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either incentive stock options or nonqualified stock options, stock appreciation rights, restricted stock and other stock-based awards at the discretion of the Compensation and Benefits Committee of the Board of Directors. At the annual meeting of shareholders held on June 8, 2000, the Company’s shareholders voted to increase the shares of common stock authorized for issuance under the Stock Incentive Plan from an aggregate of 7 million shares to an aggregate of 9 million shares. At December 31, 2001, the Stock Incentive Plan had outstanding options representing 5,257,498 shares of common stock. Options available for issuance were 2,469,655 as of December 31, 2000 and 1,463,925 as of December 31, 2001.
As permitted, the Company follows APB No. 25, under which no compensation cost has been recognized in connection with stock option grants. Had compensation cost for these plans been determined consistent with SFAS No. 123, the Company’s net earnings and earnings per share (“EPS”) would have been reduced to the following pro-forma amounts (in thousands, except per share data):
|
|
Years Ended December 31,
|
|
|
2001
|
2000
|
1999
|
|
Net Earnings:
|
As Reported
|
$ 84,407
|
$ 61,340
|
$ 43,435
|
|
|
Pro Forma
|
81,001
|
57,251
|
40,098
|
EPS, basic
|
As Reported
|
1.30
|
1.03
|
0.74
|
|
EPS, diluted
|
As Reported
|
1.24
|
0.93
|
0.69
|
EPS, basic
|
Pro Forma
|
1.25
|
0.96
|
0.68
|
|
EPS, diluted
|
Pro Forma
|
1.19
|
0.87
|
0.64
|
The fair value of the stock options included in the pro-forma amounts shown above was estimated as of the grant date using the Black-Scholes option-pricing model with the following weighted-average assumptions:
| |
2001
|
2000
|
1999
|
|
Dividend yield
|
0%
|
0%
|
0%
|
|
Expected volatility
|
73%
|
74%
|
74%
|
|
Risk-free interest rate
|
4%
|
5%
|
6%
|
|
Expected life
|
4 years
|
4 years
|
4 years
|
Transactions with respect to the
plans for the three years ended December 31, 2001 were as follows (shares in
thousands):
| |
2001
|
2000
|
1999
|
| |
 |
| |
Shares
|
Weighted
Average
Exercise
Price
|
Shares
|
Weighted
Average
Exercise
Price
|
Shares
|
Weighted
Average
Exercise
Price
|
|
|
| Outstanding at beginning of year
|
5,204
|
$ 8
|
6,177
|
$ 8
|
5,441
|
$ 8
|
Granted
|
599
|
18
|
299
|
11
|
2,339
|
9
|
| Exercised
|
(469)
|
7
|
(881)
|
8
|
(344)
|
9
|
| Canceled
|
(77)
|
10
|
(391)
|
8
|
(1,259)
|
11
|
|
|
Outstanding at end of year
|
5,257
|
$ 9
|
5,204
|
$ 8
|
6,177
|
$ 8
|
|
|
Exercisable at end of year
|
3,291
|
$ 7
|
2,380
|
$ 8
|
1,655
|
$ 8
|
|
|
42
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