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Stock-Based Compensation
 9 Months Ended
Sep. 30, 2012
Stock-Based Compensation [Abstract]  
STOCK-BASED COMPENSATION
(7) STOCK-BASED COMPENSATION

The Company adopted a nonqualified incentive stock option plan (the “BancFirst ISOP”) in May 1986. The Company amended the BancFirst ISOP to increase the number of shares to be issued under the plan to 2,800,000 shares in May 2011. At September 30, 2012, 64,860 shares were available for future grants. The BancFirst ISOP will terminate on December 31, 2014. The options are exercisable beginning four years from the date of grant at the rate of 25% per year for four years. Options expire at the end of fifteen years from the date of grant. Options outstanding as of September 30, 2012 will become exercisable through the year 2018. The option price must be no less than 100% of the fair value of the stock relating to such option at the date of grant.

In June 1999, the Company adopted the BancFirst Corporation Non-Employee Directors’ Stock Option Plan (the “BancFirst Directors’ Stock Option Plan”). Each non-employee director is granted an option for 10,000 shares. The Company amended the BancFirst Directors’ Stock Option Plan to increase the number of shares to be issued under the plan to 205,000 shares in May 2009. At September 30, 2012, 30,000 shares were available for future grants. The options are exercisable beginning one year from the date of grant at the rate of 25% per year for four

years, and expire at the end of fifteen years from the date of grant. Options outstanding as of September 30, 2012 will become exercisable through the year 2015. The option price must be no less than 100% of the fair value of the stock relating to such option at the date of grant.

The Company currently uses newly issued stock to satisfy stock-based exercises, but reserves the right to use treasury stock purchased under the Company’s Stock Repurchase Program (the “SRP”) in the future.

The following table is a summary of the activity under both the BancFirst ISOP and the BancFirst Directors’ Stock Option Plan:

 

                                 
    Options     Wgtd.
Avg.
Exercise
Price		     Wgtd. Avg.
Remaining
Contractual
Term		     Aggregate
Intrinsic
Value		  
    (Dollars in thousands, except per share data)  

Nine Months Ended September 30, 2012

                                

Outstanding at December 31, 2011

     1,298,431     $ 30.14                  

Options granted

     —         —                    

Options exercised

     (88,610 )      17.11                  

Options canceled, forfeited or expired

     —         —                    
   

 

 

                          

Outstanding at September 30, 2012

     1,209,821       31.10       8.40 Yrs    $ 14,354  
   

 

 

            

 

 

    

 

 

  

Exercisable at September 30, 2012

     655,871       25.03       5.27 Yrs    $ 11,764  
   

 

 

            

 

 

    

 

 

  

The following table is a summary of the Company’s non-vested options as of September 30, 2012, and any changes during the nine months ended September 30, 2012:

 

         
    Options  

Non-vested at December 31, 2011

     591,700  

Options granted

     —    

Options vested

     (37,750 ) 

Options forfeited

     —    
   

 

 

  

Non-vested at September 30, 2012

     553,950  
   

 

 

  

The following table has additional information regarding options granted and options exercised under both the BancFirst ISOP and the BancFirst Directors’ Stock Option Plan:

 

                                 
    Three Months Ended
September 30,		     Nine Months Ended
September 30,		  
    2012     2011     2012     2011  
    (Dollars in thousands, except per share data)  

Weighted average grant-date fair value per share of options granted

   $ —       $ 12.11     $ —       $ 12.46  

Total intrinsic value of options exercised

     1,947       264       3,696       669  

Cash received from options exercised

     794       263       1,516       701  

Tax benefit realized from options exercised

     753       102       1,430       259  

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model and is based on certain assumptions including risk-free rate of return, dividend yield, stock price volatility, and the expected term. The fair value of each option is expensed over its vesting period.

 

The following table is a summary of the Company’s recorded stock-based compensation expense:

 

                                 
    Three Months  Ended
September 30,		     Nine Months Ended
September 30,		  
    2012     2011     2012     2011  
    (Dollars in thousands)  

Stock-based compensation expense

   $ 391     $ 371     $ 1,189     $ 1,017  

Tax

     (151 )      (144 )      (460 )      (394 ) 
   

 

 

    

 

 

    

 

 

    

 

 

  

Stock-based compensation expense, net of tax

   $ 240     $ 227     $ 729     $ 623  
   

 

 

    

 

 

    

 

 

    

 

 

  

The Company will continue to amortize the remaining fair value of stock options, over the remaining vesting period of approximately seven years. The following table shows the remaining fair value of stock options:

 

         
    September 30, 2012  
    (Dollars in thousands)  

Fair value of stock options

   $  5,340  

The following table shows the assumptions used for computing stock-based compensation expense under the fair value method:

 

                 
    Nine Months Ended
September 30,		  
    2012     2011  

Risk-free interest rate

     1.74 %      3.32 % 

Dividend yield

     2.00 %      2.00 % 

Stock price volatility

     32.88 %      28.86 % 

Expected term

     10 Yrs      10 Yrs 

The risk-free interest rate is determined by reference to the spot zero-coupon rate for the U.S. Treasury security with a maturity similar to the expected term of the options. The dividend yield is the expected yield for the expected term. The stock price volatility is estimated from the recent historical volatility of the Company’s stock. The expected term is estimated from the historical option exercise experience.