Stock-Based Compensation

3 Months Ended

Mar. 31, 2012

Stock-Based Compensation

Stock-Based Compensation

(7)Stock-Based Compensation

We recognize compensation expense for stock-based compensation awards issued to employees that are expected to vest. Compensation cost is based on the fair value of awards as of the grant date.

The following table summarizes the pre-tax stock-based compensation expense included in reported net income (in thousands):

	Three months ended March 31,
	2012		2011
Non-qualified stock options	$	231	$	190
Restricted stock units	125		129
Board of Directors stock grants	125		100
Total stock-based compensation expense	$	481	$	419

Pursuant to our 2011 Stock Incentive Plan (the “2011 Plan”), we may grant awards of non-qualified stock options, incentive stock options, restricted stock, stock units, performance shares, performance units and other incentives payable in cash or in shares of our common stock to officers, employees or members of the Board of Directors. The 2011 Plan replaced the 1973 Non-Qualified Stock Option Plan, as amended, and the 2003 Incentive Stock Plan (the “Prior Plans”). No new awards will be made under the Prior Plans and outstanding awards will remain outstanding under the Prior Plans until settled. As of March 31, 2012, we had non-qualified stock options and restricted stock units outstanding under these plans as discussed below.

Non-Qualified Stock Options

Summarized information for our non-qualified stock options is as follows:

					Weighted
					average
					remaining
			Weighted		contractual	Aggregate
	Number of		average		term	intrinsic
Stock Options	options		exercise price		(in years)	value
Outstanding at December 31, 2011	1,441,370		$	9.93
Granted	18,500		15.25
Exercised	(185,080	)	10.67
Forfeited	(6,000	)	13.17
Expired	(9,380	)	3.03
Outstanding at March 31, 2012	1,259,410		$	9.93	2.72	$	9,528,000
Stock options expected to vest	1,219,860		$	9.99	2.66	$	9,158,000
Exercisable at March 31, 2012	557,410		$	9.75	2.03	$	4,321,000

Restricted Stock Units

In addition to stock options, we issue restricted stock units to key employees and members of the Board of Directors based on meeting certain service goals. The stock units vest to the recipients at various dates, up to five years, based on fulfilling service requirements. We recognize the value of the market price of the underlying stock on the date of grant as compensation expense over the requisite service period. Upon vesting, the stock units are settled in shares of our common stock. Summarized share information for our restricted stock units is as follows:

	Three		Weighted
	months ended		average
	March 31,		grant date
	2012		fair value
	(In shares)		(In dollars)
Outstanding and unvested, beginning of period	102,967		$	6.43
Granted	6,000		15.25
Vested	(12,560	)	9.01
Forfeited	(812	)	6.00
Outstanding and unvested, end of period	95,595		$	6.65
Restricted stock units expected to vest	89,380		$	7.06