Note 5 - Stock-based Compensation

9 Months Ended

Sep. 30, 2020

Notes to Financial Statements

Share-based Payment Arrangement [Text Block]

5.

         STOCK-BASED COMPENSATION

At

September 30, 2020,

we have

three

stock-based compensation plans in effect. In

August 2020,

shareholders approved the

2020

Non-Employee Directors' Stock Incentive Plan (the

“2020

Plan”), which authorizes the issuance of

200,000

shares of common stock to non-employee directors. We record compensation cost related to unvested stock awards by recognizing the unamortized grant date fair value on a straight-line basis over the vesting periods of each award. We have estimated forfeiture rates based on our historical experience. Stock option compensation expense for the

three

and

nine

month periods ended

September 30, 2020

and

2019

has been recognized as a component of general and administrative expenses in the accompanying Consolidated Financial Statements. We recorded

$207,000

and

$49,000

of stock-based compensation expense for the

three

months ended

September 30, 2020

and

2019,

respectively, and

$330,000

and

$129,000

for the

nine

months ended

September 30, 2020

and

2019,

respectively.

As of

September 30, 2020,

there is

$235,000

of unrecognized compensation cost related to stock options. There were

no

options exercised during the

three

and

nine

months ended

September 30, 2020.

During the quarter ended

September 30, 2020,

an aggregate of

4,380

shares totaling

$150,000

were granted to the

three

independent members of our board of directors pursuant to the

2020

Plan. Pursuant to the terms of the

2020

Plan, the shares were granted at fair market value on the date of the Annual Meeting of Shareholders and vested upon issuance.

No

options expired unexercised during the quarter. The following table summarizes options as of

September 30, 2020:

	# of Shares		Wgt Avg Exercise Price		Wgt Avg Remaining Contractual Life in Years		Aggregate Intrinsic Value
Outstanding at September 30, 2020		126,500	$	8.94		4.1	$	3,801,190
Vested and exercisable at September 30, 2020		102,500	$	5.61		2.8	$	3,421,390

The estimated fair value of options granted is calculated using the Black-Scholes option pricing model with assumptions as previously disclosed in our

2019

Form

10

-K.

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

third

quarter of

2020

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

September 30, 2020.

The amount of aggregate intrinsic value will change based on the market value of the Company's stock.