Stock Based Compensation

6 Months Ended

Jun. 30, 2012

Stock Based Compensation [Abstract]

Stock Based Compensation

5. Stock Based Compensation

The Corporation follows a fair-value based method for valuing stock-based compensation that measures compensation cost at the grant date based on the fair value of the award.

The fair value of each option grant is estimated on the date of grant using the modified Black-Scholes options-pricing model. The following table details the fair value and assumptions used to value stock options as of the grant date that were granted during the six months ended June 30, 2011:

	2011
Fair value, calculated	$	1.49
Exercise Price	$	2.14
Risk-free interest rate		3.58	%
Expected stock price volatility		57.30	%
Expected dividend yield		—
Expected Life		10 years

In 2012, no options were granted as the Corporation awarded restricted shares in lieu of options related to goals achieved within the 2011 officer incentive plan.

A summary of the status of the Corporation’s stock option plans as of June 30, 2012 and December 31, 2011, and changes during the periods ending on those dates is presented below:

	Six Months ended June 30, 2012					Year ended December 31, 2011
	Shares			Weighted- average exercise price		Shares			Weighted- average exercise price
Outstanding at beginning of period		587,342		$	4.68		463,642		$	5.84
Granted		—			—		161,538			2.14
Exercised		—			—		—			—
Forfeited		(1,442	)		8.67		(29,338	)		7.03
Expired		—			—		(8,500	)		11.93
Outstanding at end of period		585,900		$	4.65		587,342		$	4.68
Options exercisable at period end		399,033		$	5.76		317,467		$	6.58
Weighted-average fair value of options granted during the period				$	—				$	1.49

The following information applies to options outstanding at June 30, 2012:

	Options Outstanding						Options Exercisable
Range of Exercise Prices	Number Outstanding		Weighted- Average Remaining Contractual Life (Years)		Weighted- Average Exercise Price		Number Exercisable		Weighted- Average Exercise Price
$  1.90  - $  2.51		471,652		8.0	$	2.39		284,785	$	2.42
$  8.92		19,260		5.6		8.92		19,260		8.92
$11.36  - $14.16		45,137		3.8		13.70		45,137		13.70
$16.13  - $17.17		49,851		1.8		16.44		49,851		16.44
		585,900		7.0	$	4.67		399,033	$	5.78

In 2009, Camco granted 50,000 restricted shares of stock out of the current authorized common stock related to an employment agreement. The issuance of restricted stock vests in four equal increments beginning in 2010.

In March 2012, Camco granted 262,500 shares of restricted stock awards with an impact to unearned/deferred compensation of $625,000, $262,500 of common stock and additional paid in capital of $362,500. The stock was granted under the Camco Financial Corporation 2010 Equity Plan to officers based on 2011 performance. The restrictions on the shares that were granted and have vested generally lapse after one year. The grant date fair value per share of restricted stock is the stock price at close on grant date, which is expensed on a straight-line basis during the vesting period. The shares represented by restricted stock awards are considered outstanding at the grant date, as the recipients are entitled to voting rights and dividends if declared. A summary of restricted stock award activity for the period is presented below:

	Non-vested Number of Shares			Weighted Average Grant Date Fair Value
Non-vested balance at January 1, 2011		37,500		$	2.50
Vested		(12,500	)		2.50
Non-vested balance at December 31, 2011		25,000		$	2.50
Granted		262,492			2.38
Vested		(64,979	)		2.40
Non-vested balance at June 30, 2012		222,513		$	2.39

At June 30, 2012, there was approximately $458,000 of compensation cost that has not yet been recognized related to restricted stock awards. That cost is expected to be recognized over a remaining period of two years.