XML 20 R9.htm IDEA: XBRL DOCUMENT
v3.10.0.1

Note C - Shareholders' Equity | 12 Months Ended
--- | ---
Sep. 30, 2018
Notes to Financial Statements |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | NOTE C – SHAREHOLDERS’ EQUITY The Company is authorized to issue 50,000,000 shares of common stock at $.01 par value and 5,000,000 undesignated shares. From the undesignated shares, 500,000 shares have been designated as Series B Junior Participating Preferred Shares and none of such shares have been issued or are outstanding. The Board of Directors may, by resolution, establish from the remaining undesignated shares different classes or series of shares and may fix the relative rights and preferences of shares in any class or series. Stock-Based Compensation: The Company’s stock-based compensation plans are administered by the Compensation Committee of the Board of Directors, which selects persons to receive awards and determines the number of shares subject to each award and the terms, conditions, performance measures and other provisions of the award. The Company currently has one equity compensation plan, the 2007 Stock Compensation Plan, from which it grants equity awards that are used as an incentive for directors, officers, and other employees. The 2007 Stock Compensation Plan has 1,003,644 shares available for issue as of September 30, 2018. As of September 30, 2018, $3,522,909 of total unrecognized compensation expense related to non-vested awards is expected to be recognized over a period of approximately 6.1 years. The Company recorded related compensation expense for the years ended September 30, 2018, 2017, and 2016 of $2,003,207, $2,319,975, and $1,404,899, respectively. For the year ended September 30, 2018, $1,835,086 of this expense was included in selling, general and administrative expense and $168,121 was included in cost of sales. For the year ended September 30, 2017, $2,103,621 of this expense was included in selling, general and administrative expense and $216,354 was included in cost of sales. For the year ended September 30, 2016, $1,272,656 of this expense was included in selling, general and administrative expense and $132,243 was included in cost of sales. Stock Options: The Company uses the Black-Scholes option pricing model to determine the weighted average fair value of options granted. During the fiscal year ended September 30, 2018, the Company granted employees non-qualified stock options to purchase an aggregate of 108,000 shares of common stock with a weighted average contractual term of 4.7 years, a three year vesting term, and a weighted average exercise price of $13.37. There were no stock options granted during the years ended September 30, 2017 and 2016. The weighted-average fair value at the grant date for options issued during the year ended September 30, 2018 was $4.78. This fair value was estimated at the grant date using the assumptions listed below:
|  | Year ended September 30, 2018
Dividend yield |  |  | 0 | %
Weighted average expected volatility |  |  | 43.68 | %
Weighted average risk-free interest rate |  |  | 2.70 | %
Weighted average expected life |  |  | 3.7 | years
Vesting period |  |  | 3.0 | years
The expected stock price volatility is based on the historical volatility of the Company’s stock for a period approximating the expected life. The expected life represents the period of time that options are expected to be outstanding after their grant date. The risk-free interest rate reflects the interest rate at grant date on zero -coupon U.S. governmental bonds having a remaining life similar to the expected option term. Options are generally granted at fair market values determined on the date of grant and vesting normally occurs over a three to five -year period. However, options granted to directors have a one year vesting period and a six year contractual term. The maximum contractual term is normally six years. Shares issued upon exercise of a stock option are issued form the Company’s authorized but unissued shares. There were no options vested during the year ended September 30, 2018 and 2017, respectively. For the year ended September 30, 2018, there were 2,250 stock options that were exercised using a cashless method of exercise. For the year ended September 30, 2017, there were 10,500 stock options that were exercised using a cashless method of exercise. The intrinsic value of options exercised during the years ended September 30, 2018 and 2017 was $75,767 and $237,172, respectively. The intrinsic value of options exercisable as of September 30, 2018 is $331,535. Option transactions under the 2007 Stock Compensation Plan during the years ended September 30, 2018 and 2017 are summarized as follows:
|  |  | Number of shares |  |  |  | Weighted average exercise price |  |  |  | Weighted average fair value |
Outstanding as of September 30, 2016 |  |  | 54,800 |  |  | $ | 3.13 |  |  |  |  |
Granted |  |  | - |  |  |  | - |  |  |  | - |
Cancelled or Forfeited |  |  | - |  |  |  | - |  |  |  |  |
Exercised |  |  | (15,850 | ) |  |  | 3.97 |  |  |  |  |
Outstanding as of September 30, 2017 |  |  | 38,950 |  |  |  | 2.79 |  |  |  |  |
Granted |  |  | 108,000 |  |  |  | 13.37 |  |  | $ | 4.78 |
Cancelled or Forfeited |  |  | - |  |  |  | - |  |  |  |  |
Exercised |  |  | (8,450 | ) |  |  | 3.58 |  |  |  |  |
Outstanding as of September 30, 2018 |  |  | 138,500 |  |  | $ | 10.99 |  |  |  |  |
The following table summarizes information concerning options exercisable under the 2007 Stock Compensation Plan:
Year ended |  |  | Exercisable |  |  |  | Weighted average remaining contractual life |  |  |  | Weighted average exercise price |
September 30, 2018 |  |  | 30,500 |  |  | 1.89 years |  | $ | 2.58 |
September 30, 2017 |  |  | 38,950 |  |  | 2.73 years |  | $ | 2.79 |
The following table summarizes information concerning options currently outstanding at:
Year Ended |  |  | Number outstanding |  |  |  | Weighted average remaining contractual life |  |  |  | Weighted average exercise price |  |  |  | Aggregate intrinsic value |
September 30, 2018 |  |  | 138,500 |  |  | 3.82 years |  | $ | 10.99 |  |  | $ | 340,531 |
September 30, 2017 |  |  | 38,950 |  |  | 2.73 years |  | $ | 2.79 |  |  | $ | 421,237 |
Restricted Stock: The Company’s 2007 Stock Compensation Plan permits our Compensation Committee to grant other stock-based awards. The Company awards restricted stock grants to employees that vest over one to ten years. Restricted stock transactions during the years ended September 30, 2018 and 2017 are summarized as follows:
|  |  | Number of shares |  |  |  | Weighted average grant date fair value |
Unvested shares as of September 30, 2016 |  |  | 563,570 |  |  | $ | 14.26 |
Granted |  |  | 3,795 |  |  |  | 16.45 |
Vested |  |  | (185,231 | ) |  |  | 12.30 |
Forfeited |  |  | (11,604 | ) |  |  | 14.79 |
Unvested shares as of September 30, 2017 |  |  | 370,530 |  |  |  | 15.24 |
Granted |  |  | 7,235 |  |  |  | 14.17 |
Vested |  |  | (113,930 | ) |  |  | 16.45 |
Forfeited |  |  | (15,222 | ) |  |  | 15.41 |
Unvested shares as of September 30, 2018 |  |  | 248,613 |  |  | $ | 14.65 |
The Company repurchased a total of 41,989 shares of our common stock at an average price of $11.66 in connection with payment of taxes upon the vesting of restricted stock previously issued to employees for the year ended September 30, 2018. The Company repurchased a total of 75,445 shares of our common stock at an average price of $12.63 in connection with payment of taxes upon the vesting of restricted stock previously issued to employees for the year ended September 30, 2017. Employee Stock Purchase Plan: The Clearfield, Inc. 2010 Employee Stock Purchase Plan (“ESPP”) allows participating employees to purchase shares of the Company’s common stock at a discount through payroll deductions. The ESPP is available to all employees subject to certain eligibility requirements. Terms of the ESPP provide that participating employees may purchase the Company’s common stock on a voluntary after tax basis. Employees may purchase the Company’s common stock at a price that is no less than the lower of 85% of the fair market value of one share of common stock at the beginning or end of each stock purchase period or phase. The ESPP is carried out in six -month phases, with phases beginning on July 1 and January 1 of each calendar year. For the phases that ended on December 31, 2017 and June 30, 2018, employees purchased 14,242 and 15,932 shares, respectively, at a price of $10.41 and $9.39 per share, respectively. For the phases that ended on December 31, 2016 and June 30, 2017, employees purchased 11,144 and 14,723 shares, respectively, at a price of $15.21 and $11.22 per share, respectively. As of September 30, 2018, the Company has withheld approximately $70,905 from employees participating in the phase that began on July 1, 2018. After the employee purchase on June 30, 2018, 87,081 shares of common stock were available for future purchase under the ESPP.

X
- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -URI http://asc.fasb.org/subtopic&trid=2208855 + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_DisclosureTextBlockAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration