Annual report pursuant to Section 13 and 15(d)

STOCKHOLDERS' EQUITY

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STOCKHOLDERS' EQUITY
 12 Months Ended
Dec. 31, 2019
Stockholders' Equity Note [Abstract]  
STOCKHOLDERS' EQUITY STOCKHOLDERS’ EQUITY
 
Authorized Shares
 
The Company is authorized to issue two classes of capital stock consisting of up to 5,000,000 shares of preferred stock, $0.001 par value, and 50,000,000 shares of common stock, $0.001 par value.
 
Dividends
 
The following tables summarize the Company’s cash dividend activity during 2019 and 2018 (in thousands, except per share data):

Declaration Date
 
Per Common Share
 
Amount
 
Payment Date
October 29, 2019 (special)
 
$
0.40

 
$
4,608

 
November 29, 2019
January 27, 2019 (special)
 
0.08

 
912

 
March 15, 2019
January 27, 2019
 
0.16

 
1,824

 
March 15, 2019
 
 
$
0.64

 
$
7,344

 
 

Declaration Date
 
Per Common Share
 
Amount
 
Payment Date
October 21, 2018 (special)
 
$
0.18

 
$
2,048

 
November 23, 2018
October 21, 2018
 
0.16

 
1,820

 
November 23, 2018
July 18, 2018 (special)
 
0.25

 
2,844

 
August 24, 2018
July 18, 2018
 
0.15

 
1,707

 
August 24, 2018
April 17, 2018 (special)
 
1.76

 
20,022

 
May 25, 2018
April 17, 2018
 
0.14

 
1,592

 
May 25, 2018
February 6, 2018
 
0.13

 
1,479

 
March 9, 2018
 
 
$
2.77

 
$
31,512

 
 


Declaration and payment of any future dividends on shares of common stock will be at the sole discretion of the Company’s Board of Directors.

Stock Repurchases

On January 12, 2016, the Board of Directors authorized an increase to the Company’s stock repurchase program first approved on July 28, 2015 from $15.0 million to $70.0 million. Repurchases are expected to be executed to the extent that the Company’s earnings and cash-on-hand allow, and will be made in accordance with all applicable securities laws and regulations, including Rule 10b-18 of the Exchange Act. For all or a portion of the authorized repurchase amount, the Company may enter into one or more plans that are compliant with Rule 10b5-1 of the Exchange Act that are designed to facilitate these purchases. The stock repurchase program does not require the Company to acquire a specific number of shares, and may be suspended from time to time or discontinued.

On May 16, 2019, the Company’s Board of Directors authorized the Company to proceed with the purchase of up to $8.0 million in shares of common stock under the foregoing stock repurchase program. In connection therewith, the Company was advised that George K. Broady, a director of the Company and beneficial owner of more than 5% of its outstanding shares of common stock, would participate in the stock repurchase program through The George K. Broady 2012 Irrevocable Trust (the “Broady Trust”) on a basis roughly proportional to his family’s ownership interest in the Company (See Note 11). During May 2019, the Company authorized its broker to proceed with the purchase of shares of the Company’s common stock in the open market for a total purchase price of $4.7 million. The stock repurchases, which included both open market purchases and the purchase of shares from the Broady Trust, were completed May 31, 2019 and resulted in the Company purchasing a total of 612,729 shares of its common stock for an aggregate purchase price of $6.7 million, plus transaction costs.

On August 6, 2019, the Company’s Board of Directors authorized the Company to proceed with additional purchases under the foregoing stock repurchase program in the open market. During August and September 2019, the Company purchased a total of 383,127 shares of common stock in the open market for an aggregate purchase price of $2.9 million, plus transaction costs. During December 2019, the Company purchased a total of 97,785 shares of common stock for an aggregate purchase price of $552,000, plus transaction costs.

As of December 31, 2019, $21.9 million of the $70.0 million stock repurchase program approved on July 28, 2015 and increased on January 12, 2016 remained available for future purchases, inclusive of related estimated income tax.

Restricted Stock

At the Company’s annual meeting of stockholders held on April 7, 2016, the Company’s stockholders approved the Natural Health Trends Corp. 2016 Equity Incentive Plan (the “2016 Plan”) to replace its 2007 Equity Incentive Plan. The 2016 Plan allows for the grant of various equity awards including incentive stock options, non-statutory options, stock, stock units, stock appreciation rights and other similar equity-based awards to the Company’s employees, officers, non-employee directors, contractors, consultants and advisors of the Company. Up to 2,500,000 shares of the Company’s common stock (subject to adjustment under certain circumstances) may be issued pursuant to awards granted. At December 31, 2019, 1,219,583 shares remained available for issuance under the 2016 Plan.

On February 1, 2019, the Company granted 22,603 shares of restricted common stock under the 2016 Plan to certain employees for the purpose of further aligning their interests with those of its stockholders and settling fiscal 2018 performance incentives totaling $377,000. The shares vest on a quarterly basis over the next three years and are subject to forfeiture in the event of an employee’s termination of service to the Company under specified circumstances.

On August 9, 2019 the Compensation ‎Committee amended the LTI Plan to provide that all then unpaid cash benefits earned by currently employed ‎participants under the LTI Plan with respect to performance periods that concluded on or prior to December 31, 2018 ‎shall be paid in the form of an award of shares of restricted stock under the Company’s 2016 Equity Incentive ‎Plan. Accordingly, on August 9, 2019, the Company awarded 1,117,485 shares of restricted common stock to ‎certain of its employees (subject to quarterly vesting for the three-year period following the date of award) in lieu of ‎aggregate unpaid cash benefits of $7.9 million earned under the LTI Plan for performance periods ending on or ‎prior to December 31, 2018.

The following table summarizes the Company’s restricted stock activity under the 2016 Plan:
 
Shares
 
Wtd. Avg. Price at Date of Issuance
Nonvested at December 31, 2017
58,032

 
$
28.59

Granted
34,202

 
16.19

Vested
(46,748
)
 
26.31

Nonvested at December 31, 2018
45,486

 
21.61

Granted
1,140,088

 
7.27

Vested
(227,892
)
 
9.84

Nonvested at December 31, 2019
957,682

 
7.34




Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive loss by component for 2019 were as follows (in thousands):
 
Foreign Currency Translation Adjustments
 
Unrealized Gains (Losses) on Available-For-Sale Investments
 
Total
Balance, December 31, 2018
$
(1,217
)
 
$
(33
)
 
$
(1,250
)
Other comprehensive income (loss)
(28
)
 
14

 
(14
)
Balance, December 31, 2019
$
(1,245
)
 
$
(19
)
 
$
(1,264
)