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4) Stock-based Compensation
 6 Months Ended
Jun. 30, 2014
Notes  
4) Stock-based Compensation

 

4)      Stock-Based Compensation

 

The Company has three fixed option plans (the “2003 Plan”, the “2006 Plan” and the “2013 Plan”). Compensation expense for options issued of $64,201 and $9,620 has been recognized for these plans for the three months ended June 30, 2014 and 2013, respectively, and $128,526 and $62,589 for the six months ended June 30, 2014 and 2013, respectively. As of June 30, 2014, the total unrecognized compensation expense related to the options issued in December 2013 was $111,496, which is expected to be recognized over the vesting period of one year.

 

The Company generally estimates the expected life of the options based upon the contractual term of the options adjusted for actual experience. Future volatility is estimated based upon the a weighted historical volatility of the Company’s Class A common stock and three peer company stocks over a period equal to the estimated life of the options. Common stock issued upon exercise of stock options are generally new share issuances rather than from treasury shares.

 

 

 

A summary of the status of the Company’s stock incentive plans as of June 30, 2014, and the changes during the six months ended June 30, 2014, is presented below:

Number of Class A Shares

Weighted Average Exercise Price

 

Number of Class C Shares

Weighted Average Exercise Price

Outstanding at December 31, 2013

         405,133

$      2.41

      508,656

$      2.00

Granted

                    -

                     -

Exercised

         (34,955)

         1.44

                     -

Cancelled

           (1,838)

         2.92

                     -

 

Outstanding at June 30, 2014

         368,340

$      2.50

      508,656

$      2.00

As of June 30, 2014:

Options exercisable

         325,243

$      2.23

      482,406

$      1.84

As of June 30, 2014:

Available options for future grant

         314,480

      105,000

Weighted average contractual term of options

outstanding at June 30, 2014

6.77 years

2.11 years

Weighted average contractual term of options

exercisable at June 30, 2014

6.42 years

1.99 years

Aggregated intrinsic value of options

outstanding at June 30, 2014

$690,130

$1,194,177

Aggregated intrinsic value of options

exercisable at June 30, 2014

$689,924

$1,194,177

 

 

 

 

 

The total intrinsic value (which is the amount by which the fair value of the underlying stock exceeds the exercise price of an option on the exercise date) of stock options exercised during the six months ended June 30, 2014 and 2013 was $115,977 and $1,241,181, respectively. The Company used a stock price of $4.27 as of June 30, 2014 to derive intrinsic value.