XML 59 R21.htm IDEA: XBRL DOCUMENT
v2.4.0.6

STOCK OPTIONS | 12 Months Ended
--- | ---
Dec. 31, 2012
STOCK OPTIONS [Abstract] |
STOCK OPTIONS | NOTE 14. STOCK OPTIONS On October 30, 2007, our stockholders approved and the Board of Directors adopted an amendment to the 2003 Executive and Employee Stock Option Plan (the "Plan") to increase the maximum aggregate number of shares of common stock reserved for issuance under the Plan from 1.2 million shares (already reserved against outstanding options) to 1.7 million shares. Except for the increase in the number of shares covered by the Plan, the Plan remained otherwise unchanged. In 2001, the Board of Directors adopted the 2001 Executive and Employee Stock Option Plan which reserved for issuance 1,200,000 stock options. Stock options typically have a ten-year life and currently vest over a seven year period. In July of 2012, the stockholders approved the 2012 Share Incentive Plan covering a total of 750,000 shares of common stock issuable upon exercise of options to be granted under the plan. At December 31, 2012 approximately 416,500 remain to be issued in this plan. The status of our stock options and stock awards are summarized as follows:
|  | Number |  |  | Weighted Average |
|  | Of Options |  |  | Exercise Price |
Outstanding at December 31, 2010 |  |  | 1,948,260 |  |  | $ | 3.79 |
Granted |  |  | 25,000 |  |  | $ | 2.81 |
Exercised |  |  | (69,000 | ) |  | $ | 0.57 |
Cancelled |  |  | (371,414 | ) |  | $ | 3.52 |
Outstanding at December 31, 2011 |  |  | 1,532,846 |  |  | $ | 3.99 |
Granted |  |  | 379,500 |  |  | $ | 2.90 |
Exercised |  |  | (28,000 | ) |  | $ | 0.70 |
Cancelled |  |  | (4,885 | ) |  | $ | 7.33 |
Outstanding at December 31, 2012 |  |  | 1,879,461 |  |  | $ | 3.81 |
Exercisable at December 31, 2012 |  |  | 1,232,894 |  |  | $ | 3.73 |
|  |  |  |  | Weighted Average |  |  |
Exercise Prices |  |  | Number Outstanding |  | Remaining Contractual Life |  | Options Exercisable |
$ | 0.70 |  |  |  | 7,000 |  | 1 year |  |  | 7,000 |
$ | 0.75 |  |  |  | 21,500 |  | 1 year |  |  | 21,500 |
$ | 1.30 |  |  |  | 25,000 |  | 1 year |  |  | 25,000 |
$ | 2.13 |  |  |  | 125,000 |  | 2 years |  |  | 125,000 |
$ | 2.25 |  |  |  | 322,500 |  | 3 years |  |  | 322,500 |
$ | 2.41 |  |  |  | 40,000 |  | 2 years |  |  | 40,000 |
$ | 2.93 |  |  |  | 35,000 |  | 3years |  |  | 35,000 |
$ | 2.95 |  |  |  | 2,500 |  | 2 years |  |  | 2,500 |
$ | 3.25 |  |  |  | 331,700 |  | 1 years |  |  | 331,700 |
$ | 6.93 |  |  |  | 20,000 |  | 4 years |  |  | 20,000 |
$ | 7.10 |  |  |  | 12,125 |  | 6 years |  |  | 10,696 |
$ | 7.18 |  |  |  | 50,000 |  | 7 years |  |  | 50,000 |
$ | 7.33 |  |  |  | 131,190 |  | 7 years |  |  | 77,809 |
$ | 7.68 |  |  |  | 7,500 |  | 6 years |  |  | 5,357 |
$ | 8.66 |  |  |  | 97,857 |  | 6 years |  |  | 70,714 |
$ | 6.60 |  |  |  | 500 |  | 7 years |  |  | 500 |
$ | 8.32 |  |  |  | 68,214 |  | 7 years |  |  | 29,643 |
$ | 7.85 |  |  |  | 7,500 |  | 7 years |  |  | 3,214 |
$ | 6.00 |  |  |  | 30,000 |  | 8 years |  |  | - |
$ | 7.45 |  |  |  | 14,286 |  | 8 years |  |  | 14,286 |
$ | 3.08 |  |  |  | 10,000 |  | 8 years |  |  | 2,858 |
$ | 2.46 |  |  |  | 65,589 |  | 8 years |  |  | 19,759 |
$ | 1.89 |  |  |  | 50,000 |  | 8 years |  |  | 14,286 |
$ | 2.80 |  |  |  | 10,000 |  | 9 years |  |  | 1,429 |
$ | 2.81 |  |  |  | 15,000 |  | 9 years |  |  | 2,143 |
$ | 2.79 |  |  |  | 46,000 |  | 10 years |  |  | - |
$ | 2.54 |  |  |  | 233,500 |  | 10 years |  |  | - |
$ | 3.79 |  |  |  | 100,000 |  | 10 years |  |  | - |
|  |  |  |  | 1,879,461 |  |  |  |  | 1,232,894 |
The number and weighted average grant-date fair values of options non-vested at the beginning and end of 2012, as well as options granted, vested and forfeited during the year was as follows:
|  | Number Of Options |  |  | Weighted Average Grant Date Fair Value |
Non-vested at January 1, 2012 |  |  | 337,734 |  |  | $ | 2.12 |
Granted in 2012 |  |  | 379,500 |  |  | $ | 1.03 |
Vested in 2012 |  |  | (65,782 | ) |  | $ | 2.50 |
Forfeited in 2012 |  |  | (4,885 | ) |  | $ | 2.82 |
Non-vested at December 31, 2012 |  |  | 646,567 |  |  | $ | 1.43 |
Common shares required to be issued upon the exercise of stock options and warrants would be issued from our authorized and unissued shares. The grant date fair value of options granted in 2012 was estimated on the grant date using a binomial lattice option-pricing model and the following assumptions: expected volatility of 41-43%, expected term of 5 years, risk-free interest rate of 0.4%, and expected dividend yield of 0%. The grant date fair value of options granted in 2011 was estimated on the grant date using a binomial lattice option-pricing model and the following assumptions: expected volatility of 41-42%, expected term of 7 years, risk-free interest rate of 1.8-2.6%, and expected dividend yield of 0%. The grant date fair value of options granted in 2010 was estimated on the grant date using a binomial lattice option-pricing model and the following assumptions: expected volatility of 42% - 43%, expected term of 7 years, risk-free interest rate of 1.1% - 2.27%, and expected dividend yield of 0%. Expected volatility is based on a weighted average of the historical volatility of the Company's stock and peer company volatility. The weighting percentages relative to our stock and the peer group was adjusted in 2010 to a 50%/50% weighting. We believe that due to our relatively low trading volume, we cannot calculate a true measurement of our volatility using just our price history alone. Therefore, we include in our calculation a peer group volatility factor. Previous to 2010 we used a weighting of 75% to 25% in favor of the peer group as our price history contained large erratic price swings that were not indicative of our true volatility. Our peer group has remained relatively the same throughout our calculations year over year. The average expected life was calculated using the simplified method as we believe we do not have sufficient history. The risk-free rate is based on the rate of U.S. Treasury zero-coupon issues with a remaining term equal to the expected life of the options. The Company uses historical data to estimate pre-vesting forfeiture rates. As of December 31, 2012, the aggregate intrinsic value of all stock options outstanding and expected to vest was approximately $194,000 and the aggregate intrinsic value of currently exercisable stock options was approximately $175,000. The intrinsic value of each option share is the difference between the fair market value of our common stock and the exercise price of such option share to the extent it is "in-the-money". Aggregate intrinsic value represents the value that would have been received by the holders of in-the-money options had they exercised their options on the last trading day of the year and sold the underlying shares at the closing stock price on such day. The intrinsic value calculation is based on the $2.42 closing stock price of our common stock on December 31, 2012, the last trading day of 2012. The total number of in-the-money options outstanding and exercisable as of December 31, 2012 was approximately 555,000. The total intrinsic value of options exercised during the years ended December 31, 2012, 2011 and 2010 was approximately $58,000, $157,000 and $198,000, respectively. Intrinsic value of exercised shares is the total value of such shares on the date of exercise less the cash received from the option holder to exercise the options. The total cash proceeds received from the exercise of stock options was approximately zero, zero and $9,000 for the years ended December 31, 2012, 2011and 2010, respectively. The total fair value of options granted during the years ended December 31, 2012, 2011 and 2010 was approximately $390,000, $33,000 and $496,000, respectively. The total fair value of option shares vested during the years ended December 31, 2012, 2011, and 2010 was approximately $164,000, $248,000 and $121,000, respectively. During the year ended December 31, 2012, we issued 20,814 common shares in exchange for 28,000 employee and non-employee stock options and 7,186 common shares (via a stock swap). Net proceeds from the issuance of common shares along with the shares received in the stock swap exercises were zero for the year ended December 31, 2012. Stock compensation cost recognized for the years ended December 31, 2012, 2011 and 2010 was approximately $161,000, $132,000 and $163,000, respectively. As of December 31, 2012, there was approximately $608,500 of total unrecognized stock-based compensation cost, related to unvested stock options granted under the Amended Plan. This cost is expected to be recognized over a weighted-average period of approximately 5 years. Allocation of stock based compensation expense for the fiscal years ended December 31, 2012, 2011 and 2010 was as follows (in thousands):
|  | 2012 |  |  | 2011 |  |  | 2010 |
Cost of sales |  | $ | 16 |  |  | $ | 16 |  |  | $ | 16 |
Research and development |  |  | 37 |  |  |  | 11 |  |  |  | 33 |
Salaries and related costs |  |  | 108 |  |  |  | 105 |  |  |  | 114 |
Total |  | $ | 161 |  |  | $ | 132 |  |  | $ | 163 |

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 SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 14 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 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Statement of Position (SOP) -Number 93-6 -Paragraph 53 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 6: 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 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 123R -Paragraph 64, 65, A240 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 8: 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 + Details
Name: | us-gaap_DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration