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Stock-Based Compensation
9 Months Ended
Sep. 30, 2011
Stock-Based Compensation

NOTE 8 — Stock-Based Compensation

 

The Company recognizes stock-based compensation in the financial statements for all share-based awards to employees, including grants of employee stock options, based on their fair values. The Company uses a binomial lattice valuation model to estimate the fair value of stock option grants. The binomial lattice model incorporates calculations for expected volatility, risk-free interest rates, employee exercise patterns and post-vesting employment termination behavior, and these factors affect the estimate of the fair value of the Company's stock option grants. Total stock-based compensation expense for the three and nine months ended September 30, 2011 was $188,677 and $548,838. Total stock-based compensation expense for the three and nine months ended September 30, 2010 was $188,893 and $509,036.

 

In the three and nine months ended September 30, 2011, 33,600 and 288,250 stock options were granted, respectively, at weighted average per share fair values estimated at $1.16 and $1.07, respectively. In the three and nine months ended September 30, 2010, 705,950 and 849,950 stock options were granted, respectively, at weighted average per share fair values estimated at $2.10 and $1.92, respectively. At September 30, 2011, options issued to employees for 1,427,288 shares were outstanding, of which options for 751,981 shares were exercisable. As of September 30, 2011, the total remaining unrecognized compensation costs related to unvested stock options was approximately $0.88 million, which will be amortized over the weighted average remaining requisite period of 1.8 years.