Note 8 - Share-based Compensation

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Text Block]

Note 8:

Share-Based Compensation

During the year ended December 31, 2022, the Company granted to certain employees an aggregate of 76,755 restricted stock units that vest over a three-year period through July 15, 2024 and 280,245 performance shares that vest upon achievement of certain stock price hurdles as measured during the period from July 15, 2020 through July 15, 2024. Each of the time-based and market-condition awards are subject to the recipient’s continued service with us, the terms and conditions of our stock incentive plan and the applicable award agreement. As of December 31, 2023, 40,204 restricted stock units and 31,584 performance shares had vested, representing a total of 71,788 issuable shares under the Plan. As of December 31, 2023, a total of 71,788 of the issuable shares had been issued to employees. On February 12, 2024, 51,761 performance shares vested upon achievement of a certain stock price. The shares were issued on April 1, 2024. On July 15, 2024, the final tranche of the restricted stock units awarded to the Company’s employees, representing 36,551 underlying shares, vested. As of the date of this filing, the underlying shares have not yet been issued to the employees. Also on July 15, 2024, all 196,900 unvested performance shares awarded to employees under the Plan lapsed without the performance criteria being achieved and were forfeited by the grantees. There are no further unvested awards outstanding under the Plan.

The share-based compensation expense recognized is included in general and administrative expense in the statements of operations. The total fair value of the awards was $3,374,002 of which $0 was unrecognized stock-based compensation expense as of September 30, 2024.

The plan participants elected to have the Company withhold shares to cover the employee payroll tax withholdings for the shares issued. As of September 30, 2024, the Company withheld 39,012 shares of the 123,549 shares issued to the employees.

The share-based compensation expense recognized by award type was $223,626 and $0 for restricted stock units and performance shares, respectively, for the nine months ended September 30, 2024. The share-based compensation expense recognized by award type was $315,369 and $420,965 for restricted stock units and performance shares, respectively, for the nine months ended September 30, 2023.

CKX LANDS, INC. 10-Q