Note 23 —Restricted Stock

On June 3, 2010, stockholders approved the 2010 Non-Employee Directors’ Stock Plan (the “2010 Directors’ Plan”), which replaced the 2006 Directors Plan. The 2010 Directors’ Plan provides for the granting of stock to Non-Employee directors to compensate them for their services to the Company. The use of the shares available under the 2010 Directors’ Plan is administered by the Company’s Board of Directors, which has delegated its powers to the Compensation Committee of the Board of Directors. The Compensation Committee has designed a plan that grants non-employee directors restricted shares of stock with the following market values on the date of grant:

For Board Service:

Each director upon initial election:		$	40,000
Annual grant to each director:		$	20,000

Annual Grants for Committee Service:

Audit Committee:
Chairman	$	15,000
Members	$	10,000

Compensation Committee:
Chairman	$	10,000
Members	$	5,000

Nominating Committee:
Chairman	$	5,000
Members	$	2,500

Half of the shares received pursuant to this plan vest immediately and the remaining shares vest on the one year anniversary of the initial grant. Shares for board service are granted on the first business day of the year and shares for committee service are granted upon appointment to the committee following the annual meeting of stockholders. Newly appointed directors receive their initial grant on their date of appointment.

Following approval of the 2010 Directors’ Plan in June 2010, directors that serve on committees of the Board of Directors received 18,359 shares of restricted stock, half of which vested immediately and half of which vested in June 2011.

In January 2011, 29,700 shares of restricted stock were granted to directors for their board service, and in June 2012, 14,769 shares of restricted stock were granted to directors serving on Board committees. Half of each of these grants vested immediately and half will vest on the one year anniversary of the grant if the director is still serving on the Board or committee on the vesting date. The Company also granted 1,984 shares of restricted stock to a new director that that joined the Board in August. Half of these share vested immediately and the remaining half vested on December 31, 2012.

In January 2012 the Company granted 30,675 shares of restricted stock to directors for their board service, and in June 2012, it granted 29,278 shares of restricted stock to directors serving on Board committees. Half of each of these grants vested immediately and half will vest on the one year anniversary of the grant if the director is still serving on the Board or committee on the vesting date. The Company also granted 1,141 shares of restricted stock to a director that agreed to join two of the Board’s committees in the middle of the year. Half of these share vested immediately and the remaining half vested in June 2013.

During 2010, the Company granted 80,552 shares of restricted stock to executive officers under the 2008 Stock Incentive Plan. These shares will vest one third on each of December 31, 2010, 2011 and 2012, if the officer has not voluntarily resigned from the Company or been terminated for cause prior to the vesting date.

During 2011, the Company granted 108,025 shares of restricted stock to eight senior employees, including it executive officers under the 2008 Stock Incentive Plan. These shares will vest one third on each of December 31, 2011, 2012 and 2013, if the holder has not voluntarily resigned from the Company or been terminated for cause prior to the vesting date.

The following table summarizes the shares of restricted stock granted, vested, forfeited and outstanding as of December 31, 2011:

	Restricted Shares		Weighted Average Grant-Date Fair Value

Unvested Shares at December 31, 2010	59,740		$	4.33

Granted	154,478		$	4.08
Vested	(108,597	)	$	4.14
Forfeited	—		—

Unvested Shares at December 31, 2011	105,621		$	4.16

Granted	130,020		$	3.02
Vested	(139,990	)	$	3.63
Forfeited	(18,319	)	$	3.68

Unvested Shares at December 31, 2012	77,332		$	3.31

The Company accounts for grants of restricted stock in accordance with ASC 718. This pronouncement requires companies to measure the cost of the service received in exchange for a share-based award based on the fair value of the award at the date of grant, with expense recognized over the requisite service period, which is generally equal to the vesting period of the grant. The Company recognized $481,000 of stock compensation expense related to the issuances of restricted stock in each of the years ended December 31, 2012 and 2011. As of December 31, 2012, there was approximately $242,000 of unrecognized expense related to these restricted stock issuances which will be recognized over a weighted-average period of 6.8 months.