Stock-Based Compensation

9 Months Ended

Sep. 30, 2012

Stock-Based Compensation [Abstract]

STOCK-BASED COMPENSATION

NOTE 6 - STOCK-BASED COMPENSATION

Effective January 1, 2012, the Board of Directors adopted the 2012 Long-Term Incentive Plan (the “2012 Incentive Plan”). The 2012 Incentive Plan was also approved by the Company’s shareholders at its Annual Meeting of Shareholders on June 7, 2012. The 2012 Incentive Plan provides for a maximum of four million shares of common stock in the aggregate that may be issued by the Company pursuant to grants of stock options, restricted stock, stock appreciation rights, restricted stock units and other performance awards. The persons eligible to receive awards under the 2012 Incentive Plan include employees, contractors and outside directors of the Company. The primary purpose of the 2012 Incentive Plan is to attract and retain key employees, key contractors and outside directors of the Company.

In February 2012, the Company granted one of its executive officers the option to purchase 150,000 shares of its common stock at $12.00 per share. The award was classified as an equity award, vesting over a service period of approximately three years. The total grant date fair value of the option was approximately $1.1 million. The Company reversed previously recognized stock-based compensation expense related to this grant of approximately $70,000 at June 30, 2012, as the executive officer terminated his employment with the Company in July 2012, and therefore, the service condition requirement for this award was not met.

On April 16, 2012, the Board of Directors approved an award of stock options, restricted stock and restricted stock units to both executive and non-executive employees under the 2012 Incentive Plan. Non-qualified options to purchase an aggregate of 472,318 shares of the Company’s common stock at $10.49 per share were awarded; these options vest over four years. A total of 116,842 shares of time-lapse restricted stock was granted, and these shares also vest over four years. A total of 116,841 shares of performance-based restricted stock was granted. These shares vest based on the outcome of the Company’s total shareholder return over a three-year period as compared to a designated peer group. This award may result in the issuance of an aggregate of up to 116,841 restricted stock units in addition to the restricted stock grants. If the minimum performance conditions are not met, however, this award may also result in no performance-based restricted stock being vested and no restricted stock units being issued. The grant date fair value of all of these awards is approximately $5.5 million.

On April 11, 2012, June 29, 2012 and September 13, 2012, the Company awarded 13,608, 12,215 and 12,755 restricted stock units, respectively, to its Board of Directors and one advisor to the Board as payment for their services to the Company during the first, second and third quarters of 2012. The restricted stock units vest over three years and have an aggregate grant date fair value of approximately $0.4 million.

On April 11, 2012, June 29, 2012 and September 13, 2012, the Company issued 500 shares of common stock to each of two advisors to the Board of Directors (aggregate of 1,500 shares issued per advisor) as payment for their services to the Company during the first, second and third quarters of 2012. The fair value of these awards was $11,020, $10,740 and $10,270, respectively, which was recorded as an expense during the three months ended March 31, 2012, June 30, 2012 and September 30, 2012, respectively. On June 6, 2012, the Company issued 4,000 shares of common stock to a retiring director as payment for his services during the second quarter of 2012. The fair value of this award was $38,840, which was recorded as an expense during the nine months ended September 30, 2012.

On September 28, 2012, the Company granted an employee the option to purchase 20,000 shares of its common stock at $10.39 per share. The award was classified as an equity award, vesting over a service period of four years. The total grant date fair value of the options was $110,646. Additionally, the Company issued this employee 5,000 shares of restricted stock vesting over a four-year service period; the grant date fair value of this award was $51,950.