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Stock-based compensation
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Nov. 30, 2014
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| Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based Compensation |
STOCK-BASED COMPENSATION
On June 15, 2005, the shareholders approved an amended and Restated Stock Option Plan amending the 2003 Stock Option Plan (the “Plan”). The Plan authorizes the issuance of up to one million shares of common stock (subject to customary adjustments set forth in the plan) pursuant to equity awards, which may take the form of incentive stock options, nonqualified stock options restricted shares, stock appreciation rights and/or performance shares. The plan expires in April, 2015.
On January 1, 2006, the Company adopted ASC Topic 718, "Stock Compensation" which requires an entity to recognize the grant-date fair value of stock options and other equity-based compensation issued to employees in the financial statements.
The fair value of the stock option grants below were estimated on the date of the grant using a Black-Scholes valuation model and the assumptions in the following table:
On February 1, 2014, the Company granted incentive stock options for 100,000 shares to Richard Kornhauser, its President and Chief Executive Officer at $3.40 per share. The closing price of the Company's stock on the date of the grant was $3.04 per share. The options vest in equal 20% increments commencing on October 17, 2014, and for each of the four subsequent anniversaries of such date. The options expire on January 31, 2019. The Company has estimated the fair value of the options granted to be $114,000 as of the grant date, which amount shall be amortized as an expense over a five year period. Accordingly, the Company recorded a charge against earnings in the amount of $27,000 for the fiscal year end November 30, 2014. There were no other stock options for named executive officers granted or options exercised during fiscal 2014.
On October 16, 2014, the Company granted incentive stock options for 10,000 shares to Gail Perlow, a Company employee, at $3.36 per share. The closing price of the Company's stock on the date of grant was $3.36 per share. The options vest in equal 20% increments commencing on October 16, 2015, and for each of the four subsequent anniversaries of such date. The options expire on October 15, 2024. The Company has estimated the fair value of the options granted to be $16,479 as of the grant date, which amount shall be amortized as an expense over a five year period. Accordingly, the Company recorded a charge against earnings in the amount of $549 for the fiscal year end November 30, 2014.
Non-qualified stock options were granted to three directors on October 2, 2014. Stanley Kreitman and Robert Lage were granted options for 10,000 shares each at $3.42 per share, and Josephine Belli was granted options for 7,000 shares at $3.42 per share. The closing price of the Company's stock on the date of the grant was $3.42 per share. The options vest on October 2, 2015, subject to the grantee's continuous service as Director through that date. The options expire on October 1, 2024. The Company has estimated the fair value of the options granted to be $44,510 as of the grant date, which amount shall be amortized as an expense over a one year period. Accordingly, the Company recorded a charge against earnings in the amount of $1,486 for the fiscal year end November 30, 2014.
A summary of stock option activity for the Company is as follows:
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