Annual report pursuant to section 13 and 15(d)

CAPITAL STOCK, STOCK PLANS, WARRANTS AND INCENTIVE COMPENSATION (Tables)

CAPITAL STOCK, STOCK PLANS, WARRANTS AND INCENTIVE COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2012

CAPITAL STOCK, STOCK PLANS, WARRANTS AND INCENTIVE COMPENSATION [Abstract]

Summary of the status of options under the Company's Plans

Summary of the status of options under the Company's total Plans and a Non-Qualified Stock Option Agreement, as of December 31, 2012, 2009, and 2010, and changes during the years ending on those dates is presented below, giving the effect to the reverse stock split. The Company's Plans consist of the 1993 Non-Qualified Stock Option Plan, the 2004 and 2010 Stock Option Plans, and the 1992 and 2003 Outside Directors Stock Plans:

	2012							2011							2010
	Shares			Weighted Average Exercise Price		Intrinsic Value (a)		Shares			Weighted Average Exercise Price		Intrinsic Value (a)		Shares			Weighted Average Exercise Price		Intrinsic Value (a)
1993 Non-qualified Stock Option Plan
Balance at beginning of year		71,600		$	10.95				126,072		$	10.02				198,272		$	9.46
Exercised		—			—	$	—		—			—	$	—		(70,000	)		8.52	$	227,000
Forfeited		(1,100	)		10.95				(54,472	)		8.79				(2,200	)		7.25
Balance at end of year		70,500			10.95	$	—		71,600			10.95	$	—		126,072			10.02	$	—
Options exercisable at year end		70,500			10.95	$	—		71,600			10.95	$	—		126,072			10.02	$	—
1992 Outside Directors Stock Plan
Balance at beginning of year		11,000		$	12.23				17,000		$	12.48				20,000		$	11.88
Forfeited		(8,000	)		13.65				(6,000	)		12.95				(3,000	)		8.44
Balance at end of year		3,000			10.10	$	—		11,000			12.23	$	—		17,000			12.48	$	—
Options exercisable at year end		3,000			10.10	$	—		11,000			12.23	$	—		17,000			12.48	$	—
2003 Outside Directors Stock Plan
Balance at beginning of year		151,200		$	10.56				133,200		$	11.04				118,800		$	11.36
Granted		12,000			5.50				18,000			7.05				14,400			8.40
Balance at end of year		163,200			10.19	$	—		151,200			10.56	$	12,600		133,200			11.04	$	—
Options exercisable at year end		151,200			10.56	$	—		133,200			11.04	$	—		118,800			11.36	$	—
2004 Stock Option Plan
Balance at beginning of year		264,167		$	10.17				274,834		$	10.21				284,833		$	10.25
Forfeited		(82,067	)		9.33				(10,667	)		11.27				(10,000	)		11.30
Balance at end of year		182,100			10.55	$	—		264,167			10.17	$	18,900		274,833			10.21	$	30,900
Options exercisable at year end		182,100			10.55	$	—		256,167			10.26	$	13,700		204,467			10.18	$	14,100
2010 Stock Option Plan(b)
Balance at beginning of year		60,000		$	7.85				—		$	—				—		$	—
Granted		—			—				60,000			7.85				—			—
Balance at end of year		60,000			7.85	$	—		60,000			7.85	$	—		—			—	$	—
Options exercisable at year end		20,000			7.85	$	—		—			—	$	—		—			—	$	—
Non-Qualified Stock Option Agreement (c)
Balance at beginning of year		50,000		$	6.75				—		$	—				—		$	—
Granted		—			—				50,000			6.75				—			—
Balance at end of year		50,000			6.75	$	—		50,000			6.75	$	50,000		—			—	$	—
Options exercisable at year end		12,500			6.75	$	—		—			—	$	—		—			—	$	—

(a)

Represents the difference between the market price at the date of exercise or the end of the year, as applicable, and the exercise price.

(b)

Plan was approved in September 2010 which authorizes grants of up to an aggregate of 1,000,000 non-qualified and incentive stock options.

(c)

Option agreement entered into between Christopher Leichtweis, President of SEC and the Company on October 31, 2011. See Note 5 – "Stock Based Compensation" for further information on this agreement.

Summary of total Stock Options

The summary of the Company's total Plans and a Non-Qualified Stock Option Agreement as of December 31, 2012, and changes during the period then ended are presented as follows (giving the effect of the reverse stock split):

	Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term			Aggregate Intrinsic Value
Options outstanding January 1, 2012		607,967		$	9.89
Granted		12,000			5.50
Exercised	─			─				$	─
Forfeited/Expired		(91,167	)		9.72
Options outstanding End of Period (1)		528,800			9.82		3.5	$	─
Options Exercisable at December 31, 2012(2)		439,300		$	10.38		2.8	$	─
Options Vested and expected to be vested at December 31, 2012		528,800			9.82		3.5	$	─

(1) Options with exercise prices ranging from $5.50 to $14.75

(2) Options with exercise prices ranging from $7.05 to $14.75