Note 2 - Stock Incentive Plans and Other Share-based Compensation

6 Months Ended

Apr. 30, 2019

Notes to Financial Statements

Share-based Payment Arrangement [Text Block]

(2) Stock Incentive Plans and Other Share-Based Compensation

As of April 30, 2019, there were approximately 439,000 remaining shares available for grant under the Optical Cable Corporation 2017 Stock Incentive Plan (“2017 Plan”).

Share-based compensation expense for employees, a consultant and non-employee Directors recognized in the condensed consolidated statements of operations for the three months and six months ended April 30, 2019 was $36,450 and $898,704 respectively, and for the three months and six months ended April 30, 2018 was $589,505 and $702,859 respectively. Share-based compensation expense is entirely related to expense recognized in connection with the vesting of restricted stock awards or other stock awards.

Restricted and Other Stock Awards

The Company has granted, and anticipates granting from time to time, restricted stock awards subject to approval by the Compensation Committee of the Board of Directors. Since fiscal year 2004, the Company has exclusively used restricted stock awards for all share-based compensation of employees and consultants, and restricted stock awards or stock awards to non-employee members of the Board of Directors.

During the three months ended April 30, 2019, OCC granted restricted stock awards totaling 30,360 shares to non-employee Directors under the 2017 Plan. The shares are subject to a one year vesting period and are part of the non-employee Directors’ annual compensation for service on the Board of Directors. The Company recorded expense totaling $28,577 and $53,644, respectively, during the three months and six months ended April 30, 2019 and recorded expense totaling $23,523 and $46,274, respectively, during the three and six months ended April 30, 2018 related to the grants to non-employee Directors.

Restricted stock award activity during the six months ended April 30, 2019 consisted of restricted stock grants totaling 30,360 shares, restricted shares forfeited totaling 4,745 and restricted shares withheld for taxes in connection with the vesting of restricted shares totaling 259,209. Employees and non-employee Directors have the option to surrender shares to pay for withholding tax obligations resulting from any vesting restricted shares, or to pay cash to the Company or taxing authorities in the amount of the withholding taxes owed on the value of any vesting restricted shares in order to avoid surrendering shares.

As of April 30, 2019, the estimated amount of compensation cost related to unvested equity-based compensation awards in the form of service-based and operational performance-based shares that the Company will recognize over a 1.6 year weighted-average period is approximately $439,000.