Stock-Based Compensation

6 Months Ended

Jun. 30, 2011

Stock-Based Compensation

Stock-Based Compensation

Note F: Stock-based Compensation

We recorded $202,000 and $164,000 of stock-based compensation in general and administrative expense for the six-month periods ended June 30, 2011 and 2010, respectively. Options to purchase 68,000 and 20,000 shares at a weighted average exercise price of $12.51 and $12.50, and options to purchase 83,000 and 60,000 shares at a weighted average exercise price of $12.69 and $12.67, were granted during the three-month and six-month periods ended June 30, 2011 and 2010, respectively. We use the Black-Scholes option pricing model to determine the fair value of options. The fair value of options granted were $266,000 and $38,000 during the three-month periods ended June 30, 2011 and 2010, respectively, and the fair value of options granted were $334,000 and $221,000 during the six-month periods ended June 30, 2011 and 2010, respectively. As of June 30, 2011, $844,000 of total unrecognized compensation expense related to non-vested stock option awards is expected to be recognized over a weighted average period of 2.5 years.

The Company's stock options generally vest over three to five years of service and have a contractual life of six to ten years. As of June 30, 2011, we had 113,000 shares available for grants under the 2005 Stock Incentive Plan.

The following table summarizes information about the stock options outstanding at June 30, 2011:

		Options Outstanding					Options Exercisable
Range of Exercise Price		Number Outstanding		Weighted Average Remaining Contractual Life	Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$	1.30-1.99		44,000	1.0 years	$	1.35		44,000	$	1.35
	3.00-3.99		38,333	1.3 years		3.13		38,333		3.13
	8.00-8.99		48,000	5.4 years		8.63		27,000		8.58
	9.00-9.99		166,000	3.8 years		9.20		89,750		9.18
	10.00-10.99		20,000	5.9 years		10.15		4,000		10.15
	11.00-11.99		15,000	5.4 years		11.19		--		--
	12.00-12.99		105,000	4.4 years		12.58		68,250		12.53
	13.00-13.99		63,000	6.7 years		10.28		--		--
	15.00-15.99		16,000	0.9 years		15.00		16,000		15.00
			515,333	4.2 years		9.12		287,333		8.25