Note 5. Stock Options and Restricted Stock Units

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Stock Options and Restricted Stock Units

2014 Equity Incentive Plan

On May 23, 2014, the shareholders of the Company approved the 2014 Equity Incentive Plan (the “2014 Plan”). Under the terms of the 2014 Plan, the Company is authorized to issue incentive awards for common stock up to 200,000 shares to employees and other personnel. On June 10, 2016, the shareholders of the Company approved an additional 200,000 awards to be issued under the 2014 Plan, bringing the total number of shares to be awarded to 400,000. The awards may be in the form of incentive stock options, nonqualified stock options, restricted stock, restricted stock units and performance awards. The 2014 Plan is effective through March 31, 2024. As of September 30, 2018, 339,000 awards had been granted under the 2014 Plan.

The following table summarizes information about stock options outstanding and exercisable at September 30, 2018: 

Options Outstanding								Options Exercisable
Exercise Price Range		Number		Weighted Average Remaining Contractual Life (in Years)		Weighted Average Exercise Price		Number
$	0.01 - 7.00		10,000		7.14	$	6.80		8,333
$	7.01 - 8.00		20,313		4.99	$	7.76		20,313
$	8.01 - 10.00		4,250		6.24	$	9.26		4,250
$	10.01 - 15.00		32,000		8.99	$	13.00		32,000
$	15.01 - 17.40		32,000		9.67	$	17.40		—
	Total		98,563		8.08		12.56		64,896

As of September 30, 2018, the Company had unrecognized stock compensation related to the options of $168,000, which will be recognized through 2019.

On January 29, 2018, the Company granted 1,000 restricted stock units with an intrinsic value of $17.65 to a certain employee of the Company. The restricted stock units vest one-half annually over two years. On June 1, 2018, the Company granted 8,000 restricted stock units with an intrinsic value of $17.40 to the four non-employee members of the Company’s board of directors. The restricted stock units vest upon the earlier of (i) the date of the Company’s 2019 annual meeting of stockholders (but only if the director ceases to be a member of the board of directors at such annual meeting as a result of not standing for re-election or not being re-elected) or (ii) June 1, 2019. During the three and nine-month periods ended September 30, 2018, 8,000 and 35,001 restricted stock units with intrinsic values of $13.00 and $7.28, respectively, vested. As of September 30, 2018, there was $173,000 of unrecognized compensation cost related to our unvested restricted stock units, which will be recognized through 2020.