Awards

 The Company uses several forms of share-based incentive awards including non-qualified stock options, incentive stock options and stock appreciation rights ("SARs"). All grants are made at prices equal to the fair market value of the stock on the grant dates, and expire ten years from the grant date.

The per share weighted average fair value of share-based incentive awards granted (options and SARs) was $25.80, $22.62 and $15.28 for fiscal 2011, 2010 and 2009, respectively. The fair value of the awards for fiscal 2011, 2010 and 2009 were estimated on the date of grant using the Black-Scholes pricing model and the following weighted average assumptions; expected life of seven years; risk-free interest rate of 2.3%, 2.8% and 2.6%; expected dividend yield of 1.0%, 1.1% and 1.5%; and expected volatility of 35.6%, 34.8% and 36.8%, respectively.

The average risk-free interest rate is based on U.S. Treasury security rates in effect as of the grant date. The expected dividend yield is based on the projected annual dividend as a percentage of the estimated market value of the Company's common stock as of the grant date. The Company estimated the expected volatility using a weighted average of daily historical volatility of the Company's stock price over the expected term of the award. The Company estimated the expected term using historical data adjusted for the estimated exercise dates of unexercised awards.

Following is a summary of share-based incentive plan grant activity (options and SARs) for fiscal 2011.

	Shares			Wtd. Avg. Exercise Price		Wtd. Avg. Remaining Contractual Term (years)		Aggregate Intrinsic Value (in millions)
Number of shares under option:
Outstanding at January 1, 2011		1,454,050		$	43.50
Granted		403,130			70.23
Exercised		(94,725	)		40.06
Forfeited		(13,300	)		57.55
Outstanding at December 31, 2011		1,747,255			49.94		6.2	$	12.1
Exercisable at December 31, 2011		839,375			39.16		4.1		9.9

The amount of options expected to vest is materially consistent with those outstanding and not yet exercisable.

The table below presents share-based compensation activity for the three fiscal years ended 2011, 2010 and 2009 (in millions):

	2011		2010		2009
Total intrinsic value of share-based incentive awards exercised	$	2.9	$	7.4	$	5.7
Cash received from stock option exercises		1.9		3.8		5.8
Income tax benefit from the exercise of stock options		1.4		1.7		2.8
Total fair value of share-based incentive awards vested		13.3		7.0		3.5

Restricted Stock

The Company also granted restricted stock awards to certain employees. The Company restrictions lapse two to three years after the date of the grant. The Company values restricted stock awards at the closing market value of its common stock on the date of grant.

A summary of restricted stock activity for fiscal 2011, fiscal 2010 and fiscal 2009:

	Shares			Wtd. Avg. Grant Date Fair Value
Restricted stock balance at January 1, 2011		181,177		$	53.44
Granted		90,803			70.04
Vested		(133,350	)		57.25
Forfeited		(300	)		52.01
Restricted stock balance at December 31, 2011		138,330		$	60.67

Treasury Stock

The Board of Directors has approved repurchase programs of up to 3,000,000 common shares of Company stock. Management is authorized to effect purchases from time to time in the open market or through privately negotiated transactions. Through December 27, 2008, the Company repurchased 884,100 shares at an average purchase price of $21.96 per share. During 2009, approximately 1.4 million shares, including all 884,100 treasury shares, were issued in settlement of the conversion premium for certain Convertible Notes (see also Note 7 to the Consolidated Financial Statements).