12. STOCKHOLDERS’ EQUITY

Common Stock

The holders of the Class A common stock are entitled to one vote for each share held. The holders of the Class B common stock are entitled to ten votes for each share held, except for the election of one director, who is elected by the holders of the Class A common stock exclusively. The Class B common stock is convertible into Class A common stock on a share-for-share basis at the option of the shareholder.

In the second quarter of fiscal year 2013, in a registered public offering we sold 11,500 shares of Class A common stock at an average price of $4.00 per share. The net proceeds received from the registered public offering, after deducting underwriting discounts, commissions and offering expenses, were $42,184 and were used to refinance our Second Lien Notes.

Preferred Stock

We are authorized to issue up to 944 shares of preferred stock in one or more series. As of April 30, 2013 and 2012, we had zero shares issued.

Stock Incentive Plans

1997 Stock Option Plan

In fiscal year 1998, we adopted the 1997 Stock Option Plan (the “1997 Plan”) a stock option plan for employees, officers and directors of, and consultants and advisors to us. As of April 30, 2013 and 2012, respectively, options to purchase 599 and 1,081 shares of Class A common stock at weighted average exercise prices of $12.23 and $11.82 were outstanding under the 1997 Plan. The 1997 Plan terminated as of July 31, 2007 and as a result no additional awards may be made pursuant to the 1997 Plan.

1997 Non-Employee Director Stock Option Plan

In fiscal year 1998, we adopted a stock option plan for our non-employee directors. The 1997 Non-Employee Director Stock Option Plan (the “Non-Employee Director Plan”) provided for the issuance of a maximum of 200 shares of Class A common stock pursuant to the grant of non-statutory options. As of April 30, 2013 and 2012, respectively, options to purchase 75 and 95 shares of Class A common stock at weighted average exercise prices of $12.45 and $11.04 were outstanding. The Non-Employee Director Plan terminated as of July 31, 2007.

2006 Stock Incentive Plan

In fiscal year 2007, we adopted the 2006 Stock Incentive Plan (the “2006 Plan”). The 2006 Plan was subsequently amended in fiscal year 2010. Up to an aggregate amount equal to the sum of: (i) 2,475 shares of Class A common stock (subject to adjustment in the event of stock splits and other similar events), plus (ii) such additional number of shares of Class A common stock as are currently subject to options granted under our 1993 Incentive Stock Option Plan, 1994 Non-statutory Stock Option Plan, 1996 Option Plan, and 1997 Plan (the “Prior Plans”) which are not actually issued under the Prior Plans because such options expire or otherwise result in shares not being issued, may be issued pursuant to awards granted under the 2006 Plan. As of April 30, 2013 there were 1,602 Class A common stock equivalents available for future grant under the 2006 Plan inclusive of additional Class A common stock equivalents which were previously issued under our terminated plans, and which have become available for grant because such awards expired or otherwise resulted in shares not being issued.

Options granted under the 2006 Plan are granted at a price equal to the prevailing fair market value of our Class A common stock at the date of grant. Generally, options granted have a term not to exceed ten years and vest over a one to four year period from the date of grant. As of April 30, 2013 and 2012, respectively, options to purchase 768 and 485 shares of Class A common stock at weighted average exercise prices of $5.16 and $7.64 were outstanding under the 2006 Plan.

Restricted stock units and performance stock units granted under the 2006 Plan are granted at a price equal to the fair market value of our Class A common stock at the date of grant. Restricted stock units vest incrementally over a three year period beginning on the first anniversary date of the grant and are based on continued employment. Performance stock units vest on April 30^th of the third fiscal year end following the grant date and are based on the attainment of a targeted average return on net assets as of the vesting date.

Restricted stock awards granted to non-employee directors under the 2006 Plan are granted at a price equal to the fair market value of our Class A common stock at the date of grant. Restricted stock awards granted to non-employee directors vest incrementally over a three year period beginning on the first anniversary of the grant date.

The following table summarizes the grant activity for stock options, restricted stock units, performance stock units and restricted stock awards for the fiscal years ended April 30, 2013, 2012 and 2011, respectively:


	Granted		Weighted Average Grant Date Fair Value		Unissued at April 30, 2013
Fiscal year 2011 grants
Stock options		280	$	2.85		250
Restricted stock units		499	$	3.57		83
Performance stock units (1)		469	$	4.20		-
Restricted stock awards		62	$	4.81		-

Total		1,310				333
Fiscal year 2012 grants
Stock options		7	$	4.14		7
Restricted stock units		305	$	6.12		143
Performance stock units (1)		255	$	6.06		196
Restricted stock awards		51	$	5.83		-

Total		618				346
Fiscal year 2013 grants
Stock options		388	$	3.03		388
Restricted stock units		340	$	5.15		273
Performance stock units (1)		316	$	5.17		259
Restricted stock awards		79	$	4.45		-

Total		1,123				920

(1)	Performance stock units are included at the 100% attainment level.

A summary of stock options, restricted stock and restricted / performance stock units outstanding as of April 30, 2013 and 2012, and changes during the fiscal year ended April 30, 2013, is presented below:


	Unvested Options		Vested Options		Total Options		Weighted Average Exercise Price		Aggregate Intrinsic Value of Vested Options		Weighted Average Remaining Term (Years)		Restricted Stock Units, Restricted Stock and Performance Stock Units Unvested (1)
Outstanding, April 30, 2012		174		1,487		1,661	$	10.55	$	592		3.6		1,380
Granted		388		-		388		4.10						735
Vested (options only) (2)		(125)		125		-		4.08						-
Forfeited		-		(607)		(607)		11.37						(533)
Exercised/Issued		-		-		-		-						(494)

Outstanding, April 30, 2013		437		1,005		1,442		8.48		240		5.3		1,088

Exercisable, April 30, 2011				1,998		1,998	$	11.80	$	52		3.1

Exercisable, April 30, 2012				1,487		1,487	$	11.33	$	222		3.1

Exercisable, April 30, 2013				1,005		1,005	$	10.41	$	94		3.7

Expected to vest at April 30, 2013		436												958

(1)	Performance stock units are included at the 100% attainment level. Attainment of performance metrics at maximum levels could result in the issuance of an additional 357 shares of Class A common stock.

(2)	The total fair value of the 125 stock options vested during the fiscal year and outstanding as of April 30, 2013 was approximately $378.

Stock-Based Compensation

We recognized stock-based compensation expense of $2,236, $1,855 and $1,592 for the fiscal years ended April 30, 2013, 2012 and 2011, respectively. Of these amounts, expense recorded with respect to stock options was $528, $258 and $387, expense recorded with respect to our employee stock purchase plan was $99, $113 and $122, and expense recorded with respect to restricted stock, restricted stock units and performance stock units was $1,609, $1,485 and $1,083 for the fiscal years ended April 30, 2013, 2012 and 2011, respectively. The tax benefit in the provision for income taxes associated with stock-based compensation expense for the fiscal years ended April 30, 2013, 2012 and 2011 was $0, $0, and $97, respectively.

As a result of the sale of the non-integrated recycling assets and select intellectual property assets in fiscal year 2011, we modified certain awards associated with our grants to allow employees who left us as a result of the transaction to become immediately vested in full with respect to their performance stock units and partially vested with respect to their restricted stock units based on their continued employment through the transaction date. This modification resulted in the issuance of 259 shares of Class A common stock and the recognition of $1,438 in total compensation expense as discontinued operations in the fiscal year 2011.

The unrecognized stock-based compensation expense at April 30, 2013 related to unvested stock options, restricted stock and restricted stock units was $2,750, to be recognized over a weighted average period of 1.64 years. Maximum unrecognized stock-based compensation expense at April 30, 2013 related to outstanding performance stock units, and subject to the attainment of targeted maximum annual returns on net assets, was $3,805, which would be recognized over a weighted average period of 1.64 years. As of April 30, 2013, we do not expect to recognize any expense related to outstanding performance stock units over the weighted average period based on our expectation that we will not meet our attainment levels.

We recorded a tax benefit of $96, $254 and $129 to additional paid in capital related to the exercise of various share based awards in the fiscal years ended April 30, 2013, 2012 and 2011, respectively. Tax savings from equity based compensation resulting from tax deductions in excess of expense are reflected as a financing cash flow in our consolidated financial statements.

Our calculations of stock-based compensation expense associated with stock options and our Employee Stock Purchase Plan for the fiscal years ended April 30, 2013, 2012 and 2011 were made using the Black-Scholes valuation model. The fair values of our stock option grants and shares to be purchased under our Employee Stock Purchase Plan were estimated assuming no expected dividend yield using the following weighted average assumptions for the fiscal years ended April 30, 2013, 2012 and 2011:


	Fiscal Year Ended April 30,
	2013	2012	2011
Stock Options:
Expected life	6.82 years	5.5 years	6.5 years
Risk-free interest rate	1.14%	0.82%	1.80%
Expected volatility	84.40%	91.54%	85.59%

Stock Purchase Plan:
Expected life	0.5 years	0.5 years	0.5 years
Risk-free interest rate	0.12%	0.10%	0.20%
Expected volatility	46.95%	49.05%	46.53%

Expected life is calculated based on the weighted average historical life of the vested stock options, giving consideration to vesting schedules and historical exercise patterns. Risk-free interest rate is based on the U.S. Treasury yield curve for the period of the expected life of the stock option. Expected volatility is calculated using the historical volatility of our Class A common stock over the expected life.

The Black-Scholes valuation model requires extensive use of accounting judgment and financial estimation, including estimates of the expected term option holders will retain their vested stock options before exercising them, the estimated volatility of our Class A common stock price over the expected term, and the number of stock options that will be forfeited prior to the completion of their vesting requirements. Application of alternative assumptions could produce significantly different estimates of the fair value of stock-based compensation and consequently, the related amounts recognized in the consolidated statements of operations.

Noncontrolling interest

Casella-Altela Regional Environmental Services, LLC (“CARES”) is a joint venture that owns and operates one water and leachate treatment facility for the natural gas drilling industry in Pennsylvania. Our joint venture partner in CARES is Altela, Inc. In the third quarter of fiscal year 2013, we entered into an agreement with Altela, Inc., which increased our membership interest in CARES from 51% to 66.1% subject to a one-year claw back provision. As of April 30, 2013, Altela, Inc. had taken advantage of the claw back provision to reestablish its 49% membership interest in CARES. In accordance with ASC 810-10-15, we consolidate the assets, liabilities, noncontrolling interest, and results of operations of CARES into our consolidated financial statements due to our controlling financial interest in the joint venture.