Company: HGBL
Filing Date: 2025-03-13
Form Type: 10-K
Source: 0000950170-25-038691
Chunk: 145

Company: Heritage Global Inc.
Filing Date: 2025-03-13
Form: 10-K
Item: Item 1B
Chunk 145
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2 Heritage Global Inc. Equity Incentive PlanIn 2022, at the Company's 2022 Annual Meeting of Shareholders, the Company's shareholders approved the 2022 Heritage Global Inc. Equity Incentive Plan, which replaces the Heritage Global Inc. 2016 Plan and authorized the issuance of an aggregate of 3.5 million shares of Common Stock for awards made after June 8, 2022. Options may not be granted with an exercise price less than the fair market value of the common stock of the Company as of the day of the grant. Options granted pursuant to the plan are subject to limitations on transfer and execution and may be issued subject to vesting conditions. Options may also be forfeited in certain circumstances. In 2024 and 2023, the Company issued options to purchase 112,500 and 470,000 shares of 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
         
        202