Note 5 - Stock-based Compensation | 9 Months Ended |
Sep. 30, 2013 |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | ' |
(5) Stockholders Equity |
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Stock-based Compensation |
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Stock-based compensation expense includes compensation expense, recognized over the applicable requisite service periods, from awards of stock options and restricted stock units (“RSUs”) made under the Omnibus Long-Term Incentive Plan as adopted by the Company’s stockholders in 2004 and subsequently amended (“Omnibus Plan”). As of September 30, 2013, there was no unrecognized compensation cost related to stock options and RSUs. In connection with the tender offer by Steel Excel Inc. (“Steel”) to acquire up to 1,316,866 of the outstanding shares of the Company’s common stock, representing a 44.7% ownership position in the Company on a fully-diluted basis, at a price of $3.95 per share (the “Offer”), the Company’s Board of Directors (the “Board”) approved the conditional acceleration of full vesting of outstanding stock options and RSUs upon the commencement of the Offer. Accordingly, upon the consummation of the Offer, $474,000 unrecognized compensation cost related to stock options and RSUs was recognized on August 23, 2013. |
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For the three and nine months ended September 30, 2013, the Company recorded pre-tax charges to general and administrative expense of $541,000 and $758,000, respectively, associated with RSU and stock option awards activity. For the three and nine months ended September 30, 2012, the Company recorded pre-tax charges to general and administrative expense of $343,000 and $1,199,000, respectively, associated with RSU awards activity. There was no stock option awards activity for the three and nine months ended September 30, 2012. |
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Stock Options |
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Stock options awarded under the Omnibus Plan are granted with an exercise price equal to the fair market value of the Company’s stock on the date of grant and vest over a period determined by the Compensation and Human Relations Committee of the Company’s Board of Directors when the options are granted. Vesting periods generally range from one to three years. The options have a maximum term of ten years. |
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As of September 30, 2013, there were 45,833 fully vested stock options outstanding and exercisable and no non-vested stock options, compared to 87,500 non-vested stock options and no fully vested stock options outstanding as of December 31, 2012, as adjusted for the 1-for-12 reverse stock split effective on January 28, 2013. |
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| | Number of | | | Weighted | | | Weighted | | | Aggregate | |
Options | Average | Average | Intrinsic |
| Exercise | Remaining Contractual | Value(In |
| Price | Term | Thousands) |
Outstanding, December 31, 2012 | | | 87,500 | | | $ | 9 | | | | 9.27 | | | | - | |
Granted | | | - | | | | - | | | | - | | | | - | |
Canceled | | | 41,667 | | | $ | 9 | | | | 8.53 | | | | - | |
Exercised | | | - | | | | - | | | | - | | | | - | |
Outstanding, September 30, 2013 | | | 45,833 | | | $ | 9 | | | | 8.53 | | | | - | |
Exercisable at September 30, 2013 | | | 45,833 | | | $ | 9 | | | | 8.53 | | | | - | |
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As of September 30, 2013, there was no unrecognized compensation cost related to non-vested stock options. |
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No stock options were exercised during the nine-month periods ended September 30, 2013 and 2012. |
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The Company did not grant any stock options during the nine-month period ended September 30, 2013. The weighted average fair value of options granted in the nine-month period ended September 30, 2012 was $6.12. The fair value of the stock options was determined using the Black-Scholes option valuation model, which relied on the following key assumptions with respect to the options granted during the respective periods: |
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| | Three Months Ended | | | Nine Months Ended | |
September 30, | September 30, |
| | 2013 | | | 2012 | | | 2013 | | | 2012 | |
| | | | | | | | | | | | | | | | |
Weighted average risk-free interest rate | | | - | | | | 1.24 | % | | | - | | | | 1.24 | % |
Expected life of the options (in years) | | | - | | | | 6.5 | | | | - | | | | 6.5 | |
Expected stock price volatility | | | - | | | | 75.64 | % | | | - | | | | 75.64 | % |
Expected dividend yield | | | - | | | | - | | | | - | | | | - | |
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The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions, including the expected stock price volatility. The risk-free interest rate is based on the U.S. Treasury security rate in effect as of the date of grant. The expected term of the options and stock price volatility are based on historical data of the Company. |
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Restricted Stock Units |
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The Company grants RSUs to certain employees and directors. RSUs are valued at the closing market value of the Company’s common stock on the date of grant. |
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The following table summarizes information regarding RSUs as of December 31, 2012 and for the nine months ended September 30, 2013, as adjusted for the 1-for-12 reverse stock split effective on January 28, 2013. |
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| | Omnibus Plan | | | Inducement Grants | |
| | Number | | | Weighted | | | Number | | | Weighted | |
Average | Average |
Value per | Value per |
Share | Share |
Outstanding, December 31, 2012 | | | 30,047 | | | $ | 31.01 | | | | 29,163 | | | $ | 21.91 | |
Granted | | | - | | | $ | - | | | | - | | | $ | - | |
Canceled | | | (5,785 | ) | | $ | 30.38 | | | | (5,113 | ) | | $ | 23.28 | |
Released to common stock | | | (19,502 | ) | | $ | 30.61 | | | | (23,593 | ) | | $ | 21.62 | |
Released for settlement of taxes | | | (4,760 | ) | | $ | 33.38 | | | | (457 | ) | | $ | 21.62 | |
Outstanding, September 30, 2013 | | | - | | | $ | - | | | | - | | | $ | - | |
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As of September 30, 2013, there was no unrecognized compensation cost related to non-vested RSUs. |
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Preferred Stock and Dividends |
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On June 20, 2013, the Company entered into an Amended and Restated Rights Agreement with its transfer agent, which amended and restated the Company’s previous Rights Agreement dated as of June 11, 2003, as amended, scheduled to expire on June 23, 2013. In connection with the Company’s entering into the Amended and Restated Rights Agreement, the Board declared a dividend of one preferred share purchase right (a “ Right” and collectively, the “Rights” ) for each outstanding share of common stock, par value $0.01 per share, of the Company to stockholders of record at the close of business on June 30, 2013. |
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The Rights granted under the Amended and Restated Rights Agreement are intended to establish a deterrent to any person acquiring 4.9% or more of the outstanding shares of the Company’s common stock, or any existing 4.9% or greater holder from acquiring any additional shares representing 1.0% or more of the then outstanding common stock, in each case, without the approval of the Board, in an effort to preserve the Company’s net operating losses and other similar tax attributes against potential limitations presented by stock ownership changes. |
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Each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series H Junior Participating Preferred Stock (“Preferred Stock”), par value $0.01 per share, of the Company’s preferred stock at a price of $6.75 per one one-thousandth of a share. The Rights become exercisable only, however, after any person acquires, or announces intention to acquire via a tender or exchange offer, 4.9% or more of the Company's outsanding shares of common stock. Prior to such time, the Board may redeem the Rights in whole, but not in part, at a redemption price of $0.01 per Right payable in cash, shares of the Company’s common stock or another form of consideration at the option of the Company. Immediately upon the redemption of any Rights, the holder’s right to exercise such Rights will terminate and the holder will be entitled only to receive the redemption price. |
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Until a Right is exercised or exchanged, the holder thereof, as such, will have no additional rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends. |
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Shares of Preferred Stock issued upon exercise of the Rights will not be redeemable. Each share of Preferred Stock will be entitled, when, as and if declared, to a minimum preferential quarterly dividend payment of the greater of (a) $10 per share, and (b) an amount equal to 1,000 times the dividend declared per share of common stock. In the event of liquidation, dissolution or winding up of the Company, the holders of the Preferred Stock will be entitled to a minimum preferential payment of the greater of (a) $1,000 per share (plus any accrued but unpaid dividends), and (b) an amount equal to 1,000 times the payment made per share of common stock. Each share of Preferred Stock will have 1,000 votes, voting together with the common stock. Finally, in the event of any merger, consolidation or other transaction in which outstanding shares of common stock are converted or exchanged, each share of Preferred Stock will be entitled to receive 1,000 times the amount received per share of common stock. These rights are protected by customary antidilution provisions. |
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At September 30, 2013 and December 31, 2012, 15,000,000 shares of Preferred Stock were authorized. There were no shares of Preferred Stock issued and outstanding at September 30, 2013 and December 31, 2012. |