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Stock-Based Compensation
 12 Months Ended
Dec. 31, 2023
Stock-Based Compensation [Abstract]  
Stock-Based Compensation
9.
Stock–Based Compensation

At December 31, 2023, the Company had the following stock-based employee compensation plans:
Equity Incentive Plans
In April 2010, the Company’s board of directors approved the Nu Skin Enterprises, Inc. 2010 Omnibus Incentive Plan (the “2010 Omnibus Incentive Plan”). This plan was approved by the Company’s stockholders at the Company’s 2010 Annual Meeting of Stockholders held in May 2010. The 2010 Omnibus Incentive Plan provides for granting of a variety of equity-based awards including stock options, stock appreciation rights, restricted stock, restricted stock units, other share-based awards, performance cash, performance shares and performance units to executives, other employees, independent consultants and directors of the Company and its subsidiaries. Options granted under the 2010 Omnibus Incentive Plan are generally non-qualified stock options, but the 2010 Omnibus Incentive Plan permits some stock options granted to qualify as “incentive stock options” under the U.S. Internal Revenue Code. The exercise price of a stock option generally is equal to the fair market value of the Company’s common stock on the stock option grant date. The contractual term of a stock option granted under the 2010 Omnibus Incentive Plan is seven years. Currently, all shares issued upon the exercise of stock options are from the Company’s treasury shares. Subject to certain adjustments, 7.0 million shares were authorized for issuance under the 2010 Omnibus Incentive Plan. On June 3, 2013, the Company’s stockholders approved an Amended and Restated 2010 Omnibus Incentive Plan, which among other things increased the number of shares available for awards by 3.2 million shares. On May 24, 2016, the Company’s stockholders approved a Second Amended and Restated 2010 Omnibus Incentive Plan, which among other things increased the number of shares available for awards by 3.8 million shares. On June 3, 2020, the Company’s stockholders approved a Third Amended and Restated 2010 Omnibus Incentive Plan, which among other things increased the number of shares available for awards by 5.9 million shares.
The fair value of stock option awards was estimated using the Black-Scholes option-pricing model with the following assumptions and weighted-average fair values as follows:

Stock Options:
  
December 31,
2021
Weighted-average grant date fair value of grants
  
$
16.10
  
Risk-free interest rate(1)
    
0.5
%
Dividend yield(2)
    
2.9
%
Expected volatility(3)
    
49.5
%
Expected life in months(4)
  
56 months
  

(1)
The risk-free interest rate is based upon the rate on a zero-coupon U.S. Treasury bill, for periods within the contractual life of the option, in effect at the time of the grant.
(2)
The dividend yield is based on the average of historical stock prices and actual dividends paid.
(3)
Expected volatility is based on the historical volatility of the Company’s stock price, over a period similar to the expected life of the option.
(4)
The expected term of the option is based on the historical employee exercise behavior, the vesting terms of the respective option, and a contractual life of either seven or ten years.

Options under the plans as of December 31, 2023 and changes during the year ended December 31, 2023 were as follows:

 
Shares
(in thousands)
    
Weighted-
average
Exercise
Price
    
Weighted-
average
Remaining
Contractual
Term (in years)
    
Aggregate
Intrinsic
Value
(in thousands)
  
Options activity – service based
                        
Outstanding at December 31, 2022
    
163.9
    
$
37.69
              
Granted
    
—
      
—
              
Exercised
    
(78.9
)
    
34.60
              
Forfeited/cancelled/expired
    
(85.0
)
    
40.78
              
Outstanding at December 31, 2023
    
—
      
—
      
—
    
$
—
  
Exercisable at December 31, 2023
    
—
      
—
      
—
      
—
  
                                 
Options activity – performance based
                                
Outstanding at December 31, 2022
    
1,461.6
    
$
40.30
                  
Granted
    
—
      
—
                  
Exercised
    
(184.6
)
    
30.50
                  
Forfeited/cancelled/expired
    
(369.4
)
    
46.75
                  
Outstanding at December 31, 2023
    
907.6
      
39.67
      
3.03
    
$
—
  
Exercisable at December 31, 2023
    
784.0
      
38.12
      
2.84
      
—
  
                                 
Options activity – all options
                                
Outstanding at December 31, 2022
    
1,625.5
    
$
40.04
                  
Granted
    
—
      
—
                  
Exercised
    
(263.5
)
    
31.73
                  
Forfeited/cancelled/expired
    
(454.4
)
    
45.63
                  
Outstanding at December 31, 2023
    
907.6
      
39.67
      
3.03
    
$
—
  
Exercisable at December 31, 2023
    
784.0
      
38.12
      
2.84
      
—
  

The aggregate intrinsic value in the table above represents the total pretax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the respective years and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on December 31, 2023. This amount varies based on the fair market value of the Company’s stock.
Cash proceeds, tax benefits and intrinsic value related to total stock options exercised during 2023, 2022 and 2021, were as follows (U.S. dollars in thousands):

 
December 31,
  
   
2023
    
2022
    
2021
  
Cash proceeds from stock options exercised
  
$
8,322
    
$
31,600
    
$
14,435
  
Tax benefit / (expense) realized for stock options exercised
    
482
      
229
      
807
Intrinsic value of stock options exercised
    
2,338
      
15,505
      
8,402
  

Nonvested restricted stock awards as of December 31, 2023 and changes during the year ended December 31, 2023 were as follows:

 
Number
of Shares
(in thousands)
    
Weighted-
average
Grant Date
Fair Value
  
Nonvested at December 31, 2022
    
953.0
    
$
44.28
  
                 
Granted
    
550.8
      
35.77
  
Vested
    
(340.7
)
    
46.56
  
Forfeited
    
(142.6
)
    
40.74
  
                 
Nonvested at December 31, 2023
    
1,020.5
    
$
39.42
  

Nonvested performance share units as of December 31, 2023 and changes during the year ended December 31, 2023 were as follows:

   
Number
of Shares
(in thousands)
    
Weighted-
average
Grant Date
Fair Value
  
Nonvested at December 31, 2022
    
180.2
    
$
44.39
  
                 
Granted
    
194.0
      
37.99
  
Vested
    
—
      
—
  
Forfeited
    
(101.3
)
    
43.70
  
                 
Nonvested at December 31, 2023
    
272.9
    
$
40.09
  

Stock-based compensation expense is recognized on a straight-line basis, except for performance-based awards for which expense is recognized using a graded-attribution method if the results are materially different than the straight-line method. The Company recognized no expense related to service condition stock options in 2023, 2022 and 2021; and recognized $14.4 million, $14.3 million and $15.4 million of expense related to service condition restricted stock units in 2023, 2022 and 2021, respectively. For performance stock options and performance stock units, an expense is recorded each period for the estimated expense associated with the projected achievement of the performance-based targets. The Company recognized none, $2.0 million of income and $7.8 million of expense related to performance stock options in 2023, 2022 and 2021, respectively; and $1.2 million expense, none and none related to performance stock units in 2023, 2022 and 2021, respectively. The amount in 2022 reflects the reversal of stock compensation for awards no longer expected to vest.
As of December 31, 2023, there was no unrecognized stock-based compensation expense related to nonvested stock option awards. As of December 31, 2023, there was $26.8 million of unrecognized stock-based compensation expense related to nonvested restricted stock awards. That cost is expected to be recognized over a weighted-average period of 2.5 years.