Stock Incentive Plan

3 Months Ended

Mar. 31, 2013

Stock Incentive Plan [Abstract]

Stock Incentive Plan

10.  Stock Incentive Plan

The Company adopted the 2010 Stock Option Plan (“2010 Plan”) following shareholder approval of the 2010 Plan at the 2010 Annual Meeting.  Subsequent to the adoption of the 2010 Plan, no additional grants may be issued under the prior plans.  The 2010 Plan provides for grants of up to 348,232 shares, which includes any shares subject to stock awards under the previous stock option plans.

Stock Options:  Under the 2010 Plan and previous plans, certain key employees have been granted the option to purchase set amounts of common stock at the market price on the day the option was granted.  Optionees, at their own discretion, may cover the cost of exercise through the exchange at the then fair value of already owned shares of the Company’s stock.  Options are granted for a 10-year period and vest on a pro rata basis over the initial three years from grant.

The Company measures the fair value of each stock option at the date of grant using the Black-Scholes option pricing model.  For the quarters ended March 31, 2013 and 2012, the Company recognized $17,000and $15,000, respectively, in stock option compensation expense as a component of salaries and other personnel expense. 

Proceeds from the exercise of stock options in the three months ended March 31, 2013 and 2012, were $48,000 and $63,000, respectively.  The Company withheld $54,000 and $63,000 to pay for stock option exercises or income taxes that resulted from the exercise of stock options in the three months ended March 31, 2013 and 2012, respectively. 

There were no stock options granted in the first quarter of 2013.

Restricted Stock Units:  The Company grants restricted stock units to certain key employees periodically.  Recipients of restricted stock units do not pay any cash consideration to the Company for the shares and receive all dividends with respect to such shares when the shares vest. Restricted stock units cliff vest at the end of a three-year time period.  For the three months ended March 31, 2013 and 2012, the Company recognized $95,000 and $98,000, respectively, in restricted stock unit compensation expense as a component of salaries and other personnel expense. 

There were no restricted stock units in the first quarter of 2013.