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Stockholders' Equity
 9 Months Ended
Mar. 31, 2013
Stockholders' Equity  
Stockholders' Equity

Note 5 — Stockholders’ Equity

 

Common Stock

 

On July 9, 2012, a contractor of the Company net exercised 30,000 stock options for a net issuance of 15,512 shares of common stock.  The options were granted in March 2008 at an exercise price of $4.10 per share. See Note 6.

 

On September 6, 2012, the Board of Directors authorized and the Company issued 154,227 shares of restricted common stock from the 2004 Stock Plan to all employees as a long-term incentive award.  Total unrecognized stock-based compensation expense of $1,223,020 related to the long-term incentive award will be recognized ratably over a four year period as the restricted common stock vests.  See Note 6.

 

On November 23, 2012, the Company issued 25,000 shares of restricted stock to a consultant who became an employee in 2013.  The value of the shares issued was $191,750, based on the fair market value on the date of issuance.  The shares vest over a two year period.  See Note 6.

 

On December 6, 2012, a total of 31,970 shares of our restricted common stock was issued pursuant to the 2004 Stock Plan to five outside directors as part of their annual board compensation for calendar year 2013.  The value of the shares issued was $249,973 based on the fair market value on the date of issuance.  All issuances of our common stock were subject to vesting terms per individual stock agreements, which is one year for directors.  See Note 6.

 

On December 20, 2012 the Company received 2,137 shares of common stock from Sterling McDonald, Vice-President and Chief Financial Officer of the Company for his payroll tax liability arising from recent vestings of restricted stock.  The $7.94 per share acquisition cost per share reflected the weighted-average market price of the Company’s shares at the dates vested.

 

On February 7, 2013,  a former consultant cash exercised 50,000 stock options that were granted in February 2006 at an exercise price of $1.41 per share. See Note 6.

 

On March 8, 2013 Sterling McDonald, Vice-President and Chief Financial Officer of the Company,  net exercised 250,000 stock options for a net issuance of 243,725 shares of common stock.  The options were granted in November 2003 at an exercise price of $0.25 per share. See Note 6.

 

During March 2013, the Company received 480 shares of common stock from Sterling McDonald, Vice-President and Chief Financial Officer of the Company for his payroll tax liability arising from recent vestings of restricted stock.  The $10.22 per share acquisition cost reflected the market price of the Company’s shares at the date vested.

 

Series A Cumulative Perpetual Preferred Stock

 

There were no sales during the nine months ended March 31, 2013.  During the nine months ended March 31, 2012, we sold 317,319 shares of our 8.5% Series A Cumulative (perpetual) Preferred Stock with a liquidation preference of $25.00 per share, 220,000 of which were sold in an underwritten public offering and 97,319 shares of which were sold under an at-the-market sales agreement (ATM), providing aggregate net proceeds of $6,930,535  after market discounts, underwriting fees, legal and other expenses of the offerings.  The Series A Cumulative Preferred Stock cannot be converted into our common stock and there are no sinking fund or redemption rights available to holders thereof.  Optional redemption can only be made by us on or after July 1, 2014 for the stated liquidation value of $25.00 per share plus accrued dividends, or following a change of control prior to such date at redemption prices of $25.50 per share prior to July 1, 2013, and $25.25 per share from July 1, 2013 through June 30, 2014.  With respect to dividend rights and rights upon our liquidation, winding-up or dissolution, the Series A Preferred Stock ranks senior to our common shareholders, but subordinate to any of our existing and future debt.  Dividends on the Series A Cumulative Preferred Stock accrue and accumulate at a fixed rate of 8.5% per annum on the $25.00 per share liquidation preference, payable monthly at $0.177083 per share, as, if and when declared by our Board of Directors.

 

During the nine months ended March 31, 2013 and 2012, we paid dividends of $505,726 and $461,815, respectively, to holders of our Series A Preferred Stock.