5. Equity Incentive Plan

 

On April 3, 2017, the Company granted 37,500 split-adjusted stock options under the Company’s 2013 Equity Incentive Plan to senior executives. The stock options have vesting base dates of the employees’ start dates, each of which were in 2016. These options have an exercise price of $4.00 and a three -year service requirement with 1/3 of the options vesting on the anniversaries of the vesting base date. In addition, the stock options have a 10-year term and the Black Scholes model was used to measure the fair value of the stock-based compensation awards.

 

The amortization expense associated with stock options during the three months ended September 30, 2017 and 2016 was $110 thousand and $147 thousand, respectively. The amortization expense associated with stock options during the nine months ended September 30, 2017 and 2016 was $436 thousand and $757 thousand, respectively. The unamortized cost of the options at September 30, 2017 was $329 thousand, to be recognized over a weighted-average remaining life of 0.9 years. At September 30, 2017, and December 31, 2016,  400,417 and 240,000 split-adjusted options were exercisable, respectively. There was no intrinsic value associated with the options as of September 30, 2017. The weighted-average remaining contractual life of the options outstanding is 7.4 years.