10. SHARE-BASED COMPENSATION

Pursuant to the Legacy Housing Corporation 2018 Incentive Compensation Plan (the “Compensation Plan”), the Company may issue up to 10.0 million equity awards to employees, directors, consultants and nonemployee service providers in the form of stock options, stock and stock appreciation rights. Stock options may be granted with a contractual life of up to ten years. At March 31, 2019, the Company had 9.8 million shares available for grant under the Compensation Plan.

The Company granted 120,000 restricted shares of its common stock to members of senior management. The shares were granted on February 7, 2019 and had a grant date fair value of $234. The shares vest at a rate of 14.3% annually, beginning on February 7, 2019, and becoming fully vested on February 7, 2025.

The Company granted 2,936 restricted shares of its common stock to the independent directors on the Company’s Board of Directors. The shares were granted on February 7, 2019 and become fully vested on December 13, 2019.

The following is a summary of restricted stock units (the “RSU”) activity (in thousands, except per unit data):


	Number of Units		Weighted Average Fair Value
Outstanding, January 1, 2019	-		-
Granted	123	$	13.63
Vested	17	$	13.63
Outstanding, March 31, 2019	106	$	13.63

As of March 31, 2019, approximately 106,000 RSUs remained unvested. Unrecognized compensation expense related to these RSUs at March 31, 2019 was $1,402 and is expected to be recognized over 5.86 years.

The Company granted 58,694 incentive stock options to a member of senior management. The options were granted on February 7, 2019 at an exercise price of $13.63 per share. The options vest at a rate of 12.5% annually, beginning on February 7, 2019, and becoming fully vested on February 7, 2026. All options expire ten years after the date of grant. Weighted-average assumptions used in the Black-Scholes option pricing model for stock options granted were as follows: risk free interest rate of 2.41%; dividend yield of 0.00%; expected volatility of common stock of 65.0% and expected life of options of 7.9 years.

The following is a summary of option activity (in thousands, except per unit data):


	Number of Units		Weighted Average Exercise Price		Weighted Average Fair Value	Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
Outstanding, January 1, 2019	-		-		-	-		-
Granted	59	$	13.63	$	7.69	6.86	$	102
Exercised	-		-		-	-		-
Forfeited	-		-		-	-		-
Outstanding, March 31, 2019	59	$	13.63	$	7.69	6.86	$	102