XML 53 R12.htm IDEA: XBRL DOCUMENT
v2.4.1.9

Stock-based compensation and equity transactions | 6 Months Ended
--- | ---
Apr. 30, 2015
Disclosure Of Compensation Related Costs, Share-Based Payments [Abstract] |
Stock-based compensation and equity transactions | Note 6 - Stock-based compensation and equity transactions The Company’s current stock incentive plan provides for the granting of qualified and nonqualified options to the Company’s officers, directors and employees. Incentive stock options granted to the Company’s employees during the six months ended April 30, 2015 vest and are exercisable equally over three years and expire in five years from date of grant. During the three and six months ended April 30, 2015, the Company granted a total of zero and 127,558 incentive stock options, respectively, to Company employees. The Company satisfies the exercise of options by issuing previously unissued common shares. The weighted average fair value of employee and non-employee directors’ stock options granted by the Company during the six months ended April 30, 2015 and 2014 was estimated to be $1.00 and $1.99 per share, respectively, using the Black-Scholes option pricing model with the following assumptions:
|  | 2015 |  |  | 2014 |
Risk-free interest rate |  |  | 0.89 | % |  |  | 1.11 | %
Dividend yield |  |  | 6.38 | % |  |  | 4.38 | %
Expected life of the option |  |  | 3.5 years |  |  |  | 5.0 years |
Volatility factor |  |  | 47.3 | % |  |  | 52.9 | %
Expected volatilities are based on historical volatility of the Company’s stock price and other factors. The Company used the historical method to calculate the expected life of the 2015 option grants. The expected life represents the period of time that options granted are expected to be outstanding. The risk-free rate is based on the U.S. Treasury rate with a maturity date corresponding to the options’ expected life. The dividend yield is based upon the historical dividend yield. Issuances of common stock by the Company During the six months ended April 30, 2015, the Company issued 252,381 shares of common stock valued at approximately $1,060,000 to the former owner of Comnet as part of the purchase price of the Comnet acquisition. The Comnet acquisition is more fully described in Note 2 of this report. Company stock option plans Descriptions of the Company’s stock option plans are included in Note 8 of the Company’s Annual Report on Form 10-K for the year ended October 31, 2014. A summary of the status of the options granted under the Company’s stock option plans as of April 30, 2015 and the changes in options outstanding during the six months then ended is presented in the table that follows:
|  |  |  | Weighted |
|  |  |  | Average |
|  | Shares |  | Exercise Price |
Outstanding at November 1, 2014 |  | 1,044,932 |  | $ | 3.27 |
Options granted |  | 181,039 |  | $ | 4.39 |
Options exercised |  | (1,337) |  | $ | 3.16 |
Options canceled or expired |  | (8,944) |  | $ | 3.99 |
Options outstanding at April 30, 2015 |  | 1,215,690 |  | $ | 3.43 |
Options exercisable at April 30, 2015 |  | 777,378 |  | $ | 2.49 |
Options vested and expected to vest at April 30, 2015 |  | 1,207,400 |  | $ | 3.41 |
Weighted average remaining contractual life of options outstanding as of April 30, 2015: 4.7 years Weighted average remaining contractual life of options exercisable as of April 30, 2015: 3.9 years Weighted average remaining contractual life of options vested and expected to vest as of April 30, 2015: 4.7 years Aggregate intrinsic value of options outstanding at April 30, 2015: $1.5 million Aggregate intrinsic value of options exercisable at April 30, 2015: $1.5 million Aggregate intrinsic value of options vested and expected to vest at April 30, 2015: $1.5 million As of April 30, 2015, $593,000 of expense with respect to nonvested share-based arrangements has yet to be recognized and is expected to be recognized over a weighted average period of 4.05 years. Non-employee directors receive $30,000 annually, which amount is paid one-half in cash and one-half through the grant of non-qualified stock options to purchase shares of the Company’s common stock. During the quarter ended January 31, 2015, the Company granted each of its three non-employee directors 44,748 options. The number of stock options granted to each director was determined by dividing $15,000 by the fair value of a stock option grant using the Black-Scholes model ($1.01 per share). These options vest ratably over fiscal year 2015. On April 6, 2015, Howard Hill, the Company’s Chief Operating Officer, took an indefinite medical leave of absence. During the quarter ended April 30, 2015, the Company granted Mr. Hill 8,733 options to continue to serve on the Board. The number of stock options granted was determined by dividing $7,500 by the fair value of a stock option grant using the Black-Scholes model ($0.86 per share). These options vest ratably from May 1, 2015 over the remaining fiscal year 2015. Stock option expense During the six months ended April 30, 2015 and 2014, stock-based compensation expense totaled $101,000 and $271,000, respectively. During the three months ended April 30, 2015 and 2014, stock-based compensation expense totaled $51,000 and $224,000, respectively. For the six months ended April 30, 2015 and 2014, stock-based compensation classified in cost of sales amounted to $29,000 and $30,000, respectively, and stock-based compensation classified in selling and general expense amounted to $72,000 and $241,000, respectively.

X
- Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsSharebasedPaymentsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5070-113901 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6406099&loc=d3e25284-112666 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 40 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6418621&loc=d3e17540-113929 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5444-113901 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 14 + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration