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Note 3 - Stock-Based Compensation
 3 Months Ended
Mar. 31, 2013
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]
3.     STOCK-BASED COMPENSATION

We have one stock option plan which provides for annual stock option grants to non-employee directors with an exercise price equal to the fair market value of the shares at the date of grant.  Under this plan, 12,000 options were awarded to directors for each of the three month periods ended March 31, 2013 and 2012.  These options vest and become exercisable six months from the option grant date.  We had two other stock option plans from 1995 which provided for stock option grants to officers, key employees and non-employee directors.  These plans expired in 2005.  The expiration of the plans has no effect on the options previously granted.  Options outstanding and exercisable were granted at a stock option price which was not less than the fair market value of our common stock on the date the option was granted and no option has a term in excess of ten years.  We recognized share based compensation expense of $5,843 and $5,000 for the quarters ended March 31, 2013 and 2012, respectively, as a component of operating expenses.  During the three months ended March 31, 2013 and 2012, the stock option activity under our stock option plans was as follows:

   
Weighted Average Exercise
Price
   
#
of
shares
   
Weighted Average Remaining Contractual Term (in years)
   
Aggregate Intrinsic Value
 
Outstanding, January 1, 2012
  $ 4.40       115,600              
Granted
    5.27       12,000              
Cancelled
    -       -              
Exercised
    -       -              
Outstanding, March 31, 2012
  $ 4.48       127,600       5.38     $ 216,332  
Exercisable, March 31, 2012
  $ 4.40       115,600       4.90     $ 206,332  
                                 
Outstanding, January 1, 2013
  $ 4.53       121,600                  
Granted
    6.87       12,000                  
Cancelled
    -       -                  
Exercised
    -       -                  
Outstanding, March 31, 2013
  $ 4.74       133,600       4.97     $ 218,446  
Exercisable, March 31, 2013
  $ 4.53       121,600       4.83     $ 206,760  

Other information pertaining to option activity during the three-month periods ended March 31, 2013 and 2012 are as follows:

   
March 31, 2013
   
March 31, 2012
 
Weighted average grant-date fair value of stock options granted
  $ 11,686     $ 10,000  
Total fair value of stock options vested
    N/A       N/A  
Total intrinsic value of stock options exercised
    N/A       N/A  

The fair value of options at the date of grant was estimated using the Black-Scholes option pricing model with the following weighted-average assumptions:

   
2013
   
2012
 
Volatility
    19.1%       21.4%  
Expected option life (yrs)
 
3
   
3
 
Interest rate (risk free)
    0.80%       0.875%  
Dividends
 
None
   
None
 

As of March 31, 2013 and 2012, there was unrecognized compensation cost related to non-vested stock options of $5,843 and $5,000, respectively.