Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2015 |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | NOTE 11 – Stock-Based Compensation |
Under the terms of the 2014 Plan, employees, certain consultants and advisors and non-employee members of the Company’s Board of Directors have the opportunity to receive incentive and nonqualified grants of stock options, stock appreciation rights, restricted stock and other equity-based awards as approved by the Company’s Board of Directors. These award programs are used to attract, retain and motivate employees and to encourage individuals in key management roles to retain stock. The Company has a policy of issuing new shares to satisfy awards under the 2014 Plan. The aggregate number of shares under the 2014 Plan that may be issued pursuant to stock options or restricted stock grants is 1,200,000 with not more than 1,000,000 of such shares available for issuance as restricted stock grants. There were 963,730 shares available for future grants under the 2014 Plan as of March 31, 2015, of which 763,730 shares were available to be issued as restricted stock grants. |
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Total stock-based compensation expense was $0.9 million and $1.0 million for the three-month periods ended March 31, 2015 and March 31, 2014, respectively. Excess tax benefits from stock-based payment arrangements decreased cash provided by operating activities and increased cash provided by financing activities by $0.1 million for the three-month period ended March 31, 2015. Excess tax benefits from stock-based payment arrangements decreased cash provided by operating activities and increased cash provided by financing activities by $0.3 million for the three-month period ended March 31, 2014. |
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Stock Options |
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Option awards are generally granted with an exercise price equal to the market price of the Company’s stock at the date of the grant and have 7- to 10-year contractual terms. All options issued contain service conditions based on the participant’s continued service with the Company and provide for accelerated vesting if there is a change in control as defined in the Equity Compensation Plans. Employee stock options generally vest over four years. |
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The Company also issues stock options to non-employee independent directors. These options generally vest in one year. |
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There were no stock options granted during either of the three-month periods ended March 31, 2015 and March 31, 2014. |
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A summary of option activity for the three-month period ended March 31, 2015 follows: |
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| | | Weighted | | | | | | | | | | | | | | | | | |
| | | Average | | | | | | | | | | | | | | | | | |
| Number of | | Exercise Price | | | | | | | | | | | | | | | | | |
Options | Shares | | Per Share | | | | | | | | | | | | | | | | | |
Outstanding, December 31, 2014 | 193,351 | | $ | 10.23 | | | | | | | | | | | | | | | | | |
Granted | — | | | — | | | | | | | | | | | | | | | | | |
Exercised | -34,164 | | | 9.75 | | | | | | | | | | | | | | | | | |
Forfeited | -77,532 | | | 9.52 | | | | | | | | | | | | | | | | | |
Expired | — | | | — | | | | | | | | | | | | | | | | | |
Outstanding, March 31, 2015 | 81,655 | | | 11.1 | | | | | | | | | | | | | | | | | |
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During the three-month period ended March 31, 2015, the Company did not recognize compensation expense related to options. During the three-month period ended March 31, 2014, the Company recognized total compensation expense related to options of less than $0.1 million. |
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There were 34,164 and 1,284 stock options exercised during the three-month periods ended March 31, 2015 and March 31, 2014, respectively. The total pretax intrinsic values of stock options exercised were $0.3 million and less than $0.1 million for the three-month periods ended March 31, 2015 and March 31, 2014, respectively. |
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The following table summarizes information about the stock options outstanding and exercisable as of March 31, 2015. |
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| Options Outstanding | | | Options Exercisable |
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| | | | | Weighted | | Weighted | | Aggregate | | | | Weighted | | Weighted | | Aggregate |
| | | | | Average | | Average | | Intrinsic | | | | Average | | Average | | Intrinsic |
Range of | | Number | | Remaining | | Exercise | | Value | | Number | | Remaining | | Exercise | | Value |
Exercise Prices | | Outstanding | | Life (Years) | | Price | | (In thousands) | | Exercisable | | Life (Years) | | Price | | (In thousands) |
| | | | | | | | | | | | | | | | | | | | | |
$ | 7.17 - 7.79 | | 21,851 | | 0.6 | | $ | 7.52 | | $ | 273 | | 21,851 | | 0.6 | | $ | 7.52 | | $ | 273 |
$ | 12.08 - 12.41 | | 59,804 | | 2.1 | | | 12.39 | | | 458 | | 44,106 | | 2.1 | | | 12.38 | | | 338 |
| | | 81,655 | | 1.7 | | | 11.09 | | $ | 731 | | 65,957 | | 1.6 | | | 10.77 | | $ | 611 |
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The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based on the Company’s closing stock price of $20.03 as of March 31, 2015, which would have been received by the option holders had all option holders exercised their options as of that date. |
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As of March 31, 2015, there was no future compensation cost related to non-vested stock options not yet recognized in the Consolidated Statements of Operations based on the most probable performance assumptions. As of March 31, 2015, $0.2 million of additional potential compensation cost related to non-vested stock options has not been recognized due to performance targets not being achieved. However, in certain circumstances, these options may be subject to vesting prior to their expiration dates. The weighted average remaining term of these options is approximately 2.1 years. |
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Restricted Stock Awards |
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Restricted stock awards provide that, during the applicable vesting periods, the shares awarded may not be sold or transferred by the participant. The vesting period for restricted stock awards generally ranges from three to 10 years. All awards issued contain service conditions based on the participant’s continued service with the Company and may provide for accelerated vesting if there is a change in control as defined in the Equity Compensation Plans. |
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The vesting of certain restricted shares may be accelerated to a minimum of three years based on achievement of various individual performance measures. Acceleration of expense for awards based on individual performance factors occurs when the achievement of the performance criteria is determined. |
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In addition, the Company has issued certain shares under a Management Stock Ownership Program. Under this program, restrictions on the shares lapse at the end of 10 years but may lapse (vest) in a minimum of three years if the employee continues in service at the Company and owns a matching number of other common shares in addition to the restricted shares. |
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Of the total restricted stock awards granted during the three-month period ended March 31, 2015, 70,694 shares may be subject to accelerated vesting based on individual performance factors; no shares have vesting contingent upon performance factors. Vesting was accelerated in 2014 and 2015 on certain awards based on the achievement of certain performance criteria determined annually, as described below. |
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The Company also issues restricted stock to non-employee independent directors. These shares generally vest in seven years from the grant date or six months following the director’s termination from Board of Directors service. |
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The following table summarizes the activity of the non-vested restricted stock during the three months ended March 31, 2015: |
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| | | Weighted | | | | | | | | | | | | | | | | | |
| | | Average | | | | | | | | | | | | | | | | | |
| | | Grant-Date | | | | | | | | | | | | | | | | | |
Non-vested restricted stock | Shares | | Fair Value | | | | | | | | | | | | | | | | | |
Outstanding at December 31, 2014 | 346,036 | | $ | 15.99 | | | | | | | | | | | | | | | | | |
Granted | 121,490 | | | 17.03 | | | | | | | | | | | | | | | | | |
Vested | -93,327 | | | 16.27 | | | | | | | | | | | | | | | | | |
Forfeited | -900 | | | 18.72 | | | | | | | | | | | | | | | | | |
Outstanding at March 31, 2015 | 373,299 | | | 16.25 | | | | | | | | | | | | | | | | | |
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During the three-month period ended March 31, 2015, the Company granted restricted stock awards with a grant date fair value totaling $2.1 million. There were no restricted stock awards granted during the three-month period ended March 31, 2014. |
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As vesting occurs, or is deemed likely to occur, compensation expense is recognized over the requisite service period and additional paid-in capital is increased. The Company recognized $0.9 million and $1.0 million of compensation expense related to restricted stock for the three-month periods ended March 31, 2015 and March 31, 2014, respectively. |
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Of the $0.9 million total compensation expense related to restricted stock for the three-month period ended March 31, 2015, approximately $0.6 million related to accelerated vesting based on achievement of certain performance criteria determined annually. Of the $1.0 million total compensation expense related to restricted stock for the three-month period ended March 31, 2014, approximately $0.7 million related to accelerated vesting, which was also based on the achievement of certain performance criteria determined annually. |
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As of March 31, 2015, there was $4.8 million of unrecognized compensation cost related to non-vested restricted stock compensation scheduled to be recognized over a weighted average period of 4.2 years. In the event individual performance targets are achieved, $2.0 million of the unrecognized compensation cost would accelerate to be recognized over a weighted average period of 1.6 years. In addition, certain of the awards granted may result in the issuance of 61,298 additional shares of stock if achievement of certain targets is greater than 100%. The expense related to the additional shares awarded will be dependent on the Company’s stock price when the achievement level is determined. |
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The fair value of shares that vested during the three-month periods ended March 31, 2015 and March 31, 2014 was $1.7 million and $4.2 million, respectively. |