Stockholders Equity

9 Months Ended

Sep. 30, 2011

Stockholders' Equity [Abstract]

Stockholders' Equity

10. Stockholders’ Equity

Purchase of Capital Stock

On June 8, 2009, the Company’s Board of Directors authorized a program for periodic purchases of GTSI’s common stock through May 27, 2011 for an aggregate purchase price not to exceed $5 million.

On August 30, 2011, GTSI entered into an amendment to the Second Amended Credit Agreement which permits GTSI to purchase its common stock subject to certain terms and conditions, including that such purchases cannot exceed an aggregate purchase price of $5 million. On August 31, 2011, the Board of Directors authorized a share repurchase program pursuant to Rules 10b5-1 and 10b-18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) permitting the Company to repurchase its common stock up to an aggregate purchase price of $5 million.

During the nine months ended September 30, 2011 and 2010, under the repurchase program, the Company purchased 25,538 and 154,377 shares of its common stock, respectively. In addition, during the nine months ended September 30, 2011 and 2010, the Company acquired 5,650 and 18,831 of its common stock, respectively, related to minimum tax withholding on vested restricted stock awards

Stock-Based Compensation

Stock Incentive Plans

The Company has one stockholder approved combination incentive and non-statutory stock incentive plan, which is named the Amended and Restated 2007 Stock Incentive Plan (“2007 Plan”). The 2007 Plan provides for the granting of options to employees and non-employee directors to purchase up to 4,500,000 shares of the Company’s common stock. The 2007 Plan also permits the grant of restricted stock and restricted stock units to its employees and non-employee directors as well as stock appreciation rights (“SARs”).

Under the 2007 Plan, options have a term of up to 10 years, generally vest over four years and option prices are required to be at not less than 100% of the fair market value of the Company’s common stock at the date of grant and, except in the case of non-employee directors, must be approved by the Board of Directors or its Compensation Committee. The vesting period for restricted stock and restricted stock units is determined by the Compensation Committee on an individual award basis. GTSI recognizes stock-based compensation expense for these graded vesting awards on a straight-line basis over the requisite service period for the entire award, which is equal to the vesting period specified in the option agreement.

Stock Options

A summary of option activity under the 2007 Plan as of September 30, 2011 and changes during the nine months then ended is presented below:

						Weighted
						Average
				Weighted		Remaining		Aggregate
	Shares			Average		Contractual		Intrinsic Value
	(in thousands)			Exercise Price		Term		(in thousands)
Outstanding at January 1, 2011		964		$	7.79
Granted		200			4.66
Exercised		—			—
Forfeited		(55	)		6.25
Expired		(380	)		8.34
Outstanding at September 30, 2011		729		$	6.76		4.13	$	1
Exercisable at September 30, 2011		381		$	8.53		2.15		—

There were 200,000 and 175,000 stock options granted during the nine months ended September 30, 2011 and 2010, respectively. There were no stock options exercised under the 2007 Plan during the nine months ended September 30, 2011. During the nine months ended September 30, 2010 there were 30,000 stock options exercised under the 2007 Plan. The Company has historically reissued treasury stock or authorized common stock to satisfy stock option exercises, restricted stock grants, and employee stock purchases. A tax benefit for the exercise of stock options and the vesting of restricted stock (including elections under Internal Revenue Code section 83(b)) in the amount of $0.1 million was recognized for the nine months ended September 30, 2011. A tax benefit for the exercise of stock options in the amount of $0.2 million was recognized for the nine months ended September 30, 2010.

Restricted Shares

During the nine months ended September 30, 2011 and 2010, 26,664 and 26,664 restricted stock awards were granted, respectively. The fair value of non-vested restricted stock is determined based on the closing trading price of the Company’s shares on the grant date. A summary of the status of Company’s non-vested restricted stock as of September 30, 2011, and changes during the nine months then ended is presented below:

				Weighted Average
	Shares			Grant-Date Fair
	(in thousands)			Value
Nonvested at January 1, 2011		85		$	8.35
Granted		27			4.56
Vested		(43	)		7.94
Forfeited		(17	)		8.00
Nonvested at September 30, 2011		52		$	6.86

Stock Appreciation Rights (“SAR”s)

A summary of SARs activity under the 2007 Plan as of September 30, 2011 and changes during the nine months then ended is presented below:

						Weighted
						Average
				Weighted		Remaining		Aggregate
	Shares			Average		Contractual		Intrinsic Value
	(in thousands)			Exercise Price		Term		(in thousands)
Outstanding at January 1, 2011		381		$	9.60
Granted		—			—
Exercised		—			—
Forfeited		(44	)		9.60
Expired		(118	)		9.60
Outstanding at September 30, 2011		219		$	9.60		2.85	$	—
Exercisable at September 30, 2011		151		$	9.60		2.55	$	—

During the nine months ended September 30, 2011 and 2010, no SARS were granted. All SARs are to be settled in Company stock.

Stock Compensation Expense and Unrecognized Compensation

For the nine months ended September 30, 2011, stock compensation expense for stock options, restricted stock awards and stock appreciation rights were $0.3 million, a credit of $0.1 million, and $0.0 million, respectively, which includes out-of-period adjustments recorded for the three months ended March 31, 2011. For the nine months ended September 30, 2010, stock compensation expense for stock options, restricted stock and SARs were $0.4 million, $0.5 million and $0.7 million, respectively.

As of September 30, 2011, there was $0.9 million of total unrecognized compensation cost related to non-vested stock-based awards, which consisted of unrecognized compensation of $0.1 million related to stock options, $0.2 million related to restricted stock awards and $0.6 million related to stock appreciation rights. The cost for unrecognized compensation related to stock options, restricted stock awards and stock appreciation rights is expected to be recognized over a weighted average period of 2.4 years, 1.0 years and 1.5 years, respectively.