Stock-Based Compensation Plan
|9 Months Ended|
Sep. 30, 2022
|Stock-Based Compensation Plan [Abstract]|
|Stock-Based Compensation Plan||
NOTE 13. STOCK-BASED COMPENSATION PLAN
Under the Company’s current 2015 Stock Incentive Plan (the “2015 Plan”), the Company’s Board of Directors has flexibility to determine the type and amount of awards to be granted to eligible participants, who must be employees, directors, officers or consultants of the Company or its subsidiaries. The 2015 Plan allows for grants of incentive stock options, nonqualified stock options, restricted stock awards, stock appreciation rights, and restricted units. The aggregate number of shares of common stock that may be granted through awards under the 2015 Plan to any employee in any calendar year may not exceed 500 shares. The 2015 Plan will continue in effect until December 2025 unless terminated sooner.
During the nine months ended September 30, 2022, the Company issued stock options for an aggregate of 440 shares under the 2015 Plan to directors and employees of the Company. Of the 440 options, 355 vest and become exercisable over a period of three years, 75 vest in four equal consecutive quarterly tranches from the date of grant and the remaining 10 vest immediately. All of the issued stock options expire ten years from the date of the grant.
For computing the fair value of the stock-based awards, the fair value of each option grant has been estimated as of the date of grant using the Black-Scholes option-pricing model with the following assumptions:
Options Granted During the Nine Months Ended September 30, 2022
(a)Expected volatility is based upon the Company’s historical volatility.
(b)The expected term was determined based upon the underlying terms of the awards and the category and employment history of employee award recipient.
The grant date fair value of the stock options granted during the nine months ended September 30, 2022 was $3,661, which will be recognized over the vesting period of the options.
Market Condition Restricted Shares Granted:
On March 4, 2022, the Company issued and granted to certain employees restricted stock awards of 700 restricted shares under the 2015 Plan, of which 700 restricted shares will vest if, on or before March 4, 2032, the Fair Market Value (as defined in the Plan) of the Company’s common stock shall have equaled or exceeded $50.00 per share for twenty consecutive trading days. For computing the fair value of the restricted shares with a market condition, the fair value of the restricted stock award grant has been estimated as of the date of grant using the Monte-Carlo pricing model with the following assumptions:
Using these assumptions, the fair value of the market condition restricted stock awards granted on March 4, 2022, was approximately $10,761 and the expected term was 4.15 years.
The total non-cash stock compensation expense related to restricted stock, stock options and stock awards recorded by the Company for the three months ended September 30, 2022 and 2021 was $2,220 and $3,064, respectively, and for the nine months ended September 30, 2022 and 2021 was $9,142 and $6,414, respectively. For the three and nine months ended September 30, 2022 and 2021, the majority of stock-based compensation costs were classified as selling, general and administrative expenses.
As of September 30, 2022, there were 1,492 unvested stock options and unrecognized compensation cost of $5,862 related to unvested stock options, as well as 1,546 unvested restricted stock awards and unrecognized compensation costs of $9,919 related to unvested restricted stock awards.
Tabular disclosure of share-based payment arrangement.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef