• Filing Date: 2020-03-23
  • Form Type: 10-K
  • Description: Annual report
v3.20.1
Stock-Based Compensation
12 Months Ended
Dec. 31, 2019
Share-based Payment Arrangement [Abstract]  
Stock-Based Compensation

The Company currently has outstanding stock-based awards granted under the 2014 Omnibus Incentive Plan (the “Plan”). Under the Plan, the Company has discretion to grant equity and cash incentive awards to eligible individuals, including the issuance of up to 1,000,000 of the Company’s ordinary shares. At December 31, 2019, there were 400,000 shares available for grant under the Plan.

 

Stock options

 

Stock options granted and outstanding under the Plan vests quarterly over four years and are exercisable over the contractual term of ten years.

 

A summary of the stock option activity for the years ended December 31, 2019 and 2018 is as follows (option amounts not in thousands):

 

   

Number

of

Options

   

Weighted Average

Exercise

Price

   

Weighted-Average Remaining

Contractual

Term

   

Aggregate

Intrinsic

Value ($000)

 
                         
Outstanding at January 1, 2018     250,000                          
Outstanding at December 31, 2018     250,000     $ 6.01       6.4 years          
Granted     290,000     $ 2.00                  
Outstanding at December 31, 2019     540,000     $ 3.86       7.4 years     $ -  
Exercisable at December 31, 2019     291,250     $ 5.26       6.1 years     $ -  

 

Compensation expense recognized for the years ended December 31, 2019 and 2018 totaled $36,000 and $38,000, respectively, and is included in general and administrative expenses. At December 31, 2019 and 2018, there was approximately $86,000 and $16,000, respectively, of total unrecognized compensation expense related to non-vested stock options granted under the Plan. The Company expects to recognize the remaining compensation expense over a weighted-average period of thirty (30) months.

 

No options were granted during the year ended December 31, 2018. During the year ended December 31, 2019, 290,000 options were granted with fair value estimated on the date of grant using the following assumptions and the Black-Scholes option pricing model:

 

    2019  
       
Expected dividend yield     0 %
Expected volatility     31 %
Risk-free interest rate     2.59 %
Expected life (in years)     10  
Per share grant date fair value of options issued   $ 0.36  

 

At the time of the grant, the dividend yield was based on the Company’s history and expectation of dividend payouts at the time of the grant; expected volatility was based on volatility of similar companies’ common stock; the risk-free rate was based on the U.S. Treasury yield curve in effect and the expected life was based on the contractual life of the options.

 

Restricted Stock Awards

 

The Company has granted and may grant restricted stock awards to eligible individuals in connection with their service to the Company. The terms of the Company’s outstanding restricted stock grants may include service, performance and market-based conditions. The fair value of the awards with market-based conditions is determined using a Monte Carlo simulation method, which calculates many potential outcomes for an award and then establishes fair value based on the most likely outcome. The determination of fair value with respect to the awards with only performance or service-based conditions is based on the value of the Company’s stock on the grant date. Restricted stock awards granted and outstanding under the Plan vests quarterly over four years.

 

During the year ended December 31, 2019 and 2018, the Company did not grant any restricted stock. At December 31, 2019 there were no unvested restricted stock. Compensation expense recognized for the year ended December 31, 2018 totaled $88,000 and was included in general and administrative expenses.