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Note 5 - Share-Based Payments
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3 Months Ended | ||||||||||||||||||
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Mar. 31, 2012
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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 2,000,000 shares are
available for issuance under this plan. As of March 31,
2012, 764,432 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 or six months ended
March 31, 2012 or 2011.
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, 2012, was approximately
$22,000 and $45,000, respectively, and $23,000 and $45,000
for the three and six months ended March 31, 2011,
respectively.
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 holder to 116,915 shares of
common stock. The intrinsic value of the options
exercised was $510,000. There was no realized tax
benefit from options exercised for the three and six months
ended March 31, 2012, based on the “with and
without” approach. No stock options were
exercised during the three and six months ended March 31,
2011.
The
following table summarizes the stock options outstanding and
exercisable at March 31, 2012:
The
aggregate intrinsic value in the table above is before income
taxes, based on the closing price of the Company’s
common stock of $5.42 per share as of the last business day
of the period ended March 31, 2012. As of March
31, 2012, the Company had unrecognized compensation expense
of approximately $15,000 related to unvested stock
options. These expenses will be recognized over
approximately 2 months. The deferred tax asset and realized
benefit from stock options exercised and other share-based
payments for the periods ended March 31, 2012 and 2011, 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 or the issuances may be
contingent on continued employment for 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.
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 in September
2012 through September 2014, provided the grantee has not
voluntarily terminated service or been terminated for
cause prior to the vesting or issuance date. There were
no restricted stock forfeitures during the three and six
months ended March 31, 2012.
The
Company granted a total of 288,750 shares of restricted
stock or shares issuable pursuant to promise to issue
shares of common stock during the six months ended March
31, 2011. The fair value of the awards granted
was approximately $1,657,000. All such shares
of restricted stock vest and all such shares must be
issued pursuant to promise to issue stock between
September 2011 and December 2013, provided the grantee
has not voluntarily terminated service or been terminated
for cause prior to the vesting or issuance date. 2,500
shares of restricted stock were forfeited during the
three and six months ended March 31, 2011.
The
Company recognized share-based compensation expense for
restricted stock or promises to issue shares of common
stock of approximately $201,000 and $407,000 for the
three and six months ended March 31, 2012, respectively,
$121,000 of which was included in accrued expenses at
March 31, 2012, since the related shares have not been
issued. Share-based compensation expense for restricted
stock or promises to issue shares of common stock for the
three and six months ended March 31, 2011 was
approximately $188,000 and $303,000, respectively, of
which $99,000 was included in accrued expenses at March
31, 2011. This expense is included in selling,
general and administrative expenses for those respective
periods. As of March 31, 2012, there was approximately
$919,000, representing approximately 169,000 unvested
shares, of unrecognized compensation cost related to
non-vested restricted stock compensation arrangements
granted under the incentive plans. This
unrecognized cost will be recognized over the weighted
average period of the next 1.40 years.
Common
Stock Purchase Warrants
At
March 31, 2012, 80,000 warrants issued in connection with
investor relations were outstanding and
exercisable. The warrants have an exercise price
of $1.30 per share, remaining life of 4.29 years and
aggregate intrinsic value of approximately
$330,000. The aggregate intrinsic value is before
taxes, based on the closing price of the Company’s
common stock of $5.42 per share on the last business day of
the period ended March 31, 2012.
No
warrants were issued in the six months ended March 31, 2012
or 2011.
There
were no warrant exercises in the six months ended March 31,
2012 or 2011. There is no unrecognized
compensation cost related to warrants as of March 31,
2012.
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