Note 4 - Stock-based Compensation

6 Months Ended

Jun. 30, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Stock-based Compensation

At June 30, 2015, we had three stock–based compensation plans in effect. We record compensation cost related to unvested stock option awards by recognizing the unamortized grant date fair value on a straight line basis over the service periods of each award. We have estimated forfeiture rates based on our historical experience. Stock option compensation expense is recognized as a component of general and administrative expenses in the accompanying Consolidated Financial Statements. We recorded $4,000 and $12,000 of stock-based compensation expense in the three months ended June 30, 2015 and 2014, respectively and $8,000 and $33,000 for the six month periods ended June 30, 2015 and 2014, respectively. The estimated fair value of options granted is calculated using the Black-Scholes option pricing model with assumptions as previously disclosed in our 2014 Form 10-K/A.

As of June 30, 2015, there is $34,000 of unrecognized compensation cost related to stock options. During the quarter ended June 30, 2015, an aggregate of 12,000 options were granted to three independent members of our board of directors pursuant to the 2011 Non-Employee Director Stock Option Plan (Director Plan). Pursuant to the terms of the Director Plan, the options were granted at fair value on the date of the Annual Shareholders meeting. During the six month period ended June 30, 2015, 4,000 options were exercised and 12,000 options expired unexercised.

The following table summarizes stock options as of June 30, 2015:

	# of Shares		Wgt Avg Exercise Price		Wgt Avg Remaining Contractual Life in Years		Aggregate Intrinsic Value
Outstanding at June 30, 2015		274,500	$	1.76		6.0	$	345,975
Vested and exercisable at June 30, 2015		254,500	$	1.72		5.8	$	320,055

The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the company’s closing stock price on the last trading day of the second quarter of 2015 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on June 30, 2015. The amount of aggregate intrinsic value will change based on the fair value of the company’s stock.