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Stock-Based Compensation
 9 Months Ended
Sep. 30, 2013
Stock-Based Compensation [Abstract]  
Stock-Based Compensation

Note G: Stock-Based Compensation

 

We compensate officers, directors and key employees with stock-based compensation under two stock plans approved by our shareholders and administered under the supervision of our Board of Directors. Stock option awards are granted at exercise prices equal to the closing price of our stock on the day before the date of grant. Generally, options vest proportionally over periods of three to five years from the dates of the grant, beginning one year from the date of grant, and have a contractual term of six to ten years. Compensation expense, net of estimated forfeitures, is recognized ratably over the vesting period. Stock-based compensation expense included in general and administrative expense for the three-month periods ended September 30, 2013 and 2012 was $63,000 and $3,500, respectively. Stock-based compensation expense included in general and administrative expense for the nine-month periods ended September 30, 2013 and 2012 was $149,000 and $186,000, respectively. At September 30, 2013, a total of 200,750 shares were available for grant under these plans.

 

Stock Options

 

A summary of the option activity for the first nine months of 2013 is as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted

 

 

 

 

 

 

Weighted

 

Average

 

 

 

 

 

 

Average

 

Remaining

 

 

 

 

 

 

Exercise

 

Contractual

 

Aggregate

 

Number of

 

Price Per

 

Term

 

Intrinsic

 

Shares

 

Share

 

(in years)

 

Value

Options outstanding at December 31, 2012
398,893 

 

$
7.95 

 
5.6 

 

$
13,080 

Granted
84,000 

 

$
6.81 

 
3.8 

 

$
24,540 

Exercised

(2,333)

 

$
3.65 

 

 —

 

$
8,632 

Forfeited or expired
(135,810)

 

$
10.14 

 

 —

 

$

 —

Options outstanding at September 30, 2013
344,750 

 

$
6.81 

 
6.4 

 

$
316,508 

Options exercisable at September 30, 2013
129,008 

 

$
8.25 

 
3.0 

 

$
61,725 

 

 

There were no options exercised during the three-month period ended September 30, 2013.  The total intrinsic value of options exercised was $20,570, during the three-month period ended September 30, 2012. The total intrinsic value of options exercised was $8,049 and $207,790 during the nine-month periods ending September 30, 2013 and 2012, respectively.  As of September 30, 2013, there was $531,000 of total unrecognized compensation cost related to non-vested stock options. The weighted average period over which the compensation cost is expected to be recognized is 9.8 years.

 

Stock Awards

 

We issue stock awards as a portion of the annual retainer for each director on a quarterly basis.  The stock awards are fully vested at the time of issuance. Compensation expense related to stock awards is determined on the grant date based on the publicly quoted fair market value of our common stock and is charged to earnings on the grant date.  During the quarter ended September 30, 2013, there were stock awards issued for 2,640 shares with a weighted-average grant date fair value of $7.10.  For the nine months ended September 30, 2013, there were stock awards issued for 9,750 shares with a weighted-average grant date fair value of $5.77.