Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2014

Summary of Significant Accounting Policies [Abstract]

The Company utilizes the Black-Scholes option pricing model to calculate the estimated fair value of each stock option granted on the date of the grant. A summary of the assumptions used in the Black-Scholes option pricing model for 2014 and 2013 are as follows:

	2014			2013
Dividend yield(1)		0.0	%		0.0	%
Expected volatility(2)	55.79% to 57.99		%	54.88% to 55.08%
Risk-free interest rate(3)	1.51% to 2.26		%	1.28% to 2.02%
Expected life(4)	5.5 to 7.0 years			7.0 years

(1) A dividend yield of 0.0% is utilized because cash dividends have never been paid.

(2) Expected volatility is based on Bloomberg’s five and one-half to seven year volatility calculation for “FRBK” stock.

(3) The risk-free interest rate is based on the five to seven year Treasury bond.

(4) The expected life reflects a 1 to 4 year vesting period, the maximum ten year term and review of historical behavior.

Summary of Stock-Based Compensation

Information regarding stock based compensation for the nine months ended September 30, 2014 and 2013 is set forth below:

	2014		2013
Stock based compensation expense recognized	$	309,000	$	237,000
Number of unvested stock options		1,050,513		893,563
Fair value of unvested stock options	$	1,552,934	$	1,210,840
Amount remaining to be recognized as expense	$	812,979	$	597,709

Calculation of EPS

The calculation of EPS for the three and nine months ended September 30, 2014 and 2013 is as follows (in thousands, except per share amounts):

		Three Months Ended September 30,					Nine Months Ended September 30,
		2014		2013			2014		2013

Net income (loss) (basic and diluted)	$	297	$	(2,222	)	$	1,589	$	(219	)

Weighted average shares outstanding		37,815		25,973			33,025		25,973
Net income (loss) per share – basic	$	0.01	$	(0.09	)	$	0.05	$	(0.01	)
Weighted average shares outstanding (including dilutive CSEs)		38,253		25,973			33,399		25,973
Net income (loss) per share – diluted	$	0.01	$	(0.09	)	$	0.05	$	(0.01	)