Quarterly report pursuant to Section 13 or 15(d)

Stock-Based Compensation Plan

v2.4.0.6
Stock-Based Compensation Plan
9 Months Ended
Sep. 30, 2012
Stock-Based Compensation Plan [Abstract]  
Stock-Based Compensation Plan

NOTE 12.  STOCK-BASED COMPENSATION PLAN 

 

Under the Company’s 2005 Stock Incentive Plan (the “2005 Plan”), the Board of Directors has flexibility to determine the type and amount of awards to be granted to eligible participants, who must be employees, directors, officers or consultants of the Company or its subsidiaries.  The 2005 Plan allows for grants of incentive stock options, nonqualified stock options, restricted stock awards, stock appreciation rights, and restricted units.  The aggregate number of shares of common stock that may be granted through awards under the 2005 Plan to any employee in any calendar year may not exceed 500 shares.  The 2005 Plan will continue in effect until June 2015 unless terminated sooner. 

 

During the nine months ended September 30, 2012, the Company issued 653 stock options, under the Company’s 2005 Plan, to employees of the Company.  Of the 653 options issued, 40 will vest in four equal consecutive quarterly tranches from the date of grant.  500 options will vest in four equal consecutive yearly tranches on April 1, 2015, 2016, 2017 and 2018.  The remaining 113 options granted will vest in three installments as follows: 43 shares shall vest on December 31, 2014, 34 shares shall vest on December 31, 2015 and December 31, 2016, and 2 shares shall vest on December 31, 2017. 

 

For computing the fair value of the stock-based awards, the fair value of each option grant has been estimated as of the date of grant using the Black-Scholes option-pricing model with the following assumptions: 

 

 

 

 

 

 

 

 

 

 

 

Options Granted During Nine Months Ended September 30, 2012

 

 

 

 

 

 

 

 

 

Number of options

 

153

 

500

Option vesting period

 

1-5 Years

 

3-6 Years

Grant price

 

$7.64 - $9.89

 

$13.00 - $16.00

Dividend yield

 

0.00%

 

0.00%

Expected volatility (a)

 

53.3% - 59.2%

 

50.3% - 58.6%

Risk-free interest rate

 

.71% - 1.44%

 

.39% - 1.04%

Expected life (years)

 

5.31 - 7.33

 

3.25 - 6.25

Weighted average fair value

 

$4.40 - $5.40

 

$2.64 - $3.94

 

 

 

 

 

 (a) Since the Company’s historical volatility was not representative of the ongoing future business, the Company’s historical volatility was based on a combination of the Company’s volatility and the historical volatility of a peer group of companies within similar industries and similar size as the Company. 

 

Using these assumptions, the fair value of the stock options granted during the nine months ended September 30, 2012 was $2,469, which will be amortized over the vesting period of the options. 

 

The total non-cash stock compensation expense related to stock options and restricted stock recorded by the Company during the three and nine months ended September 30, 2012 and 2011, respectively, was as follows: 

 

 

 

 

 

 

 

 

 

 

THREE MONTHS ENDED

 

 

September 30, 2012

 

September 30, 2011

 

 

 

 

 

 

 

Restricted stock

 

$

208 

 

$

471 

Stock options

 

 

318 

 

 

170 

Total

 

$

526 

 

$

641 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NINE MONTHS ENDED

 

 

September 30, 2012

 

September 30, 2011

 

 

 

 

 

 

 

Restricted stock

 

$

617 

 

$

2,008 

Stock options

 

 

697 

 

 

495 

Total

 

$

1,314 

 

$

2,503 

 

 

 

 

 

 

 

 

 

The fair value of unvested restricted stock awards is determined based on the market price of our shares of common stock on the grant date.  As of September 30, 2012, there were 1,248 unvested stock options and unrecognized compensation cost of $3,550 related to unvested stock options, as well as 750 unvested restricted stock awards and unrecognized compensation cost of $123 related to unvested restricted stock awards.