STOCK-BASED COMPENSATION

The Company currently has one active stock-based compensation plan, the Mannatech, Incorporated 2017 Stock Incentive Plan (the “2017 Plan”), which was adopted by the Company’s Board of Directors on April 17, 2017 and was approved by its shareholders on June 8, 2017. The 2017 Plan supersedes the Mannatech, Incorporated 2008 Stock Incentive Plan, as amended, which was set to expire on February 20, 2018. The Board has reserved a maximum of 250,000 shares of our common stock that may be issued under the 2017 Plan, consisting of 181,674 newly reserved shares and 68,326 shares that remained available for issuance under the 2008 Plan (subject to adjustments for stock splits, stock dividends or other changes in corporate capitalization). As of September 30, 2017, the Company had a total of 240,000 shares available for grant under the 2017 Plan, which expires on April 16, 2027.

The 2008 Plan provided, and the 2017 Plan provides, for grants of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance stock and performance stock units to our employees, board members, and consultants. However, only employees of the Company and its corporate subsidiaries are eligible to receive incentive stock options. The exercise price per share for all stock options will be no less than the market value of a share of common stock on the date of grant. Any incentive stock option granted to an employee owning more than 10% of our common stock will have an exercise price of no less than 110% of our common stock’s market value on the grant date.

The majority of stock options vest over two or three years, and generally are granted with a term of ten years, or five years in the case of an incentive option granted to an employee who owns more than 10% of our common stock.

The Company records stock-based compensation expense related to granting stock options in selling and administrative expenses. During each of the three months ended September 30, 2017 and 2016, the Company granted zero stock options. During each of the nine months ended September 30, 2017 and 2016, the Company granted 10,000 stock options. The fair value of stock options granted during the nine months ended September 30, 2017 and 2016 was approximately $5.87 and $12.18 per share, respectively. The Company recognized compensation expense as follows for the three and nine months ended September 30 (in thousands):



	Three months ending September 30				Nine months ending September 30
	2017		2016		2017		2016
Total gross compensation expense	$	57	$	115	$	200	$	474
Total tax benefit associated with compensation expense	9		15		37		62
Total net compensation expense	$	48	$	100	$	163	$	412

As of September 30, 2017, the Company expects to record compensation expense in the future as follows (in thousands):



	Three months ending December 31, 2017		Year ending December 31,
	Three months ending December 31, 2017		2018		2019		2020
Total gross unrecognized compensation expense	$	46	$	122	$	38	$	—
Tax benefit associated with unrecognized compensation expense	8		20		3		—
Total net unrecognized compensation expense	$	38	$	102	$	35	$	—