Note 3 - Stock-Based Compensation

9 Months Ended

Sep. 30, 2013

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

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

3.           STOCK-BASED COMPENSATION

We have one stock option plan which provides for annual stock option grants to non-employee directors with an exercise price equal to the fair market value of the shares at the date of grant. Under this plan, 12,000 options were awarded to directors in each of the first nine months of 2013 and 2012. These options vest and become exercisable six months from the option grant date. We had two other stock option plans from 1995 which provided for stock option grants to officers, key employees and non-employee directors. These plans expired in 2005. The expiration of the plans has no effect on the options previously granted. Options outstanding and exercisable were granted at a stock option price which was not less than the fair market value of our common stock as of closing on the date the option was granted and no option has a term in excess of ten years. No share based compensation expense was recognized in each of the quarters ended September 30, 2013 and 2012. Share based compensation expense of $11,686 and $10,000 was recognized for the nine month periods ended September 30, 2013 and 2012, respectively, as a component of operating expenses.

During the nine months ended September 30, 2013 and 2012, the stock option activity under our stock option plans was as follows:

	Weighted Average Exercise Price		# of shares			Weighted Average Remaining Contractual Term (in years)		Aggregate Intrinsic Value
Outstanding, January 1, 2012	$	4.40		115,600
Granted		5.27		12,000
Cancelled		-		-
Exercised		2.72		(2,000	)
Outstanding, September 30, 2012	$	4.51		125,600			4.93	$	213,256
Exercisable, September 30, 2012	$	4.51		125,600			4.93	$	213,256
Outstanding, January 1, 2013	$	4.53		121,600
Granted		6.87		12,000
Cancelled		-		-
Exercised		4.23		(49,000	)
Outstanding, September 30, 2013	$	5.04		84,600			7.22	$	104,656
Exercisable, September 30, 2013	$	5.04		84,600			7.22	$	104,656

Other information pertaining to option activity during the nine-month periods ended September 30, 2013 and 2012 are as follows:

	September 30, 2013		September 30, 2012
Weighted average grant-date fair value of stock options granted	$	0.97	$	0.83
Total fair value of stock options vested	$	11,686	$	10,000
Total intrinsic value of stock options exercised	$	113,790	$	3,077

There was no unrecognized compensation cost as of September 30, 2013 and 2012.

We have a restricted stock plan that was adopted by our Board of Directors in January 2013 and approved by our stockholders in June 2013. The plan reserves up to 300,000 shares of our common stock for restricted stock awards to our executive officers, non-employee directors and other key employees. Awards granted under the plan may be stock awards or performance awards, and may be subject to a graded vesting schedule with a minimum vesting period of four years. No awards have been made to date.