Part III ofWright Investors’ Service Holdings, Inc. (the “Company”) is filing this report incorporates certain information by reference from the registrant’s proxy statement for the 2020 annual meeting of stockholders, or an amendmentAmendment No. 1 on Form 10-K/A (this “Form 10-K/A”) pursuant to thisGeneral Instruction G (3) to Form 10-K, which amends and supplements our Annual Report on Form 10-K to be filed no later than 120 days afterfor the close of the registrant’s fiscal year ended December 31, 2020.2021, which was filed with the Securities and Exchange Commission (the “SEC”) on March 11, 2022 (the “2021 Form 10-K”).    This Form 10-K/A provides the information required to be disclosed in Part III, Items 10 through 14 and updates the information contained in Part IV, Item 15.  As a result of this amendment, the Company is filing as exhibits to this Form 10-K/A the certifications required under Section 302 of the Sarbanes-Oxley Act of 2002.  Because no financial statements are contained within this Form 10-K/A, the Company is not including certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 

TABLE OF CONTENTS

Cautionary Statement Regarding Forward-Looking StatementsPART III

Directors

Set forth below are the names of, and certain biographical information regarding, the directors of the Company. The Board of Directors currently consists of three directors.  

Harvey P. Eisen, 79, has served as Chairman of the board of directors and Chief Executive Officer of the Company since June 2007 and also has served as its President since July 2007.  Mr. Eisen has served as a director of the Company since 2004.  Mr. Eisen has served as Chairman and Managing Member of Bedford Oak Advisors, LLC, an investment partnership (“Bedford Oak”), since 1998 and was Chairman and Director of GP Strategies Corporation, a global performance solutions provider (“GP Strategies”) from 2004 to 2018. Mr. Eisen has also served on the board of directors of VerifyMe, Inc., a provider of physical, cyber and biometric security solutions from April 2018 through February 2019.

Mr. Eisen was previously Senior Vice President of Travelers, Inc. and held various executive positions with Primerica, SunAmerica Corp., and Integrated Resources Asset Management.  Mr. Eisen was president and portfolio manager of Eisen Capital Management for 10 years.  He began his career as an analyst with Stifel, Nicolaus & Co. and Wertheim.  Mr. Eisen has served on the Strategic Development Board for the Trulaske College of Business, University of Missouri since 1995 where he established the first accredited course on the Warren Buffett Principles of Investing. He also serves on the University’s Investment Advisory Committee.

Mr. Eisen is qualified to serve on our board of directors and brings valuable insight to our board of directors as a result of his broad range of business skills and his financial literacy and expertise and executive and management leadership skills. Mr. Eisen developed these skills and expertise during his long and successful business career as Chairman and Managing Member of Bedford Oak, a Senior Vice President of Travelers and Primerica, as well as his service on other public company and institutional boards.

Lawrence G. Schafran, 83, is a private investor and has served as a director and chairman of the audit committee of the Company since 2006.  Mr. Schafran also serves as a director of Glasstech, Inc., a manufacturer and seller of glass bending and tempering systems. Mr. Schafran also served as director of other public and private companies, such as Cupcake Digital, Inc., a developer of mobile applications focusing on the children’s market from 2013 to June 2019 and VerifyMe, Inc., a provider of physical, cyber and biometric security solutions from 2013 to June 2019. He also served as a Managing Director of Providence Capital, Inc., an investment and advisory firm from March 2003 until December 2012.

Mr. Schafran is qualified to serve on our board of directors because of his extensive business skills and experiences and his financial literacy and expertise.  Mr. Schafran also possesses a broad range of experiences and skill garnered from the various leadership positions and from his service on other public company boards and committees.

Dort A. Cameron III, 77, is currently the managing member of Airlie Enterprises, LLC, a private consulting and principal investments company established in 1995 and has served as a director and chairman of the Compensation and Nominating and Corporate Governance Committee since February 2019. Mr. Cameron is also the President of the Cameron Family Foundation. Mr. Cameron was a principal of the Investment Manager, a managing director of the General Partner of the Investment Manager and Chief Investment Officer (portfolio manager) of the Airlie Opportunity Fund’s portfolio from 2003 through 2014. 

Mr. Cameron has over 30 years of investment banking, merchant banking, and investment management experience. 

His experience encompasses institutional portfolio management, alternative and principal investing, fiduciary oversight, and significant private equity, high yield, and distressed transactions/situations. Mr. Cameron’s professional experience includes a position as the Chairman of the Board of Directors and a majority owner of Entex Information Services, Inc., a computer services company headquartered in Rye Brook, New York (“Entex”).  Mr. Cameron was also the General Partner of BMA Limited Partnership, a mezzanine private equity fund, which was the general partner of Investment Limited Partnership (“ILP”), which he co-founded in 1984 with Richard Rainwater of the Bass organization and managed through June of 1996. 

Mr. Cameron has served as a member of the Board of Directors of First Marblehead Corporation, Greenwich Life Settlements, TLC Beatrice as well as Middlebury College, where he still currently serves, and the Rippowam Cisqua School.

Mr. Cameron’s is qualified to serve on our Board because of his senior management roles in investment banking, merchant banking, and investment management and his other professional experience, each of which have required him to balance the demands of clients, employees and investors.

Executive Officers Who Are Not a Director

Set forth below is the name of, and certain biographical information regarding executive officers of the Company who do not serve as directors of the Company.

Harold D. Kahn, 68, is the Acting Chief Financial Officer and Acting Principal Accounting Officer of the Company since March 2019. Mr. Kahn previously served as a consultant to the Company. Mr. Kahn has been the Managing Member of Vela Capital Advisors, LLC, an independent advisory consultancy since February 2007. Mr. Kahn has been a senior principal for several privately-held technology consulting and investment management firms.  Earlier in his career, he was a Partner at PricewaterhouseCoopers in New York and Tokyo. Mr. Kahn holds an AB in Economics from Stanford University.

Corporate Governance

General

The Company is committed to establishing sound principles of corporate governance which promote honest, responsible and ethical business practices. The Company’s Board of Directors and Nominating and Corporate Governance Committee actively review and evaluate the Company’s corporate governance practices. This Annual Report on Form 10-K contains “forward-looking statements” withinreview includes comparing the meaningBoard’s current governance policies and practices with those suggested by corporate governance authorities as well as the practices of other public companies of comparable size. The Board of Directors has adopted those corporate governance policies and practices that its evaluation suggests are the most appropriate for the Company.

Audit Committee

Our Audit Committee is currently composed of Lawrence G. Schafran (Chairman) and Dort A. Cameron III. The Board of Directors affirmatively determined that Mr. Schafran and Mr. Cameron are independent, in accordance with The Nasdaq Stock Market (“Nasdaq”) independence criteria and for purposes of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E10A(m)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).  The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward looking statements. Forward-looking statements are not statements of historical facts, but rather reflect our current expectations concerning future events and results. The words “may,” “will,” “anticipate,” “should,” “would,” “believe,” “contemplate,” “could,” “project,” “predict,” “expect,” “estimate,” “continue,” and “intend,” as well as other similar words and expressions of the future, are intended to identify forward-looking statements.

These forward-looking statements generally relate to our plans, objectives and expectations for future events and include statements about our expectations, beliefs, plans, objectives, intentions, assumptions and other statements that are not historical facts.  These statements are based upon our opinions and estimates as of the date they are made.  Although we believe that the expectations reflected in these forward-looking statements are reasonable, such forward-looking statements are subject to known and unknown risks and uncertainties that may be beyond our control, which could cause actual results, performance and achievements to differ materially from results, performance and achievements projected, expected, expressed or implied by the forward-looking statements.  While we cannot assess the future impact that any of these differences could have on our business, financial condition, results of operations and cash flows or the market price of shares of our common stock, the differences could be significant. You are cautioned not to unduly rely on such forward-looking statements when evaluating the information presented in this report.

Factors that may cause actual results to differ from historical results or those results expressed or implied, include, but are not limited to, those listed below under Item 1A. “Risk Factors”.

If significant risks and uncertainties occur, or if our estimates or underlying assumptions prove inaccurate, actual results could differ materially.  You are urged to consider all such risks and uncertainties. In light of the uncertainty inherent in such forward-looking statements, you should not consider their inclusion to be a representation that such forward-looking matters will be achieved.

Additional information concerning the factors that could cause actual results to differ materially from those in the forward-looking statements is contained in Item 1. “Business”, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, and elsewhere in this Annual Report on Form 10-K and in our other filings with the Securities and Exchange Commission (the “SEC”) which are available on the SEC website at www.sec.gov.  We undertake no obligation to publicly revise any forward-looking statements or cautionary factors, except as required by law.

PART I

Item 1.  Business.

General Development of Business

Wright Investors’ Service Holdings, Inc. (the “Company”, “Wright Holdings”, “we” or “us”) was incorporated on March 10, 1998 as a wholly-owned subsidiary of GP Strategies Corporation (“GP Strategies”) and in November 2004, the Company’s common stock was spun-off to holders of record of GP Strategies common stock and GP Strategies Class B capital stock.  The Company’s common stock is quoted on the OTC Pink Sheets and is traded under the symbol “iWSH”.

The Company currentlyBoard of Directors determined that each of Messrs. Schafran and Cameron is able to read and understand financial statements and that each of Messrs. Schafran and Cameron has a substantial portionaccounting or related financial management expertise in accordance with the applicable rules of its assets consistingNasdaq. The Board of cashDirectors also determined that each of Messrs. Schafran and cash equivalents.

Description ofCameron, who serve as the Business ofAudit Committee financial experts, has the Company

The Company has noaccounting or nominal operations and, as a result, we are a “shell company”, as defined in Rule 405 of the Securities Act of 1933, as amended, or the Securities Act, and Rule 12b-2 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a shell company, our stockholders will be unable to utilize Rule 144 of the Securities Act, or Rule 144 to sell “restricted stock” as defined in Rule 144 or otherwise use Rule 144 to sell stock of the Company, and we would be ineligible to utilize registration statements on Form S-3 or Form S-8 for so long as we remain a shell company and for 12 months thereafter. Among other things, as a consequence, the offering, issuance and sale of our securities is likelyrelated financial management expertise necessary to be more expensive and time consuming and may make our securities less attractive to investors.considered a “financial expert” under SEC rules.

The Audit Committee is responsible for maintaining free and open communications among itself, the independent registered public accounting firm and Company is not engagedmanagement. The Audit Committee assists the Board of Directors in fulfilling its oversight responsibility to the businessstockholders, potential stockholders, the investment community and others relating to the integrity of investing, reinvesting, or trading in securities,the Company’s financial statements and we do not hold ourselves out as being engaged in those activities. However, under the Investment Company Act, a company may fall withinfinancial reporting process, the scopeCompany’s compliance with legal and regulatory requirements, the independent registered public accounting firm’s qualifications and independence, the Company’s systems of being an “inadvertent investment company” under section 3(a)(1)(C)internal accounting and financial controls, the annual independent audit of such Act if the valueCompany’s financial statements and the engagement of its investment securities (as defined in the Investment Company Act) is more than 40% of its total assets (exclusive of government securities and cash and certain cash equivalents).independent registered public accounting firm. 

The Company will continue to evaluate and potentially explore all available strategic options. We will continue to work to maximize stockholder value. Such strategic options may include developing or acquiring a majority interest or at least a controlling interest (as defined for purposes of the Investment Company Act of 1940, as amended (the “Investment Company Act”) in a company (or companies) with principal business operations in an industry that we believe will provide attractive opportunities for growth. We are not limited to any particular industry or type of business. The directors will also consider alternatives for distributing some or all of the proceeds to stockholders. The Company intends to continue to invest the proceeds and our other liquid assets in high-grade, short-term investments (such as cash and cash equivalents) consistent with the preservation of principal, maintenance of liquidity and avoidance of speculation.

See “Risk Factors” The Company may be classified as an inadvertent investment company” and “The Company is a shell company under the federal securities laws.”

Employees

The Company has 2 full-time employees as of December 31, 2020.

Connecticut Property

The Company has interests in land and certain flowage rights in undeveloped property (the “properties”) primarily located in Killingly, Connecticut. The properties were fully impaired as of December 31, 2018.

Item 1A.  Risk Factors.

RISK FACTORS

You should carefully consider the following risk factors relating to our business and the additional information in our other reports that we file with the SEC.

The Company may be classified as an inadvertent investment company if we acquire investment securities in excess of 40% of our total assets.

The Company is not engaged in the business of investing, reinvesting, or trading in securities, and we do not hold ourselves out as being engaged in those activities. However, under the Investment Company Act, a company may fall within the scope of being an “inadvertent investment company” under section 3(a)(1)(C) of such Act if the value of its investment securities (as defined in the Investment Company Act) is more than 40% of its total assets (exclusive of government securities and cash and certain cash equivalents).

If the Company was required to register as an “investment company” under the Investment Company Act, applicable restrictions could make it impractical for the Company to continue its business as contemplated and could have a material adverse effect on us.

The Investment Company Act and the rules thereunder contain detailed requirements for the organization and operation of investment companies. If we were required to register under the Investment Company Act, applicable restrictions and other requirements could have a material adverse effect on us. In the event that we were to be required to register as an investment company under the Investment Company Act, we would be forced to comply with substantive requirements under the Act, including:

In the event that we were to be deemed to be an investment company subject to registration as such under the Investment Company Act, compliance costs and burdens upon us may increase and the additional requirements may constrain our ability to conduct business, which may adversely affect our business, results of operations or financial condition.

The Company is a shell company under the federal securities laws.

The Company has no or nominal operations. Pursuant to Rule 405 of the Securities Act and Exchange Act Rule 12b-2, a shell company is defined as a registrant that has no or nominal operations, and either:

Our consolidated balance sheet reflects that after closing, our assets consist primarily of cash and cash equivalents. Accordingly, we are a shell company. Applicable securities rules prohibit shell companies from using a Form S-8 registration statement to register securities pursuant to employee compensation plans and from utilizing Form S-3 for the registration of securities for so long as the Company is a shell company and for 12 months thereafter.

Additionally, Form 8-K requires shell companies to provide more detailed disclosure upon completion of a transaction that causes it to cease being a shell company. To the extent that we acquire a business in the future, we must file a current report on Form 8-K containing the financial and other information required in a registration statement on Form 10 within four business days following completion of such a transaction.Delinquent Section 16(a) Reports

To assistSection 16(a) of the Exchange Act requires the Company’s executive officers and directors to file reports regarding ownership of the Company’s common stock with the SEC, inand to furnish the identificationCompany with copies of shell companies, we are requiredall such reports. Based on a review of these filings, the Company believes that with respect to check a boxthe most recently concluded fiscal year, all such reports were timely filed, except for the Form 4’s for the Company’s independent directors Lawrence Schafran and Dort Cameron III for the third and fourth quarters of 2021, which will be filed during the quarter ending on our quarterly reports on Form 10-Q and our annual reports on Form 10-K indicating that we are a shell company.June 30, 2022.

Since we are required to comply with additional disclosure because we are a shell company, we may be delayed in executing any mergers or acquiring other assets that would cause us to cease being a shell company. In addition, under Rule 144Code of the Securities Act, a holder of restricted securities of a “shell company” is not allowed to resell their securities in reliance upon Rule 144. Preclusion from any prospective purchase using the exemptions from registration afforded by Rule 144 may make it more difficult for us to sell equity securities in the future and the inability to utilize registration statements on Forms S-8 and S-3 would likely increase our cost to register securities in the future. Additionally, the loss of the use of Rule 144 and Forms S-3 and S-8 may make investments in our securities less attractive to investors and may make the offering and sale of our securities to employees, directors and others under compensatory arrangements more expensive and less attractive to recipients.

Unless we select a particular industry or target business with which to complete a business combination, you will be unable to ascertain the risks of the industry or business in which we may ultimately operate.

The Company may develop or acquire a majority interest or at least a controlling interest (as defined for purposes of the Investment Company Act) in a company (or companies) with principal business operations in an industry that we believe will provide attractive opportunities for growth. We are not limited to any particular industry or type of business. Accordingly, there is no current basis for you to evaluate the possible risks of the particular industry in which we may ultimately operate. Although we will evaluate the risks inherent in a particular target business, we cannot assure you that all of the significant risks present in that target business will be properly assessed. Even if we properly assess those risks, some of them may be outside of our control or ability to affect.

Resources will be expended in researching potential acquisitions that might not be consummated.

The investigation of target businesses and the negotiation, drafting and execution of relevant agreements, disclosure documents, and other instruments will require substantial management time and attention in addition to costs for accountants, attorneys and others. If a decision is made not to complete a specific business combination, the costs incurred up to that point for the proposed transaction likely would not be recoverable. Furthermore, even if an agreement is reached relating to a specific target business, we may fail to consummate the business combination for any number of reasons including those beyond our control.

There can be no guarantee that we will quickly identify a potential target business or complete a business combination.

The process to identify potential acquisition targets, to investigate and evaluate the future business prospects thereof and to negotiate an acceptable purchase agreement with one or more target companies can be time consuming and costly. The Company may incur operating losses, resulting from payroll, rent and other overhead and professional fees, while we are searching for a business to develop or acquire.Ethics

The Company has no revenueadopted a Code of Ethics for its principal executive officer, senior financial officers, including the principal financial officer and the principal accounting officer, and persons performing similar functions for its subsidiaries. If the Company makes any substantive amendment to the Code of Ethics or grants any waiver from operations; therefore, our existing assets may be diminisheda provision of the Code of Ethics for said executive officers, the Company will disclose the nature of such amendment or waiver in a filing on Form 8-K. The Code of Ethics was originally filed as Exhibit 14.1 to the Company’s Form 10-K for the year ended December 31, 2004, which was filed with the SEC on April 15, 2005 and ultimately depletedis incorporated by our corporate overhead and other expenses.reference herein. The Company will also provide a copy of such Code of Ethics to any person, without charge, upon written request made to the Company’s Secretary at the following address: Wright Investors’ Service Holdings, Inc., Attn: Secretary, 118 North Bedford Road, Ste. 100, Mount Kisco, NY 10549.

The Company has no revenue from operationselected to use the Smaller Reporting Company rules issued by the SEC regarding the disclosure of executive compensation. The Company had two executive officers (our “named executive officers”) including the principal executive officer at the end of the last completed fiscal year. Consequently, we are providing a Summary Compensation Table covering 2021 and have been experiencing significant negative cash flow. Expenditures related to corporate overhead generated and other related items are expensed. Until such time as we develop or acquire an operating business or businesses that generate revenue, we will continue to deplete our existing assets.2020 compensation for these two individuals.

Risks Related to Our StockSUMMARY COMPENSATION TABLE

The Company has agreedtable below summarizes the total compensation paid to restrictionsor earned by each of the Company’s Named Executive Officers for the fiscal years ended December 31, 2021 and adopted policies that could have possible anti-takeover effects and reduce the value of our stock.2020.

Several provisions of our Certificate of Incorporation

Mr. Kahn was appointed Acting Chief Financial Officer and Bylaws could deter or delay unsolicited changes in control of the Company. These include limiting the stockholders’ powers to amend the Bylaws or remove directors and prohibiting the stockholders from increasing the size of the Board of Directors or acting by written consent instead of at a stockholders’ meeting. Our Board of Directors has the authority, without further action by the stockholders to fix the rights and preferences of and issue preferred stock. These provisions and others that could be adopted in the future could deter unsolicited takeovers or delay or prevent changes in control or managementActing Principal Accounting Officer of the Company including transactions in which stockholders might otherwise receive a premium for their shares over then current market prices. These provisions may limit the abilityMarch 2019 at an agreed fee of stockholders$12,000 per month. Effective September 1, 2019, Mr. Kahn’s agreed fee was reduced to approve transactions that they may deem$7,000 per month. Effective January 1, 2020 Mr. Kahn’s agreed fee was further reduced to be in their best interests.$5,000 per month.

Risks Related to Owning Our Common StockOUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

A large portionThe following table provides information concerning the holdings of our common stock is held by a small group of large shareholders. Future sales of our common stock in the public market by the Company or its large stockholders could adversely affect the trading price of our common stock.

As of December 31, 2020, Bedford Oak Advisors, LLCunexercised and William H. Miller beneficially owned 27.78% and 17.41% of the Company’s common stock, respectively. Bedford Oak Advisors, LLC is controlled by Mr. Harvey P. Eisen, the Company’s Chairman and Chief Executive Officer. Mr. Eisen beneficially owned at such date an aggregate of 30.71% of the Company’s common stock, which percentage includes the 27.78% beneficially owned by Bedford Oak Advisors, LLC. Sales by us or our large stockholders of a substantial number of shares of our common stock in the public market or the perception that these sales might occur, could cause the market price of our common stock to decline.

Our common stock is thinly traded, which can cause volatility in its price.

Our stock is thinly traded due to our small market capitalization and the high level of ownership of our common stock by a small group of shareholders.  Thinly traded stock can be more susceptible to market volatility.  This market volatility could significantly affect the market price of our common stock without regard to our operating performance.

Possible additional issuances of our stock will cause dilution.

At December 31, 2020, we had outstanding 19,839,777 shares of our common stock. There were 33,333 shares of stock awards vested as of December 31, 2020. In addition, there are options to purchase a total of 100,000 shares of common stock all of which are exercisable asthe Company for each of the named executive officers at December 31, 2020. The Company is authorized to issue up to 30,000,000 shares of common stock and are therefore able to issue additional shares without being required under corporate law to obtain shareholder approval.  If we issue additional shares, or if our existing shareholders exercise their outstanding options, our other shareholders may find their holdings drastically diluted, which if it occurs, means they would own a smaller percentage of our Company.2021.

The Company’s operations may be negatively impacted by the coronavirus outbreak.

In December 2019, a novel strain of coronavirus was identified in Wuhan, China. Through the first quarter of 2020, the disease became widespread around the world, and on March 11, 2020, the World Health Organization declared a pandemic. The Company does not expect that the outbreak will have a material adverse effect on financial results at this time.

Item 1B.  Unresolved Staff Comments.

None.

Item 2.  Properties.Overview of Material Compensation Arrangements with Our Named Executive Officers

In July 2019,The following is a summary of the material terms of employment and compensation arrangements pursuant to which compensation was paid to our named executive officers for their service with the Company entered into a six-month leaseor its subsidiaries for office spacethe fiscal year ended December 31, 2021.

Harvey P. Eisen

Harvey P. Eisen, the Company’s Chairman, President, and Chief Executive Officer, has an annual salary of $300,000 to reflect his duties in a building located in Mt. Kisco, NY. exploring strategic alternatives for the Company.

Harold D. Kahn

The lease commenced onBoard of Directors appointed Harold D. Kahn as Acting Chief Financial Officer and Acting Chief Accounting Officer effective March 25, 2019 at an agreed fee of $12,000 per month. Effective September 1, 2019, expired on February 29,Mr. Kahn’s agreed fee was reduced to $7,000 per month. Effective January 1, 2020 and is renewed on a monthly basis for $3,800Mr. Kahn’s agreed fee was further reduced to $5,000 per month.

Item 3.  Legal Proceedings.

On September 26, 2014, the Connecticut Department of Energy and Environmental Protection (“DEEP”) issued two Orders requiring the investigation and repair of two dams in which the Company and its subsidiaries have certain ownership interests.  The first Order required that the Company investigate and make specified repairs to the ACME Pond Dam located in Killingly, Connecticut.  The second Order, as subsequently revised by DEEP on October 10, 2014, required that the Company investigate and make specified repairs to the Killingly Pond Dam located in Killingly, Connecticut.  The Company administratively appealed and contested the allegations in both Orders.  On July 27, 2017, the Company entered into a Consent Order with the DEEP relative to Killingly Pond Dam. The Killingly Pond Consent Order required the Company to continue to perform routine maintenance and administrative procedures consistent with DEEP’s Dam Safety regulations, the cost of which was not material to the Company’s financial position or results of operations.

On July 27, 2017, the Company entered into a Consent Order with the DEEP relative to Acme Pond Dam. The Acme Pond Dam Consent Order required the Company to investigate and recommend repairs to Acme Pond Dam. Based up on the work performed by the Company’s retained consulting engineering firm, the Company submitted its recommended Action Plan (the “Action Plan”) for Acme Pond Dam pursuant to the Consent Order on November 30, 2017 and such recommended Action Plan was approved by DEEP as submitted on May 23, 2019. Total expenses for the repair work conducted in accordance with the Action Plan during the year ending December 31, 2019 was approximately $150,000. All repair work required for both the ACME Pond Dam and the Killingly Pond Dam was completed as of December 31, 2019. DEEP issued a Certificate of Compliance for Consent Order for the ACME Pond Dam on February 7, 2020, and a Certificate of Compliance for Consent Order for the Killingly Pond Dam was issued on May 22, 2020.

The Company and its representatives continue to discuss a proposed ownership transfer with interested parties.

Indemnification of Directors and Officers

Section 145 of the Delaware General Corporation Law (the “DGCL”) provides, generally, that a corporation shall have the power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding (except actions by or in the right of the corporation) by reason of the fact that such person is or was a director, officer, employee or agent of the corporation against all expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. A corporation may similarly indemnify such person for expenses actually and reasonably incurred by such person in connection with the defense or settlement of any action or suit by or in the right of the corporation, provided that such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, in the case of claims, issues and matters as to which such person shall have been adjudged liable to the corporation, provided that a court shall have determined, upon application, that, despite the adjudication of liability but in view of all of the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which such court shall deem proper.

The Company’s certificate of incorporation and bylaws provide that, subject to limited exceptions and requirements, the Company is required to indemnify its directors and officers, and each person serving at the request of the Company as a director, officer, incorporator, partner, manager or trustee of another entity, to the fullest extent permitted by the DGCL.  The Company’s bylaws also provide that, subject to limited exceptions and requirements, the Company is required to advance to such person’s expenses (including attorney’s fees) incurred by them in defending and preparing for the defense of any proceeding or investigation in respect of which indemnification may be available.

Section 102(b)(7) of the DGCL provides, generally, that the certificate of incorporation of a corporation may contain a provision eliminating or limiting the personal liability of a director to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, provided that such provision may not eliminate or limit the liability of a director (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under section 174 of Title 8 of the DGCL, or (iv) for any transaction from which the director derived an improper personal benefit. No such provision may eliminate or limit the liability of a director for any act or omission occurring prior to the date when such provision became effective.  The Company’s certificate of incorporation contains such a provision limiting the personal liability of the Company’s directors to the extent permitted by the DGCL. 

Item 4.  Mine Safety DisclosuresDIRECTOR COMPENSATION

None.

PART II

Item 5.  MarketOnly directors who are not employees of the Company or its subsidiaries are entitled to receive compensation for service as a director. The table below summarizes the total compensation paid to or earned by each director of the Company (who is not an employee of the Company) for the Registrant’s Common Equity and Related Stockholder Matters.

The Company’s common stock, $0.01 par value, is quoted on the OTC Pink Sheets under the symbol “iWSH”.  Such quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

The Company did not declare or pay any cash dividends on its common stock in 2020 or 2019. The Company currently intends to retain future earnings to finance the growth and development of its business however, the directors will also consider alternative for distributing some or all of its cash and cash equivalents to stockholders.

Issuer Purchases of Equity Securities

The Board of Directors authorized the Company to repurchase up to 5,000,000 outstanding shares of common stock from time to time either in open market or privately negotiated transactions. At December 31, 2020 and 2019, the Company had repurchased an aggregate of 2,041,971 shares of its common stock and a total of 2,958,029 shares remained available for repurchase at December 31, 2020 and 2019, pursuant to the 5,000,000 shares repurchase plans. The Company did not repurchase any common stock during thefiscal year ended December 31, 2020.2021. The column “Fees Earned or Paid in Cash” includes common stock of the Company issued in lieu of cash.

Item 6.  Selected Financial Data.2021 Director Compensation

Not required.

Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations.

General Overview

The

Mr. Schafran will be issued 74,483 shares of Company is a “shell company”, as definedcommon stock in Rule 12b-2lieu of $20,000 of his annual director’s fee for the Exchange Act.  Because we are a shell company, our stockholders are unable to utilize Rule 144 to sell “restricted stock” as defined in Rule 144 or to otherwise use Rule 144 to sell our securities,third and we are ineligible to utilize registration statements on Form S-3 or Form S-8 for so long as we remain a shell company and for 12 months thereafter.  As a consequence, among other things, the offering, issuance and salefourth quarter of our securities is likely to be more expensive and time consuming and may make our securities less attractive to investors.  See “Item 1A. Risk Factors”.2021.

Our Board

Mr. Schafran will be issued 74,483 shares of Directors is considering strategic usesCompany common stock in lieu of $20,000 of his annual director’s fee for the cashthird and cash equivalents including, without limitation, using such funds, together with other fundsfourth quarter of the Company, to develop or acquire interests in one or more operating businesses.  While we have focused our development or acquisition efforts on sectors in which our management has expertise, we do not wish to limit ourselves to, or to foreclose any opportunities in, any particular industry or sector.  Prior to this use, cash on hand have been, and we anticipate will continue to be, invested in high-grade, short-term investments (such as cash and cash equivalents) consistent with the preservation of principal, maintenance of liquidity and avoidance of speculation, until such time as we need to utilize such funds, or any portion thereof, for the purposes described above.   The directors will also consider alternatives for distributing some or all of its cash and cash equivalents to stockholders (see Note 1 to the Consolidated Financial Statements). 2021.

Investments

Investment in undeveloped properties.

The Company owns certain non-strategic assets, which includes an investment in land and certain flowage rights in undeveloped property (the “properties”) primarily located in Killingly, Connecticut, which were fully impaired as of December 31, 2018, due to the Company's belief that the value of the land is nominal as a result of ongoing remediation efforts and no active market for sale of such land.

Environmental matters

On September 26, 2014, the Connecticut Department of Energy and Environmental Protection (“DEEP”) issued two Orders requiring the investigation and repair of two dams in which the Company and its subsidiaries have certain ownership interests.  The first Order required that the Company investigate and make specified repairs to the ACME Pond Dam located in Killingly, Connecticut.  The second Order, as subsequently revised by DEEP on October 10, 2014, required that the Company investigate and make specified repairs to the Killingly Pond Dam located in Killingly, Connecticut.  The Company administratively appealed and contested the allegations in both Orders.  On July 27, 2017, the Company entered into a Consent Order with the DEEP relative to Killingly Pond Dam. The Killingly Pond Consent Order required the Company to continue to perform routine maintenance and administrative procedures consistent with DEEP’s Dam Safety regulations, the cost of which was not material to the Company’s financial position or results of operations.

On July 27, 2017,

Director Compensation Program

Directors who are not employees of the Company entered into a Consent Order withor its subsidiaries, shall be paid as set forth below:

All of the DEEP relativesums designated above as “annual director compensation” are required to Acme Pond Dam. The Acme Pond Dam Consent Order requiredbe paid in Company common stock; provided that common stock issued in lieu of annual compensation is valued at the Company to investigateaverage between the closing bid and recommend repairs to Acme Pond Dam. Based upask price on the work performed by the Company’s retained consulting engineering firm, the Company submitted its recommended Action Plan (the “Action Plan”) for Acme Pond Dam pursuantday prior to the Consent Order on November 30, 2017 and such recommended Action Plan was approved by DEEP as submitted on May 23, 2019. Total expenses fordate upon which the repair work conducted in accordance with the Action Plan during the year ending December 31, 2019 was approximately $150,000. All repair work required for both the ACME Pond Dam and the Killingly Pond Dam was completed as of December 31, 2019. DEEP issued a Certificate of Compliance for Consent Order for the ACME Pond Dam on February 7, 2020, and a Certificate of Compliance for Consent Order for the Killingly Pond Dam was issued on May 22, 2020.annual compensation became payable.   

The Company and its representatives continue to discuss a proposed ownership transfer with interested parties.

Management discussion of critical accounting policies

The following discussion and analysis of the financial condition and results of operations are based on the consolidated financial statements and notes to consolidated financial statements contained in this report that have been prepared in accordance with the rules and regulations of the SEC and include all the disclosures normally required in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates that affect the reported amounts of assets, liabilities, sales and expenses, and related disclosures of contingent assets and liabilities. We base these estimates on historical results and various other assumptions believed to be reasonable, all of which form the basis for making estimates concerning the carrying values of assets and liabilities that are not readily available from other sources. Actual results may differ from these estimates.

Certain of our accounting policies require higher degrees of judgment than others in their application.  These include stock-based compensation and accounting for income taxes which are summarized below.

Stock-based compensation

Stock-based compensation cost for employees is measured at the grant date based on the fair value of the award and is recognized as an expense on a straight-line basis over the requisite service period, which is generally the vesting period. Stock-based compensation cost for consultants is initially measured at the grant date based on the fair value of the award, remeasured each reporting date until the instrument vests, at which time the cost is established. The cost is recognized as an expense on a straight-line basis, as adjusted each reporting period, over the requisite service period, which is generally the vesting period. See Note 8 to the Consolidated Financial Statements for further information regarding the Company’s stock-based compensation assumptions and expense.

Income taxes

Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to carryforwards and to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

The accounting for uncertain tax positions guidance requires that the Company recognize the financial statement benefit of a tax position only after determining that the Company would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company recognizes interest and penalties on income taxes, including those related to uncertain tax positions as interest and other expenses, respectively. 

Results of Operations

Year ended December 31, 2020 compared to the year ended December 31, 2019

For the year ended December 31, 2020, the Company had a loss from operations before income taxes of $1,014,000 compared to a loss from operations before income taxes of $1,978,000 for the year ended December 31, 2019.   

The decreased loss of $964,000 was primarily the result of a decrease in Other operating expenses of $962,000, offset by an increase in Compensation and benefits of $47,000 and an increase in Interest and other income of $49,000.ITEM 12.        SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Compensation and benefits

For the year ended December 31, 2020, Compensation and benefits were $496,000 as compared to $449,000 for the year ended December 31, 2019. Security Ownership of Principal Stockholders

The increased Compensation and benefitsfollowing table sets forth the number of $47,000 in 2020 was primarilyshares of common stock beneficially owned as of April 19, 2022 by each person who is known by the resultCompany to own beneficially more than five percent of a temporary decrease in compensation for our CEO during the third quarter of 2019. Effective October 1, 2019, the Company’s Compensation Committee reversed the temporary decreaseoutstanding Company common stock other than executive officers or directors of the CEO’s compensation to reflect his duties in exploring strategic alternatives for the Company, offset by a decreasewhose beneficial ownership is reflected in the health plan expense for the year ended December 31, 2020 in comparison to the year ended December 31, 2019.

Other operating expenses

For the year ended December 31, 2020, Other operating expensesSecurity Ownership of Directors and Executive Officers table below.  There were $829,000 as compared to $1,791,000 for the year ended December 31, 2019. 

The decreased operating expenses20,017,779 shares of $962,000 were primarily the result of decreased professional fees of $585,000, decreased rent expense of $157,000, decreased expenses associated with remediation of the reservoirs of $54,000, decreased insurance expense of $62,000, and decreased other expenses of $104,000.

Income taxes

For the years ended December 31, 2020 and 2019, the income tax (benefit) expense of $(21,000) and $25,000, respectively, substantially represents adjustments and accruals related to state minimum income taxes.

Apart from the deferred tax asset related to the AMT credit carryforward as of December 31, 2019, the Company recorded a full valuation allowance against its net deferred tax assets as of December 31, 2020 and 2019. Due to a full valuation allowance to offset deferred tax assets related to net operating loss carryforwards attributable to the loss, no tax benefit has been recorded in relation to the pre-tax loss for the years ended December 31, 2020 and December 31, 2019.

Financial condition, liquidity, and capital resources

Liquidity and Capital Resources

At December 31, 2020, the Company had cash and cash equivalents totaling $6,469,000, which it intends to use to acquire interests in one or more operating businesses, to fund the Company’s general and administrative expenses, and the directors will also consider alternatives for distributing some or all of its cash and cash equivalents to stockholders.  The Company believes that its working capital is sufficient to support its operating requirements through March 31,common stock outstanding on April 19, 2022.

The decrease in cash and cash equivalentsSecurity Ownership of $867,000 for the year ended December 31, 2020 was the result of $920,000 used in operating activities, offset by proceeds from a PPP loan of $53,000.Principal Stockholders Table

Item 7A.  Quantitative and Qualitative Disclosures About Market Risk.

Not required.

Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

Index to the Consolidated Financial StatementsSecurity Ownership of Directors and Executive Officers

Financial StatementsThe following table sets forth the beneficial ownership of Wright Investors’ Service Holdings, Inc.Company outstanding common stock as of April 19, 2022 by each person who is a director or named executive officer of the Company as of such date, naming each such person, and all persons who are directors and executive officers of the Company as of such date, as a group.

Security Ownership of Directors and Executive Officers Table

There are 108,966 shares of Company common stock to be issued to Mr. Cameron in payment of quarterly directors’ fees for services for the third and fourth fiscal quarter of 2021 and the first fiscal quarter of 2022 which are not included in the amount herein. 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMEquity Compensation Plan Information

The following table provides information as of December 31, 2021 with respect to shares of Company common stock that may be issued under existing equity compensation plans.

To

Other Compensation

See the narrative disclosure following the Summary Compensation Table and the Outstanding Equity Awards at Fiscal Year-End Table in “Item 11. Executive Compensation” for summaries of the compensation arrangements and agreements in which the Company and its executive officers and directors are participants.

Director Independence

Since the adoption of the Sarbanes-Oxley Act in July 2002, there has been growing public and regulatory focus on the independence of directors. The Company is not subject to the listing requirements of any securities exchange, including Nasdaq, because the Company’s common stock is traded on the over-the-counter bulletin board. However, in July 2007, the Board of Directors adopted the standards for independence for Nasdaq-listed companies, and Stockholders of

Wright Investors' Service Holdings, Inc.the independence determinations that follow are based upon the criteria established by Nasdaq for determining director independence and upon the criteria established by Nasdaq and the SEC for determining Audit Committee member independence.

Opinion onThe Board of Directors determines the Financial Statementsindependence of its members through a broad consideration of all relevant facts and circumstances, including an assessment of the materiality of any relationship between the Company and a director. In making each of these independence determinations, the Board of Directors considered and broadly assessed, from the standpoint of materiality and independence, all of the information provided by each director in response to detailed inquiries concerning his independence and any direct or indirect business, family, employment, transactional or other relationship or affiliation of such director with the Company.

We have auditedUsing the accompanying consolidated balance sheetsobjective and subjective independence criteria enumerated in the Nasdaq marketplace rules listing requirements and SEC rules, the Board of Wright Investors' Service Holdings, Inc. and Subsidiaries (the “Company”) as of December 31, 2020 and 2019,Directors has reviewed all relationships between each director and the related consolidated statements of operations, stockholders’ equity,Company and, cash flows for each of the years then ended, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2020 and 2019, and the consolidated results of their operations and their cash flows for each of the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered withthis review, the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Companyof Directors has affirmatively determined that, in accordance with the U.S. federal securities lawsNasdaq independence criteria, (i) Messrs. Cameron and the applicable rulesSchafran are independent, and regulations of the Securities and Exchange Commission and the PCAOB.that (ii) Messrs. Eisen is not independent.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

Critical audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.

/s/ EisnerAmper LLP

We have served as the Company’s auditor since 2004

EISNERAMPER LLP

New York, New York

March 12, 2021

WRIGHT INVESTORS' SERVICE HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)The fees billed for services rendered for 2021 and 2020 by EisnerAmper LLP, Fort Lauderdale, Florida, Auditor ID: 274 were as follows:

Policy on Pre-Approval of Services Provided by Independent Auditor

Pursuant to the requirements of the Sarbanes-Oxley Act of 2002, the terms of the engagement of EisnerAmper LLP are subject to specific pre-approval policies. In 2021 and 2020, all audit services and other services to be performed by EisnerAmper LLP were pre-approved by the Audit Committee in accordance with pre-approval policies established by the Board of Directors.  The procedures require that all proposed engagements of EisnerAmper LLP for services of any kind be directed to the Audit Committee prior to the beginning of any service.

All services provided by the independent registered public accounting firm for 2021 and 2020 were approved in advance by the Audit Committee of the Board of Directors.

PART IV

See accompanying notesIndex to consolidated financial statements.Exhibits.

WRIGHT INVESTORS' SERVICE HOLDINGS, INC.

 CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

See accompanying notes to consolidated financial statements.

WRIGHT INVESTORS' SERVICE HOLDINGS, INC.

 CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

See accompanying notes to consolidated financial statements.

WRIGHT INVESTORS' SERVICE HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

YEARS ENDED DECEMBER 31, 2020 AND 2019

(in thousands, except share data)

See accompanying notes to consolidated financial statements.

WRIGHT INVESTORS’ SERVICE HOLDINGS, INC.

Notes to Consolidated Financial Statements

The Company is a “shell company”, as defined in Rule 405 of the Securities Act of 1933, as amended, or the Securities Act, and Rule 12b-2 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a shell company, its stockholders will be unable to utilize Rule 144 of the Securities Act, or Rule 144 to sell “restricted stock” as defined in Rule 144 or otherwise use Rule 144 to sell stock of the Company, and the Company would be ineligible to utilize registration statements on Form S-3 or Form S-8 for so long as the Company remains a shell company and for 12 months thereafter. Among other things, as a consequence, the offering, issuance and sale of its securities is likely to be more expensive and time consuming and may make the Company’s securities less attractive to investors.

The Company is not engaged in the business of investing, reinvesting, or trading in securities, and it does not hold itself out as being engaged in those activities. However, under the Investment Company Act of 1940, as amended (the “Investment Company Act”), a company may fall within the scope of being an “inadvertent investment company” under section 3(a)(1)(C) of such Act if the value of the Company’s investment securities (as defined in the Investment Company Act) is more than 40% of the Company’s total assets (exclusive of government securities and cash and certain cash equivalents).

The Company intends to evaluate and explore all available strategic options. The Company will continue to work to maximize stockholder value. Such strategic options may include acquisition of an investment advisory business, acquisition of a financial services business, creating partnerships or joint ventures for those or other businesses and investing in other businesses that provide attractive opportunities for growth. The directors will also consider alternatives for distributing some or all of the Company’s cash and cash equivalents. Until such time as a decision is made as to how the liquid assets of the Company are so deployed, the Company intends to invest its liquid assets in high-grade, short- term investments (such as cash and cash equivalents) consistent with the preservation of principal, maintenance of liquidity and avoidance of speculation.

See “Risk Factors “The Company may be classified as an inadvertent investment company if the Company acquires investment securities in excess of 40% of its total assets” and “The Company is a shell company under the federal securities laws.” As of December 31, 2020, the Company is not considered an inadvertent investment company.

Principles of consolidation.

The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, all of which are inactive. All significant intercompany accounts and transactions have been eliminated in consolidation.

Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”), requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period.  Actual results could differ from these estimates.

Cash and cash equivalents

Cash equivalents represent short-term, highly liquid investments, which are readily convertible to cash and have maturities of three months or less at time of purchase.  Cash equivalents, which are carried at fair value or amortized cost, as applicable, consist of holdings in a money market fund and in treasury bills. Cash and cash equivalents amounted to approximately $6,469,000 and $7,336,000 at December 31, 2020 and 2019, respectively.

Investment Valuation

The Company carries its investments at fair value. Fair value is an estimate of the exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants (i.e., the exit price at the measurement date). Fair value measurements are not adjusted for transaction costs. A fair value hierarchy provides for prioritizing inputs to valuation techniques used to measure fair value into three levels:

An asset or liability's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Availability of observable inputs can vary and is affected by a variety of factors. The Company uses judgment in determining fair value of assets and liabilities and Level 3 assets and liabilities involve greater judgment than Level 1 or Level 2 assets or liabilities.

As of December 31, 2020, and 2019, the Company held $5,950,000 and $7,144,000 in U.S. government securities. U.S. government securities are valued using a model that incorporates market observable data, such as reported sales of similar securities, broker quotes, yields, bids, offers, and reference data. Certain securities are valued principally using dealer quotations. Money market funds are valued at the closing price reported by the fund sponsor from an actively traded exchange. U.S. government securities are categorized in Level 2 of the fair value hierarchy, depending on the inputs used and market activity levels for specific securities. The U.S. government securities, which have maturities of three months or less at time of purchase, are reported as Cash and cash equivalents on the balance sheet as of December 31, 2020 and 2019.

The following table presents the Company’s financial instruments at fair value (in thousands):

Investment in undeveloped land

The Company owns certain non-strategic assets, including an investment in land and certain flowage rights in undeveloped property (the “properties”) primarily located Killingly, Connecticut. The properties were fully impaired as of December 31, 2018.

Per share data

Basic and diluted loss per share for the years ended December 31, 2020 and 2019, respectively, is calculated based on 19,977,927 and 19,736,479 weighted average outstanding shares of common stock, including a weighted average 138,150 shares which are issuable at December 31, 2020.

Options for 100,000 and 550,000 shares of common stock in 2020 and 2019, respectively, and stock awards for 66,667 and 100,000 shares of common stock in 2020 and 2019, respectively, were not included in the diluted computation as their effect would be anti-dilutive since the Company incurred net operating losses for both years.

Stock-based compensation

Stock-based compensation cost for employees is measured at the grant date based on the fair value of the award and is recognized as an expense on a straight-line basis over the requisite service period, which is generally the vesting period. Stock-based compensation cost for consultants is initially measured at the grant date based on the fair value of the award, remeasured each reporting date until the instrument vests, at which time the cost is established. The cost is recognized as an expense on a straight-line basis, as adjusted each reporting period, over the requisite service period, which is generally the vesting period. In accordance with ASU 2016-09, the Company has made the accounting policy election to continue to estimate forfeitures based upon historical occurrences. See Note 7 to the Consolidated Financial Statements for further information regarding the Company’s stock-based compensation assumptions and expense.

Income taxes

Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to carryforwards and to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

The accounting for uncertain tax positions guidance requires that the Company recognize the financial statement benefit of a tax position only after determining that the Company would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. The Company recognizes interest and penalties on income taxes, including those related to uncertain tax positions as interest and other expenses, respectively.  The Company had no income tax uncertainties at December 31, 2020 and 2019.

Concentrations of credit risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash investments. Investments in cash and money market funds are insured up to $250,000 per depositor, per insured bank. Investments in treasury bills are insured up to $500,000. For the years ended December 31, 2020 and 2019, a substantial portion of the Company's investments in cash and treasury bills are in excess of these limits.

In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2016-13 (ASU 2016-13) "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments", which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. The standard, as amended, is effective for periods beginning after December 15, 2022 for both interim and annual periods. Early adoption is permitted. The Company does not expect the adoption of ASU 2016-13 to have an impact on its consolidated financial statements.

Accounts payable and accrued expenses consist of the following (in thousands):

The components of income tax (benefit) expense are as follows (in thousands):

For the years ended December 31, 2020 and 2019, the current income tax benefit related to operations represents a refundable alternative minimum tax credit net of adjustments to and accruals of minimum state income taxes. For the years ended December 31, 2020 and 2019, deferred income tax expense represents the utilization of the alternative minimum tax credit carryforward.

The difference between the benefit for income taxes computed at the statutory rate and the reported amount of tax expense (benefit) from operations is as follows:

The deferred tax assets and liabilities are summarized as follows (in thousands):

A valuation allowance is provided when it is more likely than not that some portion of deferred tax assets will not be realized. The valuation allowance decreased by approximately $391,000 and $476,000 respectively, during the years ended December 31, 2020 and 2019. The decreases in the valuation allowance during the years ended December 31, 2020 and 2019 was mainly due to adjustments to the net operating loss carryforward.

The Company files a consolidated federal tax return with its subsidiaries. As of December 31, 2020, the Company has a federal net operating loss carryforward of approximately $20,312,000, of which $15,280,000 expires from 2031 through 2037, and $5,032,000 does not expire. The Company also has various state and local net operating loss carryforwards totaling approximately $4,180,000, which expire between 2021 and 2040, and a capital loss carryforward of approximately $2,690,000, which expires between 2021 and 2024. State net operating loss carryforwards were reduced during the year ended December 31, 2020 by approximately $16,244,000 due to a change in State tax filings.

On May 1, 2020, the Company received $53,000 from Fieldpoint Private Bank pursuant to the Paycheck Protection Program (the “PPP Loan”) of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”). The PPP Loan matures on May 4, 2022 (the “Maturity Date”), accrues interest at 1% per annum and may be prepaid in whole or in part without penalty. No principal or interest payments are due within the initial six months of the PPP Loan. Thereafter, monthly payments of principal and interest are due. The interest accrued during the initial six-month period is due and payable, together with the remaining principal, on the Maturity Date. The Company used all proceeds from the PPP Loan to retain employees, maintain payroll and make operating expense payments to support business continuity throughout the COVID-19 pandemic. The amounts were forgiven as of January 7, 2021 (see Note 10 to the Consolidated Financial Statements).

The Company’s Board of Directors, without any vote or action by the holders of common stock, is authorized to issue preferred stock from time to time in one or more series and to determine the number of shares and to fix the powers, designations, preferences and relative, participating, optional or other special rights of any series of preferred stock.

The Board of Directors authorized the Company to repurchase up to 5,000,000 outstanding shares of common stock from time to time either in open market or privately negotiated transactions. At December 31, 2020 and 2019, the Company had repurchased 2,041,971 shares of its common stock and a total of 2,958,029 of the authorization shares, remained available for repurchase at December 31, 2020.

During the year ended December 31, 2020, there were 193,827 shares of Company common stock to be issued to the independent directors of the Company, in payment of quarterly directors’ fees due to them during 2020. During the year ended 2019, the Company issued 192,534 shares of Company common stock to the independent directors of the Company, in payment of quarterly directors’ fees due to them during 2019.  The value of the shares of Company common stock to be issued and issued as of December 31, 2020 and 2019, respectively was $80,000 each year. The equity compensation awards were issued pursuant to the exemption from the registration requirements of Section 5 of the Securities Act of 1933 (“1933 Act”) provided by Section 4(a)(2) of the 1933 Act. 

Stock awards

On February 13, 2019, 100,000 stock awards were issued to a newly appointed director of the Company. The stock awards vest equally, annually, over 3 years. The stock awards are valued based on the closing price of $0.42 of the Company’s common stock on February 13, 2019. At December 31, 2020, 66,667 stock awards remained unvested and 33,333 shares are to be issued.

The Company recorded compensation expense of $12,500 and $10,000 for the years ended December 31, 2020 and 2019, respectively, related to those stock awards. The total unrecognized compensation expense related to these unvested stock awards at December 31, 2020 is $15,600, which will be recognized over the remaining vesting period of approximately 1.12 years. 

Common stock options

The Company adopted a stock-based compensation plan for employees and non-employee members of its Board of Directors in November 2003 (the “2003 Plan”), and the National Patent Development Corporation 2007 Incentive Stock Plan in December 2007 (the “2007 NPDC Plan”).  The periods during which additional awards may be granted under the plans have expired and no further awards may be granted under any of these plans after December 20, 2017. As a consequence, any equity compensation awards issued after that time will be on terms determined by the Board of Directors or the Compensation Committee of the Board of Directors and pursuant to exemptions from the registration requirements of the securities laws.

As of December 31, 2020, all options were vested and there were outstanding options to acquire 100,000 common shares under the 2007 NPDC Plan. All 100,000 options were vested and exercisable, having an exercise price of $1.29 per share, a remaining contractual term of 1 year and zero aggregate intrinsic value. There were no grants, forfeitures or exercises of options during the year of 2020. During 2020, 450,000 options with a weighted average exercise price of $1.36, a weighted average contractual term of 2 years, and zero aggregate intrinsic value per share had expired.

As of December 31, 2019, all options were vested and there were outstanding options to acquire 550,000 common shares under the 2007 NPDC Plan. All 550,000 options were vested and exercisable, having a weighted average exercise price of $1.35 per share, a weighted average contractual term of 1.75 years and zero aggregate intrinsic value. There were no grants, forfeitures or exercises of options during the year of 2019.

On September 26, 2014, the Connecticut Department of Energy and Environmental Protection (“DEEP”) issued two Orders requiring the investigation and repair of two dams in which the Company and its subsidiaries have certain ownership interests. The first Order required that the Company investigate and make specified repairs to the ACME Pond Dam located in Killingly, Connecticut. The second Order, as subsequently revised by DEEP on October 10, 2014, required that the Company investigate and make specified repairs to the Killingly Pond Dam located in Killingly, Connecticut. The Company administratively appealed and contested the allegations in both Orders. On July 27, 2017, the Company entered into a Consent Order with the DEEP relative to Killingly Pond Dam. The Killingly Pond Consent Order required the Company to continue to perform routine maintenance and administrative procedures consistent with DEEP’s Dam Safety regulations, the cost of which was not material to the Company’s financial position or results of operations.

On July 27, 2017, the Company entered into a Consent Order with the DEEP relative to Acme Pond Dam. The Acme Pond Dam Consent Order required the Company to investigate and recommend repairs to Acme Pond Dam. Based up on the work performed by the Company’s retained consulting engineering firm, the Company submitted its recommended Action Plan (the “Action Plan”) for Acme Pond Dam pursuant to the Consent Order on November 30, 2017 and such recommended Action Plan was approved by DEEP as submitted on May 23, 2019. Total expenses for the repair work conducted in accordance with the Action Plan during the year ending December 31, 2019 was approximately $150,000. All repair work required for both the ACME Pond Dam and the Killingly Pond Dam was completed as of December 31, 2019. DEEP issued a Certificate of Compliance for Consent Order for the ACME Pond Dam on February 7, 2020, and a Certificate of Compliance for Consent Order for the Killingly Pond Dam was issued on May 22, 2020.

The Company and its representatives continue to discuss a proposed ownership transfer with interested parties.

On January 7, 2021, the Small Business Administration forgave the PPP loan in the amount of $53,000. As such the PPP loan was paid in full as of January 7, 2021.

Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

None.

Item 9A.Controls and Procedures.

(a) Evaluation of Disclosure Controls and Procedures

We carried out an evaluation, under the supervision and with the participation of our management including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended.  Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of December 31, 2020 were effective. 

(b) Management’s Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Exchange Act Rule 13a-15(f).  Our internal control processes and procedures are designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our consolidated financial statements in accordance with United States generally accepted accounting principles.  Our internal control over financial reporting includes those policies and procedures that reasonably allow us to record, process, summarize, and report information and financial data within prescribed time periods and in accordance with Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

(c) Attestation Report of the Registered Public Accounting Firm

Under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of internal control over financial reporting as of December 31, 2020 based on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control – Integrated Framework (2013) (“COSO Framework”).  Based upon our evaluation, the Company concluded that our internal control over financial reporting was effective as of December 31, 2020.

This annual report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting.  Management's report was not subject to attestation by the Company's registered public accounting firm pursuant to rules of the SEC that permit the Company to provide only management's report in this annual report.

(d) Changes in Internal Control over Financial Reporting

The Company’s Chief Executive Officer and Chief Financial Officer have also concluded that there have not been any changes in the Company’s internal control over financial reporting during the quarter ended December 31, 2020 that have materially affected or are reasonably likely to materially effect, the Company’s internal control over financial reporting.

Item 9B.    Other Information

None

PART III

Item 10.  Directors, Executive Officers and Corporate Governance.

The information required by this item is incorporated by reference to the Company’s definitive proxy statement to be filed pursuant to Regulation 14A within 120 days after the Company’s fiscal year end of December 31, 2020 for its annual stockholders’ meeting for 2020 (the “Proxy Statement”) under the captions “Directors and Executive Officers”, “Corporate Governance”, “Compliance with Section 16(a) of the Exchange Act”, “Code of Ethics” and “Audit Committee.”

Item 11.  Executive Compensation.

The information required by this item is incorporated by reference to the Company’s Proxy Statement for its 2020 Annual Meeting of Stockholders under the caption “Executive Compensation.”

Item 12.  Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

Additional information required by this item is incorporated by reference to the Company’s Proxy Statement for its 2020 Annual Meeting of Stockholders under the caption “Stock Ownership of Management and Principal Stockholders”.

Item 13.  Certain Relationships and Related Transactions, and Director Independence.

This information required by this item is incorporated by reference to the Company’s Proxy Statement for its 2020 Annual Meeting of Stockholders under the captions “Certain Transactions with Management” and “Director Independence”.

Item 14.  Principal Accounting Fees and Services.

The information regarding principal accountant fees and services and the Company’s pre-approval policies and procedures for audit and non-audit services provided by the Company’s independent accountants is incorporated by reference to the Company’s Proxy Statement for its 2020 Annual Meeting of Stockholders under the caption “Principal Accountant Fees and Services.”

Item 15. Exhibits and Financial Statement Schedules

 *Filed within

Item 16. Form 10-K Summary

None.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.INDEX TO EXHIBITS

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