Quarterly report pursuant to Section 13 or 15(d)

Note 10 - Equity

v3.10.0.1
Note 10 - Equity
 9 Months Ended
Sep. 30, 2018
Notes to Financial Statements  
Stockholders' Equity Note Disclosure [Text Block]
Note
10:
Equity
 
Stock Options
 
In the
nine
months ended
September 30, 2018,
the Company granted
110,792
stock options to employees with exercise prices ranging from
$4.92
-
$8.25.
 
 
Upon the completion of the Company’s IPO in
November 2014,
its stock trading price became the basis of fair value of its common stock used in determining the value of share-based awards. To the extent the value of the Company’s share-based awards involves a measure of volatility, it will rely upon the volatilities from publicly traded companies with similar business models until its common stock has accumulated enough trading history for it to utilize its own historical volatility. The expected life of the options granted is based on the average of the vesting term and the contractual term of the option. The risk-free rate for periods within the expected life of the option is based on the U.S. Treasury
10
-year yield curve in effect at the date of the grant. 
 
The Company has computed the fair value of all options granted during the
nine
months ended
September 30, 2018
and
2017,
using the following assumptions:
 
    Nine Months Ended September 30,
    2018   2017
Expected volatility  
 
35%
  
 
42%
Expected dividends  
 
None
 
  
 
None
 
Expected term (years)  
 
7
 
  
5.5
-
7
Risk-free rate  
2.53%
to
2.90%
  
1.98%
to
2.14%
Forfeiture rate  
 
20%
  
 
20%
 
The information below summarizes the stock options activity:
 
        Weighted   Weighted   Weighted
        Average   Average   Average
   
Number of
  
Exercise
  
Fair
  
Remaining
   
Shares
  
Price
  
Value
  
Contractual Life
Outstanding at December 31, 2016    
953,075
 
   $
3.66
 
   $
1.86
 
    
6.9
 
Granted at market price    
295,286
 
    
4.31
 
    
 
 
    
 
 
Exercised    
(206,875
)
    
1.76
 
    
 
 
    
 
 
Cancelled    
(37,570
)
    
5.11
 
    
 
 
    
 
 
Outstanding at December 31, 2017    
1,003,916
 
   $
4.18
 
   $
1.87
 
    
8.1
 
Granted at market price    
110,792
 
    
6.97
 
    
 
 
    
 
 
Exercised    
(86,640
)
    
3.44
 
    
 
 
    
 
 
Cancelled    
(67,855
)
    
3.37
 
    
 
 
    
 
 
Outstanding at Sepember 30, 2018    
960,213
 
   $
4.63
 
   $
2.05
 
    
7.0
 
Exercisable at September 30, 2018    
476,189
 
   $
4.74
 
   $
2.08
 
    
7.0
 
 
The intrinsic value of the Company’s stock options outstanding was $
3,815,537
at
September 30, 2018.
 
For the
three
and
nine
months ended
September 30, 2018,
stock-based compensation expense for stock options was
$62,951
and
$271,764,
respectively.  For the
three
and
nine
months ended
September 30, 2017,
stock-based compensation expense for stock options was
$125,588
and
$261,471,
respectively. Unrecognized stock-based compensation expense for stock options as of
September 30, 2018
was
$792,031,
which is expected to be recognized ratably over the next
2.77
years.
 
Restricted Stock
 
The information below summaries the restricted stock activity:
 
Restricted Stock Awards   Shares
Outstanding at December 31, 2017    
63,700
  
Awards granted    
50,134
  
Awards vested    
(61,700
 )
Awards forfeited    
(1,000
 )
Outstanding at September 30, 2018    
51,134
  
 
For the
three
and
nine
months ended
September 30, 2018,
stock-based compensation expense for restricted stock was
$59,825
and
$197,641,
respectively. For the
three
and
nine
months ended
September 30, 2017,
stock-based compensation expense for restricted stock was
$59,804
and
$151,041,
respectively. Unrecognized stock-based compensation expense for restricted stock awards as of
September 30, 2018
was
$316,807,
which is expected to be recognized ratably over the next
2.06
years.