Stockholders' Equity

6 Months Ended

Jun. 30, 2016

Stockholders' Equity [Abstract]

SHAREHOLDERS' EQUITY

NOTE 6 – STOCKHOLDERS’ EQUITY

Capital Stock

The Company has a total of 201,000,000 authorized shares of capital stock, consisting of 1,000,000 shares of preferred stock, $0.0001 par value and 200,000,000 shares of common stock, $0.0001 par value.

Stock and Warrant Repurchase Plan

In November 2015, the Company’s Board of Directors approved a $20.0 million stock and warrant repurchase plan (“Repurchase Plan”). This Repurchase Plan authorizes the Company to purchase from time to time the Company’s outstanding common stock and warrants through open market repurchases in compliance with Rule 10b-18 of the Securities Exchange Act of 1934, as amended, and/or in privately negotiated transactions based on market and business conditions, applicable legal requirements and other factors. Any shares and warrants purchased will be retired. The Repurchase Plan has no time deadline and will continue until otherwise modified or terminated at the sole discretion of the Company’s Board of Directors at any time. In January 2016, the Company repurchased 1,967,445 warrants for $5.4 million.

2016 CEO Share Allocation Plan

On April 8, 2016, the Company’s Board of Directors adopted the “2016 CEO Share Allocation Plan,” and at the 2016 Annual Meeting of Stockholders on June 2, 2016, the Company’s stockholders approved the 2016 CEO Share Allocation Plan, pursuant to which the Company will grant awards covering up to 1,000,000 shares of the Company’s common stock in the form of restricted stock, restricted stock units, and/or other stock- or cash-based awards to eligible employees and other service providers of the Company. The 2016 CEO Share Allocation Plan was adopted in connection with a contribution agreement (the “Contribution Agreement”) that the Company entered into with Sven-Olof Lindblad (“Mr. Lindblad”), Chief Executive Officer and President of the Company, pursuant to which Mr. Lindblad will transfer up to 1,000,000 shares from his holdings of the Company’s common stock (i.e., an equivalent number of shares as is reserved for issuance under the 2016 CEO Share Allocation Plan) (the “Contribution Shares”) to the Company as a contribution to the capital of the Company. Mr. Lindblad will not receive any consideration in exchange for the Contribution Shares. However, as a condition to the contribution of any Contribution Shares, the Company must grant awards under the 2016 CEO Share Allocation Plan, such that the number of Contribution Shares that Mr. Lindblad actually contributes to the Company will equal the number of shares corresponding to awards granted under the plan. The contribution of the Contribution Shares by Mr. Lindblad to the Company will effectively reduce the number of shares of the Company’s common stock that are outstanding by the same number of shares that would be issued under the 2016 CEO Share Allocation Plan (or a lesser number in the event awards are settled in cash). Such contributions will be effective as of the date the Company grants corresponding awards under the 2016 CEO Share Allocation Plan. The administrator may amend, suspend or terminate the 2016 CEO Share Allocation Plan at any time.

Restricted Shares and Restricted Share Units

Restricted shares are shares of stock granted to an employee, non-employee Director or other service providers for which sale is prohibited for a specified period of time. Restricted share units (“RSUs”) represent a promise to deliver shares to the employee, non-employee Director or other service providers at a future date if certain vesting conditions are met. The difference between RSUs and restricted shares is primarily the timing of the delivery of the underlying shares. A company that grants RSUs does not deliver the shares to the employee, non-employee Director or other service providers until the vesting conditions are met.

Under the 2015 Plan, one non-employee Director was granted 1,864 restricted shares on May 11, 2016. These restricted shares vest in three installments on August 8, 2016, 2017 and 2018 and are not subject to any performance-based conditions.

Under the 2015 Plan, an employee was granted 90,000 restricted shares on May 26, 2016. These restricted shares vest in four installments on May 26, 2017, 2018, 2019 and 2020 and are not subject to any performance-based conditions.

Under the 2015 Plan, five non-employee Directors will be granted $75,000 in value of restricted shares and one non-employee Director will be granted $75,000 in value of RSUs on August 8, 2016. They vest in three installments on August 8, 2017, 2018 and 2019 and are not subject to any performance-based conditions.

The amortization of the restricted shares and RSUs was $0.1 million and $0.1 million for the three and six months ended June 30, 2016, respectively. As of June 30, 2016, the unamortized value of restricted shares and RSUs was $1.2 million and is expected to be expensed over a period of 3.9 years.

The following table is a summary of restricted stock and RSU activity under the Company’s 2015 Plan:

	Restricted Shares and RSU's		Weighted Average Grant Date Fair Value
Restricted shares and RSUs awarded as of December 31, 2015		-	$	-
Granted		125,164		10.41
Vested		-		-
Forfeited		-		-
Restricted shares and RSUs awarded as of June 30, 2016		125,164	$	10.41

Stock Options

The fair value of stock options is amortized on a straight line basis over the requisite service periods of the respective awards. Stock-based compensation expense related to stock options was $1.2 million for the three months ended June 30, 2016 and 2015, respectively. Stock-based compensation expense related to stock options was $2.5 million and $2.4 million for the six months ended June 30, 2016 and 2015, respectively. Stock compensation expense is included in general and administrative expenses on the accompanying condensed consolidated statements of operations. As of June 30, 2016, the unamortized value of options was $7.2 million and is expected to be expensed over a weighted average period of 1.5 years.

During January 2016, 638,223 option shares vested and were exercised. The option shares were issued using cashless transactions, approved by management, and were used in exchange for the required exercise proceeds and payment of any related payroll withholding taxes. Using a weighted average fair value of $10.68 per share and an exercise price of $1.76 per share, 105,206 shares were transferred to provide the $1.1 million in exercise proceeds required for the transactions. In addition, 252,670 shares were transferred to provide the $2.7 million in proceeds required to pay the payroll withholding taxes for the transactions. The balance of the option shares of 280,347 shares were issued as a result of the transactions.

The following table is a summary of stock options activity under the Company’s legacy 2012 Incentive Stock Plan and its 2015 Plan:

				Weighted		Weighted
				Average		Average		Aggregate
				Exercise		Contractual		Intrinsic
	Shares			Price		Life (Years)		Value
Options outstanding as of December 31, 2015		2,849,071		$	2.69		3.7	$	23,992,814
Granted		20,000			11.26
Exercised		(638,223	)		1.76
Forfeited		(300,000	)		10.58
Options outstanding as of June 30, 2016		1,930,848		$	1.86		2.6	$	15,005,774
Vested and expected to vest after June 30, 2016		1,930,848		$	1.86		2.6	$	15,005,774
Exercisable as of December 31, 2015		-		$	-
Vested		638,223			1.76
Exercised		(638,223	)		1.76
Forfeited		-			-
Exercisable as of June 30, 2016		-		$	-