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STOCK COMPENSATION PLANS
 3 Months Ended
Mar. 31, 2012
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
STOCK COMPENSATION PLANS
NOTE 3 – STOCK COMPENSATION PLANS

On May 25, 2005, the Company’s stockholders approved a new Equity Compensation Plan, which authorizes up to 500,000 shares of Class A Non-Voting Common Stock, or Class A Stock, for issuance, referred to as the 2005 Equity Compensation Plan, or the Plan.  Since May 25, 2005, no additional grants have been made under the Company’s other stock-based compensation plans that were previously available.  The Company accounts for stock options issued after January 1, 2006 under FASB Accounting Standards Codification, or ASC Topic, 718.  For the three months ended March 31, 2012, compensation expense of approximately $29,000 was recorded for stock options granted in May 2011.  Approximately $31,000 in compensation expense was recorded during the three months ended March 31, 2011 for stock options issued in May 2010.  Costs were determined based on the fair value at the grant dates and those costs are being charged to income over the service period associated with the grants.
 
The fair value of each option grant is estimated using the Black-Scholes-Merton option pricing model with the following weighted-average assumptions used for grants issued in 2011 and 2010.  All options were granted at market value with a 10-year option term with a vesting period of one year from the date of grant.
 

   
2011
  
2010
 
Expected Dividend Yield
  3.99 %  4.24 %
Expected Stock Price Volatility
  0.25   0.27 
Weighted Average Risk-Free Interest Rate
  3.12 %  3.38 %
Weighted Average Expected Life of Options (in years)
  8.36   8.97 

The expected dividend yield was based on a 12-month rolling average of the Company’s dividend yield.  The expected volatility is the standard deviation of the change in the natural logarithm of the stock price (expressed as an annual rate) for the expected term shown above.  The expected term was based on historic exercise patterns for similar grants.  The risk-free interest rate is the 10-year Treasury Constant Maturity rate as of the date of the grants.

The following summary reflects changes in the shares of Class A Stock underlying options:

 
   
Option Shares
  
Weighted Average Exercise Price
  
Weighted Average Remaining Life (Yrs.)
  
Aggregate Intrinsic Value (in thousands)
 
Plan options
            
Outstanding at January 1, 2012
  450,000  $17.61       
Granted
  ---   ---       
Exercised
  (20,250)  12.40       
Expired
  ---           
Outstanding at March 31, 2012
  429,750  $17.85   4.45  $598 
                  
Options exercisable at March 31, 2012
  396,000  $17.75   4.05  $598 

The total intrinsic value of options exercised during the three months ended March 31, 2012 was approximately $134,190.

The following summary reflects changes in the non-vested shares of Class A Stock underlying options:

Non-vested Shares
 
Option Shares
  
Weighted Average Grant – Date Fair Value Per Option
 
Non-vested at January 1, 2012
  33,750  $3.50 
Granted
  ---   --- 
Vested
  ---   --- 
Canceled
  ---   ---- 
Non-vested at March 31, 2012
  33,750  $3.50 

As of March 31, 2012, there was $15,000 of total unrecognized expense related to non-vested option shares granted under the Plan.  The cost will be recognized over the remaining 0.13 year vesting period of the unvested options.