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Stock Options and Award Programs | 12 Months Ended
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Dec. 31, 2013
Stock Options and Award Programs [Abstract] |
Stock Options and Award Programs |
| 12. | Stock Options and Award Programs
The Company's stock incentive plan is administered by the Compensation Committee and authorizes the grant or award of incentive stock options, non-qualified stock options, restricted stock awards, stock appreciation rights, dividend equivalent rights, performance unit awards and phantom shares. The option awards are for the period from 1999 through 2013. The Company issues new shares of common stock upon the exercise of stock options. Any shares associated with forfeited options are added back to the number of shares that underlie stock options to be granted under the stock incentive plan. The Company adopted the 2008 Stock Incentive Plan (the "2008 Plan") on December 18, 2008. The 2008 Plan was enacted to (a) provide incentive to officers and key employees of the Company and its affiliates to stimulate their efforts toward the continued success of the Company and to operate and manage the business in a manner that will provide for the long-term growth and profitability of the Company; (b) encourage stock ownership by directors, officers and key employees by providing them with a means to acquire a proprietary interest in the Company, acquire shares of the Company's common stock, or to receive compensation which is based upon appreciation in the value of the Company's common stock; and (c) provide a means of obtaining, rewarding and retaining key personnel and consultants. The 2008 Plan was amended and restated on December 15, 2009. Under the 2008 Plan, 6,578,049 shares were reserved for issuance under equity incentive awards to be issued pursuant to the 2008 Plan. The 2008 Plan will terminate on December 17, 2017. As of December 31, 2013 there were approximately 2,363,000 shares available for issuance under the 2008 Plan. 1997 Director's Formula Stock Option Plan Under the 1997 Director's Formula Stock Option Plan (the "1997 Director Plan"), as amended, 120 thousand shares were reserved for issuance under the plan. The 1997 Director Plan provided for option grants to purchase 12,000 shares of common stock upon a non-employee director's initial appointment to the Board of Directors. Options granted under the Director Plan vest immediately to 8,000 shares of common stock underlying such options, vest to an additional 2,000 shares after the director's completion of the first year of continued service to the Company, and vest to the remaining 2,000 shares after the completion of the second year of continued service to the Company. Each option granted pursuant to the Director Plan was evidenced by an agreement and is subject to additional terms as set forth in the agreement. Options become exercisable when vested and expire ten years after the date of grant, subject to any shorter period that may be provided in the agreement. Stock Option Plan Activity A summary of the stock option and restricted stock award activity under the Company's stock plans during the years ended December 31, 2013 and 2012 is presented below for non-vested options:
|  |  |  |  | Weighted |  |  | Weighted |
|  |  |  |  | Average Grant |  |  | Average |
|  | # of |  |  | Date Fair Value |  |  | Remaining |
NON-VESTED OPTIONS |  | Shares |  |  | per Share |  |  | Option Life |
Non-vested balances, January 1, 2012 |  |  | 840,000 |  |  | $ | 0.70 |  |  |  |  |
Granted |  |  | 400,000 |  |  | $ | 0.43 |  |  |  |  |
Vested |  |  | (340,000 | ) |  | $ | 0.64 |  |  |  |  |
Non-vested balances, December 31, 2012 |  |  | 900,000 |  |  | $ | 0.60 |  |  |  | 3.58 |
|  |  |  |  | Weighted |  |  | Weighted |
|  |  |  |  | Average Grant |  |  | Average |
|  | # of |  |  | Date Fair Value |  |  | Remaining |
NON-VESTED OPTIONS |  | Shares |  |  | per Share |  |  | Option Life |
Non-vested balances, January 1, 2013 |  |  | 900,000 |  |  | $ | 0.60 |  |  |  |  |
Granted |  |  | 1,650,000 |  |  | $ | 0.18 |  |  |  |  |
Cancelled |  |  | (650,000 | ) |  | $ | 0.22 |  |  |  |  |
Non-vested balances, December 31, 2013 |  |  | 1,900,000 |  |  | $ | 0.36 |  |  |  | 2.30 |
A summary of the stock option and restricted stock award activity under the Company's stock plans during the years ended December 31, 2013 and 2012 is presented below for options outstanding and exercisable:
|  |  |  |  | Weighted |  |  | Weighted |
|  |  |  |  | Average |  |  | Average |
|  | # of |  |  | Exercise Price |  |  | Remaining |
OUTSTANDING AND EXERCISABLE |  | Shares |  |  | per Share |  |  | Option Life |
Options outstanding, January 1, 2012 |  |  | 3,362,000 |  |  | $ | 0.64 |  |  |  |  |
Issued |  |  | 400,000 |  |  | $ | 0.69 |  |  |  |  |
Canceled |  |  | (25,000 | ) |  | $ | 0.54 |  |  |  |  |
Exercised |  |  | (525,000 | ) |  | $ | 0.08 |  |  |  |  |
Options outstanding, December 31, 2012 |  |  | 3,212,000 |  |  | $ | 0.74 |  |  |  | 2.70 |
Options outstanding and exercisable, |  |  |  |  |  |  |  |  |  |  |  |
December 31, 2012 |  |  | 2,312,000 |  |  | $ | 0.67 |  |  |  | 1.91 |
|  |  |  |  | Weighted |  |  | Weighted |
|  |  |  |  | Average |  |  | Average |
|  | # of |  |  | Exercise Price |  |  | Remaining |
OUTSTANDING AND EXERCISABLE |  | Shares |  |  | per Share |  |  | Option Life |
Options outstanding, January 1, 2013 |  |  | 3,212,000 |  |  | $ | 0.74 |  |  |  |  |
Issued |  |  | 1,650,000 |  |  | $ | 0.52 |  |  |  |  |
Canceled |  |  | (690,000 | ) |  | $ | 0.59 |  |  |  |  |
Expired |  |  | (680,000 | ) |  | $ | 0.55 |  |  |  |  |
Exercised |  |  | (155,500 | ) |  | $ | 0.30 |  |  |  |  |
Options outstanding, December 31, 2013 |  |  | 3,336,500 |  |  | $ | 0.72 |  |  |  | 3.85 |
Options outstanding and exercisable, December 31, 2013 |  |  | 1,436,500 |  |  | $ | 0.76 |  |  |  | 1.83 |
Aggregate intrinsic value represents total pretax intrinsic value (the difference between WidePoint's closing stock price on December 31, 2013 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on December 31, 2013. The intrinsic value will change based on the fair market value of WidePoint's stock. The total intrinsic value of options outstanding and exercisable as of December 31, 2013 were approximately $3.1 million and $1.3 million, respectively. The total intrinsic value of options exercised were $89,700 and $305,250 during the year ended December 31, 2013 and 2012, respectively. The fair value of each option award is estimated on the date of grant using a Black-Scholes option pricing model ("Black-Scholes model"), which uses the assumptions of no dividend yield, risk free interest rates and expected life as shown in the table below. Expected volatilities are based on the historical volatility of our common stock. The expected term of options granted is based on analyses of historical employee termination rates and option exercises. The risk-free interest rates are based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. Significant option model assumptions were as follows for options granted during the years ended:
|  | DECEMBER 31
|  | 2013 |  | 2012
Expected dividend yield |  | 0% |  | 0%
Expected volatility |  | 67% - 70% |  | 74%
Risk-free interest rate |  | 0.38-0.42% |  | 0.38-0.40%
Expected life - Employees options |  | 7 years |  | 7 years
Expected life - Non-employees options |  | 2-3 years |  | 2-3 years
Expected life - Board of directors options |  | n/a |  | n/a
The amount of compensation expense recognized under ASC 718-10 under the Company's plans was comprised of the following during the years ended:
|  | YEAR ENDED |
|  | DECEMBER 31, |
|  | 2013 |  |  | 2012 |
General and administrative expense |  | $ | 227,035 |  |  | $ | 217,611 |
Share-based compensation before taxes |  | $ | 227,035 |  |  | $ | 217,611 |
Tot net share-based compensation expense |  | $ | 227,035 |  |  | $ | 217,611 |
Net share-based compensation expenses per basic and diluted common share |  |  | nil |  |  |  | nil |
No tax benefit has been associated with the exercise of stock options for the years ended December 31, 2013 and 2012, respectively, because of the existence of net operating loss carryforwards. There will be no credit to additional paid in capital for such until the associated benefit is realized through a reduction of income taxes payable. At December 31, 2013, the Company had approximately $355,000 of total unamortized compensation expense, net of estimated forfeitures, related to stock option plans that will be recognized over the weighted average period of 2.3 years.

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- 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
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