Stock Compensation

6 Months Ended

Jun. 30, 2012

Stock Compensation [Abstract]

Stock Compensation

Note 13.  Stock Compensation

Refer to our Annual Report on Form 10-K for the year ended December 31, 2011 for a complete description of all stock-based compensation plans.

Our stock award plans provide for granting non-qualified stock options, stock awards and restricted stock awards to employees. We recognize stock compensation charges related to stock award plans when management concludes it is probable the participant will earn the award. Share-based compensation expense includes amounts recognized related to the Company Employee Stock Purchase Plan. This plan allows participating employees to acquire shares of common stock at 85% of fair market value on one specified date. Stock-based compensation expense was $375,000 and $636,000 respectively in the six months ended June 30, 2012 and 2011. The decrease in the stock-based compensation expense was primarily driven by the decrease we have realized in our stock price in 2012. This includes compensation expense for share-based payment awards granted prior to, but not vested as of June 30, 2012.

The fair value of each option award is estimated on the date of the grant using a Black-Scholes option valuation model. We use a seven-year period to calculate the historical volatility of our stock price for use in the valuation model. The dividend yield rate is based on our current dividend payout pattern and current market price. The risk-free rate for options is based on a U.S. Treasury rate commensurate with the expected terms. The expected term of options granted is derived from historical experience and represents the period of time that options granted are expected to be outstanding. Historical data is used to estimate pre-vesting forfeitures and are estimated at the time of the grant and revised, if necessary, in subsequent periods if actual forfeitures differ from the estimate.

In April 2011, 10,000 options were granted associated with the acceptance of the Chief Operating Officer position. Other than this stock award issued, options were last granted under the Company's Stock Award Plan in September 2006. The weighted average grant date fair value of options issued was $0.80.

A summary of stock option activity is as follows:

				Weighted Average
	Options			Exercise Price
Outstanding at January 1, 2012		247,650		$	11.28
Granted		-			-
Exercised		(1,500	)		10.22
Forfeited		(4,050	)		10.88
Expired		(83,000	)		13.95
Outstanding at June 30, 2012		159,100		$	9.90
Exercisable at June 30, 2012		152,433		$	9.94

The following table provides certain information with respect to stock options outstanding at June 30, 2012:

Range of		Stock Options		Weighted Average		Weighted Average Remaining
Exercise Prices		Outstanding		Exercise Price		Contractual Life
	$6.00 - $8.00		15,000	$	6.95		4.17
	$8.00 - $12.00		144,100		10.21		2.01
			159,100	$	9.90		2.21
Aggregate intrinsic value:				$	215,000

The following table provides certain information with respect to stock options exercisable at June 30, 2012:

Range of		Stock Options		Weighted Average		Weighted Average Remaining
Exercise Prices		Exercisable		Exercise Price		Contractual Life
	$6.00 - $8.00		15,000	$	6.95		4.17
	$8.00 - $12.00		137,433		10.27		1.68
			152,433	$	9.94		1.92
Aggregate intrinsic value:				$	201,000