NOTE 6 – STOCK-BASED COMPENSATION

The Company's Stock Incentive Plan (the "Plan") allows for grants of incentive stock options, non-statutory stock options, restricted stock awards, restricted stock units and other stock-based awards. The majority of all stock option and restricted stock unit grants outstanding under the Plan were granted in the first quarter of each fiscal year.

Stock-based compensation expense consisted of the following (in thousands):

Stock Options

The Company estimates the fair value of stock options using the Black-Scholes model. Key inputs and assumptions used to estimate the fair value of stock options include the exercise price of the award, the expected option term, the expected volatility of the Company's stock over the option's expected term, the risk-free interest rate applicable to the option's expected term, and the Company's estimated annual dividend yield.

The following table shows the weighted average assumptions for stock options granted in the period:

During the three months ended March 31, 2012 and 2011, the Company granted a total of 323,615 and 314,701 stock options, respectively. At March 31, 2012, unrecognized costs related to outstanding stock options totaled approximately $8,266,000, before any related tax benefit. The unrecognized costs related to stock options are amortized over the related vesting period using the straight-line attribution method. Unrecognized costs related to stock options at March 31, 2012 are expected to be recognized over a weighted average period of 2.83 years.

Restricted Stock Units

The Company estimates the fair value of service-based and performance-based restricted stock units using the Black-Scholes model. Key inputs and assumptions used to estimate the fair value of restricted stock units include the vesting period, dividend yield and closing price of the Company's common stock on the date of grant.

The following table presents the weighted average assumptions for restricted stock units granted in the period:

During the three months ended March 31, 2012 and 2011, the Company granted 149,691 and 122,235 restricted stock units, respectively. At March 31, 2012, unrecognized costs related to outstanding restricted stock units totaled approximately $13,345,000, before any related tax benefit. The unrecognized costs related to restricted stock units are being amortized over the related vesting period using the straight-line attribution method. These unrecognized costs at March 31, 2012 are expected to be recognized over a weighted average period of 2.80 years.