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Note 17 - Stock-based Compensation | 12 Months Ended
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Dec. 31, 2023
Notes to Financial Statements |
Share-Based Payment Arrangement [Text Block] |
17. | Stock-based compensation
The Board of Directors of the Company adopted an omnibus incentive plan which was approved by the shareholders of the Company at its 2017 annual shareholder meeting (the “Incentive Plan”). The purpose of the plan is to:
| ● | Encourage ownership in the Company by key personnel whose long-term employment with or engagement by the Company or its subsidiaries is considered essential to its continued progress and, thereby, encourage recipients to act in the Company’s shareholders’ interests and share in its success;
| ● | Encourage such persons to remain in the Company’s employ or in the employ of its subsidiaries; and
| ● | Provide incentives to persons who are not the Company employees to promote the Company’s success.
The Incentive Plan authorizes the Company to issue stock options (including incentive stock options and nonqualified stock options), common stock awards, and stock appreciation rights. Eligible participants in the plan include: (i) members of the Company’s board of directors and its executive officers; (ii) regular, active employees of the Company and any of its subsidiaries; and (iii) persons engaged by the Company or any of its subsidiaries to render services to the Company or its subsidiaries as an advisor or consultant. Awards under the Incentive Plan are limited to shares of the Company’s common stock, which may be shares acquired by the Company, including shares purchased in the open market, or authorized but un-issued shares. Awards are limited to 10% of the issued and outstanding shares of the Company’s common stock in the aggregate. The Incentive Plan became effective upon its approval by the Company’s shareholders on September 7, 2017 and continues in effect for a term of ten years thereafter unless amended and extended by the Company or unless otherwise terminated. The Company recognizes compensation expense in its financial statements for common stock-based options based upon the grant-date fair value over the requisite service period. No common stock awards were issued in 2023, 2022, or 2021. No stock options were granted under the Incentive Plan in 2023 or 2021. In August 2022, the Company granted a total of 20,000 stock options, respectively, to two new members of the Board of Directors and to the Chief Operating Officer. The options awarded have an exercise price equal to the mean between the highest and lowest quoted sales prices for the Company’s common stock as of the grant date as reported by the New York Stock Exchange. All options awarded in 2022 vested immediately and expire in August 2027. The Company has used the Black Scholes Merton option pricing model, which relies on certain assumptions, to estimate the fair value of the options it granted. The weighted average fair value of options granted was $2.30 per option in 2022. There were no stock options exercised in 2023 or 2022. All of the options exercised in 2021 were exercised on a cash basis. The assumptions used in the determination of the fair value of the options granted are provided in the following table:
|  | 2023 |  |  | 2022 |  |  | 2021 |
Assumptions |  | Options |  |  | Options |  |  | Options |
Expected volatility rate |  |  | n/a |  |  |  | 56.61 | % |  |  | n/a |
Expected dividend yield |  |  | n/a |  |  |  | 3.34 | % |  |  | n/a |
Risk-free interest rate |  |  | n/a |  |  |  | 3.20 | % |  |  | n/a |
Expected forfeiture rate |  |  | n/a |  |  |  | 0.00 | % |  |  | n/a |
Expected term in years |  |  | n/a |  |  |  | 2.3 |  |  |  | n/a |
The volatility rate for the options granted in 2022 were derived from the historical stock price volatility of the Company’s common stock over the same time period as the expected term of each stock option award. The volatility rate is derived by a mathematical formula using the daily closing stock price data over the expected term. The expected dividend yield is calculated using the Company’s expected dividend amount at the date of the option grant over the expected term divided by the fair market value of the Company’s common stock. For the years ended December 31, 2023, 2022 and 2021, total share-based compensation expense (before tax) totaled $0, $46, and $0, respectively. In the year ended December 31, 2022, this balance was recorded as an element of selling, general, and administrative expenses. As of December 31, 2023 and 2022, there was no unrecognized compensation expense related to stock options. A summary of the activity of the Company’s stock options and awards for the period beginning January 1, 2021 and ending December 31, 2023 is presented below.
|  |  |  |  |  | Weighted |
|  |  |  |  |  | Average |
|  | Options |  |  | Exercise Price |
Outstanding at January 1, 2021 |  |  | 44,000 |  |  | $ | 12.73 |
Granted |  |  | - |  |  |  | - |
Exercised |  |  | (20,000 | ) |  |  | 11.56 |
Canceled, forfeited, or expired |  |  | - |  |  |  | - |
Outstanding at December 31, 2021 |  |  | 24,000 |  |  |  | 13.71 |
Granted |  |  | 20,000 |  |  |  | 7.18 |
Exercised |  |  | - |  |  |  | - |
Canceled, forfeited, or expired |  |  | - |  |  |  | - |
Outstanding at December 31, 2022 |  |  | 44,000 |  |  |  | 10.74 |
Granted |  |  | - |  |  |  | - |
Exercised |  |  | - |  |  |  | - |
Canceled, forfeited, or expired |  |  | (10,000 | ) |  |  | 16.21 |
Outstanding at December 31, 2023 |  |  | 34,000 |  |  |  | 9.13 |
There were 4,310,167 options available for grant under the Incentive Plan. The following table provides the remaining contractual term and weighted average exercise prices of stock options outstanding and exercisable from the Incentive Plan at December 31, 2023.
|  |  |  | Options Outstanding |  |  | Options Exercisable |
|  |  |  |  |  |  |  | Weighted |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  | Number |  |  | Average |  |  | Weighted |  |  | Number |  |  | Weighted |
|  |  |  | Outstanding at |  |  | Remaining |  |  | Average |  |  | Exercisable at |  |  | Average |
Exercise |  |  | December 31, |  |  | Contractual |  |  | Exercise |  |  | December 31, |  |  | Exercise |
Price |  |  | 2023 |  |  | Life |  |  | Price |  |  | 2022 |  |  | Price |
$ | 12.07 |  |  |  | 10,000 |  |  |  | 0.71 |  |  | $ | 12.07 |  |  |  | 10,000 |  |  | $ | 12.07 |
| 11.56 |  |  |  | 4,000 |  |  |  | 1.06 |  |  |  | 11.56 |  |  |  | 4,000 |  |  |  | 11.56 |
| 7.18 |  |  |  | 20,000 |  |  |  | 3.61 |  |  |  | 7.18 |  |  |  | 20,000 |  |  |  | 7.18 |
|  |  |  |  | 34,000 |  |  |  | 2.46 |  |  |  | 9.13 |  |  |  | 34,000 |  |  |  | 9.13 |
The aggregate intrinsic values of total options outstanding and exercisable at December 31, 2023 and 2022 were $0 and $19, respectively. Intrinsic value is the amount by which the last trade price of the common stock closest to December 31, 2023 and 2022, respectively, exceeded the exercise price of the options granted.

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