XML 45 R18.htm IDEA: XBRL DOCUMENT

Stock Compensation - Restricted Stock and Performance Share Grants

6 Months Ended

Jun. 30, 2012

Stock Compensation - Restricted Stock and Performance Share Grants [Abstract]

STOCK COMPENSATION - RESTRICTED STOCK AND PERFORMANCE SHARE GRANTS

NOTE J – STOCK COMPENSATION – RESTRICTED STOCK AND PERFORMANCE SHARE GRANTS

The Company’s stock incentive plans provide for the making of awards to employees based upon time-based criteria or through the achievement of performance-related objectives. The Company has issued three types of stock grant awards under these plans: restricted stock with time-based vesting, performance share grants that only vest upon the achievement of specified performance conditions, and performance share grants that include threshold, target, and maximum achievement levels based on the achievement of specific performance milestones. The Company has issued 167,561 shares of restricted stock that vest over three and four-year periods of time and of this amount 132,814 shares have vested. The Company also has granted performance units with stock awards ranging from zero shares if below threshold performance conditions to 95,227 for threshold performance, 614,158 shares for target performance, and 906,044 for maximum performance. These awards are tied to corporate cash flow goals and the achievement of specified milestone development activities.

During the second quarter of 2012, the Company achieved the second performance milestone for the Tejon Mountain Village project, which was to successfully defend its environmental impact report in the courts and achieve litigation free entitlement. Please Note D - Commitments and Contingencies for a detailed status of the TMV CBD lawsuit. This achievement resulted in an acceleration of stock compensation expense during the second quarter of 2012 related to the TMV litigation free performance milestone. Additionally, the achievement of this milestone has moved up the likelihood of reaching the third performance milestone sooner. As such, the cost for this final TMV performance milestone has been accelerated.

The following is a summary of the Company’s stock grant activity assuming target achievement for outstanding performance grants for the following periods:


	June 30 2012			December 31 2011
Stock Grants Outstanding Beginning of the Year at Target		744,508			782,087
New Stock Grants/Additional shares maximum achievement		73,729			64,679
Vested Grants		(167,608	)		(36,980	)
Expired/Forfeited Grants		—			(65,278	)

Stock Grants Outstanding June 30, 2012 at Target		650,629			744,508

The fair value of restricted stock with time-based vesting features is based upon the Company’s share price on the date of grant and is expensed over the service period. Fair value of performance grants that cliff vest based on the achievement of performance conditions is based on the share price of the Company’s stock on the day of grant once the Company determines that it is probable that the award will vest. This fair value is expensed over the service period applicable to these grants. For performance grants that contain a range of shares from zero to maximum we determine, based on historic and projected results, the probability of (1) achieving the performance objective, and (2) the level of achievement. Based on this information, we determine the fair value of the award and measure the expense over the service period related to these grants. Because the ultimate vesting of all performance grants is tied to the achievement of a performance condition, we estimate whether the performance condition will be met and over what period of time. Ultimately, we adjust compensation cost according to the actual outcome of the performance condition.

For the six months ending June 30, 2012 there was total employee stock compensation of $3,642,000 with $3,475,000 being expensed and $167,000 being capitalized to projects. For the six months ending June 30, 2011 we recognized $2,313,000 in expense.

Under the NDSI Plan, each non-employee director receives his or her annual compensation in stock. Under this plan, 72,875 shares of stock have been granted since the plan was adopted in 2004. During 2012, 5,982 shares have been granted. Total expenses relating to non- employee director stock compensation during the six months ended June 30, 2012 and 2011 was $183,000 and $162,000, respectively.