A total of $20.6 million was paid in cash dividends ($0.14 per share) during the first six months of 2011, compared to $17.9 million or ($0.12 per share) during the same period in 2010.  During the second quarter ended June 30, 2011, the Company repurchased 533,012 shares of its $1 par value common stock at a weighted average price of $19.37 per share compared to 1,135,242 shares purchased at a weighted average price of $14.14 during the same period in 2010.  During the six months ended June 30, 2011, the Company repurchased 789,296 shares of its $1 par value common stock at a weighted average price of $19.22 per share compared to 1,330,392 shares purchased at a weighted average price of $13.95 during the same period in 2010.  Rollins, Inc. has had a buyback program in place for a number of years and has routinely purchased shares when it felt the opportunity was desirable. The Board authorized the purchase of 7.5 million additional shares of the Company’s common stock in October 2008.  This authorization enables the Company to continue the purchase of Rollins, Inc. common stock when appropriate, which is an important benefit, resulting from the Company’s strong cash flows.  The stock buy-back program has no expiration date.  In total, 1.7 million additional shares may be purchased under its share repurchase program.

As more fully discussed in Note 12 of the Company’s notes to the consolidated financial statements in its 2010 Annual Report on Form 10-K stock options, time lapse restricted shares (TLRS’s) and restricted stock units have been issued to officers and other management employees under the Company’s Employee Stock Incentive Plans.  The stock options generally vest over a five-year period and expire ten years from the issuance date.

During the second quarter ended June 30, 2011, approximately 43,000 shares of common stock were issued upon exercise of stock options by employees compared to approximately 1,600 shares for the prior year quarter.  In total for the six months ended June 30, 2011, approximately 53,000 shares of common stock were issued upon exercise of stock options by employees and approximately 238,000 shares of common stock were issued upon exercise of stock options by employees for the first six months ended June 30, 2010.  The Company issues new shares from its authorized but unissued share pool.  At June 30, 2011 approximately 5.2 million shares of the Company’s common stock were reserved for issuance.

The following table summarizes the components of the Company’s stock-based compensation programs recorded as expense:

Options activity outstanding under the Company’s stock option plan as of June 30, 2011 and changes during the six months ended June 30, 2011, were as follows:

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the second quarter ended June 30, 2011 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on June 30, 2011. The amount of aggregate intrinsic value will change based on the fair market value of the Company’s stock.

The aggregate intrinsic value of options exercised during the six months ended June 30, 2011 and June 30, 2010 was $0.2 million and $2.4 million, respectively. Exercise of options for the second quarter ended June 30, 2011 and 2010 resulted in cash receipts of $11 thousand and $0.3 million, respectively.  The Company recognized tax benefits of approximately $68 thousand during the quarter ended June 30, 2011, and $59 thousand for the quarter ended June 30, 2010, which have been recorded as increases to paid-in capital.  The Company recognized tax benefits of approximately $138 thousand for the six months ended June 30, 2011, and $448 thousand for the quarter ended June 30, 2010, which have been recorded as increases to paid-in capital.

The following table summarizes information on unvested restricted stock outstanding as of June 30, 2011: 

At June 30, 2011 and December 31, 2010, the Company had $26.0 million and $20.0 million of total unrecognized compensation cost, respectively, related to time-lapse restricted shares that are expected to be recognized over weighted average periods of approximately 4.3 years and 3.9 years, respectively.