Share-Based Compensation

6 Months Ended

Jun. 30, 2011

Share-Based Compensation

Share-Based Compensation

Note 9 – Share-Based Compensation

Stock Options

During the six month period ended June 30, 2011, the stock option activity under our 2002 Stock Option Plan, 1995 Incentive and Non-Qualified Stock Option Plan for key employees, and 1996 Non-Employee Director's Stock Option Plan (collectively the "Stock Option Plans"), was as follows:

	Weighted Average Price		Number of Shares			Weighted Average Remaining Contractual Life (In Years)		Aggregate Intrinsic Value
Outstanding, January 1, 2011	$	9.13		3,002,000
Granted		16.11		510,000
Cancelled		12.10		(67,000	)
Exercised		8.53		(172,000	)
Outstanding, June 30, 2011	$	10.20		3,273,000			6.00	$	19,799,000
Options exercisable as of June 30, 2011				1,715,000			3.83	$	16,312,000

The weighted average fair value of options granted during the 2011 and 2010 six month periods ended June 30 was $3.26 per share and $3.98 per share, respectively. The following table summarizes information about stock options outstanding at June 30, 2011.

	Options Outstanding								Options Exercisable
Exercise Price Range	Number Outstanding		Average Remaining Contractual Life		Weighted Average Exercise price		Number Exercisable		Weighted Average Exercise Price
$ 1.83 - 2.50		458,000		0.84	$	2.11		458,000	$	2.11
3.68 - 3.68		384,000		2.49		3.68		384,000		3.68
6.07 - 6.07		300,000		3.49		6.07		300,000		6.07
10.39 - 10.39		524,000		7.52		10.39		191,000		10.39
$ 13.93 - 16.11		1,607,000		8.27		14.77		382,000		14.05
		3,273,000		6.00	$	10.20		1,715,000	$	6.74

Other information pertaining to option activity during the six month periods ended June 30, 2011 and 2010 was as follows:

	June 30, 2011		June 30, 2010
Weighted average grant-date fair value of stock options granted:	$	1,477,000	$	2,176,000
Total fair value of stock options vested:	$	1,015,000	$	681,000
Total intrinsic value of stock options exercised:	$	1,459,000	$	2,467,000
Total pre-tax share-based compensation expense charged against income:	$	935,000	$	465,000
Total unrecognized compensation expense related to non-vested options:	$	4,482,000	$	3,906,000

Under our Stock Option Plans at June 30, 2011, in addition to the 3,273,000 shares issuable pursuant to outstanding option grants, an additional 5,878,000 shares of our Common Stock are available for future grants. Options outstanding and exercisable were granted at stock option prices which were not less than the fair market value of our Common Stock on the date the options were granted and no option has a term in excess of ten years. Additionally, with the exception of the options granted in years 2008 through 2011, options became vested and exercisable either on the date of grant or commencing six months after the option grant date. The options granted in 2008 through 2011 become vested and exercisable ratably over a five year period on each anniversary date of the option grant.

At June 30, 2011, the total unrecognized compensation expense related to non-vested options, as reported above, was expected to be recognized through the fourth quarter of 2015 for the options granted in 2011 and the fourth quarter of 2014 for the options granted in 2010. The fair value of options granted in 2011 and 2010 was estimated on the date of grant using the Black-Scholes valuation model with the following weighted average assumptions:

	2011			2010
Risk-free interest rate		2.6	%		2.5	%
Expected volatility		27.4	%		42.1	%
Weighted average expected life in years		7.4			4.5
Dividend yield		3.7	%		3.5	%

Employee Stock Purchase Plan

Total pre-tax share-based compensation expense charged against income for the three and six month periods ended June 30, 2011 and 2010 for options granted under our Employee Stock Purchase Plan ("ESPP") was as follows:

	Quarter Ended June 30,
	2011		2010
ESPP compensation expense	$	65,000	$	70,000
	Six Months Ended June 30,
	2011		2010
ESPP compensation expense	$	158,000	$	144,000

It is estimated, at this time, that the expense attributable to such share-based payments in each of the subsequent quarters of 2011 will approximate the amount recorded in the 2011 first and second quarter. However, such future expense related to our ESPP will be impacted by, and be dependent on the change in our stock price over the remaining period up to the December 31, 2011 measurement date.

Such expense was estimated on the date of grant using the Black-Scholes valuation model with the following weighted average assumptions:

	Quarter and Six Months Ended June 30,
	2011			2010
Risk-free interest rate		0.04	%		0.20	%
Expected volatility		25.0	%		34.0	%
Weighted average expected life in years		1.0			1.0
Dividend yield		3.7	%		3.5	%

We may issue new common stock or re-issue common stock from treasury to satisfy our obligations under any of our share-based compensation plans.