Annual report pursuant to Section 13 and 15(d)

Stock-Based Compensation

v3.19.1
Stock-Based Compensation
 12 Months Ended
Dec. 31, 2018
Equity [Abstract]  
Stock-Based Compensation Note 11 - Stock-Based Compensation
Stock Plan
Stock-based compensation awards were granted to employees under the Company’s 2010 Long-Term Incentive Plan, as amended and restated as of May 10, 2016 (the “Stock Plan”). The Stock Plan was approved by the stockholders at the Annual Meeting of Stockholders on May 10, 2016. The Stock Plan authorizes the compensation committee or the board of directors to issue stock options, stock appreciation rights, restricted stock awards, restricted stock units, performance-based awards, time-based awards, and other types of awards in cash or stock to key employees, consultants, and directors. The maximum number of shares that may be delivered pursuant to the awards granted under the Stock Plan is 1,120,000 shares of common stock. As of December 31, 2018 there were 252,072 shares remaining available under the Stock Plan. See Note 12 - Stockholders' Equity for details regarding the 1-for-15 reverse stock split.
Stock-Based Awards
Stock-based awards generally vest over three years. Stock-based compensation expense is recognized net of an estimated forfeiture rate, which is based on historical experience and adjusted, if necessary, in subsequent periods based on actual forfeitures. Stock-based compensation expense and cash compensation paid to the respective employees is included in our consolidated statements of operations in general and administrative expense. Tax deduction benefits for awards in excess of recognized compensation costs are reported as a financing cash flow.
In 2018, we issued three types of stock-based awards:
1.
Restricted stock units are service-based awards and entitle a grantee to receive a share of common stock on a specified vesting date. The grant-date fair value of nonvested units is determined based on the closing trading price of the Company’s shares on the grant date. These awards vest to the extent earned at the end of a three-year performance period. These awards are expensed ratably over the applicable vesting period and are settled in shares of our common stock upon vesting. These awards are considered equity awards.
2.
Time-based phantom stock units are service-based awards and represent the equivalent of one share of common stock as of the grant date. The value of these awards is based on the common stock price. These awards vest when earned at the end of the performance period which is generally 1 to 3 years. These awards are expensed ratably over the applicable vesting period and are settled in cash upon vesting. These awards are classified as liability awards.
3.
Performance-based phantom stock units are performance-based awards and we issued two types of performance-based awards:
a.
Performance cash units are performance-based awards that contain payout conditions which are based on our performance against a group of selected peer companies with regard to relative return on capital employed over a three-year performance period. Each unit has a nominal value of $100.0. A maximum of 200.0 percent of the number of units granted may be earned if performance at the maximum level is achieved. These awards vest to the extent earned at the end of a three-year performance period. These awards are expensed ratably over the applicable vesting period and are settled in cash upon vesting. These awards are classified as liability awards.
b.
Performance-based phantom stock units are performance-based awards denominated in a number of shares which contain payout conditions based on our performance against a group of selected peer companies with regard to relative total shareholder return over a three-year performance period. They represent a grant of hypothetical stock to the equivalent number of shares of common stock but, with the employee receiving cash upon vesting. We used a simulation-based option pricing approach to determine the fair value of these awards. A maximum of 250.0 percent of the number of units granted may be earned if performance at the maximum level is achieved. These awards vest to the extent earned at the end of the three-year performance period. These awards are expensed ratably over the applicable vesting period and are settled in cash upon vesting. These awards are classified as liability awards.
Restricted Stock Units
The following table presents restricted stock units granted, vested and forfeited during 2018 under the Stock Plan:
 
Restricted Stock Units
 
Weighted Average
Grant-Date Fair Value
Nonvested at January 1, 2018
302,338

 
$
27.10

Granted
107,863

 
$
12.51

Vested
(156,524
)
 
$
29.87

Forfeited
(18,079
)
 
$
23.82

Nonvested at December 31, 2018
235,598

 
$
18.84

In 2018, 2017 and 2016 we issued 107,863 units, 180,728 units, and 219,742 units, respectively, to select key personnel. The per-share weighted-average grant-date fair value of units granted during 2018, 2017, and 2016 was $12.51, $21.19, and $31.06, respectively.
Total expense recognized relating to these awards for the years ended December 31, 2018, 2017, and 2016 was $2.8 million, $4.0 million, and $7.5 million, respectively, all of which was related to nonvested units. The total fair value of the units vested during the years ended December 31, 2018, 2017, and 2016 was $4.7 million, $8.6 million, and $10.0 million, respectively.
Nonvested units as of December 31, 2018 totaled 235,598 and total unrecognized compensation cost related to unamortized units was $1.4 million as of December 31, 2018. The remaining unrecognized compensation cost related to non-vested units will be amortized over a weighted-average vesting period of approximately 27 months.
Time-based Phantom Stock Units
The following table presents time-based phantom stock units granted, vested, and forfeited during 2018 under the Stock Plan:
 
Time-based Phantom Stock Units
Nonvested at January 1, 2018
68,759

Granted
106,530

Vested
(28,387
)
Forfeited
(4,117
)
Nonvested at December 31, 2018
142,785


In 2018, 2017 and 2016 we issued 106,530 units, 43,245 units, and 79,248 units, respectively, to select key personnel.
Total expense recognized relating to these awards for the year ended December 31, 2018 was a gain of $0.3 million, and expense recognized for the years ended 2017 and 2016 was nominal and $1.4 million, respectively.
Performance Cash Units
The following table presents performance cash units granted, vested, and forfeited during 2018 under the Stock Plan:
 
Performance Cash Units
Nonvested at January 1, 2018
23,021

Granted
16,149

Vested
(10,771
)
Forfeited
(791
)
Nonvested at December 31, 2018
27,608


In 2018, 2017, and 2016 we issued 16,149 units, 14,153 units, and 17,091 units, respectively, to select key personnel.
Total expense recognized relating to these awards for the years ended December 31, 2018, 2017, and 2016 was $0.2 million, $1.0 million, and $2.3 million, respectively.
Performance-based Phantom Stock Units
The following table presents performance-based phantom stock units granted, vested, and forfeited during 2018 under the Stock Plan:
 
Performance-based Phantom Stock Units
Nonvested at January 1, 2018
87,395

Granted
107,645

Vested
(48,937
)
Forfeited
(3,778
)
Nonvested at December 31, 2018
142,325


In 2018, 2017, and 2016 we issued 107,645 units, 44,020 units, and 77,652 units, respectively, to select key personnel.
Total expense recognized relating to these awards for the years ended December 31, 2018, 2017, and 2016 was a gain of $0.6 million, gain of $0.9 million, and an expense of $1.3 million, respectively.