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Stock-Based Compensation
 12 Months Ended
Dec. 31, 2011
Stock-Based Compensation [Abstract]  
Stock-Based Compensation
4. STOCK-BASED COMPENSATION

In October 1999, the Company adopted a long-term equity incentive plan, which allows for grants of stock options, stock appreciation rights, restricted stock and performance awards to directors, officers and employees of PCA, as well as others who engage in services for PCA. The Company has not granted any option awards since 2007. Restricted stock awards granted to employees vest at the end of a four-year period, and stock awards granted to directors vest immediately. The plan, which will terminate on October 19, 2014, provides for the issuance of up to 8,550,000 shares of common stock over the life of the plan. As of December 31, 2011, options and restricted stock for 7,659,255 shares have been granted, net of forfeitures. Forfeitures are added back to the pool of shares of common stock available to be granted at a future date.

 

Compensation expense for both stock options, which were fully vested at June 30, 2010, and restricted stock recognized in the consolidated statements of income for the years ended December 31, 2011, 2010 and 2009 was as follows:

 

     Year Ended December 31,  
     2011     2010     2009  
     (In thousands)  

Stock options

    $ —      $ 226      $ 720   

Restricted stock

      9,736        6,780        6,541   
  

 

 

    

 

 

    

 

 

  

Impact on income before income taxes

      9,736        7,006        7,261   

Income tax benefit

      (3,784 )      (2,721 )      (2,827 ) 
  

 

 

    

 

 

    

 

 

  

Impact on net income

    $ 5,952      $ 4,285      $ 4,434   
  

 

 

    

 

 

    

 

 

  

The Company uses the Black-Scholes-Merton option-pricing model to estimate the fair value of each option grant as of the date of grant. Expected volatilities are based on historical volatility of the Company's common stock. The expected life of the option is estimated using historical data pertaining to option exercises and employee terminations. Separate groups of employees that have similar historical exercise behavior are considered separately for estimating the expected life. The risk-free interest rate is based on U.S. Treasury yields in effect at the time of grant. The fair value of restricted stock is determined based on the closing price of the Company's common stock on the grant date.

A summary of the Company's stock option activity and related information follows:

 

       Options     Weighted-
Average
Exercise Price		      Weighted-
Average
Remaining
Contractual
Term (years)		      Aggregate
Intrinsic
Value		  
                           (In thousands)  

Outstanding at December 31, 2008

        2,227,032      $ 19.85         

Exercised

        (185,801 )      8.69         

Forfeited

        (67,930 )      19.11         
    

 

 

    

 

 

        

Outstanding at December 31, 2009

        1,973,301        20.92         

Exercised

        (394,420 )      19.01         

Forfeited

        (10,497 )      24.62         
    

 

 

    

 

 

        

Outstanding at December 31, 2010

        1,568,384        21.38         

Exercised

        (343,685 )      20.34         
    

 

 

    

 

 

        

Outstanding and exercisable at
December 31, 2011

        1,224,699      $ 21.64         1.5       $ 4,485   
    

 

 

    

 

 

     

 

 

     

 

 

  

The total intrinsic value of options exercised during the years ended December 31, 2011, 2010, and 2009 was $2.8 million, $2.4 million, and $1.7 million, respectively. As of December 31, 2011, there is no unrecognized compensation cost related to stock option awards granted under the Company's equity incentive plan as all outstanding awards have vested.

 

A summary of the Company's restricted stock activity follows:

 

     2011     2010     2009  
     Shares     Fair Market
Value at
Date of
Grant		     Shares     Fair Market
Value at
Date of
Grant		     Shares     Fair Market
Value at
Date of
Grant		  
     (Dollars in thousands)  

Restricted stock at January 1

      1,478,000      $ 30,600        1,235,505      $ 24,718        1,038,270      $ 23,023   

Granted

      575,694        16,005        573,440        12,693        444,985        6,995   

Vested

      (229,979 )      (5,816 )      (318,350 )      (6,563 )      (237,370 )      (5,079 ) 

Cancellations

      (5,970 )      (134 )      (12,595 )      (248 )      (10,380 )      (221 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Restricted stock at December 31

      1,817,745      $ 40,655        1,478,000      $ 30,600        1,235,505      $ 24,718   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

As of December 31, 2011, there was $21.6 million of total unrecognized compensation costs related to the restricted stock awards. The Company expects to recognize the cost of these stock awards over a weighted-average period of 2.6 years.