Item 3.02. Unregistered Sales of Equity Securities.
On February 6, 2023, the Company awarded 97,900 shares of restricted common
stock under the Natural Health Trends Corp. 2016 Equity Incentive Plan, subject
to quarterly vesting for the three-year period following the date of award. The
shares of restricted stock awarded to United States participants were exempt
from registration as a limited offering pursuant to Rule 506 of Regulation D
promulgated under the Securities Act of 1933, as amended (the "Securities Act"),
and the shares of restricted stock awarded to non-United States participants
were exempt from registration as they were made outside the United States
pursuant to Regulation S promulgated under the Securities Act.
Item 5.02. Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On February 7, 2023, Chris T. Sharng, the Company's President, was granted
124,850 Phantom Shares, and Timothy S. Davidson, the Company's Chief Financial
Officer, Senior Vice President and Corporate Secretary, was granted 41,788
Phantom Shares. Phantom Shares were also granted to some other Company employees
and the Company's non-employee directors. The Phantom Shares vest in eight equal
increments, measured on the grant date and subsequent consecutive three-month
vesting periods, subject to the satisfaction of both a time-based vesting
condition and a performance vesting condition. These vesting conditions were
deemed satisfied on the grant date for the initial vesting increment. In order
for the time-based vesting condition to be satisfied for each vesting period,
the grantee must remain continuously employed by the Company through the end of
the vesting period, and in order for the performance vesting condition to be
satisfied for each vesting period, the performance criteria designated by the
Compensation Committee must be satisfied. If either vesting condition is not
satisfied for a vesting date, then the Phantom Shares scheduled to vest on such
date are forfeited. The Phantom Shares granted to the grantees identified above
are subject to a maximum payment value of $12.00 per Phantom Share, and the
grantees are not entitled to any dividend or dividend equivalent payments with
respect to the Phantom Shares. As a condition to the grant of the Phantom Shares
to each employee grantee, the grantee agreed not to sell or otherwise transfer
any shares of the Company's common stock held by him until all Phantom Shares
granted to him are vested or forfeited.
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NATURAL HEALTH TRENDS CORP. 
