Stock-Based Compensation

3 Months Ended

Mar. 31, 2012

Stock-Based Compensation [Abstract]

Stock-Based Compensation

12. Stock-Based Compensation

The Company has various stock-based employee compensation plans, which are described more fully in Note 10 of the Notes to Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011, as amended by Amendment No. 1 thereto.

Stock-based compensation expense was $38,733 and $27,348 for the three months ended March 31, 2011 and March 31, 2012, respectively. There were 100,000 new options granted by the Company during the three months ended March 31, 2012. Stock-based compensation expense is based on awards ultimately expected to vest and has been reduced for estimated forfeitures.

The Company uses the Black-Scholes option-pricing model (“Black-Scholes”) as its method of valuation of stock options granted. This fair value is amortized on a straight-line basis over the requisite service periods of the awards, which is generally the vesting period. The fair value of share-based payment awards on the date of grant as determined by the Black-Scholes model is affected by our stock price as well as other assumptions. These assumptions include, but are not limited to the expected stock price volatility over the term of the awards and the actual and projected employee stock option exercise behaviors.

At March 31, 2012, the balance of unearned stock-based compensation to be expensed in future periods related to unvested share-based awards, as adjusted for expected forfeitures, was approximately $233,000. The weighted-average period over which the unearned stock-based compensation is expected to be recognized is approximately two years.

The following table is a summary of stock option activity from January 1, 2012 through March 31, 2012:

	Stock Options
						Weighted-
						Average
	Number			Exercise Price		Exercise Price
	of Shares			Per Share		Per Share
Outstanding at December 31, 2011		4,423,335		$	0.13 - $0.62	$	0.31
Granted		100,000			0.21		0.21
Canceled/forfeited		(60,000	)		0.29 - 0.33		0.29
Outstanding at March 31, 2012		4,463,335		$	0.13 - $0.62	$	0.31

The following information applies to options outstanding at March 31, 2012:

			Weighted-
			Average		Weighted-				Weighted-
Range of	Outstanding at		Remaining		Average		Exercisable at		Average
Exercise	March 31,		Contractual		Exercise		March 31,		Exercise
Prices	2012		Life		Price		2012		Price
$0.01 - 0.19		820,000		5.6	$	0.16		462,917	$	0.16
0.20 - 0.29		1,286,835		4.8	$	0.26		789,335	$	0.26
0.30 - 0.39		1,452,500		5.1	$	0.35		912,986	$	0.34
0.40-0.49		894,000		2.2	$	0.47		894,000	$	0.47
0.60-0.69		10,000		1.5	$	0.62		10,000	$	0.62
		4,463,335		4.6	$	0.31		3,069,238	$	0.33