Note 11 - Stockholders' equity

12 Months Ended

Dec. 31, 2012

Shareholders' Equity and Share-based Payments [Text Block]

NOTE 11 – Stockholders’ equity

On May 27, 2011, the Company completed a public offering of 967,950 shares of common stock at $10.50 per share. The net proceeds of $9,387,666 is being used for general corporate purposes, including working capital.

1989 Non-Qualified Stock Option Plan

On June 15, 1989, the Company instituted a non-qualified stock option plan (the “Plan”). In connection therewith, 700,000 shares of the Company’s common stock were reserved for issuance pursuant to options that may be granted under the Plan through June 30, 2009. All options granted vest over a four-year period and expire between five to seven years after the date of grant. In 2009, the Company did not grant any options under this Plan. This 1989 Non-Qualified Stock Option Plan expired in June 2009.

2001 Non-Qualified Stock Option Plan

In November 2006, the Company registered a non-qualified stock option plan that the shareholders had approved in July 2001, covering key employees, officers, directors and other persons that may be considered as service providers to the Company. Options were awarded by the Board of Directors or by a committee appointed by the Board. Under the plan, an aggregate of 300,000 shares of Company common stock, $.01 par value, were reserved for issuance or transfer upon the exercise of options which are granted. Unless otherwise provided in the option agreement, options granted under the plan would vest over a four year period commencing one year from the anniversary date of the grant. There were no options granted in 2012. In 2011, 14,000 options were granted to outside directors at an exercise price of $7.90 , which vested as to 25% on each of January 15, April 15, July 15 and October 15 of 2011. These options expire ten years after the date of grant. The stock option plan terminated on July 22, 2011.

2007 Share Incentive Plan

On December 12, 2007, shareholders approved the Company’s 2007 share Incentive Plan (“Incentive Plan”), in connection therewith, 750,000 shares of the Company’s common stock are reserved for issuance pursuant to options or restricted stock that may be granted under the Incentive Plan through December 12, 2017.  In 2010, 16,500 shares of the Company’s common stock were granted and issued to the Company’s five outside directors. In 2011, 40,400 shares of the Company’s common stock were granted and issued to directors and key employees. In December 2011, the company granted options to purchase 200 shares of its common stock to an outside director. These options expire ten years after the date of grant. In 2012, 8,000 shares of stock were granted and issued to the Company’s four outside directors.

The purchase price of the common stock under each option plan shall be determined by the Committee, provided, however, that such purchase price shall not be less than the Fair Market Value of the Shares on the date such option is granted. The stock options generally expire seven to ten years after the date of grant. The Company recorded stock-based compensation of $234,858 and $290,598 for the years ended December 31, 2012 and 2011, respectively.

A summary of the stock option activity related to the 1989 and 2001 Stock Option Plans and the 2007 Share Incentive Plan for the period from January 1, 2011 through December 31, 2012 is as follows:

1989 Non-Qualified Stock Option Plan

	Beginning Balance Outstanding		Granted During Period		Exercised During Period		Canceled During Period		Ending Balance Outstanding		Exercisable
Year ended December 31, 2011
Number of shares		180,250		-0-		78,250		0		102,000		102,000
Weighted average exercise price Per share	$	3.97		-0-		-0-		-0-	$	4.35	$	4.35
Year ended December 31, 2012
Number of shares		102,000		-0-		60,100		-0-		41,900		41,900
Weighted average exercise price Per share	$	4.35		-0-		-0-		-0-	$	4.82	$	4.82

2001 Non-Qualified Stock Option Plan

	Beginning Balance Outstanding		Granted During Period		Exercised During Period		Canceled During Period		Ending Balance Outstanding		Exercisable
Year ended December 31, 2011
Number of shares		211,300		14,000		53,310		1,400		170,590		120,590
Weighted average exercise price Per share	$	4.02	$	4.25		-0-		-0-	$	4.41	$	4.32
Year ended December 31, 2012
Number of shares		170,590		-0-		8,110		-0-		162,480		124,980
Weighted average exercise price Per share	$	4.41	$	4.25		-0-		-0-	$	4.35	$	4.27

2007 Share Incentive Plan

	Beginning Balance Outstanding		Granted During Period		Exercised During Period		Canceled During Period		Ending Balance Outstanding		Exercisable
Year ended December 31, 2011
Number of shares		200		-0-		-0-		-0-		200		200
Weighted average exercise price Per share
Year ended December 31, 2012
Number of shares		200		-0-		-0-		-0-		200		200
Weighted average exercise price Per share			$	11.51					$	11.51	$	11.51

The Company has 204,580 of outstanding stock options under the three Plans at December 31, 2012 of which 200 were in excess of market value at December 31, 2012.

The following table summarizes information about the outstanding and exercisable options at December 31, 2012.

				Options Outstanding								Options Exercisable
Exercise Price Range				Number Outstanding		Weighted Average Remaining Contractual		Weighted Average Exercise Price		Intrinsic Value		Number Exercisable		Weighted Average Exercise Price		Intrinsic Value
$	3.00	-	3.99		72,000		4.95	$	3.65	$	428,400		72,000	$	3.65	$	428,400
$	4.00	-	4.49		15,930		0.98	$	4.25	$	85,226		15,930	$	4.25	$	85,226
$	4.50	-	4.99		100,000		4.78	$	4.62	$	498,000		62,500	$	4.62	$	311,250
$	5.00	-	5.99		6,650		1.08	$	5.90	$	24,605		6,650	$	5.90	$	24,605
$	6.00	-	7.99		9,800		8.04	$	7.90	$	16,660		9,800	$	7.90	$	16,660
$	8.00	-	11.99		200		9	$	11.51	$	0		200	$	11.51		0

The intrinsic value of the 68,210 options exercised during the year ended December 31, 2012 was $442,907. The intrinsic value of the 131,560 options exercised during the year ended December 31, 2011 was $1,522,715.

During the years ended December 31, 2012 and 2011, the Company recorded into selling and general administrative expense approximately $235,000 and $291,000 for the cost of employee and director services received in exchange for equity instruments based on the grant-date fair value of those instruments in accordance with the provisions of ASC 718.

The fair value of the stock options issued was estimated by using the Black-Scholes option-pricing model which took into account as of the grant date, the exercise price and the expected life of the option, the current price of the underlying stock and its expected volatility, expected dividends on the stock and the risk-free interest rate for the expected term of the option.

Year ended	Risk-Free Interest Rate			Expected Life (years)		Expected Volatility			Expected Dividends
December 31, 2011		1.95	%		5		63.01	%	None