Note 27 - Share-based Compensation Expenses

6 Months Ended

Jun. 30, 2018

Notes to Financial Statements

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

27. Share-based compensation expenses

In

January 2017,

the Company granted

75,000

shares of the Company’s restricted common stock to its investor relations services provider, in exchange for its services to the Company for the year ended

December 31, 2017.

These shares were valued at

US$1.02

per share, the closing bid price of the Company’s common stock on the date of the earlier of the performance commitment date or the date service was completed. Total compensation expense recognized for the service was

US$38,250

and

US$19,125

for the

six

and

three

months ended

June 30, 2017,

respectively.

In

February 2017,

the Company granted

20,000

shares of the Company’s restricted common stock to

one

of its independent directors in exchange for his services provided to the Company. These shares were valued at

US$1.12

per share, the closing bid price of the Company’s common stock on the date of grant. Total compensation expense recognized for the

six

and

three

months ended

June 30, 2017

was approximately

US$22,400

and US$

nil

, respectively.

In

July 2017,

the Company issued

75,000

shares of the Company’s restricted common stock to

two

management consulting service providers in exchange for its services to the Company for a

12

-month period commencing on

July 1, 2017.

These shares were valued at

US$1.67

per share, the closing bid price of the Company’s common stock on the earlier of the performance commitment date or the date service was completed. Total compensation expense recognized for the

six

and

three

months ended

June 30, 2018

was approximately

US$62,600

and

US$31,300,

respectively.

On

April 1, 2016,

the Company granted

16,000

shares of the Company’s restricted common stock in aggregate to

two

marketing service providers in exchange for their services to the Company for a

12

-month period commencing on

April 1, 2016.

These shares were valued at

US$1.73

per share, the closing bid price of the Company’s common stock on the date of the earlier of the performance commitment date or the date service was completed. Total compensation expense recognized for the

six

and

three

months ended

June 30, 2017

was approximately

US$6,900

and US$

nil

, respectively.

The Company granted

140,000

shares of the Company’s restricted common stock to a management consulting service provider in exchange for its services to the Company for a

24

-month period commencing on

May 1, 2015.

These shares were valued at

US$3.93

per share, the closing bid price of the Company’s common stock on the date of the earlier of the performance commitment date or the date service was completed. Total compensation expense recognized for the

six

and

three

months ended

June 30, 2017

was approximately

US$91,600

and

US$22,900,

respectively.

On

June 14, 2015,

under its

2015

Omnibus Securities and Incentive Plan, the Company granted its employees in the aggregate of

266,238

shares of the Company’s restricted common stock, which will be vested on the

third

anniversary of the date of the grant. These shares were valued at

US$2.10

per share, the closing bid price of the Company’s common stock on the date of grant. The Company adopted a

5%

forfeiture rate for recognition of the related compensation expenses of these unvested shares. Total compensation expenses recognized for the

six

months ended

June 30, 2018

and

2017

was approximately

US$87,720

for both periods. Total compensation expenses recognized for the

three

months ended

June 30, 2018

and

2017

was approximately

US$44,100

for both periods.

On

September 14, 2015,

under its

2015

Omnibus Securities and Incentive Plan, the Company also granted

5

-year common stock purchase options to its employees, in the aggregate, to purchase up to

477,240

shares of the Company’s restricted common stock at an exercise price of

US$2.10

per share, of which

159,080

options vested upon the date of grant,

159,080

options vested on

September 14, 2016

and the remaining

159,080

options vested on

September 14, 2017.

These options were valuated at

US$1.03

-

US$1.39

per option. Total compensation expenses recognized for the

six

and

three

months ended

June 30, 2017

was approximately

US$101,940

and

US$51,250,

respectively.

Options issued and outstanding at

June 30, 2018

and their movements during the

six

months then ended are as follows:

	Option Outstanding						Option Exercisable
	Number of underlying shares		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price		Number of underlying shares		Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price
Balance, January 1, 2018		835,216		3.04	$	2.49		835,216		3.04	$	2.49
Granted/Vested		-						-
Forfeited		-						-
Exercised		-						-
Balance, June 30, 2018 (unaudited)		835,216		2.54	$	2.49		835,216		2.54	$	2.49

The table below summarized share-based compensation expenses recorded for the

six

and

three

months ended

June 30, 2018

and

2017,

respectively:

	Six Months Ended June 30,				Three Months Ended June 30,
	2018		2017		2018		2017
	US$(’000)		US$(’000)		US$(’000)		US$(’000)
	(Unaudited)		(Unaudited)		(Unaudited)		(Unaudited)
Sales and marketing expenses		27		50		14		22
General and administrative expenses		102		262		51		97
Research and development expenses		22		36		11		18
Total		151		348		76		137

The aggregate unrecognized share-based compensation expenses as of

June 30, 2018

and

2017

is approximately

US$64,000

and

US$294,000

respectively. All unrecognized share-based compensation expenses as of

June 30, 2018

will be recognized for the year ending

December 31, 2018.