Equity Compensation Plans

9 Months Ended

Sep. 30, 2012

Equity Compensation Plans

7. Equity Compensation Plans

As of September 30, 2012, the Company’s equity compensation plans consisted of the 2003 Stock Incentive Compensation Plan (the “2003 Plan”) and the 2012 Stock Incentive Plan (the “2012 Plan” and together with the 2003 Plan, the “Plans”) under which incentive and non-qualified stock options and time and performance based restricted shares have been granted to employees and directors from authorized but unissued shares of common stock or treasury shares. The 2003 Plan is not active, but continues to govern all outstanding awards granted under the plan until the awards themselves are exercised or terminate in accordance with their terms. The 2012 Plan, approved by shareholders on April 27, 2012, authorized 1.75 million shares of common stock for awards. The 2012 Plan also authorizes an additional 1.2 million shares of common stock to the extent awards granted under prior stock plans that were outstanding as of April 27, 2012 are forfeited. The 2012 Plan provides for the following type of awards: options, restricted stock, restricted stock units and other stock-based awards.

The Company incurred compensation expense of $0.2 million and $0.4 million for the quarters ended September 30, 2012 and September 30, 2011, respectively, and $1.0 million and $1.2 million for the nine month periods ended September 30, 2012 and September 30, 2011, respectively, for the Plans, including restricted stock awards. No compensation costs were capitalized as part of inventory. Compensation expense decreased by $0.2 million in the quarter ended September 30, 2012 due to adjusted estimated forfeiture rates based on new information related to expected terminations.

Stock Options

The following table is a summary of outstanding and exercisable options as of September 30, 2012:

In thousands except per share amounts and years	Shares		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (years)		Aggregate Intrinsic Value
Outstanding at September 30, 2012		896,153	$	8.74		6.0	$	4,850
Exercisable at September 30, 2012		524,952	$	9.18		4.3	$	2,629

There were 20,000 options granted during the quarter and nine months ended September 30, 2012. The amount of cash received from the exercise of stock options was $0.1 million and $0.3 million during the quarter and nine months ended September 30, 2012, respectively. The intrinsic value of options exercised was $0.1 million and $0.2 million during the quarter and nine months ended September 30, 2012, respectively. There were no options granted and minimal stock option activity during the quarter and nine months ended September 30, 2011. At September 30, 2012, the total unrecognized compensation cost related to nonvested stock option awards was approximately $1.0 million, with a weighted average expected amortization period of 2.7 years.

Restricted Stock

Restricted stock includes both performance-based and time-based awards. There were 15,000 time-based restricted shares granted during the quarter and nine months ended September 30, 2012. There were no performance-based restricted shares granted during the three months ended September 30, 2012. There were 114,500 performance-based restricted shares granted during the nine months ended September 30, 2012, with a 2014 earnings per share target. No restricted shares vested in the quarter and nine months ended September 30, 2012. There were no shares granted in the prior year third quarter and 22,120 shares were granted in the nine months ended September 30, 2011. No restricted shares vested in the quarter and nine months ended September 30, 2011. At September 30, 2012, there were 383,712 unvested restricted stock awards with total unrecognized compensation cost related to these awards of $1.7 million with a weighted average expected amortization period of 2.1 years.