Stock-Based Compensation

3 Months Ended

Mar. 31, 2013

Stock-Based Compensation

Stock-Based Compensation

Note F - Stock-Based Compensation

We recognized $1.3 million and $1.0 million of stock-based compensation during the three months ended March 31, 2013 and 2012, respectively.

Our annual grant of stock-based awards occurred in the first quarter of 2013, consistent with the timing of previous annual grants.  All stock-based awards granted in the first quarter of 2013 were granted under the 2005 Omnibus Incentive Plan (2005 Plan).  These grants consisted of:

		Weighted-
		Average
	Number	Grant-Date
	of Shares	Fair Value
Stock options	668,600	$	2.09
Non-vested shares	461,210	$	7.73
Performance stock units	183,000	$	7.10

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model.  These options become exercisable in 25% increments on the first, second, third and fourth anniversaries of their date of grant, and expire on the tenth anniversary of their date of grant.  All stock options granted in the first quarter of 2013 have exercise prices equal to the market value of the common stock on the date of grant.  Market value is defined by the 2005 Plan as the closing price on the previous trading day.  The weighted-average exercise price of options granted in the first quarter of 2013 was $7.72.

The fair value of each non-vested share is estimated on the date of grant as the closing market price of our common stock on the date of grant.  All non-vested shares granted in the first quarter of 2013 vest in three equal increments on the first, second and third anniversaries of their date of grant.

The fair value of each performance stock unit is estimated on the date of grant as the closing market price of our common stock on the date of grant, minus the present value of anticipated dividend payments.  Performance stock units are a form of share-based awards similar to non-vested shares, except that the number of shares ultimately issued is based on our performance against specific performance goals over a three-year period.  At the end of the performance period, the number of shares of stock issued will be determined by adjusting upward or downward from the maximum in a range between 0% and 100%.