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Stock Incentive Plans And Stock-Based Compensation
 6 Months Ended
Jun. 30, 2011
Stock Incentive Plans And Stock-Based Compensation  
Stock Incentive Plans And Stock-Based Compensation

Note 4 - Stock Incentive Plans and Stock-Based Compensation

The Company's 2009 Stock Incentive Plan (the "2009 Plan"), which provides for stock-based awards to Company employees, non-employee directors and outside consultants or advisors, was approved by shareholders on May 13, 2009. No options have been issued to outside consultants or advisors. The number of shares of common stock reserved for issuance under the 2009 Plan is 1,000,000, of which the aggregate number of shares for which incentive stock options may be granted under the Plan is 900,000. No new grants of stock options may be made under the Company's 2003 Stock Incentive Plan (the "2003 Plan"). At June 30, 2011, there were option awards covering 686,169 shares outstanding under the 2009 Plan, together with the 2003 Plan and its predecessor, the 1993 Stock Incentive Plan. Outstanding options under all three plans typically expire ten years after the date of grant and are generally exercisable in four equal annual installments beginning one year after the date of grant. During April 2011, 200,000 options were granted to officers and directors which become exercisable in eight equal annual installments beginning one year after the date of grant.

In accordance with accounting guidance for share-based payments, the Company recognizes compensation expense for options awarded under its stock incentive plans. Current accounting guidance requires the grant-date fair value of all share-based payment awards, including employee stock options, to be recognized as employee compensation expense over the requisite service period.

 

The following table summarizes options activity in 2011:

 

     Number
of Options		     Grant Prices  

Outstanding at December 31, 2010

      399,569      $ 2.00 to $17.50   

Options granted

      289,200      $ 14.87 to $16.53   

Options exercised

      (2,600 )      $2.00   

Options cancelled or expired

      0     
  

 

 

    

Outstanding at June 30, 2011

      686,169      $ 2.00 to $17.50   
  

 

 

    

Exercisable at June 30, 2011

      286,969     
  

 

 

    

Available for grant at June 30, 2011

      623,800     
  

 

 

    

The following table presents information on stock options outstanding for the periods shown:

 

     Three Months Ended
June 30,		      Six Months Ended
June 30,		  
($ in thousands, except per share data)    2011      2010      2011      2010  

Intrinsic value of options exercised in the period

    $ 0       $ 0       $ 34       $ 0   
     As of June 30,         
     2011      2010                

Stock options:

            

Number of options

      686,169         392,319         

Options fully vested and currently exercisable

      286,969         250,694         

Weighted average exercise price

    $ 13.56       $ 13.59         

Aggregate intrinsic value

    $ 415       $ 258         

Weighted average contractual term of options

      7.41 years         6.55 years         

The aggregate intrinsic value of stock options represents the difference between the Company's closing stock price at the end of the period and the relevant exercise price multiplied by the number of options outstanding at the end of the period at each such price.

 

The fair value of the stock-based awards, as determined under the Black-Scholes model, granted in the six months ended June 30, 2011 and 2010 were $2.1 million and $344,000, or $7.20 and $5.54 per share, respectively, estimated with the following weighted-average assumptions:

 

     Six Months Ended
June 30, 2011		   Six Months Ended
June 30, 2010

Stock options:

     

Risk-free interest rate

    2.88%   3.00%

Expected dividend yield

    2.28%   2.39%

Expected term

    7.3 years   7.0 years

Expected volatility

    65.94%   58.83%

The following table summarizes stock-based compensation expense related to stock option awards for the three months and six months ended June 30, 2011 and 2010 (in thousands):

 

     Three Months Ended
June 30,		      Six Months Ended
June 30,		  
     2011      2010      2011      2010  

Stock-based compensation expense included inselling, general and administrative expenses

    $ 136       $ 52       $ 192       $ 84   

Deferred income taxes

      54         21         76         34   
  

 

 

     

 

 

     

 

 

     

 

 

  

Stock-based compensation expense related tostock options, net of tax

    $ 82       $ 31       $ 116       $ 50   
  

 

 

     

 

 

     

 

 

     

 

 

  

As of June 30, 2011 unrecognized compensation expense related to stock options was $2.5 million.