Quarterly report pursuant to Section 13 or 15(d)

STOCK-BASED COMPENSATION

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STOCK-BASED COMPENSATION
6 Months Ended
Jun. 30, 2021
Share-based Payment Arrangement [Abstract]  
STOCK-BASED COMPENSATION

NOTE 9 - STOCK-BASED COMPENSATION

 

Stock Option Plans

 

[A] Stock options:

 

The following table summarizes the activity relating to the Company’s stock options for the six-month period ended June 30, 2021:

 

    Options    

Weighted- Average

Exercise Price

    Weighted-Average Remaining Contractual Terms   Aggregate Intrinsic Value  
                       
Outstanding at beginning of year     3,624     $ 5.85              
Granted     120       7.77              
Exercised     (141 )     5.58              
Forfeited or expired     (62 )     6.04              
                             
Outstanding at end of period     3,541     $ 5.92     7.8 years   $ 2,584  
                             
Exercisable at end of period     1,276     $ 5.66     6.4 years   $ 1,218  

 

The fair value of each option grant on the date of grant is estimated using the Black-Scholes option-pricing model reflecting the following weighted-average assumptions:

 

    June 30,  
    2020     2021  
             
Expected volatility     44.7 %     50.2 %
Expected life of options (in years)     6       7  
Risk free interest rate     1.17 %     0.69 %
Dividend yield     0 %     0 %
Weighted-average fair value of options granted during year   $ 2.58     $ 3.81  

 

Expected volatility is based on historical volatility of the Company’s common stock and the expected life of options is based on historical data with respect to employee exercise periods.

 

The Company recorded stock-based compensation expense of $411 and $843 for the three- and six-month periods ended June 30, 2020, respectively and $339 and $716, for the three- and six-month periods ended June 30, 2021, respectively, in connection with awards made under the stock option plans.

 

The fair value of options vested during the six-month periods ended June 30, 2020 and 2021 was $1,012 and $438, respectively. The total intrinsic value of options exercised during the six-month periods ended June 30, 2020 and 2021 was $225 and $465, respectively.

 

 

As of June 30, 2021, there was approximately $3,480 of unrecognized compensation cost related to non-vested options granted under the Company’s stock option plans. That cost is expected to be recognized over a weighted-average period of 3.84 years.

 

The Company estimates forfeitures at the time of valuation and reduces expense ratably over the vesting period. This estimate is adjusted periodically based on the extent to which actual forfeitures differ, or are expected to differ, from the previous estimate.

 

[B] Restricted Stock Awards:

 

The Company grants restricted stock to employees, whereby the employees are contractually restricted from transferring the shares until they are vested. The stock is unvested at the time of grant and, upon vesting, there are no legal restrictions on the stock. The fair value of each share is based on the Company’s closing stock price on the date of the grant. A summary of all non-vested restricted stock for the six-month period ended June 30, 2021 is as follows: 

 

   

Number of

Non-Vested

Shares

   

Weighted-Average

Grant Date

Fair Value

 
             
Restricted stock, non-vested, beginning of year     806     $ 5.54  
Granted     416       7.67  
Vested     (129 )     6.94  
Forfeited or expired     (23 )     5.40  
                 
Restricted stock, non-vested, end of period     1,070     $ 6.20  

 

The Company recorded stock-based compensation expense of $449 and $1,048, respectively, for the three- and six-month periods ended June 30, 2020, and $710 and $1,375, respectively, for the three- and six-month periods ended June 30, 2021, in connection with restricted stock grants. As of June 30, 2021, there was $4,275 of total unrecognized compensation cost related to non-vested shares. That cost is expected to be recognized over a weighted-average period of 2.8 years.

 

[C] Restricted Stock Units:

 

The Company also grants restricted stock units (RSUs) to employees. The following table summarizes the activity relating to the Company’s restricted stock units for the six-month period ended June 30, 2021: 

 

   

Number of

Restricted

Stock Units

   

Weighted-Average

Grant Date

Fair Value

 
             
Restricted stock units, non-vested, beginning of year     75     $ 5.60  
Granted     -       -  
Vested     (34 )     5.60  
Forfeited     (4 )     5.60  
                 
 Restricted stock units, non-vested, end of period     37     $ 5.60  

 

The Company recorded stock-based compensation expense of $67 and $195, respectively, for the three- and six-month periods ended June 30, 2020, and $46 and $101, respectively, for the three- and six-month periods ended June 30, 2021, in connection with the RSUs. As of June 30, 2021, there was $146 total unrecognized compensation cost related to non-vested RSUs. That cost is expected to be recognized over a weighted-average period of 0.8 years.