Note 11 - Stockholders' Equity

12 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

1

1

. STOCKHOLDERS' EQUITY

a) Stock Option Plan

In connection with its

2007

Director Non-Qualified Stock Option Plan for non-employee directors, there are outstanding options to purchase our common stock. The plan, which terminates in

March

2017,

provides for the granting of non-qualified options at the discretion of the Compensation Committee of the Board of Directors. Options are granted at the fair market value of the underlying common stock at the date of grant and vest after

six

months. We have reserved

100,000

shares of common stock for issuance under this plan.

All options expire

ten

years from date of grant and are exercisable at any time after vesting. Of the

100,000

shares available for issuance, there are

21,400

un-optioned shares available for future grants.

A summary of stock option transactions for the years ended

December

31

is as follows:

	20 16					20 15					20 14
				Weighted					Weighted					Weighted
				Average					Average					Average
	Option			Exercise		Option			Exercise		Option			Exercise
	Shares			Price		Shares			Price		Shares			Price
Outstanding at January 1		68,400		$	5.17		72,400		$	5.16		84,600		$	5.04
Granted		-			-		-			-		-			-
Forfeited or expired		(12,000	)		5.30		(2,000	)		4.96		-			-
Exchanged		-			-		-			-		-			-
Exercised		-			-		(2,000	)		4.96		(12,200	)		4.32
Outstanding at December 31		56,400		$	5.14		68,400		$	5.17		72,400		$	5.16
Exercisable at end of year		56,400		$	5.14		68,400		$	5.17		72,400		$	5.16
Weighted-average fair value of options granted during year		n/a					n/a					n/a

The following table summarizes all of our outstanding options which are fully vested and exercisable at

December

31,

2016:

			Options Outstanding & Exercisable
					Weighted		Weighted
					Average		Average
			Option		Exercise		Maturity
Exercise Price Range			Shares		Price		(Years)
	$4.41			20,400	$	4.41		3.77
	$4.80			9,000		4.80		4.22
$5.30	to	$6.87		27,000		5.81		4.95
				56,400	$	5.14		4.41

Other information pertaining to option activity during the

twelve

month periods ended

December

31

are as follows:

	2016		2015		2014
Weighted average grant-date fair value of stock options granted		n/a		n/a		n/a
Total fair value of stock options vested		n/a		n/a		n/a
Total intrinsic value of stock options exercised	$	-	$	2,953	$	14,816

As of

December

31,

2016,

there was no unrecognized compensation cost related to non-vested stock options.

Cash received from the exercise of stock options for the years ended

December

31,

2016,

2015,

and

2014

was $ -,

$9,920

and

$52,722,

respectively.

Because we had no awards of stock options in

2016,

2015

and

2014,

we were not required to record compensation cost.

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, unless otherwise determined by the committee that administers the plan. 

In

February

2014,

our Chief Executive Officer, Chief Financial Officer, and Senior Vice President were awarded restricted stock grants consisting of

9,375

shares each. In addition,

four

of our independent directors were awarded restricted stock grants consisting of

1,619

shares each. In

February

2015,

our Chief Executive Officer, Chief Financial Officer and Senior Vice President were awarded restricted stock grants consisting of

9,344

shares each. In addition,

four

of our independent directors were awarded restricted stock grants consisting of

1,613

shares each. In

March

2016,

our Chief Executive Officer and President were awarded restricted stock grants consisting of

11,765

shares each. In addition,

five

of our independent directors were awarded restricted stock grants consisting of

2,031

shares each. For these grants in

2016,

2015,

and

2014,

we recognized share based compensation expense of

$199,870,

$145,321,

and

$67,818,

respectively, as a component of operating expenses.

A summary of the activity for nonvested restricted common stock awards as of

December

31,

2016

and

2015

is as follows:

	Shares			Grant Fair Value
Balance, January 1, 2015		34,601		$	8.96
Granted		34,484			8.99
Forfeited		-			-
Vested		(8,652	)		8.96
Balance, December 31, 2015		60,433		$	8.97
Balance, January 1, 2016		60,433		$	8.97
Granted		33,685			7.14
Forfeited		(8,187	)		8.97
Vested		(20,784	)		8.97
Balance, December 31, 2016		65,147		$	8.03

As of

December

31,

2016,

there was unrecognized compensation cost related to non-vested restricted stock awards of

$374,040

which will be recognized in each of the following years as follows:

2017	$	173,136
2018		123,693
2019		67,190
2020		10,021

Of the

300,000

shares available for issuance, there are

197,230

shares available for future awards.

b) Cash Dividend

On

June

9,

2014,

our Board of Directors authorized a

$0.25

per share special

one

-time cash dividend to be paid to stockholders of record at the close of business on

July

7,

2014.

The cash dividend, totaling approximately

$2.5

million, was paid to stockholders on

August

8,

2014.

Our Board will determine future cash dividends after giving consideration to our then existing levels of profit and cash flow, capital requirements, current and forecasted liquidity, as well as financial and other business conditions existing at the time.

c) Stockholder Rights Plan

On

June

6,

2013,

our Board of Directors authorized and declared a dividend of

one

preferred share purchase right (a “Right”) for each outstanding share of our common stock, par value

$0.0024

per share, to stockholders of record at the close of business on

June

16,

2013.

Each Right entitles the registered holder to purchase from us

one

one

-thousandth of a newly created series of preferred stock at an exercise price of

$30.00

per right. The Rights are exercisable in the event any person or group acquires

20%

or more of our outstanding common stock (an “Acquiring Person”), or commences a

tender

offer or exchange offer that would result in such person becoming an Acquiring Person. An exception is included in the Rights Plan in order to ensure that certain owners are not by virtue of their share ownership automatically deemed to be an Acquiring Person upon adoption of the plan unless any such owner subsequently accrues additional shares of our common stock and after giving effect to such acquisition owns

20%

or more of our outstanding common stock.

The Rights, as amended, will expire at

5:00

P.M. Eastern on

June

6,

2017,

unless such date is advanced or extended or unless the Rights are earlier redeemed or exchanged by our Board.

d) Share Repurchase Program

In

August

2015,

our Board authorized a share repurchase program where we

may

repurchase up to

1.2

million shares of our common stock through

August

2016.

On

June

7,

2016,

the program was amended to increase the number of shares available to purchase from

1.2

million to

2.2

million and to extend the termination date from

August

9,

2016

to

August

9,

2017.

In

2016,

we repurchased approximately

520,500

shares of our stock, at an average price of

$7.06,

totaling

$3.7

million. In

2015,

we repurchased approximately

529,000

shares of our stock, at an average price of

$7.01,

totaling

$3.7

million. There were no stock repurchases in

2014.