Company: HGBL
Filing Date: 2025-03-13
Form Type: 10-K
Source: 0000950170-25-038691
Chunk: 52

Company: Heritage Global Inc.
Filing Date: 2025-03-13
Form: 10-K
Item: Item 15
Chunk 52
---
 common stock to certain of the Company's employees under this plan, respectively. 

F-28

        2022 Plan
         
        2024

        2023

        Options outstanding, beginning of year

        563,625

        144,500

        Options granted

        112,500

        470,000

        Options exercised

        (3,750
        )

        (5,375
        )

        Options forfeited

        (17,250
        )

        (45,500
        )

        Options outstanding, end of year

        655,125

        563,625

The outstanding options under the 2022 Plan vest over four years at exercise prices ranging from $1.60 to $3.55 per share.Stock-Based Compensation ExpenseTotal compensation cost related to stock options was $0.7 million in 2024 and $0.5 million in 2023. These amounts were recorded in selling, general and administrative expense in both years. During 2024 and 2023, options to purchase 111,250 and 102,125 shares were exercised, respectively. The tax benefit recognized by the Company related to these option exercises was approximately $0.1 million in 2024, as compared to $0.4 million recognized in 2023. In connection with the stock option grants during 2024 and 2023, the fair value of each option grant was estimated on the date of the grant using the Black-Scholes option pricing model with the following assumptions: 

        2024
         
        2023

        Risk-free interest rate
         
        4%
         
        4%

        Expected life (years)
         
        7
         
        7

        Expected volatility
         
        73%
         
        65%

        Expected dividend yield
         
        Zero
         
        Zero
       
      The risk-free interest rates are those for U.S. Treasury constant maturities for terms matching the expected term of the option. The expected life of the options is calculated according to the simplified method for estimating the expected term of the options, based on the vesting period and contractual term of each option grant. Expected volatility is based on the Company’s historical volatility. The Company has never paid a dividend on its common stock and therefore the expected dividend yield is zero.The following summarizes the changes in common stock options: