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Note 5 - Share-Based Payments
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6 Months Ended | ||||||||||
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Mar. 31, 2013
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| Disclosure of Compensation Related Costs, Share-based Payments [Text Block] |
NOTE
5 – Share-Based
Payments
In
March 2008, the Company’s shareholders approved the
2008 Stock Incentive Plan which will be utilized to provide
equity opportunities and performance–based incentives
to attract, retain and motivate those persons who make (or
are expected to make) important contributions to the
Company. A total of 2 million shares are available
for issuance under this plan. As of March 31, 2013, 827,182
shares had been granted under the plan, of which 150,000
shares were in the form of stock options and the remainder
were in the form of restricted stock or other share
grants.
Stock
Options
Under
the Company’s previous share based long-term incentive
compensation plan, the 1997 Stock Option Plan, the Company
granted non-qualified stock options to
employees. There are no shares available for grant
under this plan which expired on December 31,
2006. Options issued under this plan expire 10
years after the date of grant and generally vested 1/36 per
month, with full vesting after three years. Under the
Company’s 2008 Stock Incentive Plan, options issued
expire 10 years after the date of grant and vest 1/36 per
month, with full vesting after three years. The Company did
not grant any options during the three and six months ended
March 31, 2013 or 2012.
Compensation
expense is recognized only for share-based payments expected
to vest. The Company estimates forfeitures at the date of
grant based on historical experience and future expectations.
Stock compensation expense related to options for the three
and six months ended March 31, 2013, was approximately $0,
and was $22,000 and $45,000 for the three and six months
ended March 31, 2012, respectively.
No
stock options were exercised during the six months ended
March 31, 2013. During the six months ended March
31, 2012, 193,750 stock options were exercised using the
cashless exercise option available under the plan which
entitled the holders to 116,915 shares of common
stock. The intrinsic value of the options
exercised was $510,000.
The
following table summarizes the stock options outstanding and
exercisable at March 31, 2013:
The
aggregate intrinsic value in the table above is before income
taxes, based on the closing price of the Company’s
common stock of $7.24 per share as of the last business day
of the period ended March 31, 2013. As of March
31, 2013, the Company had no unrecognized compensation
expense relating to outstanding stock options as all
outstanding stock options were fully vested. The
deferred tax asset and realized benefit from stock options
exercised and other share-based payments for the three and
six months ended March 31, 2013 and 2012, was not recognized,
based on the Company’s election of the “with and
without” approach.
Restricted
Stock
The
Company issues restricted stock to employees, directors and
consultants. Such issuances may have vesting periods that
range from one to three years. In addition, the
Company has issued stock awards to certain employees that
contain vesting provisions or provide for future issuance
contingent on continued employment for periods that range
from one to three years.
The
Company granted a total of 49,750 shares of restricted stock
or shares issuable pursuant to promises to issue shares of
common stock during the six months ended March 31, 2013. The
fair value of the awards granted was approximately $350,000.
All such shares of restricted stock vest and all such shares
must be issued pursuant to promises to issue common stock
in September 2013 through November 2014, provided
the grantee has not voluntarily terminated service or been
terminated for cause prior to the vesting or issuance date.
There were no shares of restricted stock forfeited during the
three and six months ended March 31, 2013.
The
Company granted a total of 54,750 shares of restricted stock
or shares issuable pursuant to promises to issue shares of
common stock during the six months ended March 31, 2012. The
fair value of the awards granted was approximately $227,000.
All such shares of restricted stock vest and all such shares
must be issued pursuant to promises to issue common stock by
September 2014, provided the grantee has not voluntarily
terminated service or been terminated for cause prior to the
vesting or issuance date.
The
Company recognized share-based compensation expense for
restricted stock or promises to issue shares of common stock
of approximately $173,000 and $393,000 for the three and six
months ended March 31, 2013, respectively, $116,000 of which
was included in accrued expenses at the six months then ended
since the related shares had not yet been issued at March 31,
2013. Share-based compensation expense for
restricted stock or promises to issue shares of common stock
for the three and six months ended March 31, 2012 was
approximately $201,000 and $407,000, respectively, of which
$121,000 was included in accrued expenses at March 31,
2012. This compensation expense was included in
operating expenses on the Unaudited Condensed Consolidated
Statements of Income for the three and six months ended March
31, 2013 and 2012. As of March 31, 2013, there was
approximately $481,000, representing approximately 79,000
unvested shares, of total unrecognized compensation cost
related to non-vested restricted stock compensation
arrangements granted under the Company’s equity
compensation plans. This unrecognized cost will be recognized
over the weighted average period of one year.
Common
Stock Purchase Warrants
The
Company did not issue any common stock purchase warrants
during the periods ended March 31, 2013 or
2012. During the six months ended March 31, 2013,
a warrant holder exercised 52,000 warrants using the cashless
exercise option available within the warrant agreements which
entitled the warrant holder to 43,465 shares of common
stock. There were no warrants exercised during the
six months ended March 31, 2012. As of March 31,
2013, there are no outstanding warrants.
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