STOCKHOLDERS' EQUITY

12 Months Ended

Dec. 31, 2024

STOCKHOLDERS' EQUITY [Abstract]

STOCKHOLDERS' EQUITY

10.  STOCKHOLDERS’ EQUITY

Equity Compensation Plans

The Tandy Leather Factory, Inc. 2013 Restricted Stock Plan (the “2013 Plan”) was adopted by our Board of Directors in January 2013 and approved by our stockholders in June 2013.  The 2013 Plan initially reserved up to 300,000 shares of our common stock for restricted stock unit (“RSU”) awards to our executive officers, non-employee directors and other key employees.  In June 2020, our stockholders approved an increase to the plan reserve to 800,000 shares of our common stock and extended the 2013 Plan through June 2023.  Awards granted under the 2013 Plan may be service-based awards or performance-based awards and may be subject to a graded vesting schedule with a minimum vesting period of four years, unless otherwise determined by the Compensation Committee of the Board of Directors that administers the plan.

The Tandy Leather Factory, Inc. 2023 Incentive Stock Plan (the “2023 Plan”) was adopted by our Board of Directors in April 2023 and approved by our stockholders in June 2023.  The 2023 Plan initially reserved up to 1,000,000 shares of our common stock for a variety of equity awards (including, but not limited to, RSUs, the only type of awards that have been granted to date) to our executive officers, non-employee directors and other key employees.  In June 2024, as part of their annual director compensation, certain of our non-employee directors were granted a total of 12,528 service-based RSUs under the 2023 Plan, which will vest ratably over the next four years, subject to each participant’s continued service on the board as of each vesting date.  In October 2023, the Company granted to Ms. Carr a total of 276,000 service-based RSUs under the 2023 Plan, which were to vest ratably over the next three years, subject to Ms. Carr’s continued employment as of each vesting date.  92,000 of these RSUs vested in October 2024; the rest was forfeited as of December 31, 2024.

A summary of the activity for restricted stock and RSU awards is as follows:

	Shares			Weighted Average
	(in thousands)			Share Price
Balance, January 1, 2024		623			$	5.12
Granted		74				4.47
Forfeited		(190	)			4.27
Vested		(98	)			4.36
Balance, December 31, 2024		409			$	4.32

The Company’s stock-based compensation relates to restricted stock and RSU awards.  For these service-based awards, our stock-based compensation expense, included in operating expenses, was $0.6 million and $0.8 million in 2024 and 2023, respectively.

As of December 31, 2024, there was unrecognized compensation cost related to non-vested, service-based awards of $0.3 million which will be recognized over 3.1 weighted average years in each of the following years:

Unrecognized Expense
2025	$	163
2026		119
2027		34
2028		6
	$	322

We issue shares from authorized shares upon the lapsing of vesting restrictions on restricted stock and RSUs.  In 2024 and 2023, we issued 97,588 and 108,796 shares, respectively, net of shares withheld to pay participants’ income taxes, resulting from the vesting of restricted stock and RSUs.  We do not use cash to settle equity instruments issued under stock-based compensation awards.

Share Repurchase Program

On August 8, 2022, the Board of Directors approved a new program to repurchase up to $5.0 million of the Company’s common stock on the open market on or prior to August 31, 2024.  As of December 31, 2024, the Company had repurchased less than $10,000 of shares under this plan.

On September 17, 2024, the Board of Directors approved the renewal of the stock plan, and the Company shall be authorized to repurchase up to $5 million (at then-current market value) of the Company’s common stock in open-market transactions at prevailing market prices upon periodic instructions from the Board or an authorized sub-committee of the Board until September 30, 2026. As of September 30, 2024, $5.0 million remained available for repurchase under this new program.

The direct share repurchase transactions were separately authorized by our Board of Directors and did not reduce the remaining amount authorized to be repurchased under the plans described above.