Stock-Based Compensation

12 Months Ended

Dec. 31, 2011

Stock-Based Compensation [Abstract]

Stock-Based Compensation

Note T. Stock-Based Compensation

We measure stock-based compensation expense at the grant date, based on the estimated fair value of the award, and the expense is recognized over the requisite employee service period (generally the vesting period) for awards expected to vest (considering estimated forfeitures).

The Company has an amended and restated Long-Term Incentive Plan that was adopted in conjunction with our IPO in 2004. On February 27, 2008, our Board of Directors approved an amendment to our Long-Term Incentive Plan, subject to shareholder approval, that increased the maximum number of shares of common stock available for awards under the Long-Term Incentive Plan from 2,000,000 to 2,175,000 and extended the Plan’s termination date. Our shareholders approved this Plan amendment on April 22, 2008, and the Plan now terminates twenty years from the date of such approval, or April 22, 2028. Forfeited and expired options under the Plan become generally available for reissuance. At December 31, 2011, 121,493 shares remained available for award under the Plan.

Stock Options and Grants

We use the Black-Scholes option pricing model to estimate the fair value of each option grant as of the date of grant. The volatilities are based on the 90 day historical volatility of our common stock as the grant date. The risk free interest rate is based on zero-coupon U.S. government issues with a remaining term equal to the expected life of the option.

There were no options granted during the years ended December 31, 2011, 2010 and 2009. The Company recognized no stock-based compensation expense related to stock options for the years ended December 31, 2011 and 2010 as all options previously granted are fully vested. The Company recognized $30 of stock-based compensation for the year ended December 31, 2009. A total of 9,534 options expired in the third quarter of 2010 with a weighted average exercise price of $17.03. The option expirations are due to out-of-the-money options that were not exercised prior to their expiration date. The expired options were returned to the pool of shares generally available for future use under the Long-Term Incentive Plan.

On April 29, 2011, we authorized vested stock grants to certain directors totaling 14,009 shares. The total value of the grant, based on the market value of the underlying common stock at the date of grant, was $245, which was fully expensed and is included in general and administrative expenses.

On April 28, 2010, we authorized vested stock grants to certain directors totaling 12,892 shares. The total value of the grant was $220 and is included in general and administrative expenses. On September 22, 2010, we authorized vested stock grants to certain directors totaling 1,504 shares. The total value of the grant was $25 and is included in general and administrative expenses.

On August 14, 2009, we issued vested stock grants totaling 9,591 shares to certain directors. The total value of the grant was $165 and is included in general and administrative expense.

The Company recognized $245, $245 and $195 of stock based compensation expense for the years ended December 31, 2011, 2010 and 2009, respectively, which is included in general and administrative expense. As of December 31, 2011, there was no unrecognized compensation costs related to unvested options.

The following table summarizes the transactions pursuant to our stock option plans for the last three years ended December 31.

	Number of Shares			Weighted Average Exercise Price		Weighted  Average Remaining Contractual Term (in Years)		Aggregate Intrinsic Value
Outstanding at December 31, 2008		656,903		$	4.77
Granted		—			n/a
Exercised		(105,896	)	$	3.92
Forfeited		—			n/a
Outstanding at December 31, 2009		551,007		$	4.50
Granted		—			n/a
Exercised		(385,027	)	$	4.60
Expired		(9,534	)	$	17.03
Outstanding at December 31, 2010		156,446		$	5.01
Granted		—			n/a
Exercised		(68,322	)	$	3.17
Expired		—			n/a
Outstanding at December 31, 2011		88,124		$	6.44		1.7	$	1,008
Vested and Exercisable at December 31, 2011		88,124		$	6.44		1.7	$	1,008

At December 31, 2011, 2010 and 2009, options to purchase 88,124, 156,446 and 551,007 shares of common stock, respectively, were exercisable at weighted average exercise prices of $6.44, $5.01 and $4.50 per share, respectively. The total intrinsic value of options exercised during the years ended December 31, 2011, 2010, and 2009 was $994, $4,630, and $1,386, respectively.

There were no nonvested options as of December 31, 2011, 2010 and 2009.

Performance-Based Incentive Program

In December 2006, the Board of Directors adopted a performance-based incentive program under our Long-Term Incentive Plan. This program provided participating executives with the opportunity to earn a combination of stock (50%) and cash (50%) if certain performance targets for pre-tax income and pre-tax free cash flow were achieved. During 2007, certain participating executives became entitled to performance restricted stock based on the stock price at the commencement of the three-year performance cycle (2007-2009), and as a result, 29,698 shares were issued subject to vesting upon the achievement of the performance goals. The plan was completed as of December 31, 2009, at which time a total of 17,677 shares had been released free of restrictions in accordance with the achievement of the cumulative program performance goals. The remaining 12,021 shares were not awarded under the performance-based incentive program and were returned to the pool of shares generally available for future use under the Long-Term Incentive Plan. Of the 12,021 shares that were not awarded, 2,815 shares were retired in 2009 and the remaining 9,206 shares were retired in 2010.

We record stock-based compensation expense for awards with performance conditions based on the probable outcome of that performance condition. The Company recognized no stock-based compensation expense and no cash compensation expense related to the performance-based incentive program for the years ended December 31, 2011 and 2010. The Company recognized $51 of stock-based compensation expense and $51 of cash compensation expense related to the performance-based incentive program, for the year ended December 31, 2009, which is included in general and administrative expenses. As of December 31, 2011, there is no unrecognized compensation costs related to the performance-based incentive program.

Restricted Stock Units

In March 2008, the Company’s Board of Directors authorized a one-time grant of 750,000 restricted stock units that subsequently were awarded to members of our senior management team on July 1, 2008. In November 2008, an additional 5,000 restricted stock units were also awarded. The restricted stock units vest in one-third installments on each of the tenth, eleventh and twelfth anniversaries of the grant date. The restricted stock unit agreements are designed to reward performance over a decade or longer.

The fair value of restricted stock units is determined using the market value of our common stock on the date of the grant, and compensation expense is recognized over the vesting period. In accordance with the guidance related to share-based payments, we estimate forfeitures at the time of the grant and revise those estimates in subsequent periods if actual forfeitures differ from those estimates. We use historical data to estimate pre-vesting forfeitures and record stock-based compensation expense only for those awards that are expected to vest.

A summary of the status of the restricted stock units as of December 31, 2011, and changes during the year ended December 31, 2011, is presented below and there was no activity for the years ended December 31, 2010 and 2009:

Nonvested Shares	Shares			Weighted Average Grant-Date Fair Value
Nonvested at January 1, 2011		755,000		$	18.26
Granted		(68,400	)
Forfeited		(17,600	)
Nonvested at December 31, 2011		669,000		$	18.27

The Company recognized $2,206, $2,065 and $2,046 of stock based compensation expense related to the restricted stock units for the year ended December 31, 2011, 2010 and 2009, respectively, which is included in general and administrative expense. As of December 31, 2011, there was $6,062 of unrecognized stock-based compensation cost, net of estimated forfeitures, related to the restricted stock units that is expected to be recognized over a weighted average period of approximately 6.7 years. As of December 31, 2010, there was $7,863 of unrecognized stock-based compensation costs, net of estimated forfeitures, related to the restricted stock units that are expected to be recognized over a weighted average period of approximately 6.9 years. As of December 2009, there was $9,865 of unrecognized stock-based compensation costs, net of estimated forfeitures, related to the restricted stock units that are expected to be recognized over a weighted average period of approximately 7.1 years.