Additional paid-in capital

9 Months Ended

Sep. 30, 2017

Additional Paid in Capital [Abstract]

Additional Paid in Capital [Text Block]

18. Additional paid-in capital

The Company’s positions in respect of the amounts of additional paid-in capital for the nine months ended September 30, 2017 and 2016, and the year ended December 31, 2016 are summarized as follows (figures are in thousands of USD):

					Year Ended
	Nine Months Ended September 30,				December 31,
	2017		2016		2016
Balance at beginning of the period	$	64,764	$	64,627	$	64,627
Acquisition of the non-controlling interest in Brazil Henglong(1)		(458)		-		-
Share-based compensation (2)		100		-		137
Balance at end of the period	$	64,406	$	64,627	$	64,764

(1)

In May 2017, the Company obtained an additional 15.84% equity interest in Brazil Henglong for nil consideration. The Company retained its controlling interest in Brazil Henglong and the acquisition of the non-controlling interest was accounted for as an equity transaction.

(2)

On December 2, 2016 and August 16, 2017, the Company granted 22,500 and 22,500 stock options, respectively, to the Company’s independent directors, with the exercise price equal to the closing price of the Company’s common stock traded on NASDAQ one day before the date of grant and on the date of grant. The fair value of the stock options was determined at the date of grant using the Black-Scholes option pricing model. The Black-Scholes option model requires management to make various estimates and assumptions, including expected term, expected volatility, risk-free rate and dividend yield. The expected term represents the period of time that stock-based compensation awards granted are expected to be outstanding and is estimated based on considerations including the vesting period, contractual term and anticipated employee exercise patterns. Expected volatility is based on the historical volatility of the Company’s stock. The risk-free rate is based on the U.S. Treasury yield curve in relation to the contractual life of stock-based compensation instruments. The dividend yield assumption is based on historical patterns and future expectations for the Company’s dividends.

Assumptions used to estimate the fair value of the stock options on the grant dates are as follows:

Issuance Date	Expected volatility			Risk-free rate			Expected term (years)		Dividend yield
December 2, 2016		134.8	%		1.84	%		5		0.00	%
August 16, 2017		139.2	%		1.79	%		5		0.00	%

The stock options granted during 2017 and 2016 were exercisable immediately. Their fair values on the grant dates using the Black-Scholes option pricing model were $0.1 million and $0.1 million, respectively. For the nine months ended September 30, 2017 and the year ended December 31, 2016, the Company recognized stock-based compensation expenses of $0.1 million and $0.1 million, respectively.