STOCK PLANS

6 Months Ended

Jun. 30, 2012

Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

2. STOCK PLANS

     On April 24, 2012, shareholders approved Bancorp’s 2012 Omnibus Incentive Plan (the “2012 Incentive Plan”). Bancorp's 2002 Stock Incentive Plan (the “2002 Plan”) was terminated on March 8, 2012, and no additional awards will be granted under the 2002 Plan. The 2012 Incentive Plan authorizes the issuance of up to 400,000 shares to participants in connection with grants of stock options, restricted stock, restricted stock units, stock appreciation rights, and other stock-based awards. The 2012 Incentive Plan has 370,673 shares available for grant at June 30, 2012. The number of shares that may be issued under the 2012 Incentive Plan is subject to adjustment in certain circumstances.

It is Bancorp’s policy to issue new shares for stock option exercises and restricted stock awards. Bancorp expenses stock options and restricted stock on a straight line basis over the applicable vesting term. Restricted stock granted under the 2002 Plan generally vested over a two to four year vesting period; however, certain grants were made that vested immediately or over a one year period, including grants to directors. All outstanding stock options have an exercise price that was equal to the closing market value of Bancorp’s stock on the date the options were granted. Options granted under the 2002 Plan generally vested over a two to four year vesting period; however, certain grants were made that vested immediately, including grants to directors. Stock options have a 10 year maximum term.

The following table presents information on stock options outstanding for the period shown:

	Six months ended
	June 30, 2012
			Weighted Average
	Common Shares		Exercise Price per share
Balance, beginning of period	257,080		$	70.12
Granted	-			-
Exercised	(6,055	)		11.55
Forfeited/expired	(39,556	)		74.31
Balance, end of period	211,469		$	71.01

     The following table presents information on stock options outstanding for the periods shown:

	Six months ended		Six months ended
(Dollars in thousands, except share and per share data)	June 30, 2012		June 30, 2011
Stock options vested and expected to vest:
Number		211,469		257,827
Weighted average exercise price per share	$	71.01	$	69.39
Aggregate intrinsic value	$	527	$	400
Weighted average contractual term of options		4.2 years		4.6 years
Stock options vested and currently exercisable:
Number		211,394		257,206
Weighted average exercise price per share	$	71.03	$	69.59
Aggregate intrinsic value	$	527	$	397
Weighted average contractual term of options		4.2 years		4.6 years
Unearned compensation related to stock options	$	-	$	48

There were no stock option grants for the six months ended June 30, 2012, and 2011.

     The following table presents information on restricted stock outstanding for the period shown:

	Six months ended
	June 30, 2012
			Weighted Average Market
	Restricted Shares		Price at Grant
Balance, beginning of period	264,631		$	16.98
Granted	29,673			19.05
Vested	(94,975	)		18.19
Forfeited	(13,357	)		15.66
Balance, end of period	185,972		$	16.78
Weighted average remaining recognition period	2.1 years

The balance of unearned compensation related to restricted shares as of June 30, 2012, and June 30, 2011, was $2.9 million and $4.6 million, respectively.

     The following table presents stock-based compensation expense for the periods shown:

	Three months ended				Six months ended
	June 30,				June 30,
(Dollars in thousands)	2012		2011		2012		2011
Restricted stock expense	$	380	$	468	$	777	$	975
Stock option expense		3		17		15		54
Total stock-based compensation expense	$	383	$	485	$	792	$	1,029

The income tax benefit recognized in the income statement for restricted stock compensation expense in the three and six months ended June 30, 2012, was $133,000 and $272,000, respectively. The income tax benefit recognized in the income statement for restricted stock compensation expense in the three and six months ended June 30, 2011, was $178,000 and $371,000, respectively.

The cash received from stock option exercises was $18,000 and $70,000 for the three and six months ended June 30, 2012, respectively. The Company recorded $62,000 of tax benefits from disqualifying dispositions involving incentive stock options, the exercise of non-qualified stock options, and the vesting and release of restricted stock for the six months ended June 30, 2012. No tax benefit was recorded in the six months ended June 30, 2011.