Stock-Based Compensation |
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| Stock-Based Compensation |
NOTE 5 - STOCK-BASED COMPENSATION
Employee Stock Purchase Plan
Under the Company’s Employee Stock Purchase Plan (“ESPP”), employees are able to acquire shares of common stock at 85% of the price at the end of each current quarterly plan term. The most recent term ended June 30, 2021. The ESPP is considered compensatory under current Internal Revenue Service rules. At June 30, 2021, after giving effect to the shares issued as of that date, 59,303 shares remain available for future issuance under the ESPP. The ESPP was suspended effective March 31, 2021 due to conditions of the Pineapple Merger Agreement.
2011 Executive Incentive Compensation Plan
On March 28, 2011 the Board adopted and on May 19, 2011 the Company’s shareholders approved the Company’s 2011 Executive Incentive Compensation Plan (“2011 Incentive Plan”). The 2011 Incentive Plan authorizes incentive awards to officers, key employees and non-employee directors in the form of options (incentive and non-qualified), stock appreciation rights, restricted stock, restricted stock units, performance stock units (“deferred stock”), performance cash units, and other awards in stock, cash, or a combination of stock and cash. The 2011 Incentive Plan, as amended, allows the issuance of up to 2,500,000 shares of common stock.
At June 30, 2021, 526,913 shares have been issued under the 2011 Incentive Plan, 1,168,630 shares are subject to currently outstanding options, deferred stock awards, and unvested restricted stock units, and 804,457 shares are eligible for grant under future awards.
Changes in Stock Options Outstanding
The following table summarizes changes in the number of outstanding stock options under the 2011 Incentive Plan over the period December 31, 2020 to June 30, 2021:
The aggregate intrinsic value of all options (the amount by which the market price of the stock on the last day of the period exceeded the market price of the stock on the date of grant) outstanding at June 30, 2021 was $2,129,000. The intrinsic value of all options exercised during the six months ended June 30, 2021 was $0. Net cash proceeds from the exercise of all stock options were $0 in each of the six-month periods ended June 30, 2021 and 2020.
Changes in Deferred Stock Outstanding
The following table summarizes the changes in the number of deferred stock shares under the 2011 Incentive Plan over the period December 31, 2020 to June 30, 2021:
Compensation Expense
Share-based compensation expense recognized for the six months ended June 30, 2021 was $242,000 before income taxes and $191,000 after income taxes. Share-based compensation expense recognized for the six months ended June 30, 2020 was $177,000 before income taxes and $140,000 after income taxes. Unrecognized compensation expense for the Company’s plans was $322,000 at June 30, 2021 and is expected to be recognized over a weighted-average period of 2.1 years. Share-based compensation expense is recorded as a part of selling, general and administrative expenses.
Employee Stock Ownership Plan (ESOP)
All eligible employees of the Company participate in the ESOP after completing one year of service. Contributions are allocated to each participant based on compensation and vest 20% after two years of service and incrementally thereafter, with full vesting after six years. The Company contributed $329,968 for which the Company issued 72,203 shares in March 2021 for the 2020 ESOP contribution. |
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