Equity And Stock-Based Compensation

9 Months Ended

Sep. 30, 2011

Equity And Stock-Based Compensation [Abstract]

Equity And Stock-Based Compensation

Note 2 – Equity and Stock-Based Compensation

Stock-Based Compensation

During the nine months ended September 30, 2011 and 2010, we issued 174,825 and 148,616, respectively, of Class A Nonvoting shares to certain executive employees associated with the vesting of their prior years' stock grants. During the three and nine months ended September 30, 2011 and 2010, we accrued $188,000 and $563,000, respectively, in compensation expense associated with the vesting of executive employee stock grants.

Employee/Director Stock Option Plan

We have a long-term incentive stock option plan that provides for the grant to eligible employees, directors, and consultants of incentive or nonstatutory options to purchase shares of our Class A Nonvoting Common Stock and Class B Voting Common Stock. Our 1999 Stock Option Plan expired in November 2009, and was replaced by our new 2010 Stock Incentive Plan, which was approved by the holders of our Class B Voting Common Stock in May 2010.

When the Company's tax deduction from an option exercise exceeds the compensation cost resulting from the option, a tax benefit is created. FASB ASC 718-20 relating to Stock-Based Compensation ("FASB ASC 718-20"), requires that excess tax benefits related to stock option exercises be reflected as financing cash inflows instead of operating cash inflows. For the three and nine months ended September 30, 2011 and 2010, there was no impact to the unaudited condensed consolidated statement of cash flows because there were no recognized tax benefits from stock option exercises during these periods.

FASB ASC 718-20 requires companies to estimate forfeitures.Based on our historical experience and the relative market price to strike price of the options, we do not currently estimate any forfeitures of vested or unvested options.

In accordance with FASB ASC 718-20, we estimate the fair value of our options using the Black-Scholes option-pricing model, which takes into account assumptions such as the dividend yield, the risk-free interest rate, the expected stock price volatility, and the expected life of the options.We exclude the dividend yield from the calculation, as we intend to retain all earnings.We expense the estimated grant date fair values of options issued on a straight-line basis over the vesting period.

For the 157,700 options granted during 2010, we estimated the fair value of these options at the date of grant using a Black-Scholes option-pricing model with the following weighted average assumptions:

	2010
Stock option exercise price	$ 5.07
Risk-free interest rate	2.736%
Expected dividend yield	--
Expected option life	7.23 yrs
Expected volatility	33.01%
Weighted average fair value	$1.88

We did not grant any options during the nine months ended September 30, 2011.

Based on prior years' assumptions, and, in accordance with the FASB ASC 718-20, we recorded compensation expense for the total estimated grant date fair value of stock options that vested of $47,000 and $142,000 for the three and nine months ended September 30, 2011, respectively, and $23,000 and $44,000 for the three and nine months ended September 30, 2010, respectively.At September 30, 2011, the total unrecognized estimated compensation cost related to non-vested stock options granted was $156,000, which we expect to recognize over a weighted average vesting period of 0.95 years.90,000 options were exercised during the nine months ended September 30, 2010 having a realized value of $138,000 for which we received $253,000 of cash.There were no options exercised during the nine months ended September 30, 2011.The grant date fair value of options vesting during the three and nine months ended September 30, 2011 was $47,000 and $142,000, respectively, and $23,000 and $44,000 for the three and nine months ended September 30, 2010, respectively.The intrinsic, unrealized value of all options outstanding, vested and expected to vest, at September 30, 2011 was $273,000 of which 91.3% are currently exercisable.

Pursuant to both our 1999 Stock Option Plan and our 2010 Stock Incentive Plan, all stock options expire within ten years of their grant date.The aggregate total number of shares of Class A Nonvoting Common Stock and Class B Voting Common Stock authorized for issuance under our 2010 Stock Incentive Plan is 1,250,000.At the discretion of our Compensation and Stock Options Committee, the vesting period of stock options is usually between zero and four years.

            We had the following stock options outstanding and exercisable as of September 30, 2011 and December 31, 2010:

	Common Stock Options Outstanding		Weighted Average Exercise Price of Options Outstanding		Common Stock Exercisable Options		Weighted Average Price of Exercisable Options
	Class A	Class B	Class A	Class B	Class A	Class B	Class A	Class B
Outstanding- January 1, 2010	589,750	150,000	$    5.51	$ 10.24	534,750	150,000	$ 5.62	$ 10.24
Granted	122,600	35,100	$    4.23	$   8.47
Exercised	(90,000)	--	$    2.76	$     --
Outstanding- December 31, 2010	622,350	185,100	$    5.65	$   9.90	449,750	150,000	$ 6.22	$ 10.24
No activity	--	--	$        --	$        --
Outstanding-September 30, 2011	622,350	185,100	$    5.65	$   9.90	561,933	150,000	$ 5.68	$ 11.23

The weighted average remaining contractual life of all options outstanding, vested, and expected to vest at September 30, 2011 and December 31, 2010 was approximately 4.38 and 5.13 years, respectively. The weighted average remaining contractual life of the exercisable options outstanding at September 30, 2011 and December 31, 2010 was approximately 4.11 and 4.38 years, respectively.